1 in 7 in US live Poverty (including me)

[Broomstick]

From the the BBC

Number of Americans living in poverty 'increases by 4m'
One in seven Americans was living in poverty in 2009 with the level of working-age poor the highest since the 1960s, the US Census Bureau says.

The number of people in poverty increased by nearly 4m - to 43.6m - between 2008 and 2009, officials said.

The bureau defines poverty as any family of four living on less than $21,954 a year.

Meanwhile, new figures showed home foreclosures in August hit the highest level since the mortgage crisis began.

Last year we saw the depths of the recession, including historic losses in employment not witnessed since the Great Depression”

Banks repossessed 95,364 properties in August, up 3% from July and an increase of 25% from August 2009, said RealtyTrac, a company which charts the national picture.

The official US poverty rate in 2009 rose to 14.3% from 13.2% in 2008. In 2009, 43.6 million Americans lived in poverty, up from 39.8 million the year before, the third consecutive increase, the bureau said.

The poverty figure is not a relative measure as many in Europe are, but looks simply at the amount of money going into a household.

The BBC's North America editor Mark Mardell says that in many ways the foreclosure figures will be more disturbing to Americans, as it was hardly surprising that poverty was rising last year while the economic crisis continued to bite.

The bureau's report - Income, Poverty, and Health Insurance Coverage in the US: 2009 - covers President Barack Obama's first year in office.

It indicates Americans of Asian origin are the richest, while black people are the poorest.

In a statement, Mr Obama said the report "illustrates just how tough 2009 was".

"Our economy plunged into recession almost three years ago on the heels of a financial meltdown and a rapid decline in housing prices. Last year we saw the depths of the recession, including historic losses in employment not witnessed since the Great Depression," he said.

The number of people in poverty in 2009 was the largest in the 51 years for which the US government has been publishing estimates.

The figures show a sharp rise in poverty since the beginning of the US recession in December 2007.

Among the working-age population, ages 18 to 65, poverty rose from 11.7% to 12.9%, the highest level since the 1960s.

Meanwhile, the number of Americans without health insurance increased by 4.4m from 2008 to 2009, the Census Bureau said.

The share of Americans without health coverage rose from 15.4% to 16.7% - or 50.7 million people - mostly because of the loss of employer-provided schemes during the recession.

The insurance figures cover the year before the Democrats passed a major overhaul of the US health care system, the main provisions of which come into effect in 2014.

The economy has emerged as the key issue in the November mid-term elections, with Republicans attacking Mr Obama and the Democrats' stewardship, and the Democrats defending their record amid the slow recovery.

It is perhaps depressing that in the world's richest country the proportion of people living in poverty has risen for the third year running, and that it is the biggest jump since 1994.

But it is hardly surprising that President Obama's first year in office saw the economic crisis still biting hard.

He has issued a statement claiming if it hadn't been for his action millions more would have suffered the same fate.

What is more worrying is those other figures showing more homes were repossessed last month than in any since the crisis began.

That suggests any recovery is very fragile and for many it won't feel as if the economy is improving at all.

Taken together it's a reminder for many individuals that this is still a very difficult and painful time.

This is not just piety - economic recovery is about confidence and many don't feel very confident right now.

A couple of observations from the front lines:

I don't have it particularly bad. Life is hard, but I do, in fact, have health insurance. I do have some employment. I have a place to live and enough food to eat. A lot of those folks living in poverty are worse off than I am. That still doesn't alter brutal facts like I've needed new glasses for about a year now and I am struggling to get enough funds to get an eye exam and a new pair. The little indignities of poverty and all that. But enough about me.

We don't see the "soviet style bread lines" predicted by the Duchess because of the food stamp program - most hungry people are issued cards which allow them to purchase what they need at normal stores. Thus, the poor blend in with the middle class and remain unseen. Those who are poor try to hide how they pay, and those who are not poor have no clue how many of their neighbors now depend on such benefits (along with things like food pantries) in order to eat. Problem hidden.

I did see a talking head on TV saying that this "proves" anti-poverty programs don't work and we should abolish all forms of welfare entirely. I don't know what the hell he expects to happen if that is done.

