New data released by the Census Bureau on September 17th show that poverty remains stubbornly high. In New Hampshire, 9.2 percent of people were poor in 2014 – roughly the same as in 2013 when 8.7 percent were poor.
The child poverty rate rose, with 13 percent of New Hampshire children living in poverty in 2014 – an increase from 2013 when 10.2 percent of our children were poor.
Disappointingly, our country’s economic recovery is hardly reaching New Hampshire’s poor, and progress remains slow. Nationally, the poverty rate fell slightly from 15.8 percent in 2013 to 15.5 percent in 2014. However, even if poverty keeps declining at the current rate – an extremely optimistic estimate – it would still take more than 25 years just to cut poverty in half across the U.S. It would take even longer – nearly 35 years – to bring child poverty down to that level.
In order to speed up the pace, New Hampshire and the nation need to maintain and expand investments in programs with proven success in helping people out of poverty. The new Census Bureau findings add to the mounting evidence that programs like low-income tax credits, SNAP/food stamps, and subsidized housing reduce poverty now and improve children’s chances of gaining economic security in the future. But some effective programs do not reach enough of the nearly 118,000 Granite Staters and the 48 million Americans struggling in poverty every day, and others, like SNAP, could do more good if their benefits were higher. Even the modest progress beginning to show in the Census data will stall unless Congress acts to end spending cuts known as sequestration scheduled to hit many of these programs this fall.
Deep and Disproportionate Poverty
For a family of four in 2014, the official poverty line was less than $24,230. Despite this low threshold, more than 47,000 Granite Staters live on far less, below half of the poverty level. Across the nation poverty disproportionately affects people of color. Nearly 27 percent of African Americans and 24.1 percent of Latinos in the United States are poor. In contrast, poverty for non-Hispanic whites is 10.8 percent. Nearly 22 percent of children are growing up in poverty, and the statistics are worse for children of color: 36.9 percent of African American children and 32.1 percent of Hispanic children nationally are poor.
We Can Speed Up the Pace in New Hampshire
Proven human needs programs lift millions out of poverty. The Earned Income Tax Credit (EITC) and Child Tax Credit (CTC) lifted 16,000 Granite Staters, including 8,000 children, out of poverty each year, on average, during 2011 to 2013. In 2014, housing subsidies lifted 2.8 million Americans out of poverty, and the Supplemental Nutrition Assistance Program (SNAP, formerly known as food stamps) lifted 4.7 million people out of poverty across the U.S.
Numerous research studies also show that investments in quality, affordable child care and early childhood education also lead to long-term gains for children, families and our economy. For example, Head Start participants are more likely to attend college and be employed and less likely to be a teen parent or in poor health compared to siblings who didn’t benefit from Head Start.
Congressional Cuts will Thwart Progress in New Hampshire
As effective as these programs are, their effectiveness is limited because of underfunding, and proposed Congressional cuts threaten these programs further. First imposed in 2013, sequestration’s impact through the end of 2014 resulted in 8 of the 18 agencies administering housing vouchers in New Hampshire reducing the number of households they served by 132 (some agencies in New Hampshire were able to increase the number of households served through 2014). The 2013 sequester cuts also denied Head Start services to 146 New Hampshire children. Thousands of rental vouchers were restored when Congress partly halted sequester cuts in FYs 2014 and 2015, and the numbers of children served by Head Start returned to previous levels in most areas.
Unfortunately, spending bills Congress has advanced so far this year assume that sequestration cuts will return in FY 2016. These House and Senate bills undercut the gains of the nation’s successful anti-poverty programs. Their proposed appropriations would mean that 1,300 fewer children in New Hampshire would have access to full day, full year Head Start when compared to President Obama’s budget. The House spending bill not only fails to restore the 67,000 rental vouchers still lost due to sequestration in 2013, it would cut even more, failing to renew 28,000 existing vouchers nationwide. As a result, 130 fewer New Hampshire families would have the use of housing vouchers in 2016. The Senate spending bill is even harsher, failing to renew 50,000 existing vouchers nationwide, leaving 230 New Hampshire families without this assistance.
More than 130 human needs programs have seen their funding cut since 2010, adjusted for inflation; about one-third were cut by 15 percent or more. Further cuts to these programs threaten to halt the progress made in 2014 in reducing poverty. The Congressional Budget Office also estimated that maintaining sequestration could lead to losses equal to as many as 1.4 million jobs over the next two years. Compounding these losses, as many as 10,900 fewer workers in New Hampshire would have access to job training and employment services if Congress has its way, compared to the President’s budget. New Hampshire would lose as much as $3 million in federal funding for K-12 education in low-income schools (Title I). We need more investments – not less – in programs that are proven to reduce poverty so more Americans who need help can get it.
