US poverty numbers hit record high

The poverty rate for blacks and Hispanics was much higher than for the overall population, the report said [AFP]

The US poverty rate hit its highest level since 1993 last year, with a record 46 million people living below the American poverty line, according to census data.

A government report released on Tuesday said the poverty rate rose for a third consecutive year to hit 15.1
per cent in 2010, up from 14.3 per cent a year earlier.

The US definition of poverty in 2010 was an annual income of $22,314 for a family of four, and $11,139 for a single person.

The survey showed struggles for the rest of Americans, with median annual household income falling 2.3 percent to $49,445.

However, the census report said there was no “statistically significant” change in inequality between 2009 and 2010 based on its index.

The poverty rate for blacks and Hispanics was much higher than for the overall population at 27.4 per cent and 26.6 per cent, respectively. Among regions, the South had the highest poverty rate at 16.9 per cent and the highest percentage without health insurance, 19.1 per cent.

The Census Bureau said the number of people country-wide without health insurance coverage rose to 49.9 million in 2010 from 49.0 million in 2009.

Losing ground

The report, showing the first full year since the recession officially ended in June 2009, supports the notion that Americans have been losing ground economically. It showed real median incomes fell 6.4 per cent from pre-recession levels in 2007 and were 7.1 per cent below the peak in 1999.

Underlying the census data was a rate of economic growth too weak to compensate for the loss of hundreds of thousands of jobs from 2009 to 2010, as the recession officially ended but the jobless rate shot up from 9.3 per cent to 9.6 per cent.

Ron Haskins, a senior fellow at the Brookings Institution, said the report showed “the news on economic well-being in the US is not good,” and that the trend is likely to continue.

“Given the widely accepted projections that both unemployment and in particular long-term unemployment will continue at high rates for the next several years, we can expect this pattern of continuing low income and high poverty rates for many years,” Haskins said.

“Safety net programmes run by the federal and state governments are helping millions of families avoid poverty, but these programs could be subject to cuts at the federal and state level because of continuing deficit and debt problems”.

The poverty rate increased for children under 18 to 22 per cent from 20.7 per cent in 2009.

The Children’s Leadership Council, an advocacy group, called the news “unacceptable in America.”

“We are paying the price for child poverty today, and we will pay the price for decades to come,” the organisation said, calling for legislators to avoid further cuts to child welfare.

“The rising numbers of children living in poverty is a direct result of the choices made by political leaders who put billionaires before kids,” the group said.

The US has the highest poverty rate among developed countries, according to the Paris-based Organisation for Economic Co-operation and Development.