Poor in America Increasing

Warning: If you are overly-sensitive about these types of issues, do not read this web page.

Author's Perspective: African-Americans are not the only group that is suffering economically. Other ethnic groups and some Caucasian-Americans also suffer economically. And, because of problems with the housing market, stock market, the severe recession, increased layoffs, and jobs being moved overseas, the middle class is shrinking, while the number of poor is growing very quickly. Except for the rich, most people are living paycheck to paycheck -- if they're fortunate enough to have a job. In fact, people in other countries all over the world are suffering economically.

The key message here is that most of us suffer economically for the same two reasons: (1) We live beyond our means and fail to take advantage of the money we're making while employed; (2) We lack the knowledge to significantly improve our financial position in life.

However, if you have the drive and the passion to succeed, you can create the opportunity to improve our financial position in life.  Refer to the web links listed on the right side of this web page for web pages for information about  knowledge, wealth, success, purpose in life, and starting a small business -- it may change your life!

Sidebar: America became a world power very quickly and created a lot of wealth for many Caucasian-American familes, thanks to having 200 years of free labor (via slavery) to help build the roads, buildings, farms, infrastructure, etc. Unfortunately, African-American families never had the opportunity to build their wealth while America was booming. Until this issue is resolved and a more level playing field is created, there will always be tension between the races. This is not an excuse for why African-Americans are suffering financially, it's just a fact of American History that is rarely spoken, and, needs to be stated.

At Risk: America’s Poor and Middle Classes
Due to the Great Recession of 2007-2009, the number of poor people has grown exponentially in the United States.  Almost 1 out of every 4 Americans is either poor or at risk of becoming poor! -- that's 75 million people!

A large and growing number of Americans are poor, or at risk of becoming poor, as a result of this recent recession and many will continue to struggle during the recovery, according to a White Paper released by broadcaster Tavis Smiley and the Indiana University School of Public and Environmental Affairs.

Titled “At Risk: America’s Poor During and After the Great Recession,” the White Paper was prepared at Smiley’s request as a factual foundation for the National Poverty Tour conducted last summer by Smiley and Princeton University professor Cornel West.

The White Paper reveals that the number of Americans living in poverty increased sharply during the economic downturn. The Great Recession produced not only high unemployment rates, but also record numbers of long-term unemployment, making it likely that these ranks of the “new poor” and “near poor” will continue to grow.

“Many of the ‘new poor’ are the former middle class,” Smiley noted. “Poor people are not moochers and welfare queens, as some would like you to believe. Our neighbors, colleagues, and families are all struggling. It’s a problem all of us need to solve together, right now.”

“Promoting sustained economic growth while at the same time protecting the well-being of the poor, the near poor, and the new poor is the central challenge for the leaders of the United States,” say White Paper authors Kristin Seefeldt, assistant professor in the Indiana University School of Public and Environmental Affairs, and John D. Graham, dean of the School of Public and Environmental Affairs and a former senior official with the U.S. Office of Management and Budget.

They conclude that the Great Recession has inflicted long-lasting damage to individuals, families, and communities and presents vexing challenges for policy makers.

Key White Paper findings include the following:

• The Great Recession left behind the largest number of long-term unemployed people since records were first kept in 1948. More than four million Americans report that they have been unemployed for more than 12 months. Although the official rate of unemployment is declining, much of this apparent progress is attributable to the fact that many adults are giving up on the search for a job. The more telling indicator of an economy’s job-producing performance, the ratio of the number of employed people to the number of working-age adults (the “job-to-people” ratio), has improved only slightly since the Great Recession ended in June 2009. If the long-term unemployed lose their unemployment insurance benefits before the economy produces enough well-paying jobs to approach full employment, the ranks of the “new poor” will steadily swell between now and 2017.
• Poverty has increased significantly. Some 46.2 million Americans lived below the official poverty level in 2010, about 15.1 percent of the population. The number of Americans living in poverty grew by 27 percent between 2006 and 2010, when the U.S. population increased by only 3.3 percent.
• Increases in poverty were greatest among Hispanics and African Americans, children, and households headed by women. Surprisingly, poverty also increased among working-age adults, especially people between ages 18 and 34. States with the highest poverty rates were in the South and Southwest, but states with the largest increases in poverty were scattered across the nation.
• Safety-net programs had a mixed response to the recession. Entitlement programs, such as Medicaid, the Supplemental Nutrition Assistance Program, and Unemployment Insurance, responded robustly, but programs that depend on discretionary spending were less effective.
• The Great Recession’s impact on the poor would have been even worse if not for the 2009 stimulus package, which included $250 billion aimed at protecting low-income Americans. But most of the stimulus funds have now been spent.
• Federal deficits are creating pressures to control spending, which may adversely affect the poor. The 2011 debt ceiling legislation and the failure of the congressional “super committee” will trigger spending cuts. While entitlement programs are protected, that could change with some in Congress arguing that national defense deserves a higher priority.
• States face their own fiscal problems, with the stimulus ending and state tax collections lagging. Some are cutting state spending on programs such as Medicaid and Temporary Assistance to Needy Families. More are likely to follow suit, especially if the strapped federal government pushes more responsibility to the states.

Note: This White Paper is available online athttp://www.indiana.edu/~spea/pubs/white_paper_at_risk.pdf.

Please Note: Despite all of this grim news, there is hope -- there are solutions to overcoming your financial problems. Refer to the web links on the right side of this web page about wealth, your purpose in life, how to achieve success,  the wealth-health connection and what to do when you lose your job.

Author's Note: Refer to the following web pages for information about  knowledge, wealth, success, purpose in life, and starting a small business:Knowledge is Power
Wealth & Health Connection

How to Start a Business

Purpose in Life

What is Success