Is USA Poverty Line Now $140,000/Yr?

Part 1: My Life Is a Lie: by Michael Green

I really wanted you all to read this piece. by Michael W. Green

Michael is Chief Strategist and Portfolio Manager for Simplify Asset Management.

Part 1: My Life Is a Lie

Not just hear about it through someone else’s filter. Not catch a clipped version on cable news or a late-night show. Not absorb it secondhand through social media takes that flatten it into something it is not.

Over the past couple of weeks, this article by Michael Green has been circulating everywhere. Independent press. Mainstream outlets. Talk shows. Newsletters. It has been treated as a kind of explanation for why so many Americans feel like they are falling behind even while the headline numbers insist everything is fine.

I considered pasting the entire piece into this newsletter. I decided against it. That would have felt disingenuous and frankly disrespectful to the work itself. I am not interested in accidentally passing off someone else’s analysis as my own.

What I am interested in is making sure you understand the argument before we debate it.

So what follows is a summary of Michael Green’s argument, in his framing, not mine. None of this analysis is my original work. I think it is important. I also think parts of it are wrong. I will be writing a rebuttal and a breakdown of where I agree and where I sharply disagree. But first, you need to understand what is actually being claimed.

The Core Argument

Green’s central claim is that America is measuring poverty with a broken benchmark, and that this single error has quietly distorted our politics, our economics, and our understanding of reality.

The official U.S. poverty line is still based on a formula created in the early 1960s. It assumes that food represents roughly one third of a household’s expenses, and it defines poverty as three times the cost of a minimum food diet. That formula has been adjusted for inflation, but never for how Americans actually live.

Green argues that this is not a small oversight. It is catastrophic.

Food is no longer one third of household spending. For most families, it is a small fraction. Housing, healthcare, childcare, transportation, and basic connectivity now dominate household budgets. If you update the original logic behind the poverty line using modern spending patterns, the multiplier is no longer three.

It is closer to sixteen.

That shift alone leads to his most provocative conclusion. The true income level below which a family cannot function without constant crisis is not around thirty thousand dollars. It is closer to one hundred forty thousand dollars for a family of four.

The Math of Survival

Green then walks through what he calls the real cost of existing in modern America.

He constructs a basic household budget for two working adults with two children. No vacations. No luxuries. No streaming services. Just the costs required to work, house yourself, care for children, stay insured, and remain employable.

The numbers add up quickly. Childcare becomes the single largest expense. Housing consumes far more than official models assume. Healthcare costs explode. Transportation is not optional in a country built around cars.

The conclusion is not that people are living extravagantly. It is that participation itself is expensive.

One of his key observations is that the second income most families rely on does not meaningfully improve quality of life. It exists largely to pay for the childcare required so that both parents can work. The loop closes on itself. More work does not buy stability. It buys the ability to keep working.

The Valley of Death

From there, Green introduces what he calls the Valley of Death.

As income rises from very low levels into the working and middle class range, government support falls away faster than wages rise. Medicaid disappears. Childcare subsidies vanish. Healthcare premiums and deductibles hit all at once.

The result is that a family earning sixty five thousand or even one hundred thousand dollars can be in a worse monthly financial position than a family earning far less. At the bottom, the state provides a floor. In the middle, the floor disappears but the ceiling remains out of reach.

In practical terms, Green argues that the system punishes upward mobility. Working harder often makes families poorer, not richer, once benefit cliffs are taken into account.

This, he says, explains much of the rage in American politics. Not just dissatisfaction, but resentment. People feel the system breaking the implicit deal that effort leads to security.

Participation, Not Luxury

A major part of Green’s argument is directed at economists who claim that modern goods are cheaper because they are better.

He rejects that framing. He argues that families are not buying luxury. They are buying access.

A smartphone is not a discretionary upgrade. It is required to interact with employers, schools, banks, and healthcare providers. Broadband is not optional. Transportation is not optional. Healthcare is not optional.

The question is not whether these goods are more advanced than they were decades ago. The question is what it costs to function at all.

On that basis, he argues that the real cost of participation has risen far faster than official inflation measures acknowledge.

What This Explains

Green’s final claim is that much of what we call political dysfunction is actually economic math.

The middle class feels betrayed because it is. The metrics say they are fine. Their lived experience says otherwise. Charts showing declining poverty and a shrinking middle class rely on definitions that no longer reflect reality.

If the real survival threshold is six figures, then the story we tell ourselves about progress collapses. What looks like upward mobility is often just treading water at a higher income level.

Again, this is Michael Green’s argument, not mine.

What Comes Next

I think parts of this analysis are deeply important. I also think parts of it are incomplete, and in some cases misleading and just plain dangerous/incorrect.

In my next piece, I will break down where I think this framework holds and where it breaks. I will talk about policy implications Green avoids. I will talk about the political danger of acknowledging this diagnosis without being honest about the tradeoffs required to address it. And I will put in my numbers.

Read this carefully. Sit with it.

Then we will talk about it candidly.

Part 2: The Land of Milk and "No, Honey"

---

Are you an ANGRY DEMOCRAT? If so, the please share with other Angry Dems.