Wednesday, September 17, 2014

Poverty Drops in the U.S. But Remains Unconscionable

The Census Bureau yesterday released its annual report on poverty data, Income and Poverty in the United States: 2013. After four years of economic recovery from the Great Recession, the poverty rate has finally started to go down, but for 45.3 million people still living in poverty, it is not dropping fast enough.

In 2013 (the year for which this data was collected), poverty continues to afflict 14.5 percent of the U.S. population, down from 15.0 percent in 2012. For reference, the poverty level for a family of four with two children is just $23,624 total yearly income. One in three people in the U.S. are poor or near poor (living below 200 percent of the poverty level). One in five children in the U.S., 19.9 percent, live in poverty, while one in nine children live in extreme poverty (less than half the poverty level). On the bright side, however, this year is the first time since 2000 that the child poverty rate has dropped.

For communities of color, the picture is bleaker. African American communities are suffering poverty at the Depression-era rate of 27.2 percent. Nearly two in five black children (38.2 percent) are living in poverty. For the Hispanic community, 23.5 percent were living in poverty (down from 25.6 percent in 2012). This includes almost one in three Hispanic children (30.4 percent).[i]

In response to the Census Bureau’s findings, the Reverend J. Herbert Nelson, Presbyterian Church (U.S.A.) Director for Public Witness said:

"It is unconscionable that people continue to live in poverty in America. We live in a land of plenty, where there is enough for everyone. But as the economy expands after the Great Recession, wealth continues to concentrate at the top, leaving those workers at the very bottom far behind. Today’s data release only reinforces what we already know – that we must do better at all levels of society to make sure that every person has what he or she needs to live healthy, fulfilling lives. But we in the Church cannot meet the need alone. We need a healthy partnership with government to address systemic injustice and alleviate the worst of today’s need.

Meanwhile, Congress has done worse than nothing, attacking the very social safety that is meant to catch people in dire need. They have cut social services and hunger programs, they have failed to raise the minimum wage and extend Unemployment Insurance. It is time for our decision-makers, from the President on down through Congress to local County Councils, to take proactive steps to improve jobs, reduce economic inequality, and lift people out of poverty. We have the tools and the knowledge to end poverty in this country, if only we would create the political will to see it done."

In good news, a nuanced calculation of poverty, the Supplemental Poverty Measure, shows that our safety net is doing its job when Congress allows it to work. Official poverty measure calculations do not take into account income from federal anti-poverty measures like the Earned Income Tax Credit (EITC), the Child Tax Credit, or SNAP (formerly Food Stamp) benefits. But once we take those sources of income into the formula, we find that SNAP alone lifted 3.7 million people above the poverty line. Unemployment Insurance lifted 1.2 million people out of poverty (or would have, had that income been included in the above statistics).[ii] This sort of supplemental calculation shows that, while the main economic goals still need to be reducing inequality and improving jobs and wages, we must continue to invest in anti-poverty measures. They work.

As Presbyterians, we value the dignity of work and believe that God has endowed each person with the right to productive work. Over and over again we have affirmed the right of each person to earn a dignified living and meet basics needs for herself and her family. We must pay attention to these statistics. Even as the economy is growing and unemployment is declining (most likely because people are giving up and dropping out of the job market), the recovery has not reached those worst affected by the recession. Both the income and net worth of the top 10 percent of income-earners have increased, while both income and net worth for the bottom 20 percent of workers have declined. The decrease for low-income people of color is ten times that of whites. [iii]

Yesterday’s data show that U.S. policies continue to lift up the rich and the powerful, while neglecting low-income workers and the most vulnerable people in our society – children and traditionally marginalized groups. We must support economic growth that benefits all, in addition to continuing to fund important safety net programs like SNAP, Unemployment Insurance, and the EITC. We must invest in people and in people’s lives. That means standing up against economic and racial injustice and systemic inequalities that trap generations in poverty and low-wage jobs. We need jobs that keep people out of poverty, not trap them in it.

Below are some additional highlights from the numbers:

  • 14.5 percent of the population, or more than one in seven Americans, lived below the poverty line in 2013 ($23,624 for a family of four with two children), down from 15.0 percent in 2012. This is the first drop in poverty since 2006. The number of people in poverty, 45.3 million, was not a statistically significant difference from 2012.
  • Median household income did not rise significantly and remained 8.0 percent (or $4,497) below its pre-recession level in 2007 and 8.6 percent below its level in 2000, before the 2001 recession.
  • Nearly 19.8 million people lived in extreme poverty (below 50 percent of the poverty line) in 2013
  • Over 106 million people, or 33.9 percent of the population, were poor or near poor in 2013 (living below 200 percent of the poverty line)
  • Child poverty dropped from 21.8 percent in 2012 to 19.9 percent in 2013, the first annual drop since 2000.
  • Close to one in nine children, nearly 6.5 million in all, lived in extreme poverty in 2013 (below half the poverty line).
  • 27.2 percent of African-Americans, and 23.5 percent of Hispanics lived in poverty in 2013.
  • 38.3 percent of African-American children, and 30.4 percent of Hispanic children lived in poverty in 2013.
  • The official poverty numbers do not account for programs like SNAP (formerly food stamps), the Earned Income Tax Credit (EITC), or the Child Tax Credit. Accounting for SNAP, 3.7 million fewer people would have been in poverty.

 Top 10 states (including the District of Columbia) with the highest poverty rates:

1.  Mississippi: 22.5%
2.  New Mexico: 21.7%
3.  District of Columbia: 21.3%
4.  Arizona: 20.2%
5.  Kentucky: 20.0%
6.  Louisiana: 19.2%
7.  North Carolina: 18.6%
8.  Tennessee: 18.1%
9.  Nevada: 17.4%
10.  West Virginia: 17.3%

Many Thanks to Bread for the World for help in compiling the Data Highlights.

i. Income and Poverty in the United States: 2013. Current Population Reports. By Carmen DeNavas-Walt and Bernadette D. Proctor. U.S Census Bureau, U.S. Department of Commerce. Issued September 16, 2014.
ii. Ibid.
iii. The New Poverty Data: Using it to Show What Works (and What Doesn't) to Reduce Poverty. Presentation by Jared Bernstein. Coalition on Human Needs Webinar. Presented September 11, 2014