Recession Leaves Millions Of Americans In Poverty

The ranks of the working-age poor climbed to the highest level since the 1960s as the recession threw millions of people out of work last year, leaving one in seven Americans in poverty. The overall poverty rate climbed to 14.3 percent, or 43.6 million people. Host Michel Martin speaks with Margaret Simms, senior fellow at the Urban Institute and Anirudh Krishna, associate professor of public policy at Duke University.

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MICHEL MARTIN, host:

I'm Michel Martin, and this is TELL ME MORE from NPR News.

Today, we will continue our focus on education all through September. That's been our focus, with a number of conversations.

In a few minutes, we'll take a look at for-profit colleges. It's become an article of faith that education is the way out of poverty and into lasting employment. But when it comes to for-profit colleges, do the benefits still outweigh the costs? We'll have that conversation in a few minutes with a person who represents for-profit colleges.

But first, we'll talk about poverty in its own right. President Barack Obama addresses the United Nations this week and is expected to urge world leaders to forge ahead with cutting the world's rate of extreme poverty in half.

That is something the president has to face in this country, too, because the U.S. has experienced a dramatic jump in the number of poor. The Census Bureau reports that 43.6 million people were living in poverty last year. That is the largest number since the Census Bureau began keeping track 51 years ago. That's up almost four million people from the year before.

And among those particularly hard hit are African-Americans and Latinos. The poverty rates for both groups have surpassed the 25 percent mark. Now, we've sifted through some of this data, and we decided to call two guests who've not only been thinking a lot about the problem, but they've also been thinking about solutions to such high rates of poverty, and they're with us now.

Margaret Simms is a senior fellow at the Urban Institute. She is an expert, among other things, on the economic well-being of African-Americans. And Anirudh Krishna, who is the author of a new book called "One Illness Away: Why People Became(ph) Poor and How They Escape Poverty." And he is an associate professor of public policy at Duke University. And I welcome you both, and thank you so much for joining us.

Ms. MARGARET SIMMS (Senior Fellow, Urban Institute): Thank you, glad to be here.

Dr. ANIRUDH KRISHNA (Public Policy and Political Science, Duke University): Thank you for having me.

MARTIN: Professor Krishna, I'm going to start with you. I wanted to ask: The new numbers, the new census numbers out, does that - is that a real number? Because people often dispute that these statistics really capture something real that's going on in the economy. And I wanted to know, is that a real number? Does that describe a significant decline in the economic well-being of a lot of people?

Mr. KRISHNA: Oh, yes, these are real numbers, Michel. And frankly, they're not very surprising. In fact, I would have been surprised if there had been a decrease in poverty during this time.

The point is, as I see it, that the United States has one of the highest rates of falling into poverty. Large numbers of Americans are falling into poverty every year.

In good years, this gets balanced and masked by job creation and people moving out of poverty. But in bad years, such as the present time, when people aren't moving out of poverty, and they're only falling into poverty, then we get the four million increase that we have seen.

And this is a consecutive increase over the past three years. It's not just a current time. And as you rightly said, if we keep going at this rate, then poverty among Americans, African-Americans and Latino-Americans, will soon be greater than poverty in India, which is right around 30 percent. And compared to India, we can do so much more.

MARTIN: And Margaret Simms, if you would pick that ball up. First of all, I assume you agree that this is a real number. The question I would have is: Why is poverty so persistent in this country?

Ms. SIMMS: Well, yes, it's a real number. And we can talk about what's the best measure of poverty. But these numbers are similar to what we've been keeping over the years. So they give us a sense of how we are making progress or whether we are making progress.

Clearly, one of the things that we see in the numbers and in related numbers released by Census in their report is the decline in employment. It's clear that the large unemployment numbers are influencing poverty and near-poverty. The number of African-Americans and Hispanic families who are just above the poverty line is also quite large.

If we were to expand to look at that, it's one in three African-American or Hispanic families who are near poverty and, no doubt, unemployment is an important factor there.

MARTIN: And why does the poverty rate, Margaret Simms, why does poverty remain so high? Obviously, we're in a recession, and there's been job loss, a significant job loss among a lot of sectors. But there are a lot of people that continue to argue that the real issue isn't so much the out the circumstances overall, the way the economy works, but that it's behavior, it's individual behavior. That people aren't getting enough education to meet the jobs that are there. That their own sort of personal behavior contributes to an inability to succeed in the economy that it is. What is your take?

Ms. SIMMS: Well, I think that certainly their behavior is a part of it, but it's a very small part of it. For example, many people are in poverty even though they work. But they are unable to work full-time, and they are unable to work at wages that pay them above the poverty line.

And we find that over the past 10 years, there had been more of an emphasis on people should get out and work. They shouldn't be supported by welfare. And there have been some incentives to do that. But it doesn't always mean that people will be economically secure. And that's a fundamental problem that we need to deal with.

MARTIN: And Professor Krishna, you've studied this question globally. What are the ways in which the I was struck by something you just said, which is you said if this rate continues, then the poverty rate in the U.S. will be higher than in India. I think that would be a shock to many people. What are the underlying factors here about why poverty remains so high in the U.S.?

