The coronavirus pandemic last year left millions of people unemployed and triggered the worst economic contraction since the Great Depression. Yet the share of people living in poverty in the United States last year actually fell by at least one measure due to the government’s massive relief effort.
About 9.1% of Americans were poor last year, the Census Bureau reported on Tuesday, up from 11.8% in 2019. This is based on a measure of poverty that takes into account the impact of aid programs. government, who pulled millions of people out last year. poverty. The government’s official measure, which excludes some major aid programs, rose to 11.4%, from a record 10.5% in 2019.
The fact that poverty has not increased further during such a huge economic disruption reflects the government’s equally huge response. Congress extended unemployment benefits and food aid, distributed hundreds of billions of dollars to small businesses, and sent direct checks to most American households. The Census Bureau estimated that direct controls alone lifted 11.7 million people out of poverty last year and that unemployment benefits kept 5.5 million people from falling into poverty.
“Despite the pandemic, unemployment, recession, poverty has not increased,” said Irwin Garfinkel, co-director of the Center on Poverty and Social Policy at Columbia University School of Social Work, referring to the alternative measure. “If it hadn’t been for the government grants, poverty would have exploded.”
Poverty increased much more drastically after the last recession, peaking at 15.1% in 2010 and improving only slowly thereafter.
Yet government aid programs have excluded certain groups, such as undocumented immigrants and their families, and have failed to reach others. Millions of people have had to wait weeks or months to receive benefits, forcing many to seek help from food banks or other charities.
“We measure poverty every year, when the reality of poverty is faced on a daily basis,” said Hilary Hoynes, an economist at the University of California at Berkeley, who has studied the government’s response to the pandemic. .
Many of the programs that helped people avoid poverty in the past year have expired, even as the pandemic continues. An estimated 7.5 million people lost their unemployment benefits this month after Congress allowed program extensions to expire during the time of the pandemic.
The new data could fuel efforts by President Biden and congressional leaders to enact a more sustainable expansion of the safety net. The Democrats’ $ 3.5 trillion plan, which is still taking shape, could include paid family and medical leave, government-funded child care, and a permanent extension of the child tax credit. The Liberals said the success of aid programs last year showed that such policies must be continued and expanded.
“This tells us it works to go big,” said Arloc Sherman, a poverty researcher at the Center on Budget and Policy Priorities, a progressive research group. “We have had the answer from the start. These policies are extremely effective when actually used.
But many conservatives argue that while some expansion in government assistance was appropriate during the pandemic, these programs should be cut as the economy recovers.
“We had to balance concerns about poverty, which is at an all-time low, with concerns about federal debt,” said Scott Winship, senior researcher and director of poverty studies at the American Enterprise Institute, a conservative group.