California’s Shameful Poverty Crisis

Seven years ago, the Census Bureau began calculating poverty by a new “supplemental” method, responding to criticism that the half-century-old official poverty rate was too simplistic and inaccurate.

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The new method quickly gained wide acceptance as much more accurate because it included more forms of income and, most importantly, adjustments for widely varying costs of living.

Almost immediately, California achieved the dubious distinction of having the nation’s highest poverty rate, mostly because of its high costs of living, especially housing. Currently, it’s still No. 1 with a 20.4 percent poverty rate, more than twice that of No. 50 Vermont.

The Public Policy Institute of California and Stanford University’s Center on Poverty followed suit, using a similar methodology to calculate poverty rates for the state’s 58 counties.

Their California Poverty Measure currently tabs the state’s rate at 19.5 percent with Los Angeles County the highest at 24.9 percent and Placer County the lowest at 13.1 percent.

PPIC and Stanford also calculated an additional “near-poverty” rate of 19.2 percent, which implies that nearly 40 percent of Californians are coping with economic distress.

And now we have an even deeper dive into persistent economic despair in the nation’s richest state.

United Ways of California, a coalition of local organizations that raise money for charities, commissioned “Struggling to Stay Afloat,” which delves into poverty not only at the state and county levels, but right down to neighborhoods.

Moreover, the new study breaks down the data not only geographically, but by race or ethnicity, gender, occupation, marital status, education and other factors.

Overall, it found that “1 in 3 households in California, over 3.3 million families – including those with incomes well above the (official) federal poverty level – struggle every month to meet basic needs.”

Not surprisingly, Latinos have the highest poverty of any ethnic group, with 53 percent of households having incomes that fall below the “real cost measure.” The incomes deemed to be adequate vary widely from community to community, depending on local living costs.

All three of these statistical exercises are telling us the same thing – that California has an immense poverty problem rooted more in high living costs than in its family incomes. And housing is the most important cost driver.

The political response to California’s poverty crisis has been tepid, even though Democrats who dominate its politics often denounce economic disparity.

Raising minimum wages and welfare grants and offering a state tax credit to the working poor may have some impacts on the margin. However, the extra incomes they generate are quickly consumed by higher housing costs, plus the higher gas taxes, local sales taxes and energy bills being imposed to deal with other political priorities.

Poverty must be attacked at its roots, such as the ever-worsening shortage of housing, which drives its costs ever-upward, and the lack of education and training for good jobs that employers want to fill, but can’t.

Capitol politicians have sidestepped the politically difficult task of overcoming local opposition to housing construction, or reducing environmental red tape. The state Democratic Party just endorsed a ballot measure that would make local rent control ordinances easier to enact, thus discouraging new housing investment even more.

Nor has the dominant party been willing to buck the union-led education establishment and insist on more accountability for educating poor kids – more than half of the state’s 6 million K-12 students – so they can break their families’ poverty cycles.

Cowardice and tokenism cannot and will not erase California’s shameful status as the nation’s most poverty-ridden state.

This article was originally published by the San Jose Mercury News