Officially, the Great Recession ended in 2009. But after three years of “recovery,” there were 6.7 million more people living in poverty than in 2008, a recession year. We’ve been stuck with 15 percent of our people in poverty for three years. In the 2008 recession year, 13.2 percent were poor. Forty-six million poor people is a big and troubling number. But that is only part of the story of unshared recovery. More than one-third of us – 106 million people – are near poor, living one lay-off or health disaster away from very hard times. (For a family of four, if your income was below $23,492 you were considered poor in 2012; near poor is defined as below $46,984 for a family of four, or below $36,568 for a three-person family.)
But to describe the times we’re in as the “Great Unshared Recovery” suggests that there is a recovery that the majority of us are not experiencing. And yes, that’s exactly what we’ve got. In the last three years, the income of the top 1 percent grew by 31.4 percent, while the rest of us saw our incomes grow by less than one-half of 1 percent. There has been economic growth, and more people are working. But most workers have lost ground since just before or during the Great Recession, while those at the top have regained most of what they lost when the stock market crashed.
There are lots of statistics to spout from the data released by the Census Bureau last week. (I’m not done spouting – poverty among children demands our attention. And you can see a brief summary on the Coalition on Human Needs’ poverty webpage, plus a lot more analysis there too.) But it’s most important to think about why the recovery isn’t being shared, and what to do about it. The big reason is that we are not making enough public or private investments that result in jobs or that help to prepare for future jobs. In fact, in the public sector, we are disinvesting. Hundreds of thousands of public sector jobs were lost at the state and local levels when the recession hit. Now federal cuts are reducing more services and jobs.
The Census data show some of what happens when a severe economic downturn is followed by inadequate government investment. Private business has figured out how to make money without creating many jobs, and the public sector has failed to invest enough in renewable energy and other technologies, education, caregiving, and infrastructure to make needed progress in creating jobs. As a consequence, median income is down, and the share of households with income below $50,000 has risen, while the share with income above $50,000 has shrunk.
Almost all of us are getting hurt by the unshared recovery, but the harm is not being inflicted equally. Children remain our most disproportionately poor age group. More than 16 million are living below the poverty line, or 21.8 percent. For children of color, the picture is stunningly worse: one in three African American and Hispanic children is poor. Since 2008, the number of children in extreme poverty (living below half the poverty line) has risen. There are now more than 7.1 million children so deeply poor.
So many millions of children in poverty has a high cost. We are placing them at higher risk of preventable health problems and making it harder for them to succeed in school. Every parent who fiercely protects her children from harm should rise up in anger to think of the struggles poor families go through to feed and house their children, and how more frequent moves or chronic health problems like asthma make it so much tougher for them to get a good education.
The new data do not only tell us the bad news of unshared recovery. They also spotlight successes. For example, there are fewer people without health insurance, and children, especially, have been gaining health coverage. This success comes from expanded Medicaid coverage for children and from the beginnings of the new health care law. Similarly, SNAP/food stamps kept 4 million people out of poverty, and unemployment insurance kept 1.7 million people from being poor.
Knowing this, it is particularly amazing that extremists in the House of Representatives held sway last week to insist on slashing at the programs that work. They pushed votes to deny food stamps to at least 4 million people. They kept the sequestration cuts in place so that there will be still more cuts to Head Start and other education, unemployment benefits, and much more. The Census data tell us that more than four in ten households are paying more than 35 percent of their income on rent, but the House-passed temporary budget would continue harsh cuts in rent vouchers for the poor. The data show that just under 48 percent of 3 and 4 year olds are in preschool, despite all we know about the importance of early childhood education. But the House voted to continue the deep Head Start cuts that are keeping 57,000 young children out of Head Start this fall.
Even worse, they recklessly threaten to shut down government to force an attempt to stop the new health care law, even though (or rather, because) it is working. If they have their way, they will deepen poverty, hunger, and joblessness, and widen the gap between the rich and everyone else. The Senate and the President reject this approach. They want to stop most cuts and to ask those at the top who are only ones who’ve recovered from the recession to do without a few of their tax breaks so we can invest in shared prosperity. It’s up to us to demand that the House turns away from destructive brinksmanship. Congress must take steps so families and children can share in economic recovery, not be closed out of it. There’s no time to waste.