Everyone else agrees that the core of the problem is jobs, jobs, and jobs. There is simply not enough work for people who can and want to work. Until we get more jobs that allow at least a livable wage (that translates to the upper levels of poverty) this will not end.

Where do all the people go who have lost their homes? Sure, some move in with family, but not all of them. Where are they? Where do they sleep at night? Homeless shelters have not increased in capacity since all this started, and were already close to full. Where are the homeless?

It is going to be a long, hard winter.

[Broomstick]

From The New York Times

Poverty Rate Rose Sharply in 2009, Says Census Bureau
By ERIK ECKHOLM
Published: September 16, 2010

The percentage of Americans struggling below the poverty line in 2009 was the highest it has been in 15 years, the Census Bureau reported Thursday, and interviews with poverty experts and aid groups said the increase appeared to be continuing this year.

As the country fights its way out of the worst economic crisis since the Great Depression, four million additional Americans found themselves in poverty in 2009, with the total reaching 44 million, or one in seven residents. Millions more were getting by only because of expanded unemployment and other assistance.

And the numbers could have climbed higher: One way embattled Americans have gotten by is sharing homes with siblings, parents or even nonrelatives, sometimes resulting in overused couches and frayed nerves but holding down the rise in the national poverty rate, according to the report.

Um... let's get real here - this isn't "holding down the poverty rate", it's reducing the number of people sleeping sidewalks and going to bed actually hungry. They're still poor.

The share of residents in poverty climbed to 14.3 percent in 2009, the highest level recorded since 1994. The rise was steepest for children, with one in five affected, the bureau said.

The report provides the most detailed picture yet of the impact of the recession and unemployment on incomes, especially at the bottom of the scale. It also indicated that the temporary increases in aid provided in last year’s stimulus bill eased the burdens on millions of families.

For a single adult in 2009, the poverty line was $10,830 in pretax cash income; for a family of four, $22,050.

Just for the record - my Other Half and I got by last year on all of $7,000. For BOTH of us. The amounts quoted are the TOP of the poverty line, not the bottom. Keep in mind, too, that we are not homeless and we do managed to scrape together the basics of life (with some help from family and friends as well as government assistance)

Given the depth of the recession, some economists had expected an even larger jump in the poor. “A lot of people would have been worse off if they didn’t have someone to move in with,” said Timothy M. Smeeding, director of the Institute for Research on Poverty at the University of Wisconsin.

Dr. Smeeding said that in a typical case, a struggling family, like a mother and children who would be in poverty on their own, stays with more prosperous parents or other relatives.

The Census study found an 11.6 percent increase in the number of such multifamily households over the last two years. Included in that number was James Davis, 22, of Chicago, who lost his job as a package handler for Fed Ex in February 2009. As he ran out of money, he and his 2-year-old daughter moved in with his mother about a year ago, avoiding destitution while he searched for work.

“I couldn’t afford rent,” he said.

Danise Sanders, 31, and her three children have been sleeping in the living room of her mother and sister’s one-bedroom apartment in San Pablo, Calif., for the last month, with no end in sight. They doubled up after the bank foreclosed on her landlord, forcing her to move. "It’s getting harder,” said Ms. Sanders, a mail clerk. “We’re all pitching in for rent and bills.”

Well, I guess that explains the lack of people sleeping on the sidewalk....

There are strong signs that the high poverty numbers have continued into 2010 and are probably still rising, some experts said, as the recovery sputters and unemployment remains near 10 percent.

“Historically, it takes time for poverty to recover after unemployment starts to go down,” said LaDonna Pavetti, a welfare expert at the Center on Budget and Policy Priorities, a liberal-leaning research group in Washington.

Dr. Smeeding said it seemed almost certain that poverty would further rise this year. He noted that the increase in unemployment and poverty had been concentrated among young adults without college educations and their children, and that these people remained at the end of the line in their search for work.

One indirect sign of continuing hardship is the rise in food stamp recipients, who now include nearly one in seven adults and an even greater share of the nation’s children. While other factors as well as declining incomes have driven the rise, by mid-2010 the number of recipients had reached 41.3 million, compared with 39 million at the beginning of the year.

