Number of Americans in poverty at record high

Hope Yen
Associated Press

Washington – A record number of Americans  –  49.1 million  –  are poor, based on a new census measure that for the first time takes into account rising medical costs and other expenses.

The numbers released Monday are part of a first-ever supplemental poverty measure aimed at providing a fuller picture of poverty. Although considered experimental, they promise to stir fresh debate over Social Security, Medicare and programs to help the poor as a congressional supercommittee nears a Nov. 23 deadline to make more than $1 trillion in cuts to the federal budget.

Based on the revised formula, the number of poor people exceeds the record 46.2 million, or 15.1 percent, that was officially reported in September.

Broken down by group, Americans 65 or older sustained the largest increases in poverty under the revised formula  –  nearly doubling to 15.9 percent, or 1 in 6  –  because of medical expenses that are not accounted for in the official rate. Those include rising Medicare premiums, deductibles and expenses for prescription drugs.

“As seniors choose between food and medicine, some lawmakers are threatening lifeline programs that provide a boost to those in poverty or a safety net to those grasping at the middle class,” said Jo Ann Jenkins, president of AARP Foundation, which represents the needs of older Americans. “With nearly 16 percent of seniors already living in poverty, our country cannot afford to slide further backward.”

Working-age adults ages 18-64 saw increases in poverty  –  from 13.7 percent to 15.2 percent  –  due mostly to commuting and child care costs.

And for the first time, the share of Hispanics living in poverty surpassed that of African-Americans, 28.2 percent to 25.4 percent. That is due to a jump in the poverty rate for Hispanics under the new measure because of lower participation among immigrants and non-English speakers in government aid programs such as housing and food stamps.

Due to new adjustments for geographical variations in costs of living, people residing in the suburbs, the Northeast and West were the regions mostly likely to have poor people  –  nearly 1 in 5 in the West.

Economists have long criticized the official poverty rate as inadequate, although they differ widely on the best ways to calculate it. Based on a half-century-old government formula, the official rate continues to assume the average family spends one-third of its income on food. Those costs have actually shrunk to a much smaller share, more like one-seventh.

The official formula fails to account for other expenses such as out-of-pocket medical care, child care and commuting, and it does not consider non-cash government aid when calculating income, such as food stamps and tax credits, which have increased in the last few years.

In reaction to some of the criticism, the federal government last year tasked the Census Bureau with developing a new measure, based partly on recommendations made by the National Academy of Sciences. The new measure’s goal is to help lawmakers to better gauge the effectiveness of anti-poverty programs. It does not replace the Census Bureau’s official poverty formula, which continues to determine eligibility and distribution of billions of dollars in federal aid for the poor.

“We’re now about to go into federal debt discussions showing a major increase in elder poverty and a decrease for African-Americans. That just defies common sense, and the political implications could be devastating,” said Douglas Besharov, a University of Maryland public policy professor and former scholar at the conservative American Enterprise Institute, who called the new measure “arbitrary.”

“Sure, there’s a lot of suffering out there, but the inexorable result of all of this is to give more ammunition to groups to prevent cuts for the elderly. That means more cuts for low-income families,” he said.

Kathleen Short, a research economist at the Census Bureau, said many of the shifts in poverty reflect the large numbers of older people who hover near the poverty line after receiving Social Security cash payments. The poverty line is defined under the official measure as $11,139 for an individual, or $22,314 for a family of four.

Because of Social Security benefits, only 9 percent of seniors, or roughly 3.5 million, live in poverty according to the official formula. But that number increases by roughly 2.7 million when taking into account additional health care costs and other factors. If it weren’t for the health care costs, the poverty rate for seniors would have dropped to 8.6 percent.

“The medical expenses are very large,” Short said.

Not all groups saw increases in poverty under the new measure. For instance, children and African-Americans saw declines in their poverty rates, mostly due to the positive effects of government aid programs including food stamps. Residents living in more rural areas as well as the Midwest and South also fared better, due to lower costs of living.

