Searching for Causes of Poverty's Climb

Why is the poverty rate at its highest level in 11 years, and how can we fix it?

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News yesterday that the poverty rate has risen to 13.2%, its highest point in over a decade, was naturally met with consternation from pundits who speculated that the trends have deeper roots than the current crisis, and may keep rising. Many believe this argues for another stimulus package, but others note that reduced tax receipts could cause the deficit to balloon.

  • Poverty Will Keep Climbing, writes Felix Salmon at Reuters. "And even if a slow economic recovery is beginning to take hold, I can't see that number declining much in the foreseeable future. Which is unconscionable, in the richest country in the world."
  • There Goes the Budget, says Douglas A. McIntyre at 24/7 Wall Street. "The poverty numbers and the average income figures are signs of the inescapable problems that the government faces with the deficit. The 2008 Census figures are not entirely negative, perhaps not next to the 2007 figures, but put next to the likely numbers for 2009 they look unmanageable for a country that is trying to pull itself out of a nearly bottomless economic pit. America may believe it can stand more poverty from a moral standpoint, but it cannot from a financial one."
  • Saved by the Stimulus, says Mark Thoma at an Economist's View. " The worsening job situation since 2008 portends much higher poverty in 2009 and 2010. ... While the increases in poverty in 2009 are likely to be large, they would have been much greater without the economic recovery legislation."
  • Health Care Costs Don't Explain It, argues Kevin Drum in Mother Jones. "Roughly speaking, if you add together both cash income and healthcare premiums and adjust everything for inflation, median income over the past decade has increased from about $56,400 to $57,000. In other words, a whopping 1%. It really has been a lost decade."
  • Extend Unemployment Benefits, urges Tim Fernholz in The American Prospect. Fernholz quotes a recommendation from Bob Greenstein, who suggests "extending unemployment benefits when they are set to expire later on in the fall, given the still-challenging labor market and the the fact that these extensions have often occurred during past recessions."
  • Proof of Bush's 'Economic Debacle," says Justin Fox at Time. "I don't know how much of this was bad luck and how much was bad policy (nobody does), but there's really no getting around the fact that the Bush presidency was an economic debacle. Americans got poorer on his watch. The last time that happened was, well, during his father's presidency. But that one only lasted four years, so it was different."
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