Food banks, too, report swelling demand. “We’re seeing more younger people coming in that not only don’t have any food, but nowhere to stay,” said Marla Goodwin, director of Jeremiah’s Food Pantry in East St. Louis, Ill. The pantry was open one day a month when it opened in 2008 but expanded this year to five days a month.

And Texas food banks said they distributed 14 percent more food in the second quarter of 2010 than in the same period last year.

The Census report showed increases in poverty for whites, blacks and Hispanic Americans, with historic disparities continuing. The poverty rate for non-Hispanic whites was 9.4 percent, for blacks 25.8 percent and for Hispanics 25.3 percent. The rate for Asians was unchanged at 12.5 percent.

The median income of all households stayed roughly the same from 2008 to 2009. It had fallen sharply the year before, as the recession gained steam and remains well below the levels of the late 1990s — a sign of the stagnating prospects for the middle class.

The decline in incomes in 2008 had been greater than expected, and when the two recession years are considered together, the decline since 2007 was 4.2 percent, said Lawrence Katz, an economist at Harvard. Gains achieved earlier in the decade were wiped out, and median family incomes in 2009 were 5 percent lower than in 1999.

“This is the first time in memory that an entire decade has produced essentially no economic growth for the typical American household,” Mr. Katz said.

The number of United States residents without health insurance climbed to 51 million in 2009, from 46 million in 2008, the Census said. Their ranks are expected to shrink in coming years as the health care overhaul adopted by Congress in March begins to take effect.

Government benefits like food stamps and tax credits are not included in calculating family incomes. But rises in the cost of housing and regional differences in the cost of living are not taken into account either.

If food-stamp benefits and low-income tax credits were included as income, close to 8 million of those labeled as poor in the report would instead be just above the poverty line, the Census report estimated. Unemployment benefits, which are included in the calculations, helped keep 3 million families above the line last year, the report said.

The poverty line is a flawed measure, experts agree, but it remains the best consistent long-term gauge of need available, and its ups and downs reflect genuine trends.

The federal government will issue an alternate calculation next year that will include important noncash and after-tax income and also account for regional differences in the cost of living. But it will continue to calculate the rate in the old way as well, in part because eligibility for many programs, from Medicaid to free school lunches, is linked to the longstanding poverty line.

[J]

A quick snapshot of the depression:

Linky

15 Shocking Poverty Statistics That Are Skyrocketing As The American Middle Class Continues To Be Slowly Wiped Out

1. Approximately 45 million Americans were living in poverty in 2009.
2. According to the Associated Press, experts believe that 2009 saw the largest single year increase in the U.S. poverty rate since the U.S. government began calculating poverty figures back in 1959.
3. The U.S. poverty rate is now the third worst among the developed nations tracked by the Organization for Economic Cooperation and Development.
4. According to the U.S. Department of Agriculture, on a year-over-year basis, household participation in the food stamp program has increased 20.28%.
5. The number of Americans on food stamps surpassed 41 million for the first time ever in June.
6. As of June, the number of Americans on food stamps had set a new all-time record for 19 consecutive months.
7. One out of every six Americans is now being served by at least one government anti-poverty program.
8. More than 50 million Americans are now on Medicaid, the U.S. government health care program designed principally to help the poor.
9. One out of every seven mortgages in the United States was either delinquent or in foreclosure during the first quarter of 2010.
10. Nearly 10 million Americans now receive unemployment insurance, which is almost four times as many as were receiving it in 2007.
11. The number of Americans receiving long-term unemployment benefits has risen over 60 percent in just the past year.
12. According to one recent survey, 28% of all U.S. households have at least one member that is looking for a full-time job.
13. Nationwide, bankruptcy filings rose 20 percent in the 12 month period ending June 30th.
14. More than 25 percent of all Americans now have a credit score below 599.
15. One out of every five children in the United States is now living in poverty.

By any rational measure this is a DEPRESSION.

[Broomstick]

Yeah, I knew that two years ago - why did it take so long for everyone else to realize it?

[J]

Denial, ignorance, apathy, endless media cheerleading & propaganda, fudged government statistics, among other things.

