America's Deepening Poverty Problem

Welcome to Politics Bites, where every afternoon at It's A Free Country, we bring you the unmissable quotes from the morning's political conversations on WNYC. Today on the Brian Lehrer Show, Rachel Black, a policy analyst in the Asset Building Program at the New America Foundation, looks at the new Census Bureau report showing a record number of Americans living below the poverty line. 

The unemployment rate is taking its toll, with the number of people living below the poverty line the highest it has been in the more than fifty years. Minorities and the young were hit hardest, and the median income for men is about where it was in 1963 with adjustments for inflation.

Black said much of the dramatic uptick in the people below the poverty line has to do with unemployment and with under employment as people struggle to make ends meet.

If you don’t have a job you also don’t have income.

Sign of the Times

There are more people than ever living below the poverty line, yet in relative percentage terms, that is the same percentage of the population living below the poverty line in 1993—and it is actually a smaller percentage than in the early 1960s.

Black said the fluctuations are due to recessions or growth in the economy, but also in response to policy changes such as the Earned Income Tax Credit and Medicare. 

That’s one area in which we‘ve made a significant amount of progress. Poverty isn’t just this monolithic number for a monolithic people.

Poverty in America

The poverty-threshold of $22,000 for a family of four is low, yet relative to extreme poverty in other parts of the world seems arbitrary.  Black said $22,000 is very little when you take into account costs faced by working parents, such as daycare, which can run $16,000 annually. For a single mother of two, for example, that amount is untenable.

So for two kids, paying of safe and reliable daycare so she can work, so she can make the income and wages that she needs to support her family can be a huge challenge.

Black pointed out that even before the recession low-income families were struggling.

People weren’t prepared to lose their jobs. They weren’t prepared to go without income for as long as they have. Even for families higher up the economic ladder, people had too much debt and not enough savings, so this recession has hit everyone hard.

Black said that some 45 million people are currently receiving food stamps, and many more of the people who need food assistance don’t qualify for  the program.

The safety net is incredibly frayed and not meeting the needs of the people who need it… [the food stamps program] requires you to have such low income and such low savings that you really have to be in desperate straits in order to qualify.

She said a better program would allow people to get assistance until they were back on their feet and were allowed to try to sustains savings.  Requiring people to be so poor before qualifying for assistance makes it much harder for people to be able to pull out of poverty. 

The Face of Poverty

The struggle against poverty is not equally distributed. Only 9.9 percent of the white population is living in poverty, while a staggering 27 percent of African-Americans are. One reason for that disparity is the disparity in asset building; minorities in the United States tend to have far lower levels of asset holdings than white people and thus are impacted much more deeply by the recession. African-Americans, particularly, tend to hold wealth in housing rather than stocks, and so have been particularly hurt by the housing market collapse. A full quarter of minority households began the recession with no accumulated wealth at all.

As we’re considering how we get out of this recession, [one lesson] is making sure that people are more resilient and less vulnerable going into the next one, and one way surely to do that is help them to build a pool of resources that they can pull on in case of emergencies.