The census report found that the poverty rate for all groups would have jumped to 18 percent  –  or 6 million more people  –  if it weren’t for the earned income tax credit, a safety net program which offers credits to low- and moderate-income families as an incentive to work and to help offset the burden of Social Security taxes. Temporary expansions to that program are slated to expire after next year.

Without food stamps, the poverty rate would have risen to 17.7 percent, which translates to about 5 million more people. That program was expanded in 2009 as part of the federal stimulus plan; the expansions are now phasing out gradually and will expire completely in 2014.

“Ironically, the new poverty figures are arriving just in time to show the success of many of the very programs that are being subject to budget cuts and scrutiny at the federal and state level,” said Arloc Sherman, a senior researcher at the Center for Budget and Policy Priorities, a liberal-leaning think-tank. “Legislatures are making some of the harshest state cuts in recent history for vulnerable families, and some in Congress are advocating cutting deeply from federal assistance for those at the bottom.”
Other findings:

  • Poverty for Asians increased, from 12.1 percent under the official measure to 16.7 percent. Among non-Hispanic whites, it rose from about 10 percent to 11.1 percent.
  • The poverty rate for children declined, from 22 percent to 18.2 percent.
  • Under the revised formula, the West had the most people in poverty at 19.4 percent. It was followed by the South (16.3 percent), the Northeast (14.5 percent) and the Midwest (13.1 percent).

On Monday, the Census Bureau said its new measure remained a “work in progress,” with additional refinements needed to better determine commuting and housing costs. The bureau also said it needed to collect additional data before it can publish reliable supplemental numbers on poverty broken down by state.

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Standard & Poors downgrades credit ratings of four Dutch Banks

Standard & Poor’s has lowered credit ratings of major Dutch banks including ABN AMRO, Rabobank.

Standard & Poor’s Ratings Services downgrades the credit ratings of four
Dutch banks over the growing risks of the potential prolongation of the eurozone
recession.

(PressTV) On Friday, S&P slashed ABN AMRO’s rating to A from A+ and Rabobank’s rating to AA- from AA. Two other banks, SNS REAAL and F. van Lanschot Bankiers were also cut by one notch.
“In our view, Dutch banks are exposed to increased economic risks as a result of a potentially more protracted downturn in the Netherlands and wider eurozone,” said the New York-based rating agency in a statement.
Dutch bank ING has said on November 7 it would lay off another 2,350 employees over time after a huge profit plunge.

The bank released figures showing that the net profit for Q3 2012 has only reached 609 million euros, indicating a massive reduction from the 1.69 billion-euro profit reported in the same quarter last year.

Europe plunged into financial crisis in early 2008. Insolvency now threatens heavily-debt-ridden countries such as Greece, Spain, Portugal, Italy, and Ireland.
The worsening debt crisis has forced the EU governments to adopt harsh austerity measures and tough economic reforms which have triggered incidents of social unrest and massive protests in many European countries.
MAM/HGH

What Does It Mean that Residents in All 50 States Have Filed Petitions to Secede?

By Washington’s
Blog

Secession:  Exploding Movement, Tempest In a Teapot … Or Something Else?

A lot of attention is being given to the fact that residents in all 50 states have filed petitions to secede from the United States.

Daily Caller reports:

By 6:00 a.m. EST Wednesday, more than 675,000 digital signatures appeared on 69 separate secession petitions covering all 50 states, according to a Daily Caller analysis of requests lodged with the White House’s “We the People” online petition system.

***

Petitions from Alabama, Florida, Georgia, Louisiana, North Carolina, Tennessee and Texas residents have accrued at least 25,000 signatures, the number the Obama administration says it will reward with a staff review of online proposals. (RELATED: Will Texas secede? Petition triggers White House review)

The Texas petition leads all others by a wide margin.

***

States whose active petitions have not yet reached the 25,000 signature threshold include Alaska, Arkansas, Arizona, California, Colorado, Connecticut, Delaware, Hawaii,Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Maine, Maryland, Massachusetts,Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Dakota, Ohio, Oklahoma,Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Utah, Vermont,Virginia, Washington, West Virginia, Wisconsin and Wyoming.

