Poor Kids in a Rich Country: America's Children in Comparative Perspective (review)

In Poor Kids in a Rich Country, Lee Rainwater and Timothy Smeeding have solidified their reputations as America's foremost international poverty researchers. This short book has a straightforward and important goal: to place the poverty rates of U.S. children in comparative perspective. This is accomplished nicely using comparable cross-sectional poverty data from the Luxenbourg Income Study (LIS) for the United States, Canada, Australia, and the 12 Western European countries.

This is mostly a nontechnical book aimed at the broadest possible general audience. There are no weighty or arcane theoretical debates regarding the various causes or consequences of child poverty, either here or abroad. The empirical approach is straightforward and compelling, but without pretension regarding measurement and the kinds of statistical methods used. The first part of the book includes eight chapters that provide comparative information about relative poverty rates, the role of demographics, income packaging (e.g., earnings and government assistance), and poverty policy. The second part of the book includes three additional chapters aimed at more technically sophisticated readers interested in learning how poverty lines are established and how countries with different currencies, different consumption patterns, and different purchasing power can be compared. In some ways, these chapters might be considered technical appendices. They are very nicely done.

The best thing about this book is its accessibility and its mostly dispassionate discussion of results. Rainwater and Smeeding ask the most fundamental questions and then answer them in clever and compelling ways. How does child poverty in the United States—the world's richest country—compare with poverty rates in 14 other rich Western industrialized countries? Using one-half the median equivalent income as a relative measure of poverty (which they defend in the opening chapter), Rainwater and Smeeding report a child poverty rate of 20.3% in the United States in 1997. This is higher than any other country. Sweden's poverty rate, by comparison, is only 2.4%. The U.S. also has the highest percentage of high-income children (defined as one and one-half times the median equivalent income) and a comparatively small middle-income population. Income inequality among U.S. children is extreme.

Compared with children in other countries, low-income children in the United States have the largest percentage below poverty (50%). U.S. low-income children are more deeply in poverty than children elsewhere, and they are relatively disadvantaged in comparison to America's adult population. By benchmarking poverty rates to the gross domestic product, the authors also show that the "average child" in the U.S. is poorer than the average child in 12 of the 14 comparison countries. They dispute the usual claim that America has more inequality but that the average well-being is nevertheless higher than other countries. This turns out not to be the case.

Critics often point to the fact that the United States population of children is more heterogeneous and at greater risk of poverty (e.g., more female heads and fewer adult workers in the household). But Rainwater and Smeeding anticipate and then dispel this argument; demographic differences between countries are small and do not explain the higher poverty in the United States. Perhaps surprisingly, differences in the number of earners are not the explanation for higher child poverty rates in the United States. The U.S. and Sweden have among the lowest percentages of poor children's families with no earners (about 25%). But the poverty rate for America's children in these families is 87%, compared with only 16% in Sweden. By comparison, 67% of Belgium's poor children live with no earners, yet only 32% of all children in nonearning families are poor. Clearly, the issue in America is not the lack of working parents but remuneration from work and the effectiveness of the welfare safety net. Rainwater and Smeeding demonstrate this in separate chapters on income packaging...