In the United States, poverty is measured by annual income. The poverty line is based on a calculation that takes into consideration the minimum costs to feed an individual, child and adult not differentiated, multiplied by three. The following gives an overview of the demographics of poverty and how these demographics have changed since 1979. It considers trends that have emerged over the last few decades and reconsiders the successes and failures of past public policy.
Keywords Feminization of Poverty; Mass Imprisonment; Poverty Line; Silent Generation; Wage Gap; War on Poverty; Working Poor
The Demographics of Poverty
In the United States, poverty is measured by annual income. The poverty line is based on a calculation that takes into consideration the minimum costs required to feed an individual, child and adult not differentiated, multiplied by three. The calculation was designed by Mollie Orshansky, a Social Security Administration employee, in 1963. Despite recommendations from researchers and the Panel on Poverty and Family Assistance, a early 1990s government panel that studied the issue for two and a half years, the calculation for of the American poverty line has remained unchanged and in the opinion of many experts greatly misstated. This paper explores the demographics of poverty in a two-fold manner. First it breaks down the demographics based on the official calculation and second suggests how much further poverty may reach in certain categories based on available data; various methodologies used in measuring statistics around the issue of poverty, income, and work; and the suggestions by the Panel on Poverty and Family Assistance.
The War on Poverty
President Lyndon Johnson first addressed the War on Poverty in his 1964 State of the Union Address. Johnson called for a "nationwide war on the sources of poverty." The program included programs such as Head Start, School Breakfast program, Minimum Wage Bill, Job Corps, and the College Work Program. These programs were passed as part of Johnson's Great Society plan, which included the Civil Rights Act of 1965 and Voting Rights Act of 1965. Taken as a whole, the Great Society was to benefit many Americans, but its focus was on the civil rights and economic hardships of African Americans. In 1980 President Ronald Reagan was elected and started the process of dismantling the institutions that were erected by Johnson to support the poor. In 1981 the Omnibus Budget Reconciliation Act was passed, which cut eligibility for welfare programs, cut benefit levels, and allowed states to cut off benefits if new state work regulations were not met. The plan cut many benefits to the lowest wage earners, but left most of the middle class initiatives, such as the College Work Program, intact. The idea behind the initiatives was to keep the poorest welfare recipients from becoming entrenched in or dependent upon welfare programs. Research shows that it may have had the opposite effect (Englander & Jane, 1992). In his 1988 State of the Union Address, Reagan said, "My friends, some years ago, the Federal Government declared war on poverty, and poverty won." From 1963 to 1979 the official poverty rate dropped from 19 percent of the population to 11.7 percent. The number of Americans officially considered poor dropped from thirty-six million to twenty-six million. In 2012, however, nearly 16 percent of Americans were living at or below the poverty line (less than $23,000 a year for a family of four), the highest poverty rate since President Johnson had declared the War on Poverty in 1964.
The demographics of poverty continue to evolve. Changes and trends can been recognized in measurements of race, gender, and age.
The Poverty Line Calculation
"Mollie's measurement" is straightforward and may have served as a functional measurement in the 1960s. However, the formula has become flawed over time. In 1963, it was assumed that the cost of food made up one in every three dollars in an individual's budget. That figure has dropped to one in nine dollars (US Department of Labor, 2006). This might lead to the assumption that the poverty line is too high. However, the calculation also does not take into account the increase of mothers in the workforce since 1963 and the associated increase in daycare expenses, increases in the costs of health care, and rapid acceleration of housing costs (Citro, Michael, et al, 1995). This calculation and the Panel on Poverty and Family Assistance also do not take into account the breathtaking rise in oil prices since 2000. The 2013 government calculation for a family of four was $23,550. Based on that figure, more than forty-seven million Americans were considered to be living in Poverty in 2013. Based on various recommendations by the Panel on Poverty and Family Assistance that figure could go up one to four points (Pear, 1995). Each percentage point represents approximately three million people. According to the US Census Bureau’s unofficial supplemental poverty measure—which accounts for the value of government benefits, the varying costs of living in different regions, and the cost of health care in addition to income and food costs—fifty million Americans were considered to be poor in 2013.
