Monday, September 12, 2005

German and US Poverty

Spiegel Online drips Schadenfreude in the wake of Katrina, observing that American poverty has grown 12% on President Bush’s watch. However, under the US definition of poverty a wage-earning German family like the one I grew up in would be just 11% above the US poverty level – and that’s on the most favorable assumptions.

My family consisted of a blue-collar wage earner, a homemaker and 4 kids – the US would call this a 6-person family unit.

US Poverty Guidelines for 2005 (48 Contiguous States):

Poverty Level (US$) for 6 Persons in Family Unit: $25,870

At the current exchange rate of $1.2281 this is 21,065 Euros.

The German Statistical Office
reports (my ellipsis and emphasis)

…actual average earnings of all (German) employees in 2003 amounted to 26,700 (Euros).

“All employees” includes everyone from the lowest paid to the highest, so it overstates average blue-collar wages.

2003, unemployment has soared, so I doubt that average earnings have increased.

…in 2003 as a whole, unemployment averaged 4.376 million
… (in January 2005) The unadjusted jobless rate in Germany rose to 5.037 million people)

So an average German family of a wage earner, homemaker and 4 kids earns only 11% more than a poverty-stricken US family. And that ignores lower German blue collar earnings, higher German taxes and current undervaluing of the $!

All of which makes sense, because:

France, Italy, Great Britain and Germany have lower GDP per capita than all but four of the states in the United States…This puts Europeans at a level of prosperity on par with states such as Arkansas, Mississippi and West Virginia.

This completes our “Be Beastly To The Germans” post for this week - assuming no further provocations...