THE NUMBERS BEHIND WEALTH INEQUALITY

In 1963, families near the top had six times the wealth (or, $6 for every $1) of families in the middle. By 2016, they had 12 times the wealth of families in the middle. Why has wealth inequality worsened over the past 50 years? And why, in particular, has the racial wealth gap not closed? Nine charts illustrate how income inequality, earnings gaps, homeownership rates, retirement savings, student loan debt, and lopsided asset-building subsidies have contributed to these growing wealth disparities.

Source: Urban Institute, 10/5/17, Inequality

WHO IS POOR IN AMERICA?

In 2016, 40.6 million people, or 12.7% of the population, lived in poverty, for example, a family of four that earned less than $24,339. One-third of those living in poverty were children under the age of 18 and 11% were seniors. The remaining 56% were of working age (18 to 64). One quarter of all those living in poverty were in the labor force and an additional 3% were early retirees. An additional 12% of the total were of working-age and disabled. Another 15% of those living in poverty were working-age adults who were students or caregivers. Compared to 30 years ago, a lower percentage of seniors are living in poverty, but because baby boomers are aging the sheer number of poor seniors is greater. Over the past 30 years, a growing number of working-age people were poor (from 15.4 million in 1986 to 21.9 million in 2016). The largest group of working-age adults living in poverty were employees working less than full-time and full-year: 28%.

Source: Brookings Institution, 10/12/17, Poor in America

Community Conversation on Poverty

If you have not heard, there is a group gathering monthly to discuss poverty in St. Lawrence County and all of the related issues.  To date, the group has mostly been educating themselves on some of the issues, but the long-term goal is to develop some action plans to address some of the challenges of poverty in the County.

At a meeting earlier this week, there was some discussion of housing and weatherization issues.  We heard that 31% of the housing in St. Lawrence County is substandard.  And a third of our population has a net worth of less than $15,000, so the resources are not there to address the housing issues.

If you would like to be part of this ongoing conversation, send an e-mail to povertyconversation@gmail.com and ask to be added to the list.

Economic inequality as a cause of hunger

Chronic hunger persists across the U.S. The number of food insecure Americans has risen—from 10% in 2002 to 13%.  While anti-hunger leaders have been effective at maintaining funding for SNAP and increasing the number of food banks, and federal food programs have remained intact while other anti-poverty programs have been eliminated or slashed, Andy Fisher argues that anti-hunger advocates are missing an essential point: That hunger is not an isolated problem, but the product of much larger economic inequality driven by low wages. Fisher is the author of a new book,  Big Hunger: The Unholy Alliance between Corporate America and Anti-Hunger Groups, which contends that because anti-hunger organizations are heavily reliant on corporate donations of food and money, they have often failed to hold businesses accountable for offshoring jobs, cutting benefits, exploiting workers and rural communities, and resisting wage increases.

Source: Civil Eats, 4/20/17, Solve Poverty

Why do our helpers live in poverty?

At this past Friday's poverty forum, Steve Knight, CEO of United Helpers, told us that his organization serves over 1,800 people per day and about 70% of them live in poverty.

He went on to say that United Helpers and its subsidiary, Sparx, employ 1,000 people and he estimates that half of them are also poor.

I have always hated the idea that, as an employer, I might be paying people less than a living wage.  I'm sure Steve hates that, too!

This sad fact raises a question of values.  We often pay the people who care for our most vulnerable community members - children and seniors - so little that they cannot adequately support their own families.

Why do we place so little value on this kind of important work that makes our families and communities stronger?

How do we change that?  How do we change public opinion, government officials minds, and donors and funders perspectives to understand that if we want to do the good work of our nonprofit organizations, we need to pay people to do the work.  And they need to be able to support their own families.

I don't have an answer, but I know we will never find an answer if we don't begin the conversation!

Gloria

Some thoughts on poverty in St. Lawrence County

This past Friday, a group convened in Canton to start a discussion about the issues surrounding poverty in St. Lawrence County and what we can do to better address it.

