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CHAPTER ONE What Is Poverty, and How Is It Measured? For researchers and citizens alike, “poverty” generally has two different meanings. Absolute poverty is an established standard that is uniform across all countries and does not change over time. An income-related example of absolute poverty would be living on less than X dollars a day. According to the United Nations Educational, Scientific and Cultural Organization, the current standard for absolute poverty is set to an income of less than US$1 a day.1 Relative poverty is what most people envision when they discuss and debate poverty in the United States today. Relative poverty is defined in terms of the society in which an individual lives. Relative poverty definitions vary, as a result, between and among countries and over time. Federal offi- cials in the United States measure poverty in relation to other citizens in the country in a given year. The official poverty measure in the United States, therefore, is an indicator of relative poverty.2 Any discussion of relative poverty and how to measure it in the United States, at least from a governmental perspective, has to begin with Mollie Orshansky. Those interested in defining and measuring poverty should care- fully consider Orshansky’s premise from the late 1960s: Counting the poor is an exercise in the art of the possible. For deciding who is poor, prayers are more relevant than calculation because poverty, like beauty, lies in the eye of the beholder. Poverty is a value judgment it is not something one can verify or demonstrate, except by inference and suggestion, even with a measure of error. To say who is poor is to use all sorts of value judgments. The concept has to be limited by the purpose which is to be served by the definition. There is no particular reason to