Debilitating Poverty In America? How Is That Even Possible In Such A Wealthy Country?

Yesterday, the census bureau reported that household income decreased 2.3% from the 2021. Their per capital personal income in 2021 was $64,143 nationally. There were 17 counties with less than $33,000 in personal income around half the national average:

• Wheeler, Georgia $24,341 (69.3% Trump)

• Crowley, Colorado- $24,314 (72.6% Trump)

• Union, Florida- $25,293 (82.1% Trump)

• Lake, Tennessee- $29,534 (73.3% Trump)

• Elliott, Kentucky- $29,572 (75.0% Trump)

• Forest, Pennsylvania- $29,573 (71.1% Trump)

• Ziebach, South Dakota- $30,532 (44.6% Trump)

• Telfair, Georgia- $30,573 (65.2% Trump)

• Charlton, Georgia- $30,916 (74.8% Trump)

• Lafayette, Florida- $31,218 (85.4% Trump)

• Petroleum, Montana- $31,503 (85.6% Trump)

• Bent, Colorado- $32,716 (66.1% Trump)

• Hamilton, Florida- $32,123 (65.3% Trump)

• Wilcox, Georgia- $32,288 (73.2% Trump)

• Stewart, Georgia- $32,844 (40.2% Trump)

• Liberty, Florida- $32,872 (79.8% Trump)

• DeSoto, Florida- $32,873 (65.6% Trump)

They’re all basically white, Republican MAGA counties with 2 exceptions, Ziebach, South Dakota (where most of the voters are Native Americans) and Stewart, Georgia (a mostly minority rural county).

Yesterday, digging into the Census Bureau report, the NY Times reported that poverty is on the rise— a lot— after years of declining. Why? Inflation— living costs rose— while conservatives forced federal programs that provided aid to families during the pandemic to expire. Ben Casselman and Lydia DePillis wrote that “The poverty rate rose to 12.4 percent in 2022 from 7.8 percent in 2021, the largest one-year jump on record, the Census Bureau said Tuesday. Poverty among children more than doubled, to 12.4 percent, from a record low of 5.2 percent the year before. Those figures are according to the Supplemental Poverty Measure, which factors in the impact of government assistance and geographical differences in the cost of living. The increases followed two years of historically large declines in poverty, driven primarily by safety net programs that were created or expanded during the pandemic. Those included a series of direct payments to households in 2020 and 2021, enhanced unemployment and nutrition benefits, increased rental assistance and an expanded child tax credit, which briefly provided a guaranteed income to families with children.”

The increasing cost of living added to the challenge last year. The poverty threshold, which is based on the cost of essential items like food and housing, rose sharply: A family of four living in a rental home was considered poor under the supplemental measure if the family’s income was less than $34,518 in 2022, up from $31,453 in 2021.

…The White House, in a blog post previewing the report, argued that more recent data “tell a more optimistic story.” Inflation has cooled in recent months, while the job market has remained strong and wages continue to rise.

The hot job market has had clear benefits for those able to take advantage of it. Many workers, especially in low-paying industries like hospitality and retail, experienced significant wage gains in 2022, in some cases by moving between jobs in search of better pay. Income for the poorest 20 percent of households— excluding tax credits and some other government benefits— rose 4.3 percent last year, adjusted for inflation. Income gains also outpaced inflation for the least educated workers.

Inequality, as measured by the ratio between the richest and poorest 10 percent of households, narrowed, as most of the decrease in median incomes came from those at the middle and top of the wage distribution. Racial gaps also shrank, as white households lost ground to inflation, while inflation-adjusted income was little changed for other racial and ethnic groups.

The “official” poverty rate— an older measure that is widely considered outdated because it excludes many of the government’s most important anti-poverty programs, among other shortcomings— was nearly flat last year, at 11.5 percent, reflecting the offsetting forces of higher prices and increased earnings of low-wage workers. By that measure, the poverty rate for Black Americans was 12.4 percent, the lowest rate on record.

“There has really been this resurgence in terms of the labor market fortunes of Black workers, particularly Black male workers,” said Michelle Holder, an economist at John Jay College in New York. “The most important element for people in my community is can we get a job, and if we can get a job, can we keep a job? And right now, both things look pretty darn good.”

But those unable to work, or unable to work full-time, faced a one-two punch of higher costs and lost benefits in 2022 — problems that have continued this year. Increased federal nutrition benefits, one of the last vestiges of pandemic aid efforts, expired last spring.

