Census data: Half of U.S. poor or low income
The St. Columbanus Church food pantry in Chicago feeds 500 households a week, but some weeks it struggles to keep up with demand. / CBS
WASHINGTON - Squeezed by rising living costs, a record number of Americans — nearly 1 in 2 — have fallen into poverty or are scraping by on earnings that classify them as low income.
The latest census data depict a middle class that's shrinking as unemployment stays high and the government's safety net frays. The new numbers follow years of stagnating wages for the middle class that have hurt millions of workers and families.
"Safety net programs such as food stamps and tax credits kept poverty from rising even higher in 2010, but for many low-income families with work-related and medical expenses, they are considered too `rich' to qualify," said Sheldon Danziger, a University of Michigan public policy professor who specializes in poverty.
"The reality is that prospects for the poor and the near poor are dismal," he said. "If Congress and the states make further cuts, we can expect the number of poor and low-income families to rise for the next several years."
Video: New data shows poverty at an all-time high
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Congressional Republicans and Democrats are sparring over legislation that would renew a Social Security payroll tax cut, part of a year-end political showdown over economic priorities that could also trim unemployment benefits, freeze federal pay and reduce entitlement spending.
Robert Rector, a senior research fellow at the conservative Heritage Foundation, questioned whether some people classified as poor or low-income actually suffer material hardship. He said that while safety-net programs have helped many Americans, they have gone too far, citing poor people who live in decent-size homes, drive cars and own wide-screen TVs.
"There's no doubt the recession has thrown a lot of people out of work and incomes have fallen," Rector said. "As we come out of recession, it will be important that these programs promote self-sufficiency rather than dependence and encourage people to look for work."
CBS News correspondent Byron Pitts told the story in November of the Struble family. They are college educated, career-holding members of America's vast middle class. They had a combined annual income of $85,000. But in November of 2009, Todd lost his job, and hasn't had a steady paycheck since. They now have only an estimated $25 in their savings account, perhaps another $100 in their checking. Click on the player at left to see the full story of America's middle class in decline.Mayors in 29 cities say more than 1 in 4 people needing emergency food assistance did not receive it. Many middle-class Americans are dropping below the low-income threshold — roughly $45,000 for a family of four — because of pay cuts, a forced reduction of work hours or a spouse losing a job. Housing and child-care costs are consuming up to half of a family's income.
States in the South and West had the highest shares of low-income families, including Arizona, New Mexico and South Carolina, which have scaled back or eliminated aid programs for the needy. By raw numbers, such families were most numerous in California and Texas, each with more than 1 million.
The struggling Americans include Zenobia Bechtol, 18, in Austin, Texas, who earns minimum wage as a part-time pizza delivery driver. Bechtol and her 7-month-old baby were recently evicted from their bedbug-infested apartment after her boyfriend, an electrician, lost his job in the sluggish economy.
After an 18-month job search, Bechtol's boyfriend now works as a waiter and the family of three is temporarily living with her mother.
"We're paying my mom $200 a month for rent, and after diapers and formula and gas for work, we barely have enough money to spend," said Bechtol, a high school graduate who wants to go to college. "If it weren't for food stamps and other government money for families who need help, we wouldn't have been able to survive."
Since the housing bubble burst, nearly 4 million American homes have been lost to foreclosure. An estimated 1.6 million children will be homeless at some time during the year - 38 percent more than at the start of the recession. As CBS News correspondent Ben Tracy explains, unemployment has driven some families to the southern California desert, where a barren old WWII training ground in the desert has become a place for many to park their troubled lives. Click on the player at left for the full story of "Slab City".
About 97.3 million Americans fall into a low-income category, commonly defined as those earning between 100 and 199 percent of the poverty level, based on a new supplemental measure by the Census Bureau that is designed to provide a fuller picture of poverty. Together with the 49.1 million who fall below the poverty line and are counted as poor, they number 146.4 million, or 48 percent of the U.S. population. That's up by 4 million from 2009, the earliest numbers for the newly developed poverty measure.
The new measure of poverty takes into account medical, commuting and other living costs. Doing that helped push the number of people below 200 percent of the poverty level up from 104 million, or 1 in 3 Americans, that was officially reported in September.
Broken down by age, children were most likely to be poor or low-income — about 57 percent — followed by seniors over 65. By race and ethnicity, Hispanics topped the list at 73 percent, followed by blacks, Asians and non-Hispanic whites.
Even by traditional measures, many working families are hurting.
Following the recession that began in late 2007, the share of working families who are low income has risen for three straight years to 31.2 percent, or 10.2 million. That proportion is the highest in at least a decade, up from 27 percent in 2002, according to a new analysis by the Working Poor Families Project and the Population Reference Bureau, a nonprofit research group based in Washington.
Among low-income families, about one-third were considered poor while the remainder — 6.9 million — earned income just above the poverty line. Many states phase out eligibility for food stamps, Medicaid, tax credit and other government aid programs for low-income Americans as they approach 200 percent of the poverty level.
The majority of low-income families — 62 percent — spent more than one-third of their earnings on housing, surpassing a common guideline for what is considered affordable. By some census surveys, child-care costs consume close to another one-fifth.
Paychecks for low-income families are shrinking. The inflation-adjusted average earnings for the bottom 20 percent of families have fallen from $16,788 in 1979 to just under $15,000, and earnings for the next 20 percent have remained flat at $37,000. In contrast, higher-income brackets had significant wage growth since 1979, with earnings for the top 5 percent of families climbing 64 percent to more than $313,000.
A survey of 29 cities conducted by the U.S. Conference of Mayors being released Thursday points to a gloomy outlook for those on the lower end of the income scale.
