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Public Statements

Poverty

Floor Speech

By:
Date:
Location: Washington, DC

Ms. LEE of California. As the founder of the Congressional Out of Poverty Caucus, I rise today to continue talking about the ongoing crisis of poverty in our country.

Yesterday, unfortunately, with the supplemental poverty report, we learned that poverty continues to impact nearly 50 million Americans, including 16 million children all across our country and in every congressional district. My home State of California tops the list, followed by our Nation's capital--the District of Columbia--Arizona, Florida, and Georgia.

On this election day, low-income Americans, the working poor, middle-income Americans--every American--spoke loudly and clearly. They voted for strengthening the middle class and for putting people back to work, and they voted for Congress to get back to doing the work of the American people: to strengthen our economy for all Americans and to create economic opportunities that will lift millions of families out of poverty and into the middle class. Most importantly, the American people voted to reject job-killing cuts and a tax on Medicare, Medicaid, and Social Security.

What they don't want is for our country to be rushed into urgent budget decisions by the false threat of a so-called ``fiscal cliff.'' Mr. Speaker, I don't buy it, and the American people don't believe it either.

This economic and political gridlock is just another political cliff created by the hostage-taking obstructionism of the Tea Party-controlled Congress. The real cliff that anyone is facing today is a human cliff, and far too many American families are standing on the edge as I speak. If we don't strengthen our economy for all Americans, millions will be cut off from the only lifeline keeping them from falling off that human cliff and into poverty--unemployment compensation. Far too many people will be cut off from vital programs like employment insurance, the Child Tax Credit and the Earned Income Tax Credit if this Congress fails to act.

It is long past time to come together, to work to find a balanced approach and, as Chairman Cleaver just said, to get past the partisan obstructionism that has kept us from moving our economy and our country forward. We have got to stop this. Just 10 years ago, in the year 2000, our Nation had a balanced budget, projected surpluses, and a robust economy. The passage of a serious tax cut rapidly ended those surpluses and began to, quite frankly, explode the debt. The Bush-era tax cuts have already cost over $2.2 trillion in Federal revenue since they were enacted, and we cannot afford to allow them to be made permanent. Let's not forget, Mr. Speaker, that this Congress has already voted to cut $1.5 trillion in discretionary spending enacted through the 2011 Budget Control Act.

Low-income Americans are already hurting from multiple rounds of cuts to programs and benefits that they rely on. Our middle class and our working poor have already done their part, and we cannot continue to attempt to balance the budget on the backs of the most vulnerable Americans--our poor, our seniors, our children, and our disabled.

So I hope all Members of Congress will follow the President's lead and support his call for ending the Bush tax cuts above $250,000, ending the billions in subsidies for Big Oil, and closing the countless loopholes that allow huge corporations and the super rich to avoid paying what they owe. In addition, we can find billions in additional savings by making smart and targeted cuts to our defense budgets. Our military leaders have already outlined cuts that will not put at risk our brave men and women in harm's way or weaken the national security of our Nation. We know that there are billions in waste, fraud, and abuse in the defense budgets that can be saved if we can just account for the hundreds of billions in spending by ensuring the Pentagon can pass an audit.

Mr. Speaker, we face many challenges, but we must not allow our political crisis to create an economic crisis for millions of Americans who are struggling. Now is not the time to turn our backs on struggling families just to preserve tax giveaways to millionaires and billionaires. We must come together to wage a war on poverty and end the war on the poor.

Finally, as 350 economists have said, we need jobs first. With recovery, deficit reduction will come by its own accord thanks to increased revenues in an improving economy. They went on to say that public outlay for jobs and recovery come first, growth is restored, and revenues follow. Budget cuts only lead to a deeper slump.

Census: Fuller Poverty Picture Finds 49.7M Are Poor, Factoring in Medical and Work Expenses

(By Associated Press, November 14, 2012)
WASHINGTON--The ranks of America's poor edged up last year to a high of 49.7 million, based on a new census measure that takes into account medical costs and work-related expenses.

The numbers released Wednesday by the Census Bureau are part of a newly developed supplemental poverty measure. Devised a year ago, this measure provides a fuller picture of poverty that the government believes can be used to assess safety-net programs by factoring in living expenses and taxpayer-provided benefits that the official formula leaves out.

Based on the revised formula, the number of poor people exceeded the 49 million, or 16 percent of the population, who were living below the poverty line in 2010. That came as more people in the slowly improving economy picked up low-wage jobs last year but still struggled to pay living expenses. The revised poverty rate of 16.1 percent also is higher than the record 46.2 million, or 15 percent, that the government's official estimate reported in September.

