Back in the field in 2010 to study the deeply poor, Kathryn Edin began to encounter something markedly different from anything she had seen in 20 years of canvassing poor communities: families with no visible means of cash income from any source. As Edin and I write in $2 a Day: “[W]hat was so strikingly different from a decade and a half earlier was that there was virtually no cash coming into these homes.”
Has there been a spike in the number of children going for periods with virtually no cash in the U.S.? We began to test this with the Survey of Income and Program Participation (the SIPP), where we saw a striking spike in the number of households with children reporting cash incomes of no more than $2 per person, per day over a month, a calendar quarter, and a year. To date, we have substantiated our core findings in two other major household surveys. Yet all of these surveys suffer from problems—some people may not want to reveal all their sources of income, they may forget, or they may misunderstand the questions. Perhaps our findings across three surveys were driven entirely by faulty data.
We tested this first by examining administrative records from the Supplemental Nutrition Assistance Program (SNAP, formerly food stamps)—which told much the same story as the SIPP. But another important source can help here—the federal government supports a micro-simulation model called TRIM, which is constructed by the non-partisan think-tank, The Urban Institute. TRIM corrects Current Population Survey (CPS) data for the “under-reporting” of public benefits—when people forget or choose not to say they receive benefits from a program like TANF. We can use it to examine data that is adjusted for these factors. Even with these corrections, survey data remain imperfect. And when extreme poverty is measured with an annual recall, you might expect it to be subject to a lot of error (people might not remember their income from January well when reporting after the end of a year; TRIM doesn’t correct for reporting in other forms of income besides public participation). But TRIM is a significant improvement over unadjusted survey data from the Current Population Survey, and we seek to determine if results using TRIM match our previous findings from other data sources.Read More