Few would argue that being born into wealth is a failsafe guarantee of childhood happiness. Instead, it's a cliche, the idea that rich, self-centred people will happily leave their children to be cared for by paid employees, lavishing their offspring with distant material comfort instead of time and family nurture, until – at some barbarically tender age – they can be packed off to boarding school and emerge as fully fledged brats. It's also a cliche that poor and selfless types will make all manner of sacrifices for their kids, making up for financial lack with attention, care and love.

Like all cliches, these two have settled around grains of truth. Rich monsters exist, as do poor paragons. In the real world, however, there's no level of affluence above which excellent parenting becomes impossible, and no level of poverty, in a welfare state, below which a child can be said with certainty to have no advantages of any kind.

No doubt many people will have looked on Thursday's "new range of indicators" for assessing child poverty with suspicion. Iain Duncan Smith, the work and pensions secretary, says Labour's system of measuring child poverty was flawed because it was all about money. Any household living at or below 60% of the median income was considered to be living in relative income poverty. Duncan Smith is the first to point out that the coalition itself has demonstrated how unreliable this method of calculation is. Since it came to power in 2010, 300,000 children have moved out of relative income poverty, not because they have any more money behind them (on the contrary), but because a decline in the median income nationally has pushed the poverty line down.

Beyond Duncan Smith's mind-boggling revelation that statistics don't always bear witness to absolute truth, however, things get tricky and people start to feel judged. Duncan Smith's list of poverty indicators includes worklessness, educational failure, family breakdown, problem debt and poor health. A household can struggle with any or all of these and still be doing right by their kids, just as it can experience none of them, yet still be neglectful and abusive. It's simply not possible to make a handy list that accurately predicts whether a child is "at risk". But that doesn't mean that it's pointless to try. What is refreshing about Duncan Smith's approach, and what was lacking in Labour's, is that his list invites people to think about the complex challenges of being a good parent, while Labour's approach put too much emphasis on modest adjustments to income as a magic bullet.

One serious problem with Duncan Smith's method, of course, is that in general the right tends to view poverty as a moral failure, and wealth as a moral victory. Duncan Smith could be viewed as simply keen to put some meat on the bones of this simplistic, unhelpful and damaging ideological position. Thus, living in an area of high unemployment is a moral failure. Being an atypical child who didn't or doesn't thrive at a one-size-fits-all school is a moral failure. Being a single parent is a moral failure. Borrowing money you can't pay back is a moral failure. Being of less than optimal fitness is a moral failure. Bag the lot – one of these things tends to lead to another – and it starts to look as if people only have themselves to blame. Which is a recipe for multiple miscarriages of moral justice.

Another serious problem, however, is that the left can be guilty of being too reactive to the right's agenda, romanticising poverty even as it condemns it, and overly eager to link wealth with immorality, even evil. It's the latter that has great twittering clumps of the population fervently believing that the British establishment is one big, happy paedophile ring. Just as insidious though, is the former approach, which casts every person who cannot provide for themselves and their families as a passive victim of terrible circumstance, stripped of agency in their own tragic lives, lives that would, had those people been offered the smallest opportunity, have been exemplary.

Neither extreme is useful. One is unrealistic in its failure to understand how hard it can be to motivate yourself when the odds seem stacked against you. The other is unrealistic in its failure to understand that no matter how tough those odds are, self-motivation is the one thing that's absolutely necessary before they can be beaten (no matter how much or little outside help and support is on offer).

But, actually, in raising some of the points that he does, Duncan Smith points to some simple solutions, that would normally be strongly resisted by the right. "Problem debt" is the clearest example. The issue here is that the poorer you are, the higher the interest rates your loans attract, and the more difficult it becomes to summon up the motivation to pay them off. Problem debt is caused by problem lenders, who make a fortune out of poverty even as they perpetuate it. A crackdown on those who exploit poverty in this egregious fashion is long overdue.

It shouldn't be too hard for the Conservatives to concede that crippling debt at high interest rates is a bad thing. They never stop saying that the nation as a whole must avoid this, or sink into the most miserable stagnation. When all of your personal income is being swallowed by bills, and you don't seem able to get ahead, then an individual can easily be overtaken by miserable stagnation, too.

So Duncan Smith's indicators invite consideration of how the poorest can truly be motivated. A lifetime of in-work poverty is actually not much more attractive than a lifetime of out-of-work poverty. It's all very well banging on about self-respect, but low pay is all about lack of respect. It says the time of some people is of barely any worth.

Asking people to respect themselves while defending the right of employers to treat them without respect is, to say the least, a mixed message. Low wages don't motivate people. As long as renting a decent family home – let alone buying one – remains out of reach, or as long as paying today's food or energy bills – never mind saving for the future – seems like an impossible task, then self-respect is hard.

Every indicator says that people who see good economic futures for themselves are more likely to delay having children until they are in a position to afford them. But those who just don't see that time ever coming do see – how could they not? – that the only way to attract political interest in their own poverty is to have a child. Mass child poverty is the consequence of denying whole swaths of people the ability to envisage a more affluent and secure future. That's the important thing to understand.

Duncan Smith is attempting a more nuanced approach. But ultimately, he's making the same sad mistake New Labour did. Child poverty is not a stand-alone problem with its own solution, no matter how you define it. It's a grim, self-perpetuating consequence of adult poverty, just as it always has been.