Could You Raise a Healthy Kid on $2 a Day?

March 19, 2012

A seasoned advocate sees a perfect storm endangering vulnerable children—and one program that helps many weather it.

Policy Changes Can Deepen Poverty

When it comes to extreme poverty, many blame the victim—we've heard politicians talk about adults who cannot or will not keep a job, Moms who buys junk food and expensive appliances—but Arloc Sherman, who has been studying the data for years, blames the system.

Sherman, senior researcher with the Center on Budget & Policy Priorities, has analyzed the rising number of destitute families since 1996. In this analysis, he includes a chart from the National Poverty Center study showing that the increase in extreme poverty began before the 2007 recession. (Click to enlarge the chart.)

Click for larger viewHe says conditions deteriorated for the very poorest families before the Great Recession, when fundamental changes in the welfare system shifted benefits from guaranteed cash assistance to time-limited work supports and cash assistance dollars did not keep pace with inflation, eroding to less than $2 a day in Mississippi and Tennessee, for example.

As for work—Sherman points out that most of these families are headed by a single parent struggling with serious mental or physical problems that leave them jobless for extended periods of time.

That’s the really bad news.

Policy Changes Can Also Alleviate Poverty

If you want to cheer up a bit, check out the charts from the original National Poverty Center study. When you factor in the mitigating impact of food stamp benefits, you get a slightly less troubling picture.

About 2.8 million children lived in extreme poverty at the beginning of 2011, roughly 16 percent of all children in poverty.

The data are still distressing: NPC estimates that the number of households living on $2 or less in income per person, per day in a given month increased from about 636,000 in 1996 to about 1.46 million households in early 2011, a percentage growth of 130 percent.

About 2.8 million children lived in extreme poverty at the beginning of 2011, roughly 16 percent of all children in poverty.

Who are these families? About half are households headed by single mothers and many represent disadvantaged minorities. While the percentage growth in extreme poverty was greatest among these groups, they are not the only ones affected—many were white and/or suburban households.

For those who say that poverty—like the weather—is something you have to accept because you can’t do much about it, the NPC charts should be a revelation.

After all, a closer look at the numbers shows the powerful impact of social programs. Factoring in the effect of food stamp benefits helps slow the dramatic upward curve of rising extreme-poverty households. In fact, the National Poverty Center points out that after the expansion of food stamp benefits in the stimulus bill, the prevalence of extreme poverty remained virtually unchanged.

Rich Kids Do Well in America, Poor Kids Do Better in Canada

Some who examine the child poverty data from other countries draw a similar conclusion about a nation’s ability to change the trajectory of poverty and its consequences. While larger economic forces may drive poverty rates, what nations do in response can make a difference.

Researcher Miles Corak says if he were a rich kid, he’d be happy to grow up in America, but if he were born to parents in poverty, he’d rather be born in Canada, where “being in the bottom 10 percent would mean less hardship: my family income would be greater; I would be more likely to be living with both of my biological parents; I would be visiting a doctor regularly; and I would spend more time with my parents, particularly my mother during my infancy as she would have almost one year of paid parental leave.”

The Great Recession Did Increase Concentrations of Poverty

Bye bye boom:
the number of communities experiencing concentrated poverty increased with the Great Recession.

It may be a hard sell to convince people public policy matters when it comes to reducing or alleviating poverty. But it isn’t difficult to see that the Great Recession contributed to the problem.

In two new reports, both the Brookings Institution and the Annie E. Casey Foundation find that, after progress in the economic boom of the late 1990s, the number of communities experiencing concentrated poverty increased with the Great Recession of the late 2000s, wiping out the earlier gains.

According to the Brookings Institution analysis not only did the number of extreme-poverty communities increase in the later 2000s, but pockets of poverty spread more widely across the country, including the suburbs.

Why do numbers on communities of concentrated poverty matter? The Brookings researchers point out that households (or parents) struggling with extremely limited resources has a hard enough time, but their task is made even more difficult by the double whammy of a high-poverty community with higher prices food and services along with higher crime rates, poorer schools, fewer job opportunities and little private-sector investment.

The recent Annie E. Casey Foundation data snapshot uses the latest American Community Survey data to show the more recent effects of the Great Recession and its aftermath on children and families, and focuses on the larger “poverty” population, not just the poorest of the poor.

The Casey report finds about 7.9 million, or 11 percent, of the nation’s children are growing up in poverty-stricken areas where at least 30 percent of residents live below the federal poverty level. In 2000, that number was 6.3 million kids, or 9 percent.

It's worth noting that according to this report, most of the children in these communities—75 percent—have at least one parent in the labor force.

Like Brookings, the Annie E. Casey Foundation points out that developmental risks associated with growing up in severe poverty, including more limited access to quality schools, medical care and safe outdoor spaces.

A Perfect Storm Pounds Poor Children

Do you see the elements of a perfect storm endangering vulnerable children? I do.

Eliminating the guaranteed cash benefit in the 1996 welfare reform came at a time when the economy was lifting many boats. But just as the welfare reform’s time limits began to run out and the cash benefits continued to erode, the economy began to slow down (in the early 2000s), slowing progress out of poverty for low-wage or jobless families.

During the same time period, stagnating wages in low-skilled jobs meant greater vulnerability and fewer reserves to help working families stay afloat during an economic downturn.

When the financial meltdown and subsequent economic collapse began in 2007, most everyone was affected, including many who had not expected to face unemployment, foreclosure, or poverty. More communities—both those already vulnerable and those more stable— were driven into higher concentrations of extreme poverty.

Those families with the least reserves hit rock bottom. Even those who do the research on how families survive hard times have no idea how these hardest-hit families are surviving.

The welfare policy change, low wages, and an economic collapse created the perfect storm that is putting more of our children in poverty and in peril.

The Slim Silver Lining

There is only one silver lining in this story. One program remained a true safety net and did its job—the food stamp (SNAP) program. And as a new report from Children’s Health Watch points out, SNAP has made the difference for children’s health and well-being, meaning the difference between a child healthy enough to go to school and learn, and a child plagued by illness, development delay and a life’s promise compromised.

What Next?

If you believe it is immoral to stand silently by while your neighbors fall, or that a great nation does not neglect its most vulnerable children, you don’t need to turn your back on poverty and the poor.

Many of us are campaigning to preserve and strengthen the safety net that protects children, to widen opportunities for younger generations, and to ensure that economic recovery means shared prosperity. Join with us.

For more on this, check out these campaigns doing great work to fight poverty and hunger:


Jan Richter is Editor emeritus for the SparkAction SparkUpdate. She was previously Outreach Specialist for Connect for Kids



Jan Richter