During
this presidential election campaign season, candidates have stepped up their
rhetoric regarding just how much support should be afforded to lower-income
Americans. One of the more controversial issues has revolved around a
presidential candidate's assertions that poor people have a safety net in
place, and therefore do not deserve as much concern as the middle class. This
begs the question: Do lower-income people truly have a "safety net"
in place?
What Is "Poverty?"
Many people may identify themselves as "poor"
simply because they cannot take that Caribbean vacation or eat at fancy
restaurants more than twice per week. But the true definition of poverty is much more extreme
than that. While there are several methods used to measure and identify poverty, one of the most
widely-referenced definitions of poverty states that a four person household in 2011 earning $23,021 or
less qualifies as poor, according to data provided by the United States Census Bureau.
Using this definition, the
"official" poverty rate of the United States was 15% in 2011, meaning
that roughly 46.2 million people lived in poverty. This is significantly lower
than the median household income from 2006-2010 of roughly $52,000 per year.
What Sort of Benefits Do Lower-Income People Receive?
Households
that qualify as "living in poverty" are eligible for certain benefits
and subsidies from the U.S. government. Indeed there are several programs in place to ease the
burden of poverty. Some of the more familiar social programs include food stamps, as well as
healthcare assistance through Medicare and Medicaid. While these are the
largest government programs in place, they are not the only benefits available.
Lower-income Americans are
also eligible for subsidized housing, student financial aid and tax breaks such
as the Earned Income Tax Credit. Thanks to these programs, millions of people have been
lifted out of poverty. In fact, if you were to treat food stamps as income,
they would have lifted almost 4 million people out of poverty. If you
were to consider the Earned
Income Tax Credit as income, then almost 6 million people would be lifted above
the poverty line. Despite the pundits, social programs such as food stamps and the Earned
Income Tax Credit have improved the lives of many lower-income people.
Less Obvious Costs of Being Poor
Despite the "safety net" offered by social
programs to help poor people make ends meet, lower-income families face many
challenges that go beyond basic needs such as food and healthcare.
Employment Challenges
Finding
work with a standard schedule is challenging for lower-income people. According
to a survey conducted by the Urban Institute, roughly 40% of working parents
held jobs with hours considered standard (i.e. weekdays between 8 a.m. and 6
p.m.). Nonstandard working hours may complicate childcare options. This
survey also revealed that lower-income
people feel as though they are limited in terms of employment opportunities;
thus, they take any work they can find and they prioritize holding onto their
jobs. This type of employment insecurity is very different from the
concerns of higher-income households, which have a bit more flexibility when it
comes to choosing how they spend their professional time.
Trouble Finding Affordable Childcare
Another
obstacle faced by lower-income people is finding affordable childcare. Among
families with young children living in poverty, roughly one-third of monthly
income is spent on childcare costs, according to a study by the Carsey
Institute. As mentioned above, there are childcare subsidies in place to ease
this financial burden. A
person who receives subsidies spends somewhere in the neighborhood of 14% of
his or her income on childcare. A person with a higher-income spends only about
7% of his or her income on the same costs.
High-Quality Food May Be Harder to Come By
Access
to high-quality nutrition is another cost to being lower income. Busy
lifestyles combined with the lack of easy access to fruits and vegetables contribute
to diets that are insufficient in vitamins and minerals. Many lower-income
people need to work much harder to find fresh and healthy food that will meet
their nutritional needs.
The Bottom Line
There
are several social programs in place that give a boost to lower-income
families. It is important, however, to remember that the true cost of poverty
is much less obvious. Lower-income people often pay an intangible price
for being poor, as they tend to have fewer employment opportunities. Childcare
costs account for a large chunk of their budgets, and access to high-quality
food may be limited.
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