Globe, World

The United States, where poverty grows daily

Recent publications in many news outlets show that poverty in the world’s largest economy has returned to the level of 1965..


Cira Rodríguez César


This demonstrates that those who generate the current global economic crisis are also causing a growing number of injustices and greater inequalities at home.

Peter Edelman, a professor of Law at Georgetown University Law Centre, specialised in subjects including poverty, welfare and constitutional law, recently asserted that his country has returned to where it was in the 70’s.

In his analysis he considers that misery is related to unemployment and the reduction of both is likely to be a slow and frustrating process, creating the view of a country dragged even further towards the abyss by a problem that isn’t soon to disappear.

Barack Obama, President of EE.UU.

According to his assessments, the situation has four causes: employees with low salaries, single parent families, the near disappearance of financial assistance for mothers on low incomes, and discrimination based on race and gender.

Official figures indicate that in the 1990’s more than two thirds of children from families affected by poverty received social welfare, but now the figure is only 27%, while six million people make do with food coupons as income.

According to Edelman, poverty is increasing rapidly: last year one sixth of the population of the United States (47 million people) were living below the poverty line.

From this figure, demographers have predicted that poverty levels will remain at this level until at least 2014.

The highest level of poverty recorded was 22.4% in 1959, and at the present time an increase of 0.1% would be sufficient to pass the poverty level of 1965, which reached 15.1% that year, and the outlook is not optimistic.

However, the White House hopes to cover up this reality by highlighting an intelligence study that predicts a spectacular decrease of those living below or near the poverty margin in the world for 2030.

At the same time the website affirms that in their own country 100 million people are below or approaching the poverty line.

The current stagnation and weakness of the American economy presupposes a worsening of the situation, and according to analysts from this webpage, the Gross Domestic Product (GDP) of the USA has been continually negative since 2005.

Respected sources such as The Wall Street Journal, have published data that confirm this picture: today one in four workers in the US earn salaries at or below the poverty line and 49.1% of Americans live in a home where at least one person receives economic subsidies from the government.

They also infer that approximately half of all American adults spend at least some time living below the poverty line before reaching 65 years of age.

They point out that since the beginning of the Obama administration, the number of Americans living in poverty has grown to six million, while 14 million subsist on coupons.

The comparison of figures shows that one in every six Americans of an advanced age lives below the federal poverty line, while Forbes claims that the 400 richest Americans have an accumulated wealth equal to that of 150 million people living in poverty.

Significantly, 1.5 million American families live on less than two dollars a day, the rate of employment has remained above 8% during 40 consecutive months and 42% of all unemployed people in the US have been without work for at least six months.

Such is the situation of the largest global economy that the Department of Commerce has confirmed that its GDP grew at an annual rate of 1.5% in the second trimester, the slowest rate since the third trimester of 2011.

So economic growth has slowed between April and June, and with an expected blow from the lowest consumer spending in a year, more stimuli from the Federal reserve become likely.

A large part of the American deceleration during this period is due to a reduction in consumer spending, due to the weak increase in employment and earnings, the two most significant causes of poverty in the USA.

Consumer spending, which represents almost 70% of American economic activity grew at a rate of 1.5%, less than the 2.4% registered in the first trimester.

After this news, the White House revised downward its prediction of economic growth in 2012 and 2013 to a rate of 2.3% this year and 2.7% next year, much less than the 2.7% and 3% predicted earlier.

Fewer labour contracts, consumer nervousness, weak manufacturing activity and the effects of the crisis in Europe point to what everyone fears: another recession. (PL)

(Translated by Oliver Harris)

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