In 1979, roughly 22 percent of Latino Americans lived below the poverty line. In 2011 that percentage remained approximately the same, at 23 percent. However, the Latino population had grown more than three and a half times during that period and the number of Latino Americans living beneath the official poverty line grew from 2.9 million in 1979 to 9.2 million in 2006 (DeNavas-Walt, Proctor, & Smith 2007). Approximately one out of every five Latino Americans lived in poverty. According to data from the US Census Bureau from 2007 to 2011, among Hispanic Americans, poverty rates ranged from a low of 16.2 percent for Cuban Americans to a high of 26.3 percent for Dominican Americans (Macartney, Bishaw, & Fontenot, 2013).
Many factors influence the high number of Latino and Hispanic Americans living in poverty, including the breakdown of extended families experienced by new immigrants, the relative youth of the Latino American population, immigration status, lack of English proficiency, discrimination, and lower-than-average educational attainment (De La Rosa, 2000). However, the educational attainment gap between Latino Americans and other races has been significantly narrowed in recent decades and, in 2013, new Hispanic high school graduates surpassed their white counterparts in college enrollment for the first time. Rising rates of educational attainment among Latino Americans will likely help to alleviate the rate of poverty among this demographic.
According to Census data from 2007 and 2011, 26 percent of African Americans lived below the official poverty line. The figure was nearly 31 percent in 1979. In 2012, 9.9 million African Americans lived in poverty compared to 8 million in 1979. These figures are understated based on the assumptions of the Panel on Poverty and Family Assistance related to the cost of living in urban areas. The issues surrounding African American poverty include neighborhood entrenchment (Ross, & Mirowsky, 2008), higher-than-average rates of incarceration (Western, 2008), erosion of the nuclear family, lower-than-average levels of education attainment, high unemployment for African American men, and discrimination.
The most striking issues in the demographics of poverty in the African American community are related to the fortunes of the African American men. In 1979, the incarceration rate of African American men was about 5 percent. This is figure increased to approximately 12 percent without any significant increase in crime rates (Western, 2007). In fact, the US prison population increased by a staggering 700 percent from 1970 to 2005, outpacing crime and population rates. According to the Bureau of Justice Statistics, one in three African American men has spent some time in jail. African Americans are also arrested and incarcerated at higher rates than their white counterparts, even when having committed the same offense. African Americans are also three times more likely to be searched during a traffic stop than white Americans, are twice as likely to be arrested, and almost four times as likely to experience the use of force in encounters with the police (American Civil Liberties Union, 2007). The disproportional rate of incarceration of African Americans has a significant impact on wage trajectories and job opportunities. White men with prison records are more likely to be offered entry-level jobs than black men with identical criminal records. In fact, white men with criminal records have better chances of finding employment than equally qualified African American men with no criminal history, indicating continuing discrimination in hiring practices that elevates the unemployment rate for African Americans (von Zielbauer, 2005). Unemployment rates for African American men over the age of twenty exceeded 13 percent in 2012. These figures are understated because unemployment rates exclude the incarcerated population. A staggering 65 percent of African American children, or 6.5 million, lived in low-income families in 2011 (National Center for Children in Poverty, 2013).
The US Census Bureau has tracked Asian American poverty figures since 1987. The number of Asian Americans living in poverty has dropped from one in six in 1987 to one in ten in 2006. The reasons behind the Asian success has been attributed to parental economic status, immigrant status, expectations, and values (Vartanian, Thomas, et al, 2007). In the 2006, for the first time, Asian Americans surpassed white Americans in median income for full-time workers (DeNavas-Walt, Proctor, & Smith 2007). In 2012, approximately 12.6 percent of Asian Americans were living below poverty, about the same as overall US population living in poverty, 12.4 percent. Approximately 52 percent of Asian Americans have a bachelor’s degree or higher, compared to 28 percent of the total US population....
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