Making Poverty History

We might not expect TV's American Idol to be out in front of most presidential candidates on issues of national importance, but that's what happened this spring. AI's producers announced that they would dedicate two evenings to raising funds and awareness for children and young people in poverty, in both America and Africa. The show's commitment stands in contrast to most of the 2008 candidates. What does American Idol know that they don't?

American Idol isn't alone. In the last two years, there has been a surge of interest in ending poverty in America. In the faith community, Sojourners and Call to Renewal announced a Covenant for a New America and urged others to help them cut child poverty by half in 10 years. Catholic Charities USA created a Campaign to Reduce Poverty in America. New York City Mayor Michael Bloomberg created an Economic Opportunity Commission and charged it with proposing ways to promote opportunity and reduce poverty in the city, and he has begun implementing the commission's recommendations. A Task Force on Poverty, Work and Opportunity of the U.S. Conference of Mayors, led by Los Angeles Mayor Antonio Villaraigosa, made a set of ambitious recommendations. Governors, mayors, and legislatures in Connecticut, Minnesota, California, and Wisconsin -- among others -- have launched or proposed initiatives. These efforts are occurring against the backdrop of the larger international efforts to make poverty history.

Among presidential candidates, John Edwards has proposed a goal of ending poverty within the next 30 years, and put forward a plan to get there. Barack Obama, in announcing his candidacy, declared, "Let's be the generation that ends poverty in America." Can the other candidates be far behind? Will anyone want to go into a presidential debate saying it's a bad idea to try to eliminate poverty?

Why Now?

Why this revival of interest in tackling poverty now? There are many reasons, but three stand out.

First, Hurricane Katrina gave poverty a human face. The horrific images, and the stories behind them, made painfully clear that not far from the Mardi Gras part of town, thousands of city residents didn't own cars and couldn't afford a night in a hotel when disaster was approaching. Pre-Katrina New Orleans represented an exceptionally bad case of concentrated poverty, but not a unique one. The Brookings Institution reports at least one neighborhood of extreme poverty -- where at least 40 percent of residents live in poverty -- in 46 of the 50 largest cities in the country.

Second, the extraordinary growth of wealth at the top has called attention to the corresponding growth of inequality and poverty. In 2005, the top 20 percent of American households had 50.4 percent of the nation's income, while the bottom 20 percent had 3.4 percent -- the largest margin between top and bottom since this data series began, in 1967. The Center on Budget and Policy Priorities reports that between 2003 and 2004, the post-tax income of the bottom fifth rose by $200 a year, while that of the top fifth rose by $11,600, and post-tax income for the top 1 percent rose by $145,500. And the wealth gap is far more extreme, with the top 1 percent of households holding one-third of the nation's net worth, while the bottom 40 percent have less than one percent of the nation's net worth. This is the widest gap since the 1920s.

Third, there is increasing recognition that in a globalized economy, the nation should not have millions of children growing up in persistent poverty. Our economic success increasingly depends on having a well-educated, adaptable workforce.

A new study by Harry Holzer and several colleagues, commissioned by the Center for American Progress' Task Force on Poverty, underscores how serious the drag on the economy turns out to be. Holzer and colleagues estimate that the net loss to the economy from persistent childhood poverty is about $500 billion each year. That is about 4 percent of the gross domestic product, more than $1,600 for every person in the country. The economic loss is almost evenly divided among lower productivity, higher health costs, and increased crime costs for adults who grew up in persistent poverty.

How much we lag behind other developed nations is starkly apparent in a new UNICEF study of child well-being. UNICEF found that the United States had the highest share of children with family incomes below half of median income among 21 rich nations -- 22 percent, as compared with an average of 11 percent for the others. Compared with 24 other nations, the United States tied for 22nd on infant mortality, ranked 22nd in terms of low

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