It was predictable that the financial implosion of 2008 and the loss of 8 million jobs in the Great Recession that followed would generate a huge spike in the nation's poverty rate in 2009, and for several years afterwards. That is precisely what has happened, and what continues to occur. The latest Census Bureau figures reveal the dreadful enormity of the economic disaster.
As a result of the harshest recession since the Great Depression, the share of American residents living in poverty climbed to 14.3 percent in 2009, from 39.8 million in 2008 to 43.6 million - the highest level recorded since 1994. One out of five children suffered anew from poverty, a rate worse than for adults.
As employers shed jobs and employer-provided health insurance, the rate of medically uninsured soared as well, from 47.3 million to 50.7 million. Without the expanded Medicaid effort, the number of insured would have been millions more. Census Bureau figures show, for example, that employers dropped coverage for 6.5 million workers. That pushed down the percentage of workers with employer-based insurance from 58.5 percent in 2008 to 55.8 percent in 2009, the lowest level since 1987.
In Tennessee, that figure is probably worse. Our state's rate of employer-organized insurance has trailed most states for years by as much as 10 percent. Even before the Great Recession the rate of employer-provided insurance was below 55 percent.
Just as a beefed-up Medicaid strengthened the safety net for newly unemployed workers and families, so, too, did unemployment insurance. Without such emergency benefits, the toll of broadening poverty would have been far worse. More than 3 million Americans have received longer-term unemployment insurance, allowing them, however tenuously, to stay in their homes a little longer as they look for work.
Food-stamp benefits and low-income tax credits also relieved the crush of poverty, keeping 8 million poor Americans above the official poverty statistical breakpoint. The current federal poverty level is $22,050 for a family of four and $10,830 for a single adult, in pretax dollars. That artificial figure, of course, is not a certain indicator of poverty, since the cost of living, wages and other price disparities vary greatly around the county.
The Census Bureau's official numbers also underplay the severity of the recession's continuing impact in other ways. Many economically shocked families who lost their jobs and homes, the Census found, avoided the effects of greater poverty by moving in with other family members or relatives, and sometimes with friends. The rate of multifamily households, the Census found, rose 11.6 percent in 2009.
The collateral damage continues to be huge. Though the median income remained fairly constant from 2008 to 2009, the recession had already gained steam and generated job losses in 2008. In both years, and continuing into 2010, income has fallen as wages and salaries have been frozen and workers have been forced to take unpaid furloughs.
Cutbacks in pension and 401k contributions and higher employee cost for health insurance have also pushed back real median income. Thus median incomes in 2009, in inflation-adjusted dollars, were 5 percent lower than in 1999. That's the first time median family income has lost more than a decade of gains in contemporary times.
The economic pain has not been shared equally. People with less education, and people of color - mainly the people already in the lower economic rungs - have been hammered disproportionately: The poverty rate for non-Hispanic whites in 2009 was 9.4 percent; for Hispanics, 25.3 percent, and for blacks, 25.8 percent. The rate for Asians, 12.5 percent, didn't change.
Contrary to Republican and Tea Party talking points, the Census figures confirm that unemployment, Medicaid and low-income tax credits - programs that Republicans have resisted in Congress - have served well in mitigating the economic pain. So have stimulus funds that helped state and local governments create jobs and save existing jobs.
Americans have good cause to wonder how much farther the economy would have fallen without those programs. Those who rail about the slowness of the recovery - which has added jobs for eight straight months - must know by now that an economy set back so harshly as in 2008-09 cannot be expected to recover rapidly from such significant job losses. It will require several years, and strong governmental support for those left in the backwash of such a deep global recession.