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PovertyinAmerica.ppt

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Since the 1960s, the United States Government has defined poverty in absolute terms. This makes poverty more easily measurable.
The "absolute poverty line" is the threshold below which families or individuals are considered to be lacking the resources to meet the basic needs for healthy living; having insufficient income to provide the food, shelter and clothing needed to preserve health.
A large percentage of the governments poverty measurements depend on the price of food.

"Relative poverty" can be defined as having significantly less access to income and wealth than other members of society. Therefore, the relative poverty rate can directly be linked to income inequality.
Means relative poverty can decline if rich people lose a lot of money.

The current poverty measure was established in the 1960s and is now widely acknowledged to be outdated. It was based on research indicating that families spent about one-third of their incomes on food — the official poverty level was set by multiplying food costs by three. Since then, the same figures have been updated annually for inflation but have otherwise remained unchanged.
Yet food now comprises only one-seventh of an average family’s expenses, while the costs of housing, child care, health care, and transportation have grown disproportionately. Most analysts agree that today’s poverty thresholds are too low. And although there is no consensus about what constitutes a minimum but decent standard of living in the U.S., research consistently shows that, on average, families need an income of about twice the federal poverty level to meet their most basic needs.

Thirty-seven million Americans live below the official poverty line.
One in eight Americans now lives in poverty.
A family of four is considered poor if the family’s income is below $21,027.
One third of all Americans will experience poverty within a 13-year period. In that period, one in 10 Americans are poor for most of the time, and one in 20 are poor for 10 or more years.

“One in eight Americans -- approximately 37 million people -- now live below the federal poverty line of $19,971 for a family of four. (A woefully inadequate measure that is 42 years old and fails to account for basic necessities.) That's 4.9 million more people than in 2000 and the poverty rate for children is the highest of all age groups. Nearly 60 million people live just above the poverty line. Using the British standard of measurement, approximately 30 percent of Americans --and 40 percent of American children -- are living in poverty.”

Eighteen percent of children are in poverty.
10.9 percent of working-age adults (between the ages of 16 and 64) are in poverty.
9.7 percent of the elderly are in poverty.
13.8 percent of females and 11.1 percent of males were poor

The white non-Hispanic poverty rate is 8.2%.
The poverty rate for African Americans is 24.5%.
The poverty rate for Hispanics is 21.5%.
The poverty rate for Asian Americans is 10.2%.

Federal minimum wage is $6.55 per hour
Some states and localities have mandated a higher minimum wage
Minimum wage in Washington state is $8.55
Minimum wage in Kansas is $2.65, for employees not covered by the Federal Fair Labor Standards Act

Inequality has reached record highs. The richest 1 percent of Americans in 2005 held the largest share of the nation’s income (19 percent) since 1929. At the same time, the poorest 20 percent of Americans held only 3.4 percent of the nation’s income.

Poverty in the United States is far higher than in many other developed nations. At the turn of the 21st century, the United States ranked 24th among 25 countries when measuring the share of the population below 50 percent of median income.
While the United States has the second lowest long-term unemployment rate in the developed world, it has the highest percentage of children who are not likely to live to age 60 and persons living on less than 50% of the national median income and the third highest percentage of adults lacking functional literacy skills.

Six years after the 2001 recession ended, there were 5.7 million more poor Americans last year than in 2000.
Poverty rates in 2007 were higher than in 2000 for both native-born (11.9 versus 10.8 percent) and foreign-born residents (16.5 versus 15.4 percent).
Average incomes for the bottom fifth of U.S. households were lower in 2007 than in 2000 ($11,551 versus $12,229), and average incomes for the next highest quintile were also lower ($29,442 versus $30,353).

Even more sobering is the fact that the number of severely poor is growing rapidly. In 1975 the severely poor were 30% of the population in poverty. Today a dismaying 43% of persons in poverty are severely poor by national standards. But more embarrassing than the share of the poverty population truly poor is the increase in the number of persons descending into severe poverty. While the rate of new entrants moving into poverty is somewhat stable, those who are becoming truly poor are increasing at a rate 56% higher than the growth rate of new entrants into poverty.”

As another sign that poverty is now climbing rapidly, food stamp caseloads have increased dramatically in recent months, rising by 2.6 million people or 9.6 percent between August 2007 and August 2008, the latest month for which data are available. In 25 states, at least one in every five children is receiving food stamps. Because monthly food stamp caseload data are available long before the official Census poverty data for the prior calendar year, rising food stamp caseloads are the best early warning sign of growing poverty.