Chris Rediehs, the Commissioner of Social Services for the County, was one of the speakers and laid out some worrisome statistics:

• Over 2,000 County residents are supported by the Temporary Aid for Needy Families (TANF, what some people might call "welfare")
• In addition to those residents, nearly 14,000 additional residents are enrolled in SNAP (Supplemental Nutrition Assistance Program)
• 9,500 households rely on heating assistance to stay warm in the winter
• These programs bring $240 million annually into St. Lawrence County, meaning we have a disproportionate reliance on funds from outside our own region.

Commissioner Rediehs noted that poverty is about both lacking resources and finding doors to opportunity closed, so that giving people food is not going to solve the problem.  He also has seen that poverty is not usually a permanent situation and that all of us may need a little help at some point in time.

He made three suggestions for how people can get involved:

1. Events like today to illuminate the issue of poverty and its complexity.  Educate yourselves and work to educate others.
2. Volunteering - there is no one solution, but every effort helps.  While giving out a meal of a bag of canned goods will not solve all of a household's problems, it will help them in the moment and that's important.  Consider how else to volunteer that might get beyond the hand-outs to a hand up.
3. Don't accept that it's hopeless.  It's not and we can make progress toward solutions.

WHY POOR PEOPLE MAKE “BAD” FINANCIAL DECISIONS

In her new book, The Unbanking of America, Lisa Servon helps to dispel the popular misconception that most poor people and people who use expensive, alternative financial services like payday lenders don’t have enough financially savvy to understand how expensive the services are, or that they don’t handle their finances well enough to have access to cheaper, traditional banking options. In fact, Servon finds, most people who use alternative lenders are all too aware of how finances work and are desperately trying to use a system bent against them. She notes that many people who rely on pricey, short-term payday loans actually have credit cards with lower interest rates that they haven’t yet maxed out. They choose payday loans over credit cards not because they don’t understand how interest works, but because they’re smart enough to know that payday delinquency won’t be reported to a credit bureau in the same way late credit card payments are, thus preserving their credit score which can help them obtain a variety of other necessities including more credit. “What if,” Servon writes, “instead of focusing narrowly on people’s ‘poor choices’ ... we worked harder to understand the options available to people and the context in which they make those choices?”

Source: Atlantic, 1/18/17, The Underbanked

TANF SPENDING--A CAUTIONARY TALE OF BLOCK GRANTS

Two key purposes of welfare reform are providing a temporary safety net for families and preparing recipients for work.  Yet nationally, states use just 51% of their combined TANF block grant and state funds for basic assistance, work-related activities, work supports/supportive services, and child care, the latest data (2015) show. States now spend only 25% of their TANF funds on basic assistance to help very poor families care for their children and meet very basic needs, such as shelter.  When TANF began 20 years ago, basic assistance was the single biggest use of TANF funds in all states. And, not only has state spending on basic assistance dropped, but the TANF block grant has lost a third of its value since its creation due to inflation.  After adjusting for inflation, state spending on basic assistance has fallen by 62% since 1997. States spend little to help families work, using only 10% of their TANF funds for work activities and supports, and they use only 17% of their TANF funds to help low-income working families afford child care.  

Source: Center for Budget & Policy Priorities, 1/10/17, TANF Spending

POVERTY IS UNEQUAL

The Census Bureau’s annual report on poverty and income shows major economic improvement on a number of indicators, including a drop in poverty from 14.8 % of Americans in 2014 to 13.5% in 2015. Virtually all groups of Americans, including children, shared in the poverty reduction, with about one million fewer children living in poverty and the child poverty rate improving from 21.1% 2014 to 19.7% in 2015. But, despite clear improvement, America’s children and young adults still have the highest poverty rates, and children and young adults of color experience sharply elevated poverty even within that group. One analysis found that most of these children live in families with at least one working parent: in 2015, about 70% of poor children and 84% of low-income children lived with at least one worker. Children and young adults of color are far more likely to be poor than White children. About one third of Black children and about three in ten Hispanic children live in poverty.

