According to a recent survey of poverty, the ranks of those classified as poor remained at record highs in 2011. What is more, the gap between the rich and everyone else widened further.
The report indicated a fall in median income for the second year in a row, a decline in workers’ wages, and a sharp increase in the number of workers holding down full-time jobs at near-poverty wages. The picture that was represented is simply nightmarish.
The poverty rate remained essentially unchanged from 2010.
Only in the US roughly 46.2 million people remained below the official poverty line in 2011, the highest number in more than half a century. The 15.0 percent poverty rate was the highest since 1983.
One in five children in the US was poor. The nation’s capital, Washington DC, had the third highest poverty rate, ranked by states, after New Mexico and Louisiana. Great attention should be paid to child poverty because it is linked with lower levels of child well-being. When compared to children from more affluent families, poor children are more likely to have low academic achievement, to drop out of school and have health, behavioral, and emotional problems.
The supposed recovery of America from 2001 to 2007 was the first ever to see an increase in the poverty rate, from 11.7 percent to 12.5 percent. The poverty rate from 2009 through 2011 increased to 15.0 percent. According to official figures, poverty has risen since 2000 by 3.7 percentage points.
This is because the timid economic expansions following recessions over the past decade have been entirely designed to benefit the rich, with minimal job growth and stagnant or declining wages on the one side, and massive tax breaks and government bailouts for the corporations and the wealthy on the other.
Certain statistics emphasized the devastating influence of the economic crisis and the government’s right-wing policies on young workers. In the spring of 2007, there were 19.7 million “shared households”. Households include at least one additional adult (18 or older) not enrolled in school. By the spring of 2012, this number had climbed to 22.3 million. This indicates that more and more post-high school and post-college young people are forced by economic problems to move in with their parents.
The report unveiled that the poverty rate of young adults age 25-34 living with their parents, measured by their own income only, was 43.7 percent.
All of these figures severely underestimate the real level of poverty, because the government’s poverty threshold is absurdly low.
The growth of poverty is by no means the result of simple economic forces. It reflects the agenda carried out by the government to defend the interests of the corporate elite at the expense of the working class.
The Center for Budget and Policy Priorities (CBPP) estimated in its review of the US Census report that a $36 billion fall in unemployment benefits in 2011 added 0.3 percentage points to the poverty rate. The disappearance of 386,000 public-sector jobs also increased the ranks of the poor.
Social inequality also has increased greatly. The Gini index shows that income inequality rose by 1.6 percent between 2010 and 2011. (The Gini index is a measure of household inequality in which zero represents perfect income equality and 1 percent inequality). This was the first time the Gini index indicated an annual increase since 1993.
The total share of income dropped for the middle and fourth quintiles of US households. The top 1 percent of earners saw a 6 percent boost in income.
David Johnson, chief of the Census Bureau’s social, economic and housing statistics division, said that the rising inequality from 2010 to 2011 is mostly driven by changes at the very top of the distribution.
Tim Smeedling, the director of the Institute for Research on Poverty at the University of Wisconsin-Madison, pointed out that the second and third quintile of Americans now account for only 23.8 percent of the nation’s income.
Average weekly wages for non-supervisory workers dropped by 0.3 percent after preparing for inflation. A 17.3 percent increase in the number of workers in the lowest income group holding down full-time jobs showed the impact of wage-cutting in every sector of the economy.