Like previous recessions, the current downturn is likely to cause significant increases both in the number of Americans who are poor and the number living in “deep poverty,” with incomes below half of the poverty line. Because this recession is likely to be deep and the government safety net for very poor families who lack jobs has weakened significantly in recent years, increases in deep poverty in this recession are likely to be severe.

Already there are signs that the recession is hitting low-income Americans hard. Between September 2006 and October 2008, the unemployment rate for workers age 25 and over who lack a high school diploma — a heavily low-income group — increased from 6.3 percent to 10.3 percent. Yet low-income workers who lose their jobs are less likely to qualify for unemployment benefits than higher-income workers, due to eligibility rules in place in many states that deny benefits to individuals who worked part time or did not earn enough over a "base period" that often excludes workers' most recent employment.

The current recession already has pushed up the unemployment rate from 4.9 percent in December 2007 to 7.6 percent in January 2008. Alternative measures of the labor market paint a bleaker picture. Almost one in seven workers — some 13.9 percent of all workers — are unemployed, involuntarily working part time, or are jobless and available for work but have grown discouraged from looking for work. Private and government payrolls combined have shrunk for 13 straight months, and net job losses since the start of the recession some 14 months ago total 3.6 million. And, those who have lost jobs are having a very difficult time finding a new one: more than one-fifth (22.4 percent) of the 11.6 million unemployed have not been able to find a job despite looking for 27 weeks or more.

The housing market’s ongoing troubles heighten the potential for significant increases in homelessness during this recession. Home foreclosures have pushed many owner and renter families into the rental market, driving up rents in some areas by increasing the demand for housing — despite falling incomes and rising unemployment. In addition, a number of state and localities are beginning to cut back homelessness prevention programs due to large state and local budget shortfalls, even as the need for these programs grows.

Urban areas have a poverty rate of 17%, compared to a poverty rate of 9% for the suburbs.
White flight
No new businesses = no jobs
Higher crime rates
Higher rates of pollution

Poverty rate in the South is 14%.
One in seven people living in rural America lives below the poverty line.
Poverty rates are higher in rural areas for almost every demographic.

Nearly a third of Native Americans live in poverty.
The country's 2.1 million Indians, about 400,000 of whom live on reservations, have the highest rates of poverty, unemployment and disease of any ethnic group in America.
Indians earn only a little more than half as much money as the average American.

Lower education— Low levels of parental education are a primary risk factor for being low income. Eighty-three percent of children whose parents have less than a high school diploma live in low-income families, and over half of children whose parents have only a high school degree are low income as well.
New to the country
Don’t possess marketable skills
Has a disability
Single parent households

“Many welfare recipients possess significant barriers to employment. In 2002, 42 percent of welfare recipients had not finished high school, 35 percent reported being in very poor health, and 30 percent had not worked in recent years. Other potential barriers to employment include the presence of an infant, language barriers, and the need to care for a child with disabilities. About two out of five welfare recipients (44 percent) had two or more barriers to work in 2002. The share of recipients with multiple barriers remained fairly constant between 1997 and 2002.”

“The working poor and unemployed are working hard, but in most respects not moving ahead, the report concludes. While most of those surveyed report needing less than an additional $200 per month to meet their family’s needs, this amount of money represents a substantial increase in hours worked at low wages. The working poor and unemployed lack access to the critical paths of opportunity in the new economy—higher education, ongoing job training, job growth in suburban neighborhoods, childcare support, and information technology.” (Working Hard But Staying Poor, 1999)

“Under the TANF structure, the federal government provides a block grant to the states, which use these funds to operate their own programs. States can use TANF dollars in ways designed to meet any of the four purposes set out in federal law, which are to: ‘(1) provide assistance to needy families so that children may be cared for in their own homes or in the homes of relatives; (2) end the dependence of needy parents on government benefits by promoting job preparation, work, and marriage; (3) prevent and reduce the incidence of out-of-wedlock pregnancies and establish annual numerical goals for preventing
and reducing the incidence of these pregnancies; and (4) encourage the formation and maintenance of two-parent families.’” (An Introduction to TANF, 2005)

Furthermore, the nation’s basic cash assistance safety net for very poor people who are jobless is much weaker and less well equipped to meet the challenges that a serious economic downturn poses than it was in previous major recessions. The biggest changes in that safety net have resulted from changes in public assistance policies at both federal and state levels. As a result of changes in such policies, basic cash assistance reaches many fewer poor families with children than in the recessions of the 1970s, 1980s, and 1990s. Today, only about 40 percent of families eligible for cash assistance under the Temporary Assistance for Needy Families program actually receive it. That is about half the percentage of families eligible for TANF’s predecessor (the Aid to Families with Dependent Children program) that received its benefits during the recessions of earlier decades.

