Category Archives: Poverty

Temporary Assistance for Needy Families

Source: James P. Ziliak, National Bureau of Economic Research (NBER), NBER Working Paper No. w21038, March 2015

From the abstract:
In this chapter I provide a brief history of the TANF program, including changes made as part of the 2005 Deficit Reduction Act. I then present a variety of program statistics, including trends in aggregate and state-level caseloads and spending, along with changes in the demographic composition of the program, especially the shift from adult with child cases to child-only cases. I also highlight the changing composition of spending on the program from cash assistance to in-kind assistance, and the challenges faced in documenting total (cash + in-kind) caseloads and spending. I follow this with a discussion of the behavioral issues surrounding TANF, including the four program goals and possible modifications as part of the 2014 reauthorization legislation, and then I provide a systematic review of the research evidence on whether those goals have been met.

The Working Poor Confound the Experts

Source: Peter Coy, Matthew Philips, Rich Miller, Bloomberg Businessweek, January 15, 2015

The left and the right alike have pounced on the drop in Americans’ labor force participation rate to score political points. The rate tied an almost 37-year low of 62.7 percent in December, according to data released on Jan. 9 by the U.S. Bureau of Labor Statistics. And the poorest families are the least likely to be in the labor force.

So this factoid should come as a big surprise: Low-income families are the only ones whose participation rate has risen. The average for families in the lowest tenth of households by income rose by 11 percentage points over a 13-year period, to just under 44 percent. The participation rate of families in the top tenth of incomes fell by a little more than 3 percentage points, to just under 80 percent. To put it simply, the poor have been stepping forward while the rich have been stepping back.

These calculations were made by Nicolas Petrosky-Nadeau, a senior economist at the Federal Reserve Bank of San Francisco who is on leave from Carnegie Mellon University. He dug up the new data in collaboration with Robert Hall, an economist at the Hoover Institution and Stanford University. Petrosky-Nadeau says he and Hall were surprised by what they found, as are other economists who have seen the numbers. …

….The research undermines the Democratic case that rapid economic growth is essential to alleviating poverty, because it makes labor markets so tight that employers have no choice but to hire people some would prefer to avoid, such as racial minorities, the long-term jobless, the handicapped, and ex-convicts…. The research also weakens the Republican case that the welfare state keeps people from working….

Fifty Years Later: From a War on Poverty to a War on the Poor

Source: Anna Maria Santiago, Social Problems, Volume 62 Issue 1, First published online: 18 March 2015
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From the introduction:
It was images of poor families taken in rural Appalachia by photographers Billy Barnes, John Dominis, and Andrew Stern, coupled with the writings of The New York Times journalist Homer Bigart and seminal books by scholars Michael Harrington (The Other America [1962]) and John Galbraith (The Affluent Society [{1958}1998]) that brought poverty to light as a major social problem facing a relatively affluent America of the late 1950s and early 1960s. Concerned with expanding opportunities and increasing income for the 37 million Americans living in poverty at the time, President Lyndon B. Johnson declared an unconditional war on poverty on January 8, 1964, initiating a “new era of direct federal involvement in schools, hospitals, labor markets, and neighborhoods” (quoted in Bailey and Danziger 2013:1-3). The overarching goals of the War on Poverty were to: sustain high levels of employment; accelerate national and regional economic growth; improve labor markets; regenerate urban and rural communities; expand educational and training opportunities for youth as well as adults; advance the nation’s health; and expand support to the elderly and disabled (Bailey and Danziger 2013:7). To address these goals, Johnson worked with Congress to pass more than 200 pieces of legislation, resulting in the largest expansion of social safety net programs in U.S. history. This legislation created the Medicaid and Medicare programs providing health care to low-income people and the elderly; expanded the Head Start early education program; increased funding for K-12 and postsecondary education; established Food Stamps (currently known as SNAP) and other school and community-based nutrition programs; …

Low-Income Working Families: The Racial/Ethnic Divide

Source: Deborah Povich, Brandon Roberts and Mark Mather, Working Poor Families Project, Policy Brief, Winter 2014-2015

A new report by The Working Poor Families Project examines the large and growing economic divide among America’s 32.6 million working families, with whites and Asians at the top and other racial/ethnic groups—particularly blacks and Latinos—falling behind. In 2013, there were 10.6 million low-income working families in America—racial/ethnic minorities constitute 58 percent of this group, despite only making up 40 percent of all working families nationwide. In addition, working families headed by racial/ethnic minorities were twice as likely to be poor or low-income (47 percent) compared with non-Hispanic whites (23 percent)—a gap that has increased since the onset of the Great Recession in 2007. There are significant state and regional variations in the economic well-being of minority working families as well. The report calls on state policy leaders to address this economic divide, offering policy recommendations that address these inequalities, improve conditions for millions of lower-income parents and their children and promote economic growth.

Measuring Access to Opportunity in the United States

Source: Annie E. Casey Foundation, KIDS COUNT Data Snapshot, February 2015

From the abstract:
This KIDS COUNT data snapshot illustrates how outdated methods measuring poverty in the United States are giving an inaccurate picture of how families are really faring and what public programs are actually working. The brief introduces the more accurate Supplemental Poverty Measure (SPM) and shows how government programs affect state poverty rates. Recommendations on targeting families in need give policymakers input on implementing efficient and cost-effective public programs.