Many mayors cited the challenges of meeting increased demands for food assistance, expressing particular concern about possible cuts to federal programs such as food stamps and WIC, which assists low-income pregnant women and mothers. Unemployment led the list of causes of hunger in cities, followed by poverty, low wages and high housing costs.
Across the 29 cities, about 27 percent of people needing emergency food aid did not receive it. Kansas City, Mo., Nashville, Tenn., Sacramento, Calif., and Trenton, N.J., were among the cities that pointed to increases in the cost of food and declining food donations, while Mayor Michael McGinn in Seattle cited an unexpected spike in food requests from immigrants and refugees, particularly from Somalia, Burma and Bhutan.
Among those requesting emergency food assistance, 51 percent were in families, 26 percent were employed, 19 percent were elderly and 11 percent were homeless.
"People who never thought they would need food are in need of help," said Mayor Sly James of Kansas City, Mo., who co-chairs a mayors' task force on hunger and homelessness.
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http://www.lowincomecable.com
Search in you tube: "Father Nathan Monk at Pensacola City Council"
It's not taxes or regulation that's strangling smaller businesses. It's that their customers have no money to spend. And it's clear that the 1% likes it that way and will keep it that way. Big businesses have found ways to become even more profitable by firing more workers and either replacing them with foreign workers at slave labor wages or not replacing them at all, and squeezing more work out of the terrified work force that remains.
A consumer economy run by institutions, financial and business, that refuse to create more jobs in sufficient numbers to sustain the labor force is doomed. That's exactly where we are. No jobs, no prospects, no future. And Paul Ryan's deficit-reduction budget is based on cutting social services, not military spending or subsidies for the rich or corporate welfare. Out of $4 trillion in cuts, more than $3 trillion will come from services to the poor and near poor. Virtually no cuts will be made in subsidies and services to the wealthy.
At this rate, we'll be seeing shanty towns and people feeding themselves from dumpsters, which is already happening but not nearly on the scale that we'll see in a decade. And the world will wonder what happened to America, the economic engine of the world. China and India will thrive while all but the richest Americans will barely survive. As long as we continue to believe in voodoo economics and scapegoat its victims, America has no future. And the more Republicans we elect, the faster the end will come.
Mr. Struble should be getting unemployment and he's able bodied and college-educated. Keep getting any work you can, Mr. Struble. And Mrs. Struble should be earning more as a full-time teacher. Get a full-time job, Mrs. Struble, instead of being a substitute. Give your kids duties at home so you can get a better job. Do tutoring to make extra money. Clean houses. Put ads in church bulletins and on the internet to get this work. We did this to get back on our feet, and you can, too.
The best lesson you can teach your kids is how to face adversity and be self-sufficient. Show them how to work hard and cobble together as much work as you can. Quit complaining and change your attitude, for your children's sake. If you have to sell your house, do it, and rent a small place. Join a church so you can network with folks who will help you. This ALWAYS works. Show your kids how to be a team and pull together. If you've tried all this, try again, and show them how much you love them by getting up and at 'em.
You go, Strubles. You can do this. It's your responsibility, not the government's. Bless you all and let prayer and confidence be your gifts this Christmas.
Is it possible that this survey shows that 30 years of Reaganomics has hurt the USA? That "trickle-down" voodoo economics is a sham perpetrated by the rich for the rich?
That's exactly what it shows, and how bad it's been for America.
According to the architect of "supply-side economics" (SSE), Bruce Bartlett, in his book 'The New American Economy,' in which he states "supply-side economics should declare victory and then go out of existence."
Bartlett continues:
"During the George W. Bush years, however, I think SSE became distorted into something that is, frankly, nuts -- the ideas that there is no economic problem that cannot be cured with more and bigger tax cuts, that all tax cuts are equally beneficial, and that all tax cuts raise revenue."
"These incorrect ideas led to the enactment of many tax cuts that had no meaningful effect on economic performance. Many were just give-aways to favored Republican constituencies, little different, substantively, from government spending. What, after all, is the difference between a direct spending program and a refundable tax credit?"
"The supply-siders are to a large extent responsible for this mess, myself included. We opened Pandora's Box when we got the Republican Party to abandon the balanced budget as its signature economic policy and adopt tax cuts as its raison d'etre. In particular, the idea that tax cuts will 'starve the beast' and automatically shrink the size of government is extremely pernicious."
http://capitalgainsandgames.com/blog/bruce-bartlett/1168/supply-side-economics-rip
"Military benefits are a constitutional benefit."
Sorry dan, but that's a lie. It's not in our constitution at all, no more than benefits for any other government worker like you were!
Try again......GO FISH!
"You are stupid to think the feds can manage your health care (MC) and retirement funds. (SS)"
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USA_is_back:
But drunk dan, doesn't the "feds" manage YOUR tax payer subsidized medical insurance and YOUR tax payer subsidized retirement? Are you saying YOU are stupid ?
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I think dan is too drunk to understand his utter hypocrisy, since his hand is out for his own entitlements, but everyone else be damned in his crazy world.
Of course the government is managing both his taxpayer subsidized retirement and his socialized health care, which he didn't pay one red cent for, yet is adamant about keeping it while taking away Social Security and Medicare for everyone else!
HYPOCRITE dan is a JOKE!
drunk dan says "Socialism does not work!!". What he meant is Socialism works as long as he is the recipient. He wants his Socialist government handouts. He just doesn't think anyone else should get a piece of his socialist pie.
Absolutely correct!
And if it was up to the far-right, hard-core republicans like dan, the middle class would be extinct within 10 years, and the Greedy One Percent would have almost 100% of the pie!