Source: Center for Law & Social Policy, 10/5/16, Inequality in Poverty

AFTERSCHOOL PROGRAMS SCARCE IN HIGH-POVERTY COMMUNITIES

Despite higher demand for afterschool programs in communities of concentrated poverty, many low-income families face barriers to participating in such programs, according to a new report from the Afterschool Alliance. America After 3 PM finds that 67% of parents living in areas where the poverty rate is 30% percent or higher struggle to find a quality afterschool environment for their child, compared to 46% of parents in other communities. Affordability, poor transportation networks, hours of operation, and inconvenient locations were the primary obstacles facing parents looking for a program. The authors recommend increased investment in public afterschool programs, integrating other social services such as affordable housing and meals into afterschool programs, and raising awareness about the effectiveness of such programs in low-income communities.

Source: Spotlight on Poverty, 9/7/16, Afterschool

FOOD AND A PLACE TO SLEEP COULD LEAD TO BETTER HEALTH

Patients’ social and economic circumstances powerfully influence their health and well-being. But until recently there’s been relatively little effort to systematically address these factors. The Center for Medicare and Medicaid Innovation, a government organization established by the Affordable Care Act to test new ways to deliver and pay for health care, is trying to change that. It recently announced a pilot program to help health systems close gaps between medical care and social services in their communities. The program, known as Accountable Health Communities, will invest $157 million over five years to study whether helping patients with social needs in five key areas — housing, food, utilities, transportation, and interpersonal safety — can improve health and reduce medical costs.There’s good evidence that social support can improve health and cut costs. Research suggests nutrition assistance for low-income women and children reduces the risk of low birth weight, infant mortality, and developmental problems — at a cost that’s more than fully offset by lower Medicaid spending. Other work suggests providing elderly patients with home-delivered meals can help them live independently and prevent expensive nursing home stays. The program will award grants to 44 organizations around the country to build partnerships among state Medicaid agencies, health systems, and community service providers to identify which strategies are most effective for linking patients to the services they need.

Source: New York Times, 7/20/16, Food for Health

WELFARE RULES THWART MOVING UP

The welfare reform law of 1996 required Temporary Assistance to Needy Families (TANF) recipients to meet “stringent work requirements.” TANF is delivered to states through block grants, which require that states place a certain percentage of people into the workforce. However, many of these jobs are low-wage, and states discourage people from acquiring skills for better jobs, pushing them to find a job as soon as possible. Lacking training or education, these low-wage workers find it nearly impossible to advance into higher paying jobs.The number of TANF recipients has decreased from 13 million in 1995 to three million today. And those who could not find even low-skill jobs in the allowed amount of time lost all government help, which thrust them into deep poverty. Today, about 1.5 million households, including about three million children, are living on $2.00 per person or less per day.

Source: The Atlantic, 7/11/16, Failing Welfare Reform

FOOD DIVIDE GROWS BETWEEN RICH & POOR

Overall, Americans are eating better. Between 2002 and 2012, the percent of people eating a poor diet fell from around 56% to under 46%. But it's a different story if you separate people out by income. High-income Americans are eating better than ever — swapping fruit juice for whole fruits, replacing refined grains with whole grains, and eating tons of nuts — while the low-income group has improved much more modestly. Here's how some of the trends break down:

• High-income people are eating a lot more fruit, while those in the low-income group didn't see a significant change. By 2012, high-income people were eating almost two more servings of fruit per week, replacing fruit juice (a less healthy option) with whole fruit.
• Everyone is eating more whole grains, but only high-income people are dropping their consumption of refined grains like white bread and corn flakes.
• Everyone is drinking fewer sugar-sweetened beverages like soda and sports drinks, but high-income people are drinking a lot less than low-income people. The two are basically falling in lockstep.

