Record number of Americans live in poverty, lack health insurance

A record number of Americans are living in poverty. That’s according to new numbers released by the Census Bureau today for 2009, which also show the number of people who have health insurance decreased for the first time since 1987, when officials started tracking the data. But, as FSRN’s Jacob Fenston reports, the numbers weren’t as bad as many expected.

TRANSCRIPT

In 2009, 14.3 percent of Americans -- about 1 in 7 -- were officially living in poverty. That's up from 13.2 percent in 2008.

DAVID JOHNSON: I think there have been a lotta predictions out there projecting the
poverty rate going up more than we suggested.

That's David Johnson of the Census Bureau. Economists were predicting a poverty rate as high as 15 percent. But Johnson says two things contributed to the slightly lower number.

JOHNSON: The poverty rate for the elderly actually fell for this period. Mainly because of social security benefits.

And unemployment insurance.

JOHNSON: The expansion of that actually brought 3.3 million people out of poverty.

Another factor is that people are living differently -- many more 20- and 30-somethings are living with their parents. This "doubling up," combines incomes, and bumps families above the poverty line. The poverty rate among young people living with their parents would be five times higher, if they were on their own, according to census officials.

But Harvard economist Bruce Meyer says the overall poverty rate would actually be lower, if we took into account all the government programs to help the poor:

BRUCE MEYER: The way it's calculated doesn't include food stamps, doesn't include tax credits, doesn't include housing benefits, doesn't include Medicaid.

But another problem is that the poverty line is low, in fact, it was lowered in 2009. For a single person, the federal poverty threshold is about $11,000 a year. For a family of four --  including two children -- it's about $22,000.

Kristin Seefeldt, public policy professor at Indiana University, says the way this measure is calculated is outdated.

KRISTIN SEEFELDT: Yes, it was developed in the early 1960s, based on spending patterns in the 60s.

And, there's no accounting for differences in cost of living.

SEEFELDT: So it's the same no matter if you live in New York City, or if you live in rural Wyoming.

She says this recession hit the poor especially hard, since welfare reform in 1996 tied welfare to work.

SEEFELDT: Maybe that approach makes sense when the economy's booming, like it was in the late 90s, but we don't really have a plan for dealing with poor people who lose their jobs and can't find new ones during periods of a recession.

The new census data also showed 4.4 million more people lacked health insurance last year.

Quentin Young, with Physicians for a National Health Plan, says these numbers show why an employment-based health care system doesn't work.

QUENTIN YOUNG: The system is unraveling with the economy, and beyond the economy. The costs of health insurance have gone up astronomically.

The numbers released Thursday are part of the annual Current Population Survey. It's based on a sample of 100,000 households from across the country.

Jacob Fenston, FSRN, Washington.