In addition, those poor unemployed individuals not raising minor children who don’t qualify for unemployment insurance no longer are eligible for any type of cash assistance. State general assistance programs — formerly the safety net of last resort for this group of people — were largely eliminated across the country in the late 1980s and early 1990s (except for programs for people with disabilities). Many of these individuals cannot even qualify for food stamps; in most parts of the country, jobless people aged 18-50 not raising minor children are restricted to three months of food stamps out of every three-year period. As a result, there is a substantial population of individuals for whom there is little or no safety net at all. That population will grow much larger in the next year or two.

BusinessDictionary.com, 2007—“social services -- Definition: Benefits and facilities such as education, food subsidies, health care, and subsidized housing provided by a government to improve the life and living conditions of the children, disabled, the elderly, and the poor in the national community.”

In 2002 over 5.1 million families, or 4.6% of U.S. households, lived in subsidized housing.
HUD has operated many different kinds of housing programs, but these can be classified under three headings: public housing owned by the government, tenant-based programs that provide people vouchers to subsidize rent, and project-based programs that underwrite the costs of private owners who, in turn, pledge to house low-income people.

Food subsidies will cost taxpayers $55 billion in fiscal 2007 and account for 61 percent of the USDA’s budget.
Food stamps
Students receiving free and reduced lunch
The women, infants, and children (WIC) program

Loss of health insurance and rising health care costs are one of the main reasons why people are falling into poverty.
46 million Americans lack health insurance, or one in seven people.
In the U.S. health insurance is tied to your job, which means no job = no health insurance.

Head Start program
After school programs
Public schooling
Vouchers
Charter schools

Many people can’t afford a reliable car, so transportation to a job can be difficult.
Free public transportation—the bus, subway/metro

The religious angle—helping those in poverty is a central tenant of many world religions.
The ethical angle—many believe that if you have the ability to do so, then you have an ethical obligation to help your fellow citizens in poverty. We are all Americans and we cannot allow one country of haves and one country of have-nots.

Persistent childhood poverty is estimated to cost our nation $500 billion each year, or about four percent of the nation’s gross domestic product.
Poverty = less education = less competent workforce = lower U.S. economic competitiveness
The experience of severe or chronic economic hardship limits children’s potential and hinders our nation’s ability to compete in the global economy. American students, on average, rank behind students in other industrialized nations, particularly in their understanding of math and science. Analysts warn that America’s ability to compete globally will be severely hindered if many of our children are not as academically prepared as their peers in other nations.

“…diseases very similar to those plaguing Africa, Asia, and Latin America are also occurring frequently among the poorest people in the United States, especially women and children. These diseases -- the "neglected infections of poverty" -- are caused by chronic and debilitating parasitic, bacterial, and congenital infections. While most Americans have never heard of neglected tropical diseases (NTDs), the analysis estimates that these infections occur in hundreds of thousands of poor Americans concentrated primarily in the Mississippi Delta (including post-Katrina Louisiana), Appalachia, the Mexican borderlands, and inner cities. These diseases represent a major cause of chronic disability, impaired child development, and adverse pregnancy outcomes, yet many of them are preventable.

The pervasive impact of poverty on health is evident regardless of how poverty is measured. David Williams and his colleagues at the University of Michigan thus found that people with annual incomes of under $10,000 had more than three times the risk of dying in a given year as those who made more than $30,000. Dozens of other studies have produced similar findings, regardless of whether income, education, or occupation was used as the marker of low socioeconomic status. Finally, and moving the unit of analysis from the individual to the community, the now-classic Alameda County Study in California demonstrated that residence in a poor neighborhood itself, regardless of the individual's income, resulted in a risk of dying 40 percent higher than would be expected on the basis of age, gender, and even smoking history.

Environmental factors—poor people are more likely to work or live in areas with low environmental quality. For example, you are much more likely to find coal fired power plants, emissions producing factories, and waste dumps near communities where poor people live.
Environmental racism—the practice of placing power plants or other environmentally bad industries near minority communities.

Poverty—is it the fault of the individual or society?
People who blame society tend to argue that forces like capitalism and racism are to blame for domestic poverty.
People who blame the individual tend to focus on factors like individual will and personal choices for why domestic poverty exists.

Social services—are they a right that cannot be taken away or are they a privilege that can be taken away?
Are social services like health care and subsidized housing and food a human right?
Governments can provide negative rights and positive rights. Negative right = something the government won’t interfere with or take away (life, liberty, pursuit of cash).
Positive right = something the government provides or gives you.

Poverty—is it even possible to eliminate it?
Even if it is possible, are the cures worst than the disease?
Is there an acceptable level of poverty that we can be content with?