Food cost is undoubtedly part of the reason for this gap, but it doesn't fully explain it. Other, less tangible factors also play a role: the time cost to buying foods and preparing them yourself; a nutrition knowledge barrier, and heavy marketing of junk food and fast food to low-income people.  

Source: The Week, 7/4/16, Food Gap

Coalition on Human Needs Responds to Speaker Ryan's proposal

Deborah Weinstein, executive director of the Coalition on Human Needs, issued the following statementy in response to the House GOP anti-poverty proposal:

“The plan put forth by House Speaker Paul Ryan and his GOP colleagues actually is a blueprint for exacerbating poverty and inequality in the United States. While lacking in legislative and policy specifics, this blueprint cannot be separated from the budget proposal championed by House Republicans. This year’s GOP budget derives three-fifths of its cuts from programs that help low- and moderate-income Americans, while protecting tax cuts for the wealthy and for corporations.

“The issue of funding is a gaping hole in this proposal. It costs money to give people the tools to escape poverty. But the budget approved by the House Budget Committee earlier this year would cut low-income programs by $3.7 trillion over 10 years, mostly in health care, but also cutting SNAP by $150 billion (a 30 percent cut between 2021-2026), and cutting Pell Grants and other low-income education programs. Do Ryan and his colleagues now disavow these cuts?

“While the report mostly chooses rhetoric over specific proposals, it does hint at an intention to reduce cash assistance. In one very troubling example, it criticizes Supplemental Security Income (SSI) for children with disabilities, calling for “access to needed services in lieu of cash assistance.” Children who receive SSI have severe and long-term disabilities, requiring time and expense that diminish their parents’ ability to work. Denying cash assistance to these families will drastically worsen their ability to provide for their children’s significant needs. 

“The report vaguely favors giving states more authority to change federal programs. This appears to be a nod to Speaker Ryan’s past recommendation to create ‘Opportunity Grants’ – fixed funding to states that allow them to change rules in effective safety net programs. It is also similar to the House Agriculture Committee’s Child Nutrition Reauthorization proposal to allow three states to take a reduced funding level and change school meals program standards as they choose. There should be no doubt that freezing or reducing funding while allowing states to change program rules is no way to reduce poverty or increase opportunity. Instead, it will give states more incentives to deny help to people who need it. 

“If Speaker Ryan and his colleagues are serious about cutting poverty and expanding opportunities for American families, they should embrace policies that actually benefit working families. This requires investing in good jobs, raising the minimum wage, ensuring an adequate safety net, adopting family-friendly work policies such as paid medical leave and predictable hours, and investing in human capital through a sound education system, all the way from pre-K through college.”

BABIES COST MORE WHEN YOU’RE POOR

New parents quickly learn there are very few financial supports for families with young children to help them buy baby supplies. Many low-income families are doubly penalized because they can’t  afford to join wholesale stores or shop online and therefore pay more for basic supplies. One blogger (with Amazon Prime and Costco memberships and a car) compared her costs with the retail options available to a mother without these options.

• Diapers--22 cents/diaper online versus 36 cents at the local grocery store
• Formula--$20 per week at big box store versus $29 at local grocery
• Baby food--$5 made at home (thanks to  food processor/blender/dishwasher) versus $18 for jars at grocery store
• Baby supplies (swaddles, laundry detergent, diaper cream, and bottles)--free thanks to points on Amazon credit card versus $10 at grocery store.

Total savings=$41 per week or over $2000 a year.

Source: Talk Poverty, 6/1/16, Baby Costs

THE POOR PAY MORE

Prices for everyday purchases at grocery and drug stores are increasing faster for low-income Americans than their wealthy counterparts, according to new research from Harvard University. Researchers found that retail prices are increasing by more than 2% per year for goods purchased by consumers with incomes below $30,000, but just 1.4% per year for those with incomes above $100,000. Most of the price discrepancy can be attributed to wealthy consumers’ habit of buying premium brands, which tend to have more stable prices over time, according to the study. While apparently small, if that divergence continues it would become hugely important in a relatively short period of time. After 20 years, for example, every dollar in the pocket of a poor consumer would be worth just 88 cents compared to what a wealthier consumer would be able to buy with it at the grocery store, given the differences in inflation and in both consumers' preferences.

