The True Cost of Poverty (Personal WriteUp)

Article Summary

During the 2012 United States Presidential Election, one of the largest growing topics was poverty in the United States of America, as Presidents had to address such a concerning topic the nation is facing at. The latest statistics on the United States Poverty showed that nearly 47% of Americans live either below or at the poverty line. But what is of great concern is what is defined as poverty by the United States Government? Though many different approaches may be used to calculate and come to a consensus, the most actively used method of approach defines poverty as ‘a four person household in 2011 earning $23,021 or less qualifies as poor’. With such a definition, 15% of the United States population (46.2 million people) live in poverty. However, though an unfortunate event, there are many great benefits introduced by the United States government to help those in poverty. There are many programs introduced for those in poverty such as food stamps, and Medicare (healthcare program). Moreover they are subject to less income tax as they are able to qualify for ‘for subsidized housing, student financial aid and tax breaks such as the Earned Income Tax Credit’. These programs have helped increase the living standards of people in poverty in the United States of America. However, there are still many challenges that the people of the United States in poverty still face. This includes childcare and the ability to purchase healthy and quality foods. It is estimated that those in poverty spend nearly 1/3 of their minimal income on childcare alone. A quote that best represents the scenario for their food challenges is provided in the article as the following: ‘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 food’. Demonstrating the challenges faced by those in poverty, this article in a summary establishes the growing concerns of poverty in the United States and its effects on living standards.

Relation to the Course

This article has much to relate to the economic concepts covered in class. The following are example of its connections to the course content:

Fiscal Policy: This article has heavy connection to the fiscal policy concepts covered in class. It demonstrates the fiscal policies used by the United States Government, to attack such a large and growing concern for the United States population. The United States Government is handling this issue by adapting its Fiscal Policies. It has begun to use an Expansionary fiscal policy to address this large growing concern. It has decreased its level of taxation on the poor to stimulate their finances and allow future potential growth. In addition, it has increased government spending into social welfare programs to help those in poverty. In a nutshell, this article demonstrates how the United States Government has executed an expansionary fiscal policy to help those in poverty in America.

GDP Limitations: Another connection that this article made to the content studied within the course was GDP and Living Standards, particularly the limitations within them.  It demonstrates how large the GDP of the United States of America is, marking as the largest GDP in the world, stating it as the largest economy in the world. Theoretically, the largest nation in the world, should provide to its people, and have the highest living standards in the world. But this is not the case in this situation as there is a vast wealth gap between the population. There are those that are extremely rich, and of course there are those that are in poverty.

Unemployment Rate: As discussed in the course, this article highlights the unemployment in the United States Government. It highlights a very high level of unemployment in the United States which is what has let to such high levels of poverty. Moreover, it blames the high level of unemployment from the economic downturn in 2008, a cyclical type of unemployment as discussed in the course. It furthermore highlights the social and economic drawbacks of high levels of unemployment, such as a falling economy, and high rates of poverty, leading to low living standards for the nation as a whole.

 

Comments

The reason I selected this article was due to my personal interest in the matter. I am personally very interested in politics and have followed along with the United States Presidential Election since the Republican Campaign began. With such a strong interest in the whole matter, I was interested on seeing the candidates stand’s on domestic and global issue, to make a more informed and educated decision on whom I would support in the election. One of the concerns I had was the issue of unemployment in America. I was interested on seeing the candidate’s stand and plan of action on such a vital issue. But in order to understand their stand on the matter, I had to first fully understand the problem itself. In fact I didn’t read this article because of the assignment; I read it to better understand the unemployment in America. I find this topic very interesting as it is a large and global concern, and this article has helped me better understand the unemployment in the world’s largest economy (the United States of America) better than ever before. In fact I found a lot of things interesting in the article such as the fact that 47% of Americans live either at or below the poverty line. I knew that unemployment and poverty existed within America, but I never knew it was to such of an extent. By coming to the understanding of how crucial this matter is in reality, I have come to make a more informed decision on the matter with respects to the political playing field. When I first heard that the United States spends $553 billion on welfare a year, and that Obamas plan is to increase welfare spending to roughly $800 billion, I was in great awe and disappointment as I believed that $553 Billion was enough and that the additional funds can help towards better and more crucial spendings. But after reading the article and understanding what a large issue this is, I do agree with Obama’s stand on the matter, as this is unacceptable. As a greater life lesson, I first came to a conclusion on the matter without doing further research, but after reading the article and becoming more informed on the topic, I believe I have to a better conclusion and stand on such a crucial affair.  In conclusion, this article has helped me better understand the unemployment in America, and has further devised me to make greater decisions to help fix such a large and problem.