(NewsNation) — A viral claim that $140,000 is the “real poverty line” has reignited debate over how poverty is defined and what it means to be middle class in 2025.

Investor Michael Green recently calculated that a family of four would need roughly $136,500 a year to afford essentials like child care, food, transportation, housing and health care.

That’s more than four times the U.S. poverty threshold set by the Department of Health and Human Services, which is $32,150 for a family of four.

Green, chief strategist and portfolio manager for Simplify Asset Management, laid out his argument in a widely read Substack essay that drew both praise and fierce pushback.

“The nerve that I struck is unfortunately what many people have been demanding, which is just for people to actually listen to their lived experience, what’s going on in the households in America,” Green told NewsNation’s Leland Vittert.

In his essay, Green argued that the federal poverty threshold relies on an outdated formula that places too much weight on food costs and no longer reflects today’s cost of living.

“Everything changed between 1963 and 2024,” Green wrote. “Housing costs exploded. Health care became the largest household expense for many families. Employer coverage shrank while deductibles grew. Child care became a market, and that market became ruinously expensive.”

He called the $140,000 “real poverty line” a “conservative” estimate based on the cost of living in suburban New Jersey — a figure well above the median household income of $83,730 and one that would classify most Americans as poor.

“We are not calculating the price of luxury. We are calculating the price of participation,” Green wrote.

The essay sparked a flurry of reactions from economists, with one calling the argument “all wrong” and another deeming it “the worst poverty analysis I have ever seen.” But some thought Green raised important questions about the poverty line and modern living costs.

“He is echoing some things that poverty scholars have talked about for quite a while — the official poverty measure being antiquated,” Christopher Wimer, co-director of Columbia University’s Center on Poverty and Social Policy, told The Washington Post. “Food in budgets has become a much smaller piece. Housing has gotten much more expensive.”

Experts challenge the $140K claim

Noah Smith, an economic commentator and writer, called Green’s claim “totally off-base” and “out of touch with reality” in a Substack rebuttal.

“The whole idea that more than half of Americans are poor doesn’t fit with anything we know about the lifestyles that typical Americans actually live,” Smith argued.

He pointed to data showing that most households have sufficient food, ample living space, health insurance and sufficient transportation. Smith attributed Green’s conclusion to math errors and a definition of poverty that “doesn’t make any sense.”

Economist Tyler Cowen echoed that criticism in an article for The Free Press, arguing that Green’s analysis is a series of “methodological errors” and ignores improvements in living standards.

Cowen said Green mischaracterized how the poverty line is actually calculated, which is updated annually for inflation using the Consumer Price Index.

“Prices are high in large part because demand is high, which can only happen because so many more Americans can afford to buy things,” Cowen wrote.

The $100,000 ‘Valley of Death’

Green said he didn’t expect the analysis to go viral and acknowledged in a follow-up essay that he hadn’t sourced all the data or thoroughly “stress test” the numbers.

Still, he stood by an idea he calls the “Valley of Death” — the income range where families earn too much to qualify for government support but not enough to absorb rising costs.

“Our entire safety net is designed to catch people at the very bottom, but it sets a trap for anyone trying to climb out,” Green wrote. “As income rises from $40,000 to $100,000, benefits disappear faster than wages increase.”

That “mathematical valley,” Green argued, explains part of the “rage” in the American electorate, pitting “the ‘working poor’ (the middle class)” against the “‘actual poor’ and immigrants.”

Green later clarified in an interview that people earning $140,000 are not “literally poor” but said that’s roughly the level where a family can “cover all of the expenses without government assistance and start saving.”

Poverty isn’t the same as struggling to afford a comfortable middle-class life — a distinction Green’s critics emphasize. But the reaction to his essay suggests it tapped into a deeper anxiety: For many families, the benchmarks of economic stability feel increasingly out of reach.