Rajiv Shah, head of the United States Agency for International Development, may well want to keep a low profile this week and refrain from lecturing other nations on how to help their poor. For, if he does, he may be gently reminded that in 2010, poverty in his own country jumped by a staggering 20 per cent, from 12.5 per cent of the population to 15.1 per cent.
These were the figures compiled by the U.S. Census Bureau (USCB), which said in its report this week on Income, Poverty and Health Insurance Coverage in the U.S.: 2010, that not only were 46.2 million Americans in poverty after the worst recession since the 1930s, but this worsening trend had continued for the fourth consecutive year and was “the largest number in the 52 years for which poverty estimates have been published.”
The official poverty line applied in the survey was $22,314 for a family of four.
The report also provided food for thought to those opposing President Barack Obama's groundbreaking Affordable Health Care Act, passed last year. Even as the Republicans, led by new Tea Party members in the U.S. Congress and in the States, press for the repeal of the inclusion-focussed Act, the USCB report warned that the number of people without health insurance coverage had risen from 49 million in 2009 to 49.9 million in 2010.
The aggregate picture painted by the USCB report suggests that it was not only those at the bottom of the economic food chain who suffered through the recession years and beyond — median income for the entire population dropped during this time and some racial groups were hit harder than others.
The report argued that since 2007, the year prior to the most recent recession, real median household income has declined 6.4 per cent. While real median income declined for white and African-American households between 2009 and 2010, the differences in the variable for Asian and Hispanic-origin households were not statistically significant.
Putting these results in context Ron Haskins, Senior Fellow at the Brookings Institution and a former White House and congressional advisor on welfare issues, said to The Hindu, that the rise in poverty was caused by “the sluggishness of the American economy, especially the high levels of unemployment and long-term unemployment (more than 27 weeks).”
Arguing that the government's programmes had a dramatic effect in keeping poverty rates from going even higher, Mr. Haskins however said that fiscals that were gaining momentum in the aftermath of the deficit reduction debate could “now and over the next year or two” begin to have an impact on poverty.
“In addition, billions in extra spending on programmes for the poor were included in the 2009 stimulus Bill and those are running out this year,” Mr. Haskins explained, though conceding that neither the states nor the federal government have money to increase the “already huge spending the U.S. does on programmes for the poor.”
In the healthcare field, the welfare outcomes may be more positive depending on the course of legal action across U.S. challenging the constitutional validity of President Obama's landmark reform Bill.
“If the Affordable Care Act is not repealed or stopped by the courts, health insurance coverage will begin to go up in 2014 and 2015,” Mr. Haskins noted, adding that the Act has already had a positive impact through its provision to allow adult children up to 25 years of age to be covered by their parents' health insurance policies.