Hurting households
POVERTY FIGURES released yesterday by the US Census Bureau show that more Americans slid into poverty last year and median incomes fell for the second year in a row. Unfortunately, the federal government's spending priorities have not improved the situation, and the continuing loss of jobs does not bode well for a quick rebound.
According to the bureau's annual report, the poverty rate rose to 12.1 percent in 2002, up from 11.7 percent in 2001. Nearly 34.6 million people lived in poverty, about 1.7 million more than the previous year. Increases in poverty were largest among blacks, rising from 22.7 percent in 2001 to 24 percent. The rates remained relatively unchanged for non-Hispanic whites, Asians, and Hispanics. Put another way, there were 3 million more poor people in 2002 than there were in 2000, the last year before the unemployment rate began to rise.
In addition, the bureau reported that median household income fell by $500, or 1.1 percent, between 2001 and 2002, to $42,409 after accounting for inflation. Taken together, the rise in poverty and the decline in median income are a reflection of the unemployment rate, which rose from 4.7 percent in 2001 to 5.8 percent in 2002.
The deteriorating financial condition of millions of Americans deserves more than lip service from the Bush administration and Congress. They have been less generous in providing federal unemployment insurance to the long-term unemployed than the government was during the last recession, in the early 1990s. As a result, the number of workers who have run out of federal unemployment benefits without finding work has been two times the figure at a similiar point in the previous downturn.
President Bush and Congress should correct that. They should extend child tax credits for low-income families who were dropped from tax cut legislation earlier this year that gave an average rebate of $93,000 to people earning more than $1 million a year. They should also provide child care assistance to low-income families so parents can work without worrying about the quality of that care or or falling into poverty to pay for it.
Officials of the Department of Health and Human Services recently gloated about a reduction in the number of people receiving welfare benefits. In the mid-90s, eight of 10 poor families who were eligible for cash assistance received it. In 2000, only five out of 10 received it, meaning that half of those families with children who needed help didn't get it. That is nothing to gloat about, especially when compared with a recent analysis of statistics from the Congressional Budget Office that showed that the gap between the rich and poor more than doubled from 1979 to 2000. If the safety net for the poor were performing as well as it is for the rich, poverty could be erased.
