As for the with transfer one, does it include non-monetary transfers? Most important among those is medical care - poor families with children are far more likely to be eligible for free state provided health insurance (Medicaid) than others. If it doesn't then it is misleading, given that we're using percentage of median income, and in the US health care is a pretty big cost. In countries where you have universal health care this won't be an issue.
I had the same question.
See this thread in In Wales' Social construction of poverty diary.
Also, from the Innocenti Report Card:
Is poverty to be defined as an absolute condition - the inability to purchase or consume a fixed minimum package of goods and services? Or is it to be defined as a relative state - the falling behind, by more than a certain degree, from the average income and life-style enjoyed by the rest of the society in which one lives? This Report Card opts for the latter concept.The poverty measured and analysed in these pages (with the exception of Figure 2) is the poverty of those whose `resources (material, cultural, and social) are so limited as to exclude them from the minimum acceptable way of life in the Member States in which they live'. This definition, adopted by the European Union in 1984, is today the most commonly used definition in the industrialized world. For practical purposes, it is usually interpreted as `those whose incomes fall below half of the average income (as measured by the median) for the nation in which they live'. <...> It might be argued, therefore, that the concept of relative child poverty is merely measuring inequality. In support of this view, it could be said that the low levels of child poverty revealed in the Czech Republic or Hungary are attributable to nothing more than a degree of income equality, and that this is in itself no more than a passing legacy of the communism that also bequeathed so much misery and pollution before being overthrown by the popular will. Conversely, the supposedly high level of child poverty in the United States might be said to reveal nothing more than the higher degree of income inequality which is what provides the incentives to make the United States what it is - the richest country on earth. Counter-argument The use of a relative definition of child poverty can, however, be just as vigorously defended. The current review of the poverty line in the United States is being driven, in part, by the fact that over the last 40 years great changes have occurred in American society and in Americans' perceptions and expectations of what constitutes a minimum acceptable way of life (changes which can to some extent be captured in the fact that food now accounts for considerably less than one third of average household expenditure). This, by implication, is an admission that the poverty line ought to change as society becomes wealthier. This conceded, it can be argued that the necessary relationship between poverty lines and rising national wealth ought to be maintained in a way that is consistent and dependable, rather than arbitrary and uncertain. It can further be argued that it is relative poverty which most accurately reflects the equality of opportunity that has long been the boast and battle-cry of the industrialized nations. No matter how complicated the debate about the relationships between poverty in childhood and prospects in later life (Box 4), few would seriously maintain that the sons and daughters of the poor have the same opportunities as the sons and daughters of the rich. But perhaps the most important argument is that it is the level of relative poverty that most accurately captures what it is that we should be concerned about. Once economic development has progressed beyond a certain minimum level, the rub of the poverty problem - from the point of view of both the poor individual and of the societies in which they live - is not so much the effects of poverty in any absolute form but the effects of the contrast, daily perceived, between the lives of the poor and the lives of those around them. For practical purposes, the problem of poverty in the industrialized nations today is a problem of relative poverty.
This Report Card opts for the latter concept.The poverty measured and analysed in these pages (with the exception of Figure 2) is the poverty of those whose `resources (material, cultural, and social) are so limited as to exclude them from the minimum acceptable way of life in the Member States in which they live'. This definition, adopted by the European Union in 1984, is today the most commonly used definition in the industrialized world. For practical purposes, it is usually interpreted as `those whose incomes fall below half of the average income (as measured by the median) for the nation in which they live'.
<...>
Conversely, the supposedly high level of child poverty in the United States might be said to reveal nothing more than the higher degree of income inequality which is what provides the incentives to make the United States what it is - the richest country on earth.
Counter-argument
The use of a relative definition of child poverty can, however, be just as vigorously defended.
The current review of the poverty line in the United States is being driven, in part, by the fact that over the last 40 years great changes have occurred in American society and in Americans' perceptions and expectations of what constitutes a minimum acceptable way of life (changes which can to some extent be captured in the fact that food now accounts for considerably less than one third of average household expenditure). This, by implication, is an admission that the poverty line ought to change as society becomes wealthier. This conceded, it can be argued that the necessary relationship between poverty lines and rising national wealth ought to be maintained in a way that is consistent and dependable, rather than arbitrary and uncertain.
It can further be argued that it is relative poverty which most accurately reflects the equality of opportunity that has long been the boast and battle-cry of the industrialized nations. No matter how complicated the debate about the relationships between poverty in childhood and prospects in later life (Box 4), few would seriously maintain that the sons and daughters of the poor have the same opportunities as the sons and daughters of the rich.
But perhaps the most important argument is that it is the level of relative poverty that most accurately captures what it is that we should be concerned about. Once economic development has progressed beyond a certain minimum level, the rub of the poverty problem - from the point of view of both the poor individual and of the societies in which they live - is not so much the effects of poverty in any absolute form but the effects of the contrast, daily perceived, between the lives of the poor and the lives of those around them. For practical purposes, the problem of poverty in the industrialized nations today is a problem of relative poverty.
While I am unsure on this question, the bold text is what I found most persuasive in favor of using relative poverty. Truth unfolds in time through a communal process.
There are also serious issues with measuring poverty nationwide according to a single income level beyond the question of relative vs. absolute. Cost of living varies widely, and in a decentralized system like the US so do social services and benefits. Who is worse off - the family of four with 18K a year in NYC, or the same family in a small town in the Midwest. Seemingly the former, given the far higher CoL in NYC. However, the NYC family is much more likely to be living in public housing, thus negating the main difference in CoL, and they don't need a car. Plus the official 'poverty line' is based on a badly outdated basket of goods making it a bad joke.
There are fewer poor children in many European countries than in the US, even if you set the bar at the US poverty level. In the long run, we're all dead. John Maynard Keynes
