The Near Poor, Time for a Policy Response

In her book The Missing Class, Sociologist Katherine Newman documented a startling new discovery – almost 57 million Americans were living in a reality known as the ‘near poor,’ those living 100 to 200 percent above the poverty line, neither officially destitute nor comfortably middle class. In her “The Nation” interview with Eyal Press, Dr. Newman noted that policymakers have been slow in responding to this group, “I haven’t heard anybody else (besides John Edwards) talk about these people, Republicans nor Democrats. I don’t think the political parties reach out to them very much.” This interview, as well as her book, hit the press in mid 2007, but the plight of the near poor failed to make a blip on policy radar screens.

Four years and one catastrophic economic downturn later, Katherine Newman was right in her assessment of the near poor. It took the prestige and popularity of the New York Times to unveil this great discovery (again) in their November 18th article “Older, Suburban, and Struggling, ‘Near Poor’ startle the Census.” Citing recent statistics from the Census Bureau’s new supplemental poverty measure that better accounts for disposable income spent on things like medical expenses, this article concludes that 51 million Americans fall into the near poor category, with incomes only 50 percent above the poverty line.

Dr. Newman was spot on again when she stated that policymakers – Republican or Democrat – are not paying much attention to this group. GOP candidates like Mitt Romney and Newt Gingrich are championing tax cuts for the middle class (the class this near poor group tends to fall into), while Michelle Bachmann and Rick Perry opt for the opposite, believing that the poor and near poor are getting a “free ride” and should be taxed more heavily. Beyond this, just how should policy makers respond?

Looking at families only, (policy responses for all types of people that fall into this category are outside the scope of this post) Republicans and Democrats could take advice from former Presidents like Ronald Reagan and Bill Clinton and expand on social insurance programs like the Earned Income Tax Credit (EITC). The EITC program, which rewards parents with a tax credit per child based on their yearly earnings (up to $5,751 for a married family with 3 children, filing jointly, and making less than $49,078 in 2011), was expanded by Ronald Reagan in 1986 and again by Bill Clinton in 1993. While the EITC has been one of the most effective anti-poverty policies ever devised by the federal government, increasing the amount would help families facing high disposable income costs like medical expenses, and would put Americans more in line with our European counterparts.

Or, policymakers could finally embrace the policy suggestions of social scientists across the United States and define broader social reforms that could eliminate many of the work-family conflicts that keep the near poor teetering on edge of poverty. For example, state subsidized, quality childcare is one policy option that resounds from the research of political scientists like Dr. Janet Gornick of the LIS Center and CUNY Graduate School and researcher Heather Boushey from the Center for American Progress.

The simple fact is that the issues faced by the near poor will only get worse without a policy response. So whether or not the Republicans decide to embrace the policies of their revered Ronald Reagan or President Obama decides to listen to the policy suggestions from a growing number of social scientists, someone needs to act. Now.


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