Economic Recovery Leaves Low-Income Working Families Behind

By the end of 2011, the official unemployment rate had dropped to 8.5%. The stock market seemed on its way to recovering the huge losses of 2008-9. The housing industry showed signs of life.

But the number of low-income working families rose to 10.4 million — up by 200,000 from 2010, according to a new brief from the Working Poor Families Project.

This means that nearly a third — 32.1% — of all working families struggled to make do with incomes below 200% of the Census Bureau’s applicable poverty threshold.*

The percent of low-income working families has steadily increased since 2007, when the recession set in. In that year, 28% of working families were poor or near-poor.

So we now have about 47.5 million people — 23.5 million of them children — in the group WPFP has carved out, i.e., those in families with children where the members who were at least 15 years old collectively worked a minimum of 39 weeks during the prior 12-month period.

What this tells us, of course, is that high unemployment doesn’t sufficiently account for the high poverty rate — or the more realistic 200% of that rate.

It does account for some part of it. According to the brief, the share of low-income families working dropped a bit between 2009 and 2011 — from 73% to 71%.

A larger part of the story seems to be the types of jobs those low-income family members had. About a fourth of the adults in these families worked in just eight occupations — all of them characteristically low-wage, e.g., cashiers, health aides, restaurant wait servers.

The brief tells us that many were working part-time — not by choice — and often in multiple temporary jobs.

But the data in the source it cites are very old. So we really don’t know how much cobbled-together, on-and-off employment boosted the number of working families who, at best, had barely enough to make ends meet.

We do know, however, that these working arrangements made them even more economically insecure than they would have been otherwise.

The rise in working poor families, as WPFP defines them, is another indicator of growing income inequality in the U.S.

While the poorest fifth were getting 5% of all income earned, the top fifth were getting 48% — not, in many cases, only income earned by the (figurative) sweat of their brows.

Looking at average incomes by education level, WPFP concludes that increasing the portion of workers with at least some postsecondary education “would go a long way toward narrowing the income gap.”

As I’ve written before, I find this doubtful, though it would surely move some of the low-income workers up from the bottom fifth.

We’d still have growth in low-wage occupations that can’t be fully automated or shipped overseas.

Employers won’t pay more merely because they can’t find enough qualified workers who’ve got, at most, a high school diploma or the equivalent. They won’t recreate the mid-wage jobs they’ve eliminated either.

WPFP seems to recognize this, since it also addresses job quality — and in terms that would apply mainly to low-wage occupations.

On the policy front, it recommends raising and indexing the minimum wage, mandating comprehensive paid sick and family leave, enforcing fair labor and other workplace standards and “ensuring that if public job creation expenditures persist, they benefit workers and their communities.”

All but the last would be easier for workers to gain for themselves if we had full employment again, i.e., a labor market with relatively few job seekers for jobs employers want to fill.

Economist Jared Bernstein, who’s long championed full employment as a policy goal, cites, only half in jest, the advantages workers gained when the “black death” plague swept Western Europe in the 14th century.

Well, we’re far from full employment. And happily no one’s predicting a plague. But it doesn’t look like we’re going to get public job creation expenditures.

What looms instead are job losses — at least a million, maybe over twice that — if Congress can’t agree to stop the briefly-delayed across-the-board spending cuts.

Same result — or perhaps worse — if it replaces them with equivalent cuts that shield defense, as the House majority wants.

And undoubtedly a much larger number if the Republicans succeed in forcing additional cuts on top of the $1.2 trillion already enacted the last time they ginned up a debt ceiling crisis.

This, as the WPFP brief indicates, would be a double-whammy for working poor families — not only an even worse labor market, but spending cuts in programs that help them meet basic needs and and become card-carrying members of the working middle class.

* Double the threshold for a two-adult, two-child family is $45,622.

What Do Hate Crimes Against Homeless People Show … and Not?

“Our society has learned to hate the homeless.” So tweeted Eric Sheptock, a leading “homeless homeless advocate” in the District of Columbia.

It’s easy to see why. But I don’t believe it, though we’ve got good evidence that some people do indeed harbor a virulent animus against homeless people.

Sheptock had just read a news release about a homeless woman who was set on fire as she slept on a bus bench in Los Angeles. This was the second such attack on a person sleeping outdoors in the area.

These certainly seem to be hate crimes against the homeless — the subject of a long series of annual reports by the National Coalition for the Homeless.

I say “seem to” because Neil Donovan, Executive Director of NCH, himself acknowledges that “only a disturbed mind” acts out “such an intense passion of dislike.” Disturbed enough, I think, so that we sometimes can’t fathom a motive.

In its latest report, NCH documents 105 new attacks on homeless people by people who weren’t themselves homeless — 32 of them fatal. This brings the reported 13-year total to 1,289.

As in the past, most of the attackers were young men — some of them very young indeed. We’re told, for example, of a 14-year-old and a 15-year-old who shot a homeless man in order to steal his bicycle.

And some of the attacks were shocking in their wantonness — for example, a fatal bludgeoning with a tire iron committed “just for fun.”