Even now most people believe it's merely a recession and things aren't going to become any (or much) worse from here. Anyone using the forbidden "D" word is labeled as a doomer or nutjob. Then again, the same thing happened back in 1930 and we all know how that one turned out.

[Marcus Aurelius]

Even now most people believe it's merely a recession and things aren't going to become any (or much) worse from here. Anyone using the forbidden "D" word is labeled as a doomer or nutjob. Then again, the same thing happened back in 1930 and we all know how that one turned out.

Quite obviously America needs a big war and preferably sooner than later, so that the repeat of the 1930s could be avoided. But which country could step up to the plate? Iran is not big and strong enough. China is too big with a gargantuan population and nukes. Russia doesn't look like much of a threat, has too many nukes, and too big landmass. India might do, since it has less nukes than China and it's somewhat smaller, but unfortunately is currently needed as a friend rather than enemy.

The solution: I think it's time for Thanas to set the SatNav destination to Warsaw again!

[PeZook]

The solution: I think it's time for Thanas to set the SatNav destination to Warsaw again!

Good luck convincing him ; Relations with Germany are great and we're too happy doing business to fight (for once)

More on topic, I found it interesting to note some people in America are seriously proposing slashing social spending as a measure to solve the problem ; Anybody who tried that here in Europe would be laughed out of parliament - let's face it, it's so patently obvious the problem would only get worse you have to be stuck in Bizarro World to seriously propose such insane measures.

[wautd]

On the bright side, the rich got even richer during the crisis.

[atg]

Good luck convincing him ; Relations with Germany are great and we're too happy doing business to fight (for once)

Wasn't France Germany's biggest trading parter before both World Wars?

[Murazor]

More on topic, I found it interesting to note some people in America are seriously proposing slashing social spending as a measure to solve the problem ; Anybody who tried that here in Europe would be laughed out of parliament

You talking about central/northern Europe, I take it?

Because in the last couple of years, the Spanish government has slashed a whole bunch of things and left Caritas -the Catholic Church charity organization- to deal with the vacuum, along with town governments (anecdotal stuff: the local homeless hostel in my home town used to be funded in thirds by the town government, the regional government and Caritas. As of last year, the regional gov has withdrawn the money because of the crisis and has no plans to help anytime soon). Spain has mostly withstood the social effects of the crisis thanks to the extended family level solidarity that is commonplace over here and relies very heavily in the small income of the grandfathers. Dunno how long this is going to last.

Despite this rather alarming stuff, the government (socialist government, for added insult) still plans to cut some more stuff and says that a tax rise to the richest parts of the population isn't the way to go. And they talk about our fiscal pressure being lower than Europe's as if that was inherently a good thing.

Since I hear the same kind of rumblings from Berlusconi's Italy and Greece, I think that there is more consumption of neo-liberal cool-aid in this continent that you seem to believe.

[PeZook]

Yeah, I meant Eastern Europe. I try to avoid generalizing things from Poland to the entirety of the continent for reasons that should be entirely obvious

Our government has been raising taxes and trying to reform the administration instead of slashing the (already inadequate) social spending. Of course, they're getting shit about that, too.

HOLY CRAP 1% INCREASE IN VAT AND A 2% CAPITAL GAINS TAX FOR BANKS! THEFT!!!

It says something about attitudes in a country where a government is less afraid of raising taxes than cutting social spending

[Hillary]

The UK government is slashing social spend too. Funnily enough, the media seems a little more supportive of initiatives to cut disability allowances and stop benefit cheats than it is of initiatives to make richer people pay more and hammer those who avoid tax by moving abroad.

This has nothing whatsoever to do with the wealth and offshore tax status of those who own and edit the majority of the press in this country, of course.

We're edging ever closer to a serious showdown between unions and government and a bloody winter is in sight.

[aerius]

Quite obviously America needs a big war and preferably sooner than later, so that the repeat of the 1930s could be avoided. But which country could step up to the plate? Iran is not big and strong enough. China is too big with a gargantuan population and nukes. Russia doesn't look like much of a threat, has too many nukes, and too big landmass. India might do, since it has less nukes than China and it's somewhat smaller, but unfortunately is currently needed as a friend rather than enemy.

