Six-Figure “Poverty” Claim Sparks Outrage

Person pulling out empty pocket from shorts.

A family earning $140,000 in high-cost America still can’t afford basics without sacrifice—what does this reveal about our broken poverty measures?

Story Snapshot

Mike Green calculates $136,500 gross income needed for a New Jersey family of four to cover essentials, updating 1963 poverty formula.
Federal poverty line at $32,150 leaves middle-income earners in a “valley of death”—too rich for aid, too poor for comfort.
Critics like Noah Smith and LA Times argue the math ignores realities like higher median incomes and widespread access to food, insurance, vehicles.
Debate highlights real affordability squeezes in housing, childcare, health but rejects redefining poverty at six figures.
Supplemental Poverty Measure shows true poverty declining to 6.1%, urging focus on policy fixes over hype.

Mike Green’s Poverty Recalculation

Mike Green published his Substack analysis in late November 2025. He targeted a family of four in New Jersey. Green updated Mollie Orshansky’s 1963 formula. Orshansky multiplied minimal food costs by three, assuming food took one-third of budgets. Today, food claims 6-7% per BLS data. Green applied a 14-16 multiplier, yielding $136,500 gross for essentials like $23,000 housing, $32,000 childcare, $18,000 food, $7,000 transport, $15,000 health.

Green spotlighted the “valley of death.” Families above 138% of federal poverty line lose Medicaid and ACA subsidies. Median household income hit $83,730 in 2024. Family-of-four medians reached $125,700 to $142,200 for dual earners. High-cost states trap them in instability.

Historical Poverty Line Origins

Mollie Orshansky crafted the federal poverty line in 1963 at the Social Security Administration. She priced a minimal food basket at $33 weekly for urban families. Multiplied by three, it equaled $32,150 today after CPI inflation. This metric gates benefits like Medicaid up to 138% FPL in expansion states.

Spending patterns shifted dramatically since 1963. Housing now devours 35-45% of budgets. Healthcare takes 15-25%. Childcare burdens families with young kids at 20-40%. Food shrank to 5-13%. USDA and BLS confirm these ratios. Orshansky’s assumption no longer holds.

Critics Dismantle the $140,000 Claim

Noah Smith recalculated in Noahpinion using current food shares. His 7.75 multiplier produced $80,000. Smith noted 95% of kids have insurance. Most families secure adequate food, space, and vehicles per CDC and BLS. Defining poverty at $140,000 implies over 50% of households qualify—absurd given data.

Michael Hiltzik in LA Times broke down a $140,000 budget post-taxes. After housing, food, health, $44,000 to $78,000 remained. Scott Winship and Jason Horpedahl at Cato cited $132,000-$142,000 family medians. Supplemental Poverty Measure dropped poverty from 13% in 1980 to 6.1% in 2023.

Tyler Cowen in The Free Press labeled it a myth. Bad assumptions ignore progress. Brookings affirmed one-third of middle-class households ($30,000-$153,000) struggle in 160 metros. Yet they distinguish affordability from poverty. Green’s directional point lands, but facts demand nuance.

Affordability Crisis Versus Poverty Myths

Common sense aligns with critics. Redefining poverty at $140,000 dilutes aid for the truly needy. American conservative values prioritize self-reliance and targeted help. Benefit cliffs discourage work—fix those. Housing regulations, healthcare mandates, childcare shortages drive costs. Policy targets these roots, not metric tweaks.

Short-term, the viral post pressures ACA subsidy extensions amid Republican delays. Long-term, it risks welfare expansion. Child uninsured rate sits at historic low 5.1%. Real poverty declined. Families face squeezes, but data shows resilience. Focus reforms on cliffs and costs preserves incentives.