Ford School Policy Points

September 7, 2012

Sheldon Danziger: Congress must do more to alleviate rising poverty

Sheldon Danziger is the Henry J. Meyer Distinguished University Professor of Public Policy and the director of the Ford School’s National Poverty Center.

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Sheldon Danziger says:

Every fall, the Census Bureau releases the official data on poverty and income for the previous year. So this year, we are expecting poverty to increase perhaps to as high as 15.5 percent.

Poverty reached 15 percent in the recession in the early 80s and the early 90s but hasn't been at 15.5 percent since the late 60s or early 70s.

Poverty is high because unemployment in 2011 was above 8 percent in every month, and some parts of the stimulus bill began to expire in 2011. Poverty would have been even higher had the stimulus bill not continued to provide extended unemployment insurance benefits to millions of workers in 2011. Now, those go away in 2012, and poverty is likely to continue to increase unless Congress does more to promote the creation of jobs either in the public or private sector.

Poverty is likely to remain high for several years, even if the unemployment rate starts to slowly decline because we live in a world where a rising tide no longer lifts all boats. So we need to have explicit government policies to raise the employment and earnings of low-wage workers who continue to have difficulty earning above poverty income in the kind of private economy we have.

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