The solution: I think it's time for Thanas to set the SatNav destination to Warsaw again!

Actually the best course of action would be to nuke China and India, it destroys a huge chunk of the world's manufacturing and labour base and puts an instant stop to manufacturing and labour outsourcing, and it also erases a $2 trillion+ T-bill problem at the same time. If the US loses a few cities in the exchange it's just a bonus, it now has a massive infrastructure rebuilding project which can keep millions of people employed for the next few decades. All the outsourced jobs come back home, massive infrastructure jobs projects, how can you go wrong?

[Liberty]

What is the technical definition of a depression as opposed to a recession? Because in the Great Depression, unemployment almost reached 25%; at the moment, I think we're holding stead about 10%. Not that that's just bad, I guess I'm just saying it could be a lot worse, and in the Great Depression it was.

Also, this whole thing is kind of surreal to me, probably because I don't feel all that affected. Surlethe and I each have 5 year guaranteed grad school stipends (with fee waivers, etc), and combined that'll be enough for us to live on and put some in savings over the next five years (if we're careful). Granted, it's not a whole lot, and we'll be putting in long hours, and we'll have to be quite frugal, but it's not like I'm wondering where next month's food money is coming from. Also, none of my immediate relatives have lost a job. Heck, I don't think ANY of my relatives have lost a job! Our college friends who graduated college a year or two ago all either have jobs or are in grad school. Maybe I'm just lucky.

I've heard it said that a recession is when your neighbor loses his job, and a depression is when YOU lose your job. I guess I haven't felt either. And it kind of makes me feel bad!

Now what DOES effect me is super low interest rates - what's the point of saving?!

[Broomstick]

What is the technical definition of a depression as opposed to a recession? Because in the Great Depression, unemployment almost reached 25%; at the moment, I think we're holding stead about 10%.

No, unemployment is NOT 10%. The government cooks the numbers and leaves out large numbers of people who should be counted in that particular figure.

The usually quoted number the "official" unemployment rate is the U3 number on this chart But if you read the definitions for all the U numbers you'll realize that that does not give the full picture. A more accurate (in my opinion) measure of the un/underemployment situation is the U6 number - which currently stands at 16.5 %. Not as bad as the worst of the Great Depression, but still significantly worse than it's been at any other time since then.

Our state (Indiana) currently has an official unemployment rate of 10.1% - our U6 is, of course, higher. But the effect is patchy. One town could still be doing quite well and another could have 30% unemployment. So if you are doing fine, that's great - but the suffering is still out there.

[aerius]

What is the technical definition of a depression as opposed to a recession? Because in the Great Depression, unemployment almost reached 25%; at the moment, I think we're holding stead about 10%. Not that that's just bad, I guess I'm just saying it could be a lot worse, and in the Great Depression it was.

The generally accepted definition among economists is a 10% drop in GDP in around a year or so. We of course don't have that, but we would if we subtracted out all the excess government borrowing and deficit spending. See chart on this page.

My wife & I don't go by the economist definition because it's too simplistic, we look at the U6 numbers for unemployment (currently around 17%), weekly layoff numbers, consumer spending, producer price index & inventories, hourly pay, and various other measures. We believe they're far more accurate measures of the health of the economy.

The U6 number by the way is a lot closer to what we used to measure unemployment during the Depression. Back then it was
"do you have a job?"
"no"
"do you want a job?"
"yes"
"You're unemployed"
U6 comes closest to that.

[Cecelia5578]

I have long term unemployed friends, and it pisses me off that, just because of that, companies will automatically disregard their applications.

A part of it is that it helps filter out the large number of resumes businesses get in a shitty job market, but there really is an assumption that the long term unemployed are terminally lazy or have something dreadfully defective about them.

[Kanastrous]

Some professional skills have limited shelf-life; wind up outside the work environment for long enough and you can start to miss out on practicing your skills, keeping up on new tools and techniques and maintaining your professional competitiveness.

