US Child Poverty Spiked With End of COVID Support Programs


Poverty in the United States surged dramatically in 2022, particularly among children, after social support programs put in place during the worst of the coronavirus pandemic were allowed to expire, according to data released this week by the Census Bureau.

Across the U.S, 12.4% of Americans were living in poverty in 2022, up from just 7.8% in 2021. The increase was even more pronounced among children, with 12.4% living in poverty last year, compared to 5.2% in 2021.

“This is devastating,” said Aileen Carr, interim executive director of Georgetown Law School’s Center on Poverty and Inequality. “This is the worst [increase] we’ve ever seen, especially with child poverty. It is hard to overstate the human suffering that these numbers represent.”

The data was released as part of the Supplemental Poverty Measure, which the government calculates separately from the official poverty figures. The SPM considers both the amount of money families receive from government benefit programs and the variations in the cost of living across different communities in the U.S.

The official poverty level income rate for a family with two adults and two children was $29,678 in 2022. The SPM, meant to provide a more nuanced picture, set the rate for that same family of four, assuming that they lived in rental housing, at $34,518.

Pandemic programs expire

In many ways, the low poverty numbers from 2021 were an aberration. At the time, the federal government was supporting the income of millions of Americans with a variety of pandemic-related relief programs. One of the most effective was the Child Tax Credit, which for one year provided lower-income parents with a monthly payment based on the number of children in their household.

At the time, supporters of the credit predicted it would dramatically reduce the number of children living below the poverty line, and the data from the program bore those predictions out.

Supporters also argued that the benefits of the program to both children and society at large would greatly outweigh the costs, because reduced childhood poverty is closely related to better outcomes in the areas of health, education and future participation in the workforce.

An extension of the Child Tax Credit was originally considered as part of the Build Back Better Act, a bill that contained many of President Joe Biden’s policy priorities, but the scaled-down version that eventually passed as the Inflation Reduction Act in 2022 did not extend the program.

While Republicans in Congress have supported some versions of a child tax credit in the past, and some are currently advocating for a more measured expansion, others have expressed resistance to Democrats’ plan to bring back the pandemic-era scope of assistance. Among their concerns is that the credit might serve as a disincentive to employment, keeping parents out of the workforce.

When the issue was debated in 2021, one estimate suggested that permanent implementation of the credit would reduce the U.S. workforce by 1.5 million. The price tag of the measure, estimated at $1.6 trillion over 10 years, would add significantly to the nation’s budget deficit unless measures were put in place to offset the costs, and the Democrats’ plan to balance the outlay with increased tax revenues runs counter to Republicans’ resistance to tax increases.

Families struggle

The fact that poverty increased beginning in 2022 was not news to people who see the effects of economic deprivation in the United States every day.

Judy Estey, executive director of The Platform of Hope, a Washington-based organization that she says “works with primarily Black and brown families who have been historically economically disadvantaged.”

Estey told VOA that the withdrawal of pandemic-era support programs, and particularly the Child Tax Credit, has made some of her clients’ already difficult circumstances even worse.

“We have been watching families who already were facing a lot of barriers and challenges struggle even more,” she said.

While pandemic aid was still available, Estey said, her organization tracked significant improvement in its clients’ financial condition, often out of proportion to the amount of aid they were receiving.

While pandemic aid increased household income by about 12%, she said, The Platform of Hope saw a 24% improvement in clients’ debt levels, and a 21% increase in their savings.

Advocates frustrated

Advocates of increased spending on social programs, such as Carr of Georgetown Law, are particularly frustrated by the end of the Child Tax Credit because it was so measurably successful.

“This is one policy fix that is so clear, and so straightforward, and it works,” she said. “And we made a choice. Now there are 5.2 million more children — 5.2 million children — that are now poor, that weren’t last year.”

Elizabeth Lower-Basch, deputy executive director for policy at the Center for Law and Social Policy, described the figures released this week as “not surprising, but deeply disappointing.”

She stressed that the poverty levels in the U.S. are very much dependent on policy choices made in Washington.

During the pandemic, “we made a decision that we were going to take poverty, and particularly child poverty, seriously, and make sure that people have what they need,” she told VOA. “That’s cash assistance, but also food benefits and health care. Now, we’re really rolling back that support, and with child poverty, we’re back where we were.”

That poverty levels are rising at a time when unemployment in the U.S. is near record low levels and wage growth has been strong demonstrates the continued need for government programs to aid low-income families, Lower-Basch said.

“Having working parents — even full-time, year-round working parents — is not enough to keep kids out of poverty,” she said.

Lawmakers promise action

After the Census Bureau released its data this week, there was a flurry of activity on Capitol Hill as Democratic lawmakers pledged to bring back the tax credit at the first opportunity.

Senator Ron Wyden, chairman of the tax-writing Senate Finance Committee, said he would make certain that a year-end tax package includes an expansion of the Child Tax Credit.

Representative Rosa DeLauro, the top Democrat on the House Appropriations Committee, said in a press conference Wednesday that the tax credit should be restored, adding that it “pays for itself.”

However, the Republican-controlled House of Representatives appears unlikely to reintroduce the tax credit.

White House comment

At the White House on Wednesday, Jared Bernstein, chair of the U.S. Council of Economic Advisers, said that the Biden administration supports the reintroduction of the Child Tax Credit and plans to fight for it.

“We intend to continue to not only fight for the enhanced Child Tax Credit, but to do so in a fiscally responsible way,” he said during a press conference.

Berstein pointed out that the measure is part of President Biden’s budget proposal, and that it will be paid for by increasing the share of taxes paid by the wealthiest Americans

“So, not only are we talking about re-achieving historically low levels of child poverty, but we were talking about doing so in the context of injecting much more fairness into the very top end of the tax code,” Bernstein said.

Source: VOA