The good, the bad, and the ugly in the latest poverty numbers

Gunslinger reaching for his gun

The good, the bad, and the ugly in the latest poverty numbers

Gunslinger reaching for his gun

The good, the bad, and the ugly in the latest poverty numbers

Recently, the U.S. Census released the latest figures on poverty. The topline numbers certainly gave reason to cheer. Yet, as we look at the broader picture, it is far from rosy. Here is the good, the bad, and the ugly in the poverty numbers.

The good news: child poverty fell drastically

From 2020 to 2021, child poverty didn’t just fall. It fell by a lot.

National figures showed a 40 percent drop in the official childhood poverty rate, from 9.7 percent in 2020 to 5.2 percent in 2021. Last year’s figure was a record low.

This historic drop in the childhood poverty rate is largely due to the expansion of the Child Tax Credit (CTC), a refundable credit that provides monthly cash payments to families with children. In Oregon, that benefit went to an estimated 763,000 children. According to the Center on Budget and Policy Priorities, had the Child Tax Credit not been expanded in 2021, 2.1 million more children in the U.S. would have faced severe economic hardship.

Most of the money from the expanded Child Tax Credit went to pay for essentials like food and rent. At the start of the school year, families spent the money on school expenses, including books, supplies, tutoring and after-school programs. These patterns were particularly the case among Black, Latino, and other families of color.

With a simple fix — getting cash into the pockets of families — Congress illuminated a path to ending child poverty.

The bad news: unless Congress acts quickly, the gains won’t last

Congress let the Child Tax Credit expansion expire at the end of 2021. Congress failed to take action, resulting in about 750,000 children in Oregon getting cut off from the added support. Many of these Oregon children and their families will fall back into poverty due to congressional inaction.

All hope is not lost. Congress can still take a stand against child poverty and reinstate the expansions to the Child Tax Credit. There is an opportunity to take action as a part of bipartisan year-end legislation. Policymakers must prioritize expanding the Child Tax Credit, especially as the rich and powerful push to advance their own interests with more tax cuts for corporations.

The ugly: an outdated poverty line understates economic insecurity

Though lifting people out of poverty is a good thing, the sad reality is that rising above the poverty line is no assurance of being economically secure — not by a long shot.

Poverty as a measure of economic hardship is outdated and inadequate. For a family of three to be considered poor in 2022 they must earn less than $23,030 — an amount that is far too little to survive on. While increasing family incomes any amount is a victory, we cannot settle for children being merely above the poverty line.

A methodology developed by the United Way provides a more realistic estimate of what it takes to make ends meet. The United Way’s Asset Limited, Income Constrained, Employed (ALICE) measure accounts for the full range of essentials: housing, child care, food, transportation, health care, and means of basic communication such as a phone. In Oregon, many families aren’t paid enough to meet a “survival budget” that covers these necessities. In 2018, 44 percent of Oregonians fell below this survival threshold.

The bottom line: economic security for everyone must be the goal

While Congress must take action to expand the Child Tax Credit to provide urgently-needed assistance to families with children, we must also be looking at larger, structural changes to end economic hardship. Check out our Action Plan for the People: How to Build Economic Justice in Oregon to see the policy changes Oregon can put in place to make Oregonians more economically secure.

Audrey Mechling

Audrey Mechling

Audre Mechling is the Oregon Center for Public Policy's Digital Communications and Outreach Strategist

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