If someone handed me a decent resume I wouldn't automatically shitcan it just based upon the last-worked date, but if that date lies far enough in the past I'll need some convincing that the person handing me the resume is near the top of their game as compared to someone who just wrapped a project and is looking for the next one.

[Liberty]

Our state (Indiana) currently has an official unemployment rate of 10.1% - our U6 is, of course, higher. But the effect is patchy. One town could still be doing quite well and another could have 30% unemployment. So if you are doing fine, that's great - but the suffering is still out there.

Oh I know the suffering is out there! That's why I said I feel bad - because I feel like we're doing fine, but so many others are suffering.

I'm currently living in an Indiana town that's weathering the recession fairly well, but before that, I lived in a decaying rustbelt town that it currently imploding under the influence of the recession.

[phongn]

The U6 number by the way is a lot closer to what we used to measure unemployment during the Depression. Back then it was
"do you have a job?"
"no"
"do you want a job?"
"yes"
"You're unemployed"
U6 comes closest to that.

Wouldn't that be closest to the U5 number?

[JME2]

On the bright side, the rich got even richer during the crisis.

Is anyone really surprised these guys are still trying to work the system even after the part they've played in this clusterfuck?

[aerius]

Wouldn't that be closest to the U5 number?

If you go strictly by the definitions, then yes. However the way they do it these days leaves out farm workers and anyone under 16, plus there's other adjustments they do to the numbers which leaves out people who should be counted but aren't. Once you account for the differences in survey methods & so forth the U6 number of today is the best match for the unemployment numbers of the Great Depression.

[Temujin]

I did see a talking head on TV saying that this "proves" anti-poverty programs don't work and we should abolish all forms of welfare entirely. I don't know what the hell he expects to happen if that is done.

The problem is he doesn't care. The wanking Invisible Hand will solve everything. Of course when confronted with "What happens to these people until then?", you get "Sucks to be them" or "that's the dark side of capitalism." I hear that a lot at work, which is one of the reasons I get so extra bitter about it.

Yeah, I knew that two years ago - why did it take so long for everyone else to realize it?

Growing up in Northeast Ohio and witnessing the shit pulled under Reagan had me confident that it was only a matter of time years ago. Unfortunately for me I was finally getting to a point where I could actually get ahead and live decently and save money when all this shit hit.

[Simon_Jester]

On the bright side, the rich got even richer during the crisis.

Is anyone really surprised these guys are still trying to work the system even after the part they've played in this clusterfuck?

If they weren't professional system-workers, they wouldn't be rich. It's in their nature to try and manipulate the system to their advantage in search of new chinks in civilization's defenses to exploit.

[Surlethe]

I don't have it particularly bad. Life is hard, but I do, in fact, have health insurance. I do have some employment. I have a place to live and enough food to eat. A lot of those folks living in poverty are worse off than I am. That still doesn't alter brutal facts like I've needed new glasses for about a year now and I am struggling to get enough funds to get an eye exam and a new pair. The little indignities of poverty and all that. But enough about me.

Check out Zenni Optical (http://www.zennioptical.com/home.php). We just got new glasses from them for pretty awesome prices.

Everyone else agrees that the core of the problem is jobs, jobs, and jobs. There is simply not enough work for people who can and want to work. Until we get more jobs that allow at least a livable wage (that translates to the upper levels of poverty) this will not end.

The real kicker is that in this sort of economic situation, for the market to clear, wages have to keep falling. When people are losing wealth in the housing bust, losing their homes, and the job market is so dismal that people just leave it (because firms are so uncertain about future demand that they are still laying off workers and putting off hiring new ones), it takes a long time for people to adjust to lower wages and firms to start investing and growing again. The fact that this all comes in the middle of a major international industrial transition (US unskilled manufacturing labor is significantly overvalued), which means lots of people on the market and already on the market --- we see this in Indiana all the time --- are living a lifestyle unsuited to a major wage decrease, or became unemployed and aren't willing to take low wages (thus contributing to U6 or U5, perhaps, but not more restrictive unemployment), or just aren't worth anything to firms, just adds to the magnitude of the adjustment that has to happen before the economy can inhale and start to grow robustly again.

This is a huge transition in the private markets. It will last for quite a while.