***

Fourteen states are represented by at least two competing petitions. The extra efforts from two states — Missouri and South Carolina — would add enough petitions to warrant reviews by the Obama administration if they were combined into petitions launched earlier.

Other states with multiple efforts include Alaska, California, Georgia, Illinois, Kansas,New York, Ohio, Oklahoma, Pennsylvania, Utah, Virginia and Wisconsin.

As Google notes, web searches for the term “secession” are being run in a number of states:

Conservatives – such as Judge Napolitano and Ron Paul –  say that the states have the right to secede.  And Texas governor Rick Perry said that Texas has a right to secede (although he counsels against it at the current time).

On the other hand, most liberals say that the Civil War ended the state’s right to secede.    Huffington Post is covering the wave of secession petitions … to ridicule them.

Daily Kos suggests that “secessionists can secede by renouncing their citizenship“.

As the Daily Caller notes, liberals have launched their own counter-petitions:

In a … nose-thumbing aimed at Texas’ conservative majority, progressives from the liberal state capital of Austin responded Monday with a petition to secede from their state if Texas as a whole should decide to leave the Union.

Late Tuesday a second group of Texans, this one from Houston, lodged their own White House petition. Secession-minded Texans, they wrote, “are mentally deficient and [we] do not want them representing us. We would like more education in our state to eradicate their disease.”

***

A group from El Paso, too, wants no part of an independent Texas. “Allow the city of El Paso to secede from the state of Texas,” their petition reads. “El Paso is tired of being a second class city within Texas.”

Yahoo News argues that the petitions are meaningless:

The petitions are little more than symbolic—and nothing new. Similar petitions were filed after the 2004 and 2008 elections.

Libertarian website Lew Rockwell argues in a piece by Ryan McMaken that nothing will come of the current secession attempts, but that the principle is important:

I have no illusions about this latest secession petition phenomenon. Nothing will directly come of this, and the people who are behind it are mostly people who would be singing “God Bless America” at the tops of their lungs had Mitt Romney been elected. On the other hand, it sure has a lot of people talking about secession, which shows that the idea of it remains an important part of the American political consciousness.

***

The Declaration makes a simple argument:

  1. Humans have rights from the Creator.
  2. Governments exist to secure those rights (a debatable assertion but we’ll roll with it).
  3. When the government fails to secure those rights, we can ditch it and start our own government.

That’s pretty much all it says. If you thought that was true in 1776, when tax rates were 1% and there was no such thing as a the EPA or the FBI or the IRS, why is it not true now? Because we’re so much more free now? And, no, the Declaration did not say that the government is free to violate rights as long as people get to vote on it.

The Declaration establishes that there’s no such thing as treason, and a free government requires the assumption of just secession. Lysander Spooner explains[:]

Thus the whole Revolution [of 1775–1783] turned upon, asserted, and, in theory, established, the right of each and every man, at his discretion, to release himself from the support of the government under which he had lived. And this principle was asserted, not as a right peculiar to themselves, or to that time, or as applicable only to the government then existing; but as a universal right of all men, at all times, and under all circumstances.

Ron Paul says that states have the right so secede … and predicts they will do so when the dollar collapses:

My take has been the same for many years … I believe that America – like the Soviet Union – may break up when corruption and tyranny lead to the break down of basic systems.

And see this and this.

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    Courtesy of Economic Policy Journal we now know that the majority of American states are currently insolvent, and that the US Treasury has been conducting a shadow bailout of at least 32 US states. Over 60% of Americans receiving state unemployment benefits are getting these directly from the US government, as 32 states have now borrowed $37.8 billion from Uncle Sam to fund unemployment insurance.…

  4. US Economy: Unemployment in Seven States May Have Exceeded 20%

    As I have previously pointed out, unemployment may actually be higher than during the same phase of the Great Depression. Specifically, as of 1930 – the year after the 1929 crash – the unemployment rate was 8.7 percent. As of December 2008, U-6 unemployment was 13.5 percent.…

Triple-dip recession threatens Britain

Economists have said in a survey that Britain risks facing its first triple-dip recession.