Source: Washington Post, 5/20/16, Poor Pay More

POVERTY IS TOXIC TO CHILDREN’S BRAINS

Mounting evidence shows that children who grow up poor are more likely to be subjected to stresses like hunger and neglect that act like toxins and hijack the developing brain. In small doses, stress is normal, even helpful. But repeated exposures to adverse childhood experiences remake the architecture of a child’s developing brain, particularly in the prefrontal cortex, which is in charge of executive function and differentiating between good and bad, and the hippocampus, which handles memories and learning. Toxic stress can interact with other toxins like air pollution with consequences including cognitive deficits and emotional disorders, which in turn, help perpetuate disadvantage. There is evidence that children aren’t only affected by stress they experience directly, but by traumas experienced by their parents and grandparents. Some researchers have found evidence that these traumas are passed from parent to child.

Source: Mailman School of Public Health, 5/10/16, Toxic Stress

10 FACTS ABOUT FOOD INSECURITY & SNAP

1. One in seven households was food insecure in 2014—meaning that at some time during the year they had difficulty providing enough food for all of their members. 
2. 15 million children live in food-insecure households. 
3. Even more troubling, in 2014 almost 7 million households suffered one or more periods during which food intake of household members was reduced and normal eating patterns were disrupted because the household lacked money and other resources for food. 
4. Food insecurity is distinct from poverty. 
5. In 30 states and the District of Columbia the rate of food insecurity is higher than the rate of poverty. 
6. Two-thirds of food-insecure households have annual incomes above the federal poverty level. 
7. And because many households may be food secure one year but not the next, an even larger share of households has had some experience with food insecurity than any single-year snapshot suggests.
8. SNAP is highly effective, lifting millions of people out of poverty and increasing the resources they have available to purchase food. 
9. Furthermore, several studies have found that SNAP reduces the likelihood that a household will experience food insecurity or very low food security. 
10. Recent studies have shown that SNAP improves health outcomes and households’ financial well-being, and even improves the later-life outcomes of individuals who had access to the program as children.

Source:  Brookings Institution, 4/21/16, SNAP & Food Insecurity

FRAC Focus: Obesity and Poverty

The Food Research & Action Center (FRAC) is pleased to release this new issue of FRAC Focus: Obesity and Poverty. This periodical e-newsletter focuses on obesity and low-income children and adults, looking at the intersection of obesity, low income, food insecurity, the federal nutrition programs, and federal food and nutrition policy.

This issue first features a summary of the Aspen Institute’s Advancing Health through Food Security: A Multi-Sector Approach to Address the Disease Burden and Costs of U.S. Food Insecurity on our Health System. The report explores our current understanding of the short- and long-term impacts of food insecurity on healthcare costs as well as potential solutions to address food insecurity and its health implications. 

April 2016
Online Version

WHY POOR WORKING MOTHERS CAN’T GET AHEAD

Single mothers comprise more than 85% of welfare recipients, which is why child care support was a key focus of welfare reform legislation in 1996, which boosted federal funding for child care and streamlined it into the Child Care and Development Block Grant (CCDBG), the main source of funding states can use to provide child care subsidies for poor families.  The problem is that once welfare recipients get a toehold in the job market, they may end up losing child care help just as they are transitioning out of welfare.  And while CCDBG child care subsidies are supposed to help pick up the slack, only a tiny fraction of the children eligible for that help are getting it.  Research shows that access to child care help from the CCDBG program are at a 16-year low, with only 13% of all eligible children currently receiving child care assistance.

Source: Center for Law and Social Policy, 3/15/16, Child Care Subsidies