Mr. KRISHNA: My feeling about this - first, let me say that I mentioned poverty among African-Americans and Latino-Americans. That's the worrying numbers for me because they're more than 25 percent and rising fast, faster than the other poverty rates for other population segments are rising.

But in answer to your question, Michel, I agree with Margaret that education is very important and employment is very important. But I also feel that without providing health care coverage to all, we are not going to make a dent in poverty because in the vast majority of cases I saw in the United States and in other countries, people fall into poverty when a serious illness strikes them or strikes a family member, and they don't have insurance. People...

MARTIN: If you're just I'm sorry. Let me just jump in to say if you're just joining us, you're listening to TELL ME MORE from NPR News. I'm speaking with economist Margaret Simms of the Urban Institute and Anirudh Krishna, associate professor of public policy and political science at Duke University. We're talking about last week poverty numbers from the Census Bureau that show a remarkable jump in the number of people living in poverty in the United States.

Professor Krishna, if you'd continue your thought, you've written that the focus probably shouldn't be as much on ending poverty as it should be on stopping its growth. Could you talk more about that?

Mr. KRISHNA: That's absolutely right, Michel. Everywhere we look, we found that there were two simultaneous flows of people, one flow of people into poverty and another flow of people out of poverty.

People got out of poverty when they had good education and jobs, but people fell into poverty when they suffered a serious illness or injury, and they didn't have health insurance coverage.

They sold off their assets to meet the medical costs they had. They took out long-term loans at very high rates of interest, and both these strategies led to bankruptcy and ruin. Unless we do something about health care, we cannot fix the problem of people falling into poverty. No country in history has fixed the problem of poverty without first fixing health care.

MARTIN: And Margaret Simms, what do you think about that? What obviously, this is such a big topic, but what are your thoughts? You've been thinking about this for a very long time.

Ms. SIMMS: Well, I think one of the things we really need to be concerned about is not just people falling into poverty but people who are persistently poor. And the numbers that were released don't really show that, but how many people are poor year after year.

The Urban Institute has released a study recently looking at persistent poverty among children and its impact on them as young adults. And what we see is that - when I say persistently poor, that means that children spend more than half of their childhood, up to age 18, in poverty.

And what we find is that African-American children are seven times more likely than white children to spend more than half of their life in poverty. And that has an impact on them as young adults.

They're more likely to have a non-marital birth. They're less likely to complete their education and less likely to be consistently employed. And what that suggests is that we really need to think about a two-generational strategy.

You can't just focus on education and making the children better. You need to make the circumstances in which they currently live better. So you need to help the parents, as well as the children.

MARTIN: Is there anything, Margaret Simms, and Professor Krishna, I'll ask you this question, as well: Is there anything in current policy that you feel addresses this head-on? You know, I was struck by the Sunday morning talk shows over the weekend and how little discussion there was about this issue.

There were headlines in the major newspapers, but you didn't get the sense that this is something that everybody was talking about over the weekend, at least among sort of at the highest level of government. I don't know, maybe they were, and I just don't know about it. But do you - is there something in policy that you feel addresses this head-on? Is this seen as urgent?

Ms. SIMMS: Well, it is seen as urgent by some of us, but certainly it's not getting a lot of play in today's current debate. There is so much focus on the deficit and not so much on the human deficit, that is how we deal with improving the lives of people in our society that also help them be more productive, which will be better in the end for all of us.

MARTIN: And to that point, in fairness, I will say that the president did speak about this at the Congressional Black Caucus dinner this weekend, and I think we have a clip of him, of his remarks. I'll just play it. Here it is.

President BARACK OBAMA: This historic recession, the worst since the Great Depression, has taken a devastating toll on all sectors of our economy. It's hit Americans of all races and all regions and all walks of life.

But as has been true often in our history and as has been true in other recessions, this one came down with a particular vengeance on the African-American community.

MARTIN: So, Professor Krishna, we have just a minute left, the same question I asked Margaret Simms. Do you think there's anything in current policy that addresses this problem as squarely as you would like to see it?

Mr. KRISHNA: I think there needs to be much more discussion front and center first about health care and its close link with poverty. Those numbers have also increased the numbers of the uninsured, and they've increased the most among people whose poverty has also increased the most, Latino Americans and African-Americans.

Second, there needs to be much more discussion about equality of opportunity. I saw many smart, hardworking young people in poorer communities in the United States and elsewhere not even aspiring to high positions because they don't know very much about them. We need much more focus on equality of opportunity as part of the poverty debate. That's all I have to say, Michel, thank you.

MARTIN: Anirudh Krishna is associate professor of public policy at Duke University, who studied the impact of poverty and powerlessness. He's author of the book "One Illness Away: Why People Became(ph) Poor and How They Escape Poverty." He joined us from Durham, North Carolina.

Margaret Simms is a senior fellow at the Urban Institute. She is an expert on economic well-being of African-Americans. And she was kind enough to join us in our Washington, D.C. studio. And I thank you both for speaking with us.

Ms. SIMMS: My pleasure.

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