A new survey by economists has found that Britain’s economy may shrink in the
coming months, while the country risks facing its first triple-dip recession
since records began nearly six decades ago.

 

(PressTV) According to economists, Britain will see a 0.2 percent expansion in the first
quarter of 2013, the odds of the economy falling into another recession within
the following year increased to 33 percent from 28 percent.

The survey
comes after the Bank of England’s governor Mervyn King provided a gloomy
assessment of the UK economy earlier this week, saying that the outlook remains
“challenging” and the recovery will be “long and winding.”

King stated
that the UK’s biggest risk lies with the euro-area debt crisis. His comments
were made as the quarterly Inflation Report was published by the Bank of
England, which also highlighted that British Chancellor George Osborne’s budget
cuts were putting pressure on the economy.

Meanwhile, Osborne was warned
on Wednesday 14 November by the credit rating firm Moody’s that he would be
carefully monitored in the coming months as to how he manages the balancing act
between growth and deficit reduction.

Moody’s also warned that it may
cut Britain’s credit rating in 2013 if the country plunges into a triple-dip
recession.

BGH/MOL/HE

Unemployment rate in Portugal breaks a new record of 15.8 percent

Unemployment rate in Portugal has hit a new high of 15.8 percent.

A new report says unemployment rate in the crisis-hit Portugal has hit a new
high of 15.8 percent as the country’s economic woes continue unabated.

(PressTV) Statistics Portugal (INE), an official statistics agency, on Wednesday released data for the 3rd quarter of this year. The report shows a general trend of increasing unemployment in Portugal since last year, the previous quarter had 15 percent and last year stood at 12.4 percent.

Forecasts from Lisbon and the troika of creditors – European Union, International Monetary Fund and European Central Bank – had estimated a lower jobless rate for the same quarter at 15.5 percent.

Portugal has had a 26.3 percent year on year rise of people without a job with an estimated working-able population of 5.5 million.
Almost two out of every 15 to 24 year-old has either lost their job or will not get one as the rate from last year rose 9 percent from 30 percent a year ago and 3.5 percent from the last quarter.
Portugal, like some other debt-ridden countries in the eurozone, has been seeking a bailout and has been carrying out austerity measures to make sure it gets the package.
The Portuguese Prime Minister Pedro Passos Coelho on Wednesday said the country needs to continue its spending cuts, which are scheduled for another 3 years to meet the demands of the bailout package. “We have to lower our level of spending in line with our possibilities,” he said.
He noted the austerity is necessary because “this way we make our country (Portugal) recover.”
Household spending and investments have fallen sharply in the crisis-hit country, which on top of Passos Coelho’s plans has caused the Portuguese to carry out a general strike in protest.
GVN/AZ

ALSO SEE: Anti-austerity protests across Europe turn violentHundreds of thousands angered over the economy turn out in 23 European cities

27+ states Petition to Secede from USA: Other petitions to strip citizenship/Deport those who signed???

links:
https://petitions.whitehouse.gov/petitions
http://www.reference.com/browse/Secession
http://www.presstv.com/usdetail/272016.html
https://petitions.whitehouse.gov/petition/strip-citizenship-everyone-who-signed-petition-secede-and-exile-them/ZbMjcwPf
https://petitions.whitehouse.gov/petition/deport-everyone-signed-petition-withdraw-their-state-united-states-america/dmQl1bXL

18+ states proposing seccession from the USA: Citizens Petitioning, could lead to civil unrest

links:
http://www.examiner.com/article/15-states-including-texas-have-filed-a-petition-to-secede-from-the-united-states-1?fb_comment_id=fbc_415461161854039_3797950_415612555172233#f1cb4f9ed
http://www.huffingtonpost.com/2012/11/12/secession-petition-white-house_n_2116620.html#slide=307399
http://iroots.org/2012/11/11/18-states-petition-to-secede-from-us-links-included/
https://petitions.whitehouse.gov/petitions
http://www.reference.com/browse/Secession

Japan may be in recession, figures suggest

CBC.ca

Japan’s economy contracted in the latest quarter, signalling that like Europe it may already be in recession, further weighing down world growth.