Due to medical expenses, higher living costs and limited immigrant access to government programs, people 65 or older, Hispanics and urbanites were more likely to be struggling economically under the alternative formula. Also spiking higher in 2011 was poverty among full-time and part-time workers.

As a result, the portrait of poverty broken down by state notably changes. California tops the list, hurt by high housing costs, large numbers of immigrants as well as less generous tax credits and food stamp programs to buoy low-income families. It is followed by the District of Columbia, Arizona, Florida and Georgia.

In the official census tally, it was rural states that were more likely to be near the top of the list, led by Mississippi, New Mexico, Arizona and Louisiana.

``We're seeing a very slow recovery, with increases in poverty among workers due to more new jobs which are low-wage,'' said Timothy Smeeding, a University of Wisconsin-Madison economist who specializes in poverty. ``As a whole, the safety net is holding many people up, while California is struggling more because it's relatively harder there to qualify for food stamps and other benefits.''

Broken down by group, poverty was disproportionately affecting people 65 and older--about 15.1 percent, or nearly double the 8.7 percent rate calculated under the official formula. That's because they have higher medical expenses, such as Medicare premiums, deductibles and drug costs, that aren't factored into the official rate.

While poverty rates for older Americans as a whole are higher, the new measure does show improvement in their income levels--about 15.1 percent were poor last year, down from 15.8 percent in 2010. Smeeding attributes that to a wave of more affluent, still-working baby boomers in dual-income households who are beginning to turn 65 and, as a result, are slowly raising overall income levels for seniors.

Working-age adults ages 18-64 saw an increase in poverty from 13.7 percent based on the official calculation to 15.5 percent, due mostly to commuting and child care costs.

In contrast, the new measure showed declines in poverty for children, from 22.3 percent under the official formula to 18.1 percent. Still, they remained the age group most likely to be economically struggling by any measure.

``These new numbers only reinforce what AARP and AARP Foundation hear from real people every day: older Americans are struggling to make ends meet,'' said Deb Whitman, executive vice president of AARP, an advocacy group. ``Policymakers need to understand that not every senior is well off and the critically important role Social Security or Medicare plays as providing a safety net to keep even more older Americans out of poverty. As Washington debates what should happen during the lame duck, we cannot afford to undermine the current safety net that allows many to live with dignity.''

Hispanics and Asians also saw much higher rates of poverty, 28 percent and 16.9 percent, respectively, compared with rates of 25.4 percent and 12.3 percent under the official formula. Their poverty levels rose after the government took into account safety-net programs such as food stamps and housing, which have lower participation among immigrants and non-English speakers.

In contrast, African-Americans saw a modest decrease in poverty, from 27.8 percent under the official rate to 25.7 percent based on the revised numbers. Among non-Hispanic whites, poverty rose from 9.9 percent to 11 percent.

Economists long have criticized the official poverty rate as inadequate. Based on a half-century-old government formula, the official rate continues to assume the average family spends one-third of its income on food. Those costs have actually shrunk to a much smaller share, more like one-seventh.

The official formula also fails to account for other expenses such as out-of-pocket medical care, child care and commuting, and it does not consider noncash government aid, such as food stamps and tax credits, when calculating income.

In reaction to some of the criticism, the government in 2010 asked the Census Bureau to develop a new measure, based partly on recommendations made by the National Academy of Sciences. It released national numbers based on that formula for the first time last year. This year's release features a 50-state breakdown on poverty, prompted in part by local officials such as New York City Mayor Michael Bloomberg who have argued that the official measure does not take into account urban costs of living and that larger cities may get less federal money as a result.

The goal is to help lawmakers to better gauge the effectiveness of anti-poverty programs, although it does not replace the Census Bureau's official poverty formula.

Among the findings:

--If it weren't for Social Security payments, the poverty rate would rise to 54.1 percent for people 65 and older and 24.4 percent for all age groups.

--Without refundable tax credits such as the earned income tax credit, child poverty would rise from 18.1 percent to 24.4 percent.

--Without food stamps, the overall poverty rate would increase from 16.1 percent to 17.6 percent.

``These figures are timely given the looming expiration of two key measures that account for part of these programs' large antipoverty impact: federal emergency unemployment insurance and improvements in refundable tax credits'' such as the Earned Income Tax Credit, said Arloc Sherman, a senior researcher at the Center for Budget and Policy Priorities, a liberal-leaning think-tank. ``Letting these measures expire at year's end could push large numbers of families into poverty.''


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