….People living in poverty are now bracing for that kind of chopping as a result of the partial government shutdown that began in December. By the three-week mark, most safety-net benefits were still being funded. But should the impasse drag on, that could change.
The Food Stamp Program (FSP, known since 2008 as the Supplemental Nutrition Assistance Program, or SNAP) is one of the largest safety-net programs in the United States. It is especially important for families with children. However, the FSP eligibility of documented immigrants has shifted on multiple occasions in recent decades. When I studied the health outcomes of children in documented immigrant families affected by such shifts between 1996 and 2003, I found that just one extra year of parental eligibility before age 5 improves health outcomes at ages 6-16. This suggests that expanding food-stamp access for such families has lasting long-run benefits for their children and may help to reduce public medical expenditures in the medium term.
– Immigrants’ loss of eligibility reduced participation in the Food Stamp Program among U.S.-born children of immigrants by 50%, and reduced the average benefits they received by 36%.
– Loss of parental food-stamp eligibility before age five has clear negative effects on developmental health outcomes and on parental reports of the child’s health in the medium-run.
– An additional year of food-stamp access in early life reduces medical expenditures in the medium-run by roughly $140 per child.
Today, the U.S. Census Bureau announced the release of the 2013-2017 American Community Survey (ACS) five-year estimates, which features more than 40 social, economic, housing and demographic topics, including homeownership rates and costs, health insurance, and educational attainment. The ACS five-year data release produces statistics for all of the nation’s 3,142 counties. It is the only full data set available for the 2,316 counties with populations too small to produce a complete set of single-year ACS estimates. ….
Some highlights from the report include that, when comparing the 2013-2017 period to the 2008-2012 period, median household income increased in 16.6 percent of all counties (521 counties) between the 2008-2012 period and the 2013-2017 period while poverty declined in 14 percent of all counties 441 counties). Alternatively, when comparing the same time periods, median household income declined in 222 counties (7.1 percent) and poverty rates increased in 264 counties (8.4 percent)…..
Increases in the minimum wage are widely assumed to be beneficial for low-income workers, but it is important to consider the effect an increase might have on eligibility for other benefits, particularly the federal Earned Income Tax Credit (EITC). This fact sheet examines the interaction between the minimum wage and the EITC to determine whether a minimum wage increase would produce gains in the sum of earnings plus EITC dollars for low-income workers
For workers earning the minimum wage, an increase would result in higher income; none would experience a lower net income due to changes in the federal EITC credit (though this may be offset by loss of other safety net program benefits).
For some family types, increased income would come primarily from a higher minimum wage; for others, gains would also come from the higher-value federal EITC triggered by their higher earnings.
From the summary:
Recent proposals in the House and Senate (for example, the Grow American Incomes Now Act) focus on amplifying the Earned Income Tax Credit (EITC)—a refundable tax credit for low-income workers—to compensate for growing wage inequity. We find that the share of EITC filers who are families with children is especially high in the poorest counties (those counties outlined in black on Map 1), including many places throughout the South.
The Earned Income Tax Credit provides tax relief to working people with low to moderate income, with much larger credits for tax filers with children. The credit is refundable, meaning that the EITC reduces the amount of tax owed, and any amount above that may be issued as a refund.
From the summary:
The official poverty measure indicates that child poverty declined by 1.1 percentage points between 2016 and 2017, according to analyses of the latest American Community Survey data released today. By 2017, child poverty across the nation was still 0.4 percentage point higher than before the Great Recession. Child poverty remained higher in cities and rural places than in the suburbs. For the first time, rates in cities dipped below the pre-recession level, although poverty is still slightly higher in rural and suburban places than in 2007.
For the first time, rates in cities dipped below the pre-recession level, although poverty is still slightly higher in rural and suburban places than in 2007.
…. The resulting news stories deserve our attention, but it is important to keep a vital question in mind: Does the CPS give us an accurate picture of household incomes?