There is talk that Congress might avoid the sequester cuts by cutting safety net programs that don’t rely on annual appropriations, like SNAP and Medicaid. This is the wrong approach. The U.S. Department of Agriculture found that 13.9 percent of New Hampshire households were “food insecure” over the years 2012-2014 – that is, they could not always afford enough food. SNAP reduces such hardships, but cuts in SNAP that occurred at the end of October 2013 cut the average benefit from $1.70 per meal to $1.40. According to health researchers Children’s HealthWatch, that cutback made SNAP households with children under age three 23 percent more likely to be food insecure, placing the children at risk for bad health and education outcomes. If Congress seeks to offset the cost of stopping sequestration, it should close tax loopholes or end a few corporate tax breaks. Ending the extra tax breaks for hedge fund managers, for example (a proposal with bipartisan support), would save nearly $1.4 billion a year, nearly enough to fund the $1.5 billion to cover a full year, full day program for all children in Head Start.
In addition, if Congress fails to renew improvements made in 2009 to the EITC and CTC before they expire in 2017, 16 million people – including 8 million children – will be pushed into or deeper into poverty across the U.S.
Congress Needs to Stop the Cuts
Our state and our country are continuing to recover from the Great Recession, and too many Granite Staters are still being left behind. By 2020, more than half of children in the U.S. are expected to be part of a minority racial or ethnic group. If the shamefully high poverty numbers for African American and Latino children stay so high, the future economic growth of New Hampshire and our country will be endangered as a larger proportion of our children grow up with less education and less connection to good-paying jobs. Increasing investments in programs like Head Start and safe, secure housing will give these children a better start and will benefit New Hampshire and our country as a whole as they become adults.
Members of Congress have a choice to make. They can continue to cut, forcing more Granite Staters into poverty and pushing our country backwards. Or they can stop the sequestration cuts so New Hampshire and the whole nation can expand – not cut – programs that prevent and eliminate poverty. And they can do so without cutting safety net programs like SNAP, low income tax credits like the EITC and CTC, and Medicaid.
Growing Up Granite
Our friends at the NH Fiscal Policy Institute released the following based on the census data:
The latest pieces of the puzzle regarding New Hampshire’s economic health reveals a mixed bag. According to data released yesterday by the US Census Bureau, more residents have health insurance, yet household incomes are barely rising and poverty reduction remains elusive.
Following two years with very little change, in 2014, the number of New Hampshire residents without health insurance fell by nearly 20,000, from 140,252 to 120,456. A decline was reasonably expected given that New Hampshire began enrollment in its Health Protection Program, which expands health insurance access for low-income adults, in August 2014. Previously released telephone survey results from Gallup corroborate the Census findings. For context, 9.2 percent of the state population is estimated to not have health insurance. This places New Hampshire in the middle of the pack among states, with Massachusetts (3.3 percent) and Texas (19.1 percent) being the states with the lowest and highest shares of its residents without health insurance.
Additionally, the Census data does not fully capture the effects of expanded Medicaid in the New Hampshire because the state began the program mid-year. In contrast, respondents to the American Community Survey, the tool the Census Bureau uses to capture this information, received the survey at various points throughout calendar year 2014. Thus, if a resident received a survey in March and was uninsured, but then obtained a policy in August through the Health Protection Program, they would still be counted by the Census Bureau as uninsured. Consequently, this time next year, a further decline in the number of uninsured is probable.
On the other hand, New Hampshire residents continue to struggle with exiting poverty, especially those in households with children. Between 2013 and 2014, the total number of Granite Staters in households with income below the poverty line rose from 111,495 to 117,983. While this increase is not statistically significant, it does indicate that our least fortunate residents are making minimal headway in climbing the economic ladder. Notably, New Hampshire’s poverty rate of 9.2 percent is the lowest in the nation.
Mississippi, at 21.5 percent, has the highest share of its population living in poverty. Nevertheless, the issue of households not earning enough for basic needs has become more pervasive since the turn of the century, with the number of New Hampshire residents living in poverty having almost doubled since the year 2000.
For households with children, the situation appears to have worsened again. In 2014, 12.5 percent or nearly 32,900 related children under age 18 lived in households with incomes below the poverty line. This is a statistically significant rise from 2013, when it was estimated that 9.7 percent or nearly 25,600 children were in households earning less than the official poverty level.
Finally, in 2014, the state’s median household income – the income level representing the middle of all the state’s households – was $66,532. While it is encouraging that this figure, adjusted for inflation, has stabilized over the last two years, the fact remains that the purchasing power, or ability to buy goods and services, of the median income household is about 7 percent lower than it was in 2007.