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Poverty's Cost


July 12-18, 2006


Compiled by Clara Jeffery


One in four U.S. jobs pay less than a poverty-level income. During the 1980s, 13 percent of Americans ages 40 to 50 spent at least one year below the poverty line; by the 1990s, 36 percent did. Since 2000, the number of Americans living below the poverty line at any one time has steadily risen. Now 13 percent of all Americans--37 million--are officially poor. Among households worth less than $13,500, their average net worth in 2001 was $0. By 2004, it was down to -$1,400.

Bush's tax cuts (extended until 2010) save those earning between $20,000 and $30,000 an average of $10 a year, while those earning $1 million are saved $42,700. In 2002, Sen. Charles Grassley, R-Iowa, compared those who point out statistics such as the one above to Adolf Hitler.

Bush has dedicated $750 million to "healthy marriages" by diverting funds from social services, mostly childcare. Bush has proposed cutting housing programs for low-income people with disabilities by 50 percent.

Among the working poor, 13 percent of income is spent on commuting if public transportation is used and 21 percent if a private vehicle is used. Workers who earn $45,000 or more spend 2 percent of their income on commuting. Two out of every three new jobs created is in the suburbs. Fifty-eight percent of Boston-area jobs suitable for welfare-to-work participants are within a mile of public transit. Seventy-six percent of Boston welfare moms don't own a car.

One in three people who've left welfare since 1996 did so because they couldn't meet program requirements or they hit the five-year limit. One in seven have no work, no spousal support and no other government benefits.

Forty-six million Americans are uninsured--a 15 percent increase since 2000. Eighty-three percent of those earning $75,000 or more work for companies that offer insurance, versus 24 percent of those who earn less than $25,000. Fifty-one percent of the uninsured are $2,000 or more in medical debt. Sixteen percent owe at least $10,000. In 1997, three out of four doctors provided some free or reduced-cost care. Now, two out of three do.

Two in five elderly live on less than $18,000 a year, including Social Security benefits. Last fall, Minnesota firefighters let an elderly man's mobile home burn down because he hadn't paid a $25 "fire fee."

In 2004, 600,000 high school students dropped out. If each had stayed in school for just one more year, the nation would have saved $41.8 billion in lifetime healthcare costs.

Two-thirds of the reported "shrinking" gap between white and black men's wages is attributable to black men dropping out of the labor market altogether. The true jobless rate of black men in their 20s without a high school diploma is 72 percent.

A prison record reduces a convict's wages by about 15 percent and wage growth by 33 percent. Since 1983, college tuition has risen 115 percent. Fifty two percent of poor college-qualified students go to a four-year college within two years of graduating. Eighty-three percent of richer qualified students do.

Corn subsidies have helped the price of soda fall 30 percent since 1983. Meanwhile, the price of fruit has risen 50 percent. Per capita, the National Institute of Health spends $68 on diabetes, which disproportionately affects the poor, and $1,414 on Lyme disease, which is named after a suburb in Connecticut.

Sixty-three percent of federal housing subsidies go to households earning more than $77,000; 18 percent go to households earning less than $16,500.

Since 1976, the federal budget has doubled, while HUD's budget has declined by 65 percent. Initially an anti-redlining effort, sub-prime mortgages have risen tenfold since 1994. Today, one in four sub-prime lenders are predatory, charging recipients 7 percent in up-front fees. Conventional or "prime" mortgage users are charged only 1 percent. Two percent of prime mortgages carry prepayment penalties; 80 percent of sub-prime ones do.

America now has twice as many publicly available gambling devices that take money--slot and video poker machines and electronic lottery outlets--as it has ATMs that dispense it.

Credit card late fees are 194 percent higher than in 1994. The average credit card balance for households earning less than $35,000 is $4,000. At 11.5 percent APR, making the standard minimum payment of 2 percent per month, it takes 13 years to pay off a $4,000 balance.

One in seven families claim the Earned Income Tax Credit (EITC), designed to lift the working poor above the poverty line.

In 2003, the IRS estimated it "protected" $3.1 billion of revenue by cracking down on EITC filings. Half of all audits are now conducted on taxpayers earning less than $25,000.

Forty-one percent of those making less than $30,000 think there is "a lot" of tension between the rich and the poor. Only 18 percent of those making $100,000 to $150,000 think this.


Reprinted with permission from 'Mother Jones' magazine. ©2006, Foundation for National Progress. The Byrne Report will return next week.





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