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The Rostrum

Poverty: the common problem of children in trouble


Children are hot property these days on the campaign trail and on editorial pages. The reason is not hard to find. Unvarnished self-interest suggests that those of us who are now working may not get the rewards, for example, of Social Security and Medicare if the next generation of workers can't make it in the internationally competitive workplace. So increasingly we worry about school drop-out rates, high school graduation numbers, teenage pregnancy statistics and other barometers of the rising generation.

In the welter of statistics it's hard to know which one to worry about most. But poverty is the common background of many of the children who are in trouble. We may be one nation under God, but we have increasingly become two nations as far as children are concerned.

In 1959, toward the end of the Eisenhower era, about 15 percent of children in this country lived in families with cash incomes below the poverty line. By 1969 that figure had dropped to 11 percent. Ten years later it was back up to 15 percent, and now it is over 20 percent. That means that more than 600,000 of Illinois' three million children are growing up without adequate food, shelter and clothing. That poverty in turn affects their health, their schooling and, by extension, their capacity to compete in the job market.

The reasons more children are poor vary just as their life experiences vary. For children of the working poor, most of the increase in poverty is caused by changes in the marketplace, particularly the substitution of low-paying service jobs for higher paying manufacturing jobs. For a child whose single parent does not work, the increase in poverty results partly from the government's failure to include inflation in its determination of benefits. (Before last year's increase in Aid to Families with Dependent Children, inflation had caused welfare payments in Illinois to decline 53 percent since 1970.) The large increase in the number of single-parent households has also increased the total number of children who are poor.

Most of the public debate about poverty is focused on those families who have been receiving welfare payments for many years. This form of poverty seems the most resistant to change. But the majority of poor children do not fall into this category. About one-half of poverty level two-parent families have one parent who is a full-year, full-time worker. And only 28 percent of chidren age 6 and under who are poor live in families that rely solely on public assistance.

Twenty percent of children in this country have neither public nor private health insurance

Family income figures tell the story. In the last 10 years the poorest 25 percent of families saw the value of their incomes adjusted for inflation, drop 14 percent. Even the next 25 percent of families experienced a