NCH argues that such crimes are encouraged by laws that “criminalize” homelessness. It’s referring here mainly to local laws that prohibit actions more or less necessitated by life on the streets, e.g., sitting on the sidewalk, camping in a public space.

I’ve no doubt that such laws reflect an egregious lack of sympathy — in the literal sense, i.e., feeling together with.

Perhaps codifying the otherness of homeless people does somehow affect the mindsets of youth who surely can’t (can they?) perceive their victims as human beings like themselves.

Yet our society doesn’t condone violence against homeless people. When the perps are caught, they’re prosecuted, just as they would be if they attacked model exemplars of the middle class.

And in some of the reported cases, community members intervened — or when that was too late, attended memorial services, even raised money to cover funeral costs for homeless victims.

More generally, I don’t think our communities foster an environment that breeds hate-motivated crimes against homeless people — as, for example, legally and socially-sanctioned racial prejudice in the South led to lynchings, church bombings and the like.

This isn’t to say that our popular culture doesn’t glorify violence — and more generally, macho behaviors. Or that our mental health system doesn’t let highly-disturbed people fall through the cracks.

Or that our social services fail — for want of knowledge, funds and who knows what else — to prevent young people from seeking respect and release for the energies in criminal acts.

But in communities across this country, faith-based organizations and other nonprofits have made a mission of caring for homeless people.

They feed, clothe and shelter them, provide or help them get free medical care and other services, offer them supportive and skill-building programs, advocate on their behalf and more.

We, as a society, express our support for these services. Large numbers of us donate our unpaid labor and professional expertise. Larger numbers of us donate some portion of our earnings.

And large enough numbers of us support public funding for the services to have kept them an item in government budgets.

Here in the District, where Sheptock and I live, we, through our local government, have gone further.

We guarantee homeless people shelter from “severe weather conditions” that could cause them to freeze to death or collapse from heat prostration if left to fend for themselves on the streets.

We put local taxpayer dollars behind this right to shelter and related services, e.g., outreach, transportation to a shelter, blankets and a warm drink for those who refuse to go.

Is any of this enough? Of course not.

Do we care enough to adequately fund homeless services — and other programs that could ultimately end the need for them? Not apparently if the money would come out of our very own wallets.

But, at the same time, enough of us donate our time and/or money to keep the community-based services flowing.

And I believe most of us don’t want homeless services and affordable housing short-changed to help balance public budgets — let alone to ensure that the Pentagon has more money than it needs and for weapons it doesn’t want.

I’m aware that we collectively have let our elected officials get away with the short-changing. But does this mean that we as a society hate homeless people? That, I think, short-changes us.

HUD Reports Dropping Homelessness Rates

As you may have read, the U.S. Department of Housing and Urban Development has released the nationwide results of last January’s point-in-time counts — the one-night census of homeless people that HUD requires of all its homeless assistance grant recipients.

The headlined news is that homelessness seems to be “holding steady,” as HUD Secretary Shaun Donovan puts it.

The bigger news, I think, is that homelessness rates are apparently lower than they were in 2007. This is true not only for the grand total, but for all the specific groups in the required PIT breakouts.

Some of the long-range percentage declines are so counterintuitive as to make me wonder whether we’re getting a true read or results of some unaccounted for changes in methodology.

After all, we’ve had a major recession, with lingering consequences. Nearly four million homes lost due to foreclosures.

About 4.1 million jobs lost that haven’t been replaced. A record high number of long-term jobless workers. Other labor market woes as well.

On the other hand, we do have some progress that’s fairly easy to explain. So within the definitional limits of the PIT counts maybe the rest is real too.

In any event, here are the key figures.

According to the PIT counts, the total number of people who were homeless during some night in late January was 633,782.

This is a fraction of a percent fewer than reported the year before. The number is 5.8% lower than for January 2007. In other words, 38,106 fewer literally homeless people.

The number of homeless individuals, i.e., not with a family member, ticked down 1.4% to 394,379. In January 2007, there were 6.8% — 28,998 — more of them.

The number of homeless people in families* rose by 1.4%, to 239,403. But the number of homeless families was basically the same as in 2011 — 77,157.

As compared to January 2007, there were 3.7% fewer homeless people in families and 8% fewer homeless families. These percents translate into 9,108 fewer homeless family members and 6,778 fewer homeless families.

We see larger drops in two populations that HUD — and more recently, the U.S. Interagency Council on Homelessness — have made top priorities.

The number of chronically homeless individuals** declined 6.8%, to 99,894. There were 19.3% — 23,939 — more people classified as chronically homeless in January 2007.

It seems reasonable to suppose that these figures reflect increases in permanent supportive housing — a strategy designed for chronically homeless people that’s strongly encouraged by the structure of HUD’s assistance programs, as well as a number of research and advocacy organizations.

Federal policies also account for much, if not all of the reported progress toward the goal of ending veterans’ homelessness.

According to the latest PIT counts, the number of homeless veterans declined 7.2%, to 62,619. This is 17.2% fewer than in 2009, the baseline year for this population.

