Government aid keeps millions out of poverty
By Tami Luhby @CNNMoney
September 14, 2011: 5:46 AM ET
NEW YORK (CNNMoney) -- Without help from the federal government,
millions more people would have sunk below the poverty line in 2010, U.S. Census
data shows.
Unemployment insurance helped keep 3.2 million Americans out
of poverty in 2010, according to new statistics released Tuesday. Without this
vital lifeline, which lasts up to 99 weeks, these jobless folks would have
joined the roughly 46.2 million people now considered
in poverty.
Other government assistance programs, such as food stamps,
also provided much-needed support to the poor. But because the Census Bureau's
official poverty statistics don't consider these income sources, they were not
taken into account when determining whether a person fell below the line, which
is $22,314 for a family of four.
However, the Census Bureau does calculate what impact this
assistance would have had if it were measured. Food stamp benefits would have
lifted 3.9 million people out of poverty had that aid been counted as income.
And 5.4 million people, including 3 million children, would
not have been considered impoverished had the Earned Income Tax Credit been
counted. The EITC is a refundable federal income tax credit for low- to
moderate-income working Americans. Some 22 states also offer similar credits.
Federal health programs, including Medicaid and the
Children's Health Insurance Program, also helped hundreds of thousands of
youngsters stay insured even though their parents lost employer-based coverage.
Some 570,000 fewer children were uninsured in 2010 than in 2007, before the
recession began.
Check the poverty rate in your state
The number of people receiving help from the federal
government is hovering near all-time highs as the Great Recession unleashed
wave upon wave of layoffs. And with unemployment remaining stubbornly elevated,
many Americans have had a hard time getting back on their feet again.
Roughly one in six Americans are on
government aid, with the largest two programs being Medicaid and
food stamps.
But federal and state budget crunches are swiftly chipping
away at these safety nets. At least six states cut back on the number of weeks
that the jobless can collect state
unemployment insurance. Some states have reduced the generosity of
their Earned Income Tax Credit, while Michigan
recently limited the amount of time the poor can collect cash welfare benefits.
0:00 / 3:09 Stuck in
American chronic poverty
Even greater threats loom on the federal level.
The deadline to apply for
federal extended unemployment benefits expires at the start of 2012. President Obama is pushing Congress to once again extend the deadline to apply for
these benefits, which more than 3.1 million people collect. But
House Majority Leader Eric Cantor said Tuesday he'd only favor an extension if
it were tied to job opportunities.
And it remains to be seen what type of cuts the national debt super committee
will recommend. It is charged with proposing up to
$1.5 billion in reduced spending, and some advocates for the poor feel the ax
will fall heavily on safety net programs. The federal government provides a
wide array of assistance to low-income folks, ranging from health insurance to
food stamps to housing help to child care.
"What those changes are will have a very large impact
on poverty in both the years and decades ahead," said Robert Greenstein,
president of the Center on Budget and Policy Priorities.
http://money.cnn.com/2011/09/14/news/economy/poverty_government_assistance/index.htm?iid=Popular