Have you heard that a family of four in the US is now considered poor if their household income is under $136,500 (£103,300) a year? Don’t @ me about the maths – I’m just the messenger. The person behind this calculation is Michael Green, who is chief strategist and portfolio manager for Simplify Asset Management. I think this means that he makes large sums of money by fiddling with even larger sums of money. When not doing that, Green writes a newsletter and recently published a viral piece on Substack arguing that the poverty line, calculated as $31,200 by the Department of Health and Human Services, is a “broken benchmark”. These days a family with a low six-figure income is officially “the new poor”, he reasoned.
Green’s essay has sparked numerous rebuttals, with people arguing that he had turned the poverty measure into a middle-class measure. “It’s completely disconnected from reality,” the economist Kevin Corinth said, for example, noting that the $136,500 figure was higher than the US median household income of $83,730. “It’s laughable to put a poverty line far above the median income in the United States.”
Is it really that laughable? I don’t think there’s anything particularly funny about the fact that it’s hard for a family to live on the median income now. While you can certainly quibble with Green’s figures and methodology, the larger point he makes is valuable, and something more people in his tax bracket need to understand. One of the most frustrating things about the 2024 election was the way in which Joe Biden (and then Kamala Harris) kept insisting how great the US economy was. That messaging was enraging because, for most people, the economy doesn’t mean markers such as labour market resilience. It means: “Can I afford my housing, my transport and my dinner?” It means: “Can I really afford to have a kid when childcare costs the same as college and health insurance keeps going up?” The answer to all those things is, increasingly: “Hell, no.”
The fact that life is now ridiculously expensive is hardly a revelation, but I’m glad that a Wall Street bro is finally cottoning on. Green has figured out why there’s such immense anger in the US. It’s not about immigrants; it’s the inequitable economy, stupid.
• Arwa Mahdawi is a Guardian columnist
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