The big factor here is the HUD-VASH (Veterans Affairs Supportive Housing) voucher program, which has reportedly supported permanent housing, plus supportive services for more than 42,000 veterans since the program started in 2008.

An additional factor I’d guess is that the VA side of the funding can also be used to prevent veterans from becoming homeless, e.g., by paying some one-time costs of moving to housing they can afford.

In this respect, it’s somewhat like the broader Homelessness Prevention and Rapid Re-Housing Program that was part of the Recovery Act.

HUD gives HPRP part of the credit for the just-reported homelessness decreases. And it does seem likely that the short-term help the program funded was enough for people who’d suffered temporary setbacks.

And now what? Communities had only three years to spend their HPRP grants. So they’ll have no money from that pot in the coming year — and even in the best of cases, no boost in their basic homeless assistance grants to cover the loss.

They’d share a loss of about $180 million if the “fiscal cliff” negotiations don’t halt the impending across-the-board cuts.

And there’d be lots more homeless people in want of help — more than 282,000 additional households, according to one estimate.

In short, such genuine progress as there’s been could be short-lived.

* These are only people “who are homeless as part of households that have at least one adult and one child.”

** By HUD’s definition, these are people who have a disability, including a mental illness and/or substance abuse problem, and who’ve been homeless for at least a year or at least four times in the last three years.

Where Did All the Welfare Money Go?

We all know that Republican policymakers view Temporary Assistance for Needy Families as a resounding success.

Look, they say, at how caseloads fell after Congress ended welfare as we knew it — and President Clinton signed off on the deal. We should turn more programs into block grants like TANF — Medicaid and SNAP (the food stamp program) for starters.

Caseloads did indeed fall. And they barely rose when the Great Recession set in.

Only 27% of poor parents with children got any TANF cash benefits in 2010 — 41% fewer than the year TANF was born.

And those benefits were woefully paltry — for a family of three, less than 30% of the federal poverty line in all but eight states.

A new analysis by the Center on Budget and Policy Priorities tells us why.

It’s not just because Congress has never increased the block grant funds states get as the federal government’s share, thus letting them lose at least 28% of their value.

Nor because Congress cut — and then wiped out — supplemental grants that some states had always received to compensate for ways the block grant formula short-changed them.

It’s because states are spending large chunks of their block grant funds and/or the funds they’ve got to put up as a partial match* on programs that aren’t only — or even mainly — for TANF families.

In other words, because they’re creatively exercising the much-vaunted flexibility that block grants like TANF provide.

Last year, for example, states spent, on average, only 29% of their TANF funds on cash assistance.

Another 9.4% went for services that help move families from welfare to work, e.g., education, job training, transportation assistance.

Child care subsidies accounted for another 17%. They too help move families from welfare to work, but they don’t necessarily go only to TANF and former TANF families.

What about the rest of the money?

Well, some of it paid for states’ refundable Earned Income Tax Credit, some for programs to promote marriage and discourage out-of-wedlock births and some for other legally-authorized purposes, e.g., programs states had spent money on before TANF was created.

The expenditures “authorized under prior law” don’t have to meet any of the goals Congress established for TANF. Many states, for example, claim child welfare spending as part of their match, though their programs rightly address child neglect and abuse at all income levels.

States also, CBPP reports, have claimed spending on their pre-K programs and on higher education grants for students with incomes way above the TANF eligibility level.

Such spending apparently gets lumped into an “other non-assistance” spending category in their reports to the U.S. Department of Health and Human Services.

Child welfare services may get reported this way, as may various other services, e.g., for domestic violence, mental health and substance abuse, payments to third parties for food assistance and/or shelter.

Bottom line is that states have been using TANF funds to replace funds they’d previously budgeted for these diverse purposes — or would have had to budget, using funds from other sources.

This, of course, frees up funds for other programs that have nothing whatever to do with the safety net or helping low-income families toward self-sufficiency.

There’s lots of variation among states, however. CBPP provides summaries for each and the District of Columbia.

So we learn that, in 2011, the District spent:

• No more of its TANF funds on cash assistance than it did 10 years before — $67 million. True level funding, i.e., with adjustments for inflation, would have called for somewhat over $85 million.
• Just $1 million more on work-related activities — again, as compared to 2001. This means about $6.2 million less when we account for inflation.
• $5 million more on child care, but less in inflation adjusted dollars.

Spending in all these categories declined as a percent of the District’s total TANF spending. The biggest drop was for cash assistance — down by 9%.

Contrariwise, both the percent and absolute dollar value of the combined AUPL/non-assistance category jumped — from $4 million (2%) to $39 million (15%).

Sure would like to know where that money went.

* Under federal rules, states may count third-party spending, both cash and in-kind, as part of their maintenance of effort, i.e., their required match. Thirteen states did in 2011, CBPP’s end-year for spending comparisons.

NOTE: I have made a few wording changes in this post to correct for a misinterpretation of CBPP’s figures on the District’s TANF spending.