…Congress passed the expanded child tax credit as part of the American Rescue Plan, President Biden’s pandemic-relief package, in early 2021. But unlike with other Covid-era relief programs, which were always intended to expire once the emergency passed, supporters hoped to make the expanded child credit permanent.

That didn’t happen. Faced with united opposition from congressional Republicans as well as some conservative Democrats, Biden dropped his effort to extend the program at the end of 2021; a renewed push failed again last year. The rise in poverty in 2022, social policy experts said and the White House agreed, was the inevitable result of that decision.

Critics of the child tax credit and other pandemic aid have argued that the rapid rebound in poverty after the programs’ expiration is evidence that the progress made against poverty in recent years was, in effect, artificial. Michael Strain, an economist at the conservative American Enterprise Institute, argued that programs that offer incentives to work— such as the earned-income tax credit and the standard child tax credit— have led to more sustainable gains.

“Yes, this alleviated child poverty, but it didn’t really do a whole lot to encourage self sufficiency,” he said.

Progressives take a different lesson: Government programs can succeed in helping families meet their basic needs, but only as long as they remain in place.

“The last few years just illustrated in an incredible way the power of effective government intervention,” said Arloc Sherman, a vice president at the Center on Budget and Policy Priorities, a progressive research organization. “The last couple years, through a plunge in poverty and what is now a record single-year increase in poverty in 2022, have shown that poverty is very much a policy choice.”

A couple of days ago, I hope you read about how Susie Shannon fought to create a poverty council at the DNC. This morning, Susie told me that “Programs created in the U.S. as a response to the pandemic proved what many of us have been saying for decades, that direct assistance to people in need would lower the poverty rate, especially among children. As those direct assistance programs ended (or were drastically cut) and wages remained stagnant, it was predictable that poverty rates would increase. It is shameful that in one of the richest countries in the world, so many children go to sleep hungry and over half a million people are without a roof over their heads. Even as the poverty rate increases, Republicans are moving to drive drastic cuts into the Supplemental Nutrition Assistance Program and the WIC program for pregnant women, breastfeeding moms and young children under 5 years of age. These cuts would be devastating and cruel. It is imperative that Democrats draw a line in the sand and say ‘No’ to cuts that help low-income seniors, veterans and parents with children. We must restore full funding to assistance programs to those in need if we are to reverse this downward spiral.”

This morning, Judd Legum wrote that “The massive increase in child poverty last year was a completely predictable and avoidable tragedy. Powerful people inside and outside the federal government chose to let this happen because they had other priorities… One of the Biden administration’s most prominent proposals to expand the CTC was in Biden’s Build Back Better agenda, which included expanding the CTC for one year. This proposal was blocked, in part, by Senator Joe Manchin (D-WV). In December 2021, just weeks before the CTC was set to expire, Manchin announced that he would not be voting for the Build Back Better Act, even after Democrats ‘shaped much of the current version of the bill around’ his demands. With Democrats holding 50 seats in the Senate, Manchin joined a unified Republican Party to sink the bill. Manchin released a statement stating that he opposed Build Back Better ‘largely because of its cost,’ stating that his ‘colleagues in Washington are determined to dramatically reshape our society in a way that leaves our country even more vulnerable to the threats we face.’ Publicly, Manchin stated that ‘he has always supported the child tax credit’ and opposed Build Back Better for other reasons. But, according to HuffPost, Manchin privately ‘told his colleagues that he essentially doesn’t trust low-income people to spend government money wisely.’ Manchin ‘told several of his fellow Democrats that he thought parents would waste monthly child tax credit payments on drugs instead of providing for their children.’ There is no evidence that CTC payments were being used by parents to purchase drugs. US Census Household Pulse data found that, between July 21 and August 16, 2021, the payments were spent ‘on basic household needs and children's essentials.’ The data found that food was ‘the most common item’ purchased using CTC money, with ‘half of all families in the US using their Child Tax Credit payment’ for food. Food also ‘top[ped] the list in every state’ except Mississippi, ‘where school essentials and food are essentially tied for number one.’ Other top expenses paid for by the CTC payments included ‘essential bills,’ ‘children’s clothing,’ ‘[r]ent/mortgage,’ and ‘school and child care.’”

Pervez Agwan, a progressive candidate running in a new Houston area congressional seat— and opposed by a corporate shill— told me that what he sees everyday talking with people in the district is that “Folks are struggling and unchecked corporate greed is making things 1000 times worse. Wages aren't going as far because the price of rent and basic necessities like food have skyrocketed. You have folks working multiple jobs at once and still just barely getting by. We need to fund social safety net programs and provide relief to everyday Americans.”