On an annualized basis, the world’s No. 3 economy shrank 3.5 per cent in the July-September quarter, in line with gloomy forecasts after Japan’s territorial dispute with China hammered exports that were already weakened by feeble global demand.

The bad news will temper optimism over recoveries in China and the United States., where some economists are predicting growth will top three per cent in the third quarter. China’s painful slowdown likely bottomed out in the third quarter, with recent indicators such as factory production and auto and retail sales showing improvement.

Japan’s outlook remains bleak, with most economists forecasting a further decline in economic activity for the October-December quarter, which would officially put it in a recession according to the common definition of two consecutive quarters of contraction.

Consumer spending fell 0.5 per cent in the third quarter, as subsidies for auto purchases expired, and corporate capital spending fell 3.2 per cent. Spending on reconstruction from the country’s March 2011 disasters has also weakened.

The drop for the current October-December quarter may not be as severe as that experienced in July-September.

“If the economy does recover in any way it will be a minute rebound,” said David Rea, an economist in London with Capital Economics. He said the contraction in gross domestic product in the last quarter of 2012 could be a couple of percentage points.

Deflationary funk

More than two decades after Japan’s asset bubble burst in the early 1990s, its policymakers have yet to devise an effective strategy to help the economy break out of its deflationary funk. At the same time, the Japanese yen remains stubbornly high, discouraging its companies sitting on piles of cash from investing at home and undermining its export competitiveness, especially against rivals Germany and South Korea.

Strangled by weak consumer spending and public investment, the economy grew at an anemic 0.7 per cent annual pace in April-June, according to figures that were revised down by half from the originally reported 1.4 per cent.

Until recently, the government was still forecasting growth at about 2 per cent for the year. It had predicted a turnaround late in the year, but the renewed tensions with China over disputed islands in the East China Sea, coupled with sluggish growth in Europe and other key export markets, have doused hopes for a significant rebound before 2013.

A slew of dismal recent data releases offers little encouragement.

Squeezed by surging costs for imported fuel and sinking exports, Japan’s current account surplus plunged to 2.72 trillion yen ($34 billion US) in April-September, its lowest level since monthly data began in 1985, as the trade deficit surged.

Stark reminder

Although Japan will likely continue to run current account surpluses for some time to come, its decline is a stark reminder of the country’s persisting reliance on exports to support its energy-intensive standard of living through massive imports of food, fuel and other resources.

Machinery orders for September fell twice as fast as expected. Meanwhile, the job market softened, likely hurting prospects for stronger consumer spending to help offset weak exports. Slower-than-anticipated government spending on reconstruction has further undermined demand.

Japan’s local governments are running short of funds as lawmakers dicker over legislation needed to authorize bonds to pay for deficit financing.

Signs of a recovery in China’s growth rate offer the tantalizing hope of stronger demand for Japan’s exports — if only territorial tensions are kept in check.

Tokyo’s first policy priority should be to defuse the antagonisms with Beijing that sparked sometimes violent protests in September, and are fuelling a backlash against Japan and Japanese products, especially cars, Baader said.

The Japanese yen has remained excruciatingly strong due to the country’s status as a safe haven for investment. Rather than a gradual depreciation that might erode investor confidence, Baader says, what is needed is a sudden intervention that would take the yen to between 85 yen-95 yen per dollar, or perhaps even higher, from its current 79 yen to 80 yen per dollar.

In the longer run, wider reaching, more painful reforms will be required to regain sustainable growth, said Rea of Capital Economics.

Piles of cash

Despite their generally meagre, often declining profitability, Japan’s megabanks, trading houses and other big corporations are sitting on huge cash piles. Instead of investing at home and hiring Japanese workers, they are using those resources to snap up assets around the world, such as Softbank’s recent acquisition of Nextel.