In many recent years, the answer has been “No.” Compared to the national income and product accounts (NIPA) produced by the Bureau of Economic Analysis (BEA), the CPS often gives us a strikingly different picture of the recent trend in household income. ….
Source: Matthew Desmond, Adam Travis, American Sociological Review, Volume: 83 Number: 5, October 2018
From the abstract:
Combining ethnographic and statistical methods, this study identifies interlocking mechanisms that help explain how disadvantaged neighborhoods influence their residents’ political capacity. Support systems that arise in low-income neighborhoods promote social interaction that helps people make ends meet, but these systems also expose residents to heavy doses of adversity, which dampens perceptions of collective political capacity. For the poorest residents of these neighborhoods in particular, the expected positive effect of informal social support is suppressed by the negative effect of perceived trauma. These findings present a micro-level account of poverty, social interaction, and political capacity, one that holds implications for scholarship and public policy on participatory inequality.
Poverty might mean different things in different parts of the world and to different people, but it is largely defined as being unable to afford a minimum standard of living. The United States has come a long way in addressing the problem, but progress seems to have slowed despite the recent years of economic recovery.
In many ways, the problem has even escalated. Though the economy has added millions of jobs since the recession ended, many of the jobs created are not the same as jobs that were lost. In many areas, the problem of poverty has worsened during the recovery.
Poverty is perhaps the most persistent of problems, with consequences that can span a lifetime, be transferred across generations, and loom in the minds of individuals and families living at the edge of poverty.
Click here to see how poverty is measured.
Click here to see alternative measures of poverty.
Click here to see root causes of poverty.
Click here to see who lives in poverty.
Click here to see what it means to live in poverty.
Click here to see solutions.
Ostensibly, for the past ten years, our economy has been recovering from the 2008 collapse. During the past few years, our comeback seems to have gained momentum. All the official indicators say we’re back in boom times, with a bull market, low unemployment and steady job growth. But there is an alternative set of data that depicts a different America, where the overlooked majority struggles from month to month.
The Nation recently published a stunning overview of the working poor and underpaid. One of the most powerful data points in the piece described how empty the decline in unemployment actually is: having a job doesn’t exempt anyone from poverty anymore. About 12% of Americans (43 million) are considered poor, and yet they are employed. They earn an individual income below $12,140 per year, and slightly more than that for a family of two. If you include housing and medical expenses in the calculation, it raises the percentage of Americans living in poverty to 14%. That’s 45 million people…..
The United States Has a National-Security Problem—and It’s Not What You Think
Source: Rajan Menon, The Nation, July 16, 2018
…..For millions of Americans, however, the greatest threat to their day-to-day security isn’t terrorism or North Korea, Iran, Russia, or China. It’s internal—and economic. That’s particularly true for the 12.7 percent of Americans (43.1 million of them) classified as poor by the government’s criteria: an income below $12,140 for a one-person household, $16,460 for a family of two, and so on… until you get to the princely sum of $42,380 for a family of eight. Savings aren’t much help either: A third of Americans have no savings at all and another third have less than $1,000 in the bank. Little wonder that families struggling to cover the cost of food alone increased from 11 percent (36 million) in 2007 to 14 percent (48 million) in 2014…..
…..As a result, though the United States has a per-capita income of $59,500 and is among the wealthiest countries in the world, 12.7 percent of Americans (that’s 43.1 million people), officially are impoverished. And that’s generally considered a significant undercount. The Census Bureau establishes the poverty rate by figuring out an annual no-frills family food budget, multiplying it by three, adjusting it for household size, and pegging it to the Consumer Price Index. That, many economists believe, is a woefully inadequate way of estimating poverty. Food prices haven’t risen dramatically over the past 20 years, but the cost of other necessities like medical care (especially if you lack insurance) and housing have: 10.5 percent and 11.8 percent respectively between 2013 and 2017 compared to an only 5.5 percent increase for food. Include housing and medical expenses in the equation and you get the Supplementary Poverty Measure (SPM), published by the Census Bureau since 2011. It reveals that a larger number of Americans are poor: 14 percent or 45 million in 2016…..