A Snapshot Of Poverty In America
Understanding poverty is not easy, but it is hugely important because without understanding poverty, we can't start the debate over how to get people out of poverty in every year. The census bureau publishes a really helpful snapshot of poverty in America. This isn't the official poverty report were talking about the official poverty report is based on high much money people make before you take into account taxes or some of the benefits you get from the government. And if you do not make enough money to afford a certain my deferred, then you are considered to be below the poverty line. But those other things like taxes and benefits could make a big difference in how you experience your life and food isn't the only basic meat. That's right. And that is why the report that we're gonna talk about here on the indicator is the census bureau's other poverty report. If features something called the supplemental poverty measure, this is the snapshot of poverty. That economists argue is a lot more relevant for understanding how people actually live. This report defines. Poverty is not being able to afford all the basic necessities. So yes, it includes food of course, but also clothing, housing, utilities. And since for example, renting an apartment does not cost the same in New York as it does in Wyoming, the supplemental measure makes adjustment for that, and it makes a lot of other judgments as well on the supplemental poverty measure. Also very much does account for how much money people pay in taxes and also for the government benefits that people receive. This is indicator from planet money. I'm Cardiff Garcia Stacy's on vacation this week. So filling in for her. Is that deep? I rish voice. You just heard if putty Hirsch. Yes, a person not just the voice and not just a person, but an editor. I am the editor of the indicator, and I'm here to tell you that today's planet money indicator is thirteen point, nine percent. That is the share of all Americans who live in poverty according to the supplemental poverty report, but the resources more on that report than just that one number Dakhli it helps answer. Questions like which groups of Americans are more likely to be in poverty, and it's a specially good at figuring out which government programs are most directly responsible for keeping people out of poverty. So for better look at poverty in this country, you need to go deeper into the report today on the show we are going to do just that. This message comes from the indicators sponsor Capital. One capital one's indicator is zero because they offer accounts with zero fees or minimums, and they offer accounts that can be opened from anywhere in five minutes Capital One. What's in your wallet Capital. One in a support also comes from grow with Google from coding to IT. Support grow with Google is helping Americans across the country, learn new skills for the digital age, learn more and get started at Google dot com slash grow. Okay. Diving deep into the annual supplemental poverty measure. It came out a few weeks ago. Let's do this first. Very simply poverty has been falling in recent years. For example, back in twenty thirteen. The poverty rate was fifteen point, nine percent, but after a few more years of the economy growing and more people getting jobs, the poverty rate at the end of last year was thirteen point, nine percent. So there has been progress. Yeah, there's definitely been progress, but it still means that a forty five million Americans are living in poverty. And here we can start to get a little bit more specific. For example, with education education really maters for poverty rates almost twenty nine percent of people with a high school diploma live in poverty. On the other hand, only about seven percent of people who have a college degree live in poverty, everyone else's in between those two groups. That is a huge gap by the way. Yeah. And for a number of historical reasons, poverty rates are also different across groups of different racial origins. For example, more than one out of every five black Americans lives in poverty. Roughly the same rate applies to Hispanic Americans for white Americans. The rate is less than one in ten. Other points of note here. The poverty rate for women is slightly higher than for men. Kids under the age of eighteen are more likely to live in poverty than adults people who work part time or. Three times more likely to be in poverty than people who were fulltime. And finally, married couples or a lot less likely to live in poverty than either single adults or people who live together but are not married. So those are some of the ways that poverty flies different punch. The population be probably this into this thinking. Well, what about all these government programs? Right? So let's talk about the impact of taxes and government programs on poverty rates and Inc Patty. This is where the report gets really interesting. There are two government programs, especially that are far and away the most responsible for keeping people out of poverty. I is social security, and this is a sensitive, the government pension programs. So you pay social security taxes, your whole life. And then when you retire, you can get paid a certain amount starting at age sixty two. And last year, if social security did not exist, but everything else about the economy and taxes and benefits state exactly the same. Then another twenty seven million people in the US would be living in. Already. That is a massive number twenty seven million people out of a total population of roughly three hundred twenty million. I don't know about you. My head is spinning right night. Do the math for me. Tell me what percentage that is huge. It's like getting about eight or nine percent that eight or nine percents brutal coming in second place after social security are refundable tax credits. One of these tax credits is the earned income tax credit, and that's money that the government pays to people who work but make a low income. The other is the portion of the child tax credit that goes to very low income parents with children. These tax credits kept more than eight million people out of poverty last year and more than half of them were. Children. Also deserving mention, one is food stamps, another's housing subsidies that help people for their rent. And finally, the government supplemental security income payments that go to people who are disabled or have an extremely low income. Each of these three programs. Also kept three million people out of poverty last year. So without these five, it's safe to say that tens of millions more Americans would be in poverty than our right now. Yeah, and it's not just about things that we get from the government rights also by the stuff that we pay to the government's, the taxes we pay. And this applies of course, to lot of people who don't make a lot of money. I was stunned by this the combination of the federal income tax and the Fayka tanks, which goes to pay for social security Medicare that kept two by six million people from rising above the poverty line. So that is the breakdown yet. Although on a final note for listeners, we did not present these figures to settle any kind of partisan or ideological debate. So for example, if you tend to lean more to the left or if you're democrat, you might be arguing that these numbers show the importance of government programs for keeping people out of poverty. And it may be these programs should be even more generous and further reduce the poverty level. But if you tend to lean right or your Republic. Can you might be arguing that these programs disincentivize people from working and that without the programs, the poverty level might be even lower because more people would work or maybe you would just be arguing that the government can't fund these programmes forever because they're too expensive Patty. And I are not here to adjudicate that debate. Although I have to say that those those like line notes just given would be great line notes for debate. So do please feel free to hit those on both sides? Because the point here is that debate is a month, long one, and also probably one that's never gonna end, but never did. It, it's anyone never hurts to have the facts in the analysis to inform the debate, which is why we encourage listeners to check out the supplemental poverty report directly. So we are going to link to it on our website at NPR dot org, slash money. 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