Paying the Price: How Poverty Wages Undermine Home Care in America

Source: Paraprofessional Healthcare Institute (PHI), February 2015

From the abstract:
Examines the need to improve home care wages and benefits in order to stabilize the workforce and ensure quality of care. Includes data/charts, worker stories, and profiles of states and organizations investing in the workforce.
Press release
Blog post

Reaching Those in Need: Estimates of State Supplemental Nutrition Assistance Program Participation Rates in 2012

Source: Karen E. Cunnyngham, United States Department of Agriculture, February 2015

From the abstract:
This report – part of an annual series – presents estimates of the percentage of eligible persons, by State, who participated in the Supplemental Nutrition Assistance Program (SNAP) during an average month in fiscal year 2012 and in the two previous fiscal years. This report also presents estimates of State participation rates for eligible “working poor” individuals (people in eligible households with earnings) over the same period.

Debt of the Elderly and Near Elderly, 1992-2013

Source: Craig Copeland, Employee Benefit Research Institute (EBRI), EBRI Notes, Vol. 36 No. 1, January 2015

From the abstract:
This paper focuses on the trends in debt levels among those ages 55 or older (near-elderly are defined as those ages 55-64 and the elderly are defined as those ages 65 and older), as financial liabilities are a vital but often ignored component of retirement income security. The Federal Reserve Board’s Survey of Consumer Finances (SCF) is used in this paper to determine the level of debt. Debt is examined in two ways: (1) debt payments relative to income, and (2) debt relative to assets. Each measure provides insight regarding the financial abilities of these families to cover their debt before or during retirement. For example, higher debt-to-income ratios may be acceptable for younger families with long working careers ahead of them, because their incomes are likely to rise, and their debt (often related to housing or children) is likely to fall in the future. On the other hand, higher debt-to-income ratios may represent more serious concerns for older families, which could be forced to reduce their accumulated assets to service the debt at points where their active earning years are ending. However, if these older families with high debt-to-income ratios have low debt-to-asset ratios, the effect of paying off the debt may not be as financially difficult as it might be for those with high debt-to-income and high debt-to-asset ratios. The percentage of American families with heads ages 55 or older that had debt increased from 63.4 percent in 2010 to 65.4 percent in 2013. Furthermore, the percentage of these families with debt payments greater than 40 percent of income — a traditional threshold measure of debt load trouble — increased in 2013 to 9.2 percent from 8.5 percent in 2010. However, total debt payments as a percentage of income decreased from 11.4 percent in 2010 to 10.0 percent in 2013, and average debt decreased from $80,465 in 2010 to $73,211, while debt as a percentage of assets decreased from 8.5 percent in 2010 to 8.1 percent in 2013. Housing debt drove the change in the level of debt payments in 2013, while the nonhousing (consumer) debt-payment share of income held stable from 2010. Housing debt was the major component of debt for families headed by individuals ages 55 or older. The debt levels among those with housing debt have obvious and serious implications for the future retirement security of these Americans, perhaps most significantly that these families are potentially at risk of losing what is typically their most important asset — their home.

Basic Facts About Low-Income Children – Children Under 3 Years, 2013

Source: Yang Jiang, Mercedes Ekono, and Curtis Skinner, Columbia University, National Center for Children in Poverty (NCCP), January 2015

From the summary:
Children under 18 years represent 23 percent of the population, but they comprise 33 percent of all people in poverty. Among all children, 44 percent live in low-income families and approximately one in every five (22 percent) live in poor families. Our very youngest children – infants and toddlers under age 3 years – appear to be particularly vulnerable, with 47 percent living in low-income families, including 25 percent living in poor families. Being a child in a low-income or poor family does not happen by chance. Parental education and employment, race/ethnicity, and other factors are associated with children experiencing economic insecurity. This fact sheet describes the demographic, socio-economic, and geographic characteristics of children and their parents. It highlights important factors that appear to distinguish low-income and poor children from their less disadvantaged counterparts.

Poverty in the United States: 2013

Source: Thomas Gabe, Congressional Research Service (CRS), CRS Report, RL33069, January 29, 2015

In 2013, 45.3 million people were counted as poor in the United States under the official poverty measure—a number statistically unchanged from the 46.5 million people estimated as poor in 2012. The poverty rate, or percent of the population considered poor under the official definition, was reported at 14.5% in 2013, a statistically significant drop from the estimated 15.0% in 2012. Poverty in the United States increased markedly over the 2007-2010 period, in tandem with the economic recession (officially marked as running from December 2007 to June 2009), and remained unchanged at a post-recession high for three years (15.1% in 2010, and 15.0% in both 2011 and 2012). The 2013 poverty rate of 14.5% remains above a 2006 pre-recession low of 12.3%, and well above an historic low rate of 11.3% attained in 2000 (a rate statistically tied with a previous low of 11.1% in 1973). The incidence of poverty varies widely across the population according to age, education, labor force attachment, family living arrangements, and area of residence, among other factors. Under the official poverty definition, an average family of four was considered poor in 2013 if its pretax cash income for the year was below $23,834. The measure of poverty currently in use was developed some 50 years ago, and was adopted as the “official” U.S. statistical measure of poverty in 1969. Except for minor technical changes, and adjustments for price changes in the economy, the “poverty line” (i.e., the income thresholds by which families or individuals with incomes that fall below are deemed to be poor) is the same as that developed nearly a half century ago, reflecting a notion of economic need based on living standards that prevailed in the mid-1950s.