Wednesday, November 01, 2006

SWS's self rated poverty surveys and the South Beach Diet

There are lies, damned lies, and statistics (Benjamin Disraeli).

Is it possible for poverty incidence to decline yet hunger incidence to rise? Sounds crazy but, yes its possible, says the Social Weather Stations (SWS) in it’s
latest survey result.

“The record high 16.9% of families experiencing hunger at least once in the past
three months was reached again in September 2006, according to the new SWS
survey. This amounts to 2.9 million households experiencing hunger out of a
projected base of 17.4 million households in the country.

“The latest poll, conducted from September 24 to October 2, also found 51% reporting themselves as Mahirap or Poor, compared to 59% in the previous quarter.”

If you are getting rich, would you say you experienced hunger? Probably not, unless you were on a South Beach diet. So SWS is telling us to not worry about experiencing hunger because we are probably getting rich. Funny.

SWS’s explanation for this contradictory result is even funnier. In its press release, SWS said the reason lies in the poverty threshold, or the amount of money needed for families escape poverty. SWS claims that over time Filipinos poverty threshold has been steady or even declining.

“The Median Self-Rated Poverty threshold, or the median monthly budget in
peso-terms that poor households say they need to escape poverty, went down in
Metro Manila, from P15,000 in June 2006 to P10,000 in September 2006, and in
Mindanao, from P6,000 to P5,000. It stayed at P6,000 in the Visayas and went up
in Balance of Luzon, from P5,000 to P6,000.”

Thus, it’s conclusion?

“Such money-value thresholds were already attained some years ago, even though
the cost of living increased greatly every year. Since the money-cost of living
is actually rising, a declining or unchanging poverty threshold means that
households are lowering their living standards, or belt-tightening.”

Cute, but is it logical? If you are force to do belt-tightening, would you say your economic standing is improving? I don’t think so.

If your financial requirement to escape poverty is the same or declining over the years (it certainly is declining due to inflation), does it mean you are belt-tightening? Not necessarily. It’s possible that your incomes, the basis for which you say you are no longer poor, is increasing. It’s possible that some members of the family got a job, hence the lower financial requirement.

SWS say the declining poverty threshold says people are “lowering their standards.” Probably. But would a people “lowering their standards” and economic expectations likely to say they are no longer poor? I don’t think so.

Based on SWS’s own historical data, it appears hunger has been on the decline reaching as low as close to 5 percent. But in the same period, the self-rated poverty threshold has been sizzling high at about 10,000 pesos. During the same period, SWS’s self-rated poverty was also on the downtrend. Using SWS’s explanation, how could a people say they are less and less suffering from hunger and poverty when their financial requirements to escape poverty are rising?

Something must be wrong somewhere. Let’s take those self-rated poverty surveys with a grain of salt!

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