New York TIMES/June 13, 2002
A Rise in Child Poverty Rates Is at Risk in U.S.
By JEFF MADRICK
THE sharp cut in welfare caseloads in recent years has forced many skeptics to acknowledge that the controversial reforms of 1996 had some merit. In addition to reducing the welfare rolls, one of the legislation's objectives was to raise the standard of living of poor children. The poverty rate of children has indeed dropped substantially as their parents have found work.
But many, if not most, of these surprisingly good results were a consequence of the economic boom of the late 1990's, which created so many jobs. And now a rise in child poverty rates is again a risk. The unemployment rate is up. The House has just passed a tougher welfare reform proposal requiring still more hours of work for aid recipients, even as the job market softens. The Senate also faces renewal of two important family welfare programs and is not likely to expand benefits significantly. In the meantime, states are likely to cut back on social programs now that the recession has seriously strained their finances.
In truth, not enough progress was made during the boom years. Over all, the official child poverty rate has fallen to 16 percent, but it is still well above the lows of the late 1960's and 1970's of around 14 percent, and the rate probably moved up in 2001. Child poverty for blacks and Hispanics, also down, is still an unconscionable 30 percent and 28 percent, respectively.
But the financial state of America's children becomes a stark national embarrassment when we compare it with that in other rich nations. Timothy Smeeding of Syracuse University, based on work done in collaboration with his Harvard colleague Lee Rainwater, has completed probably the most comprehensive study to date on the subject.
Because poverty rates are measured differently across nations, they are not typically comparable. To adjust for this, Mr. Smeeding draws a poverty line at a specific percentage of a nation's median income (including government cash and near-cash transfers, like America's food stamps). In Europe, official poverty lines are typically about 50 percent of median income, or even higher. In the United States, it is somewhat above 40 percent.
Based on a poverty line of 40 percent, Mr. Smeeding calculates that America still has a child poverty rate of 14.8 percent, the highest among the 19 rich members of the Organization for Economic Cooperation and Development for which he has data. Only Italy comes close, at 14.6 percent. The next closest is Canada at 9.6 percent, then Britain at 8.4 percent. France's child poverty rate is only 2.9 percent, Taiwan's is 2 percent, and Sweden is at the bottom of the list, at 1.3 percent.
The American data is updated through 1997, but the fall in the poverty rate since then does not alter the national relationships because the differences are so large.
Mr. Smeeding also adjusts these income levels for what they can actually buy in each nation, or "purchasing power parity." By doing this, he can estimate the actual standard of living of children in different countries.
It turns out that America's poorest children -- say, those in the bottom 10 percent -- have a lower standard of living than those in the bottom 10 percent in any of the other nations measured except Britain.
Moreover, the gap from rich to poor is far higher in the United States than anywhere else. In America, he finds, a child in the 90th percentile -- one whose income is higher than 90 percent of all children -- has an adjusted income five times that of one in the 10th percentile. In all other nations, it is an average of three times.
The United States also has the greatest gap between the child in the middle of the pack -- the median -- and the poor child in the 10th percentile.
Guy Stevens, a senior economist at the Federal Reserve until his recent retirement, supplements income data with an analysis of a couple of dozen noneconomic indicators of childhood well-being. He finds that the state of America's poor children is every bit as bad as the low incomes suggest.
Infant mortality rates in America are only slightly better than in Cuba, Mr. Stevens notes, making it 33rd in the world. Eighteen percent of American women have minimal or no prenatal care, higher than in any other rich nation. Fourteen percent of children have no health insurance. Only 60 percent of 3- and 4-year-olds go to child care, well below the European rate, and many of those go to centers that are inadequate.
.... [http://www.nytimes.com/2002/06/13/business/13SCEN.html]
JD