More crucially for world finances, Japan must finally grapple with its national debt, now at an unsustainable level of some 235 per cent of the country’s GDP. Dealing with that problem requires spending cuts and even bigger tax hikes than a planned increase in the national sales tax to 10 per cent that is due to take effect in 2014.

For now, Japan’s economy is cushioned by massive investments in its own debt, which protect it from any sudden major shifts by foreign investors, and by its massive earnings on foreign investments by its own financial institutions and corporations.

Despite more than two decades of stagnation, so far there has been little progress toward such reforms. Frequent changes in leadership — six prime ministers in just six years — have further undermined momentum for change.

French Economy Heading for Recession: Bank of France

France’s central bank has announced that the second-largest economy in the euro zone is heading for a recession at the end of the current year.

 

(PressTV) The Bank of France said on Friday that it was expecting the gross domestic product to shrink by 0.1 percent in the last three months of 2012, resembling the 0.1-percent dip in the third quarter, Reuters reported.

The forecast would be the second consecutive quarter of negative growth, and could make it harder for the French government to hit next year’s debt reduction targets.

The latest estimates have also put France on a dismal foothold for the beginning of 2013.

Economists say this is while French President Francois Hollande’s Socialist government was being optimistic in predicting a 0.3 percent growth this year, and a 0.8 percent in 2013.

“It’s not looking good. There’s a real inconsistency in the government’s policies. They’re creating a recession, and the growth-boosting policies will only come in afterwards,” Nicolas Bouzou from economics consultancy Asteres said.

Michel Martinez, an economist at Societe Generale bank, said the French government would face a recession; however, it would not be as deep as what reported in Spain or Italy.

“It’s a political choice. They’re going to find themselves with two options. Either they forget about more budget tightening and miss the budget target, which risks damaging France’s image with markets, or they correct the budget,” he said.

The French government hopes that 30 billion euros of budget savings – comprising 10 billion-euro worth spending cuts and 20 billion euros of tax break – will allow the government to meet its European commitments on deficit reduction.

Last week, the European Commission reduced its predictions for France, saying it is counting on the French economy growing by 0.2 percent and 0.4 percent respectively in 2012 and 2013.

MP/PKH

Unemployment rate in Greece Soars above 25 percent hitting new record

Students chant slogans outside the finance ministry in Athens during a demonstration to protest against austerity measures and Unemployment. (File Photo)

Greece’s statistics service says the number of Greeks without a job hit 25.4 percent in August, a record high in more than three years of relentless unemployment rise. (PressTV)

A new survey conducted by the Greek statistics service ELSTAT released on Thursday says the jobless rate in the country has increased since the last record in July to twice the average unemployment rate of 11.5 percent in other eurozone countries.

The report indicates that Greece has had 39 consecutive months of increasing jobless rates, and that a record number of 1.27 million people were without a job in August.

The jobless rate has more than tripled since the country’s economic crisis began five years ago and now stands at 58 percent for those aged between 15 and 24 years, compared with 20 percent in August 2008.

Earlier in the week, the European Commission (EC) said the Greek labor market would bottom out in 2013, with unemployment slipping to around 22 percent in 2014, the first year of relative recovery for the recession-battered economy.

Spain and Greece hold the top two positions on unemployment in the European Union according to Eurostat, the EC Directorate-General, with 25.5 percent of Spaniards unable to find work.

On Wednesday, the Greek government voted for a new set of austerity measures to settle an agreement for a crucial bailout fund, prompting nationwide protests by Greeks, who have risen in anger against the further spending cuts and tax hikes.

Athens is set to take budget cuts and tax increases worth 9.4 billion euros by 2013 as a pre-condition to receive more funds under its international bailout.

Europe plunged into a financial crisis in 2008, forcing EU governments to adopt tough economic reforms to cap their worsening debt crises.

The cutbacks have ignited social unrest and massive protests across many European countries.

GVN/MRS/HMV

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