By Abid Aslam
WASHINGTON, Aug. 29, 2007 (IPS/GIN) -- Record numbers of people lack health insurance, and poverty remains largely unchanged, even though the U.S. economy began recovering from its recession five years ago.
Modest gains in household income have failed to lift significant numbers out of poverty, the latest U.S. government data show.
The national poverty rate fell to 12.3 percent in 2006, down from 12.6 percent the year before, but it remains well above the 11.3 percent mark recorded in 2000, the last year in which it dropped, representatives from the U.S. Census Bureau said Tuesday. Family earnings have risen modestly because more members were working and contributing to household income, according to the bureau.
Not everyone has benefited, however.
In the countryside, poverty has stagnated at 15.2 percent, three percentage points above the national average. In all, nearly 7.2 million inhabitants of rural areas fell below the poverty line last year, despite rising agricultural prices.
The elderly accounted for much of last year's improvement and, as a group, are better off than they were in 2001. By contrast, poverty rates for children and for adults of working age remained statistically unchanged from 2005 and higher than in 2001, when the last recession bottomed out.
Overall, some 36.5 million people were deemed poor in 2006, about as many as in 2005.
'Five years into an economic recovery, the country has yet to make progress in reducing poverty, raising the typical working-age family's income, or stemming the rise in the ranks of the uninsured, compared even to where we were in the last recession,' said Robert Greenstein, executive director of the nongovernmental Center on Budget and Policy Priorities.
Median income, found at midpoint on the U.S. earnings scale, rose to $48,200 last year, a gain of 0.7 percent or $356 for households in general.
Median income among non-elderly households -- those deemed most sensitive to changes in the economy because they are headed by working-age people younger than 65 -- also rose, by 1.3 percent or $725, to $54,726. This represents a loss of 2.4 percent or $1,336 from the recession year of 2001 and a loss of $2,375 from 2000, when the business cycle last reached a peak.
Asian households recorded the highest median income, $64,200, followed by non-Hispanic whites with $52,400, Hispanics with $37,800 and blacks with $32,000. Incomes levels for these groups were statistically no different in 2005 and 2006.
The official definition of poverty varies with family size and composition. For a family made up of two adults and two children, the poverty level is set at around $20,400. People living in official poverty become eligible for health, housing, food and child care entitlements from the federal government.
Academics and advocates long have complained that the poverty level is set too low because the government uses a formula based on food costs and ignores other significant expenses.
Indeed, the Census Bureau cited the rising cost of medical attention in reporting Tuesday that a record number of U.S. residents lack health insurance.
Faced with rising health insurance costs, employers have trimmed or terminated coverage or insisted that workers find the money to pay higher premiums and deductibles, the Census Bureau said. Low-wage employees simply have been unable to keep up: more than one in six full-time workers now lack health insurance.
Government health insurance provisions also have been reduced slightly.
As a result, the number of people without health insurance increased from 44.8 million in 2005 to 47 million in 2006. The percentage without coverage rose to 15.8 percent in 2006 from 15.3 percent the previous year. Both figures rose for the second consecutive year and were the highest since the government established comparable records dating back to 1998.
The problem was worst among children and minorities.
Some 8.7 million or 11.7 percent of children younger than 18 lacked insurance in 2006. The figures rose from 8 million or 10.9 percent in 2005. Among poor children, 19.3 percent had no health insurance.
Children make up 25 percent of the U.S. population but 35 percent of those living in poverty.
Last year 34.1 percent of Hispanics lacked insurance, as did 20.5 percent of blacks and 10.8 percent of whites.
Despite the dwindling coverage offered by employers, the number and percentage of uninsured children fell between 1998 and 2004. Much of the progress was attributed to a nationwide initiative launched in 1998 and designed for families too wealthy to qualify for the federal government's Medicaid program but too poor to afford private insurance.
Those gains stalled after 2004 as money for the State Children's Health Insurance Program began to decline. Additionally, federal documentation requirements introduced last year resulted in delays or the denial of Medicaid coverage for tens of thousands of low-income U.S. citizen children whose parents lacked ready access to their offspring's birth certificates or passports.
The U.S. Senate and House of Representatives passed bills last month that would dramatically increase financing for the State Children's Health Insurance Program. The measures could reduce the number of uninsured children by between 3 million and 4 million by 2012, according to the Congressional Budget Office.
President George W. Bush has said he would veto the measures because they would lead people to drop out of private coverage in favor of children's coverage financed with public money.
In recent years, government agencies and charitable groups have issued reports describing the economic life of U.S. citizens as a precarious affair. More than 25 million are forced to resort to donations of food to sustain themselves and their families, according to the country's largest network of food banks. Among them, about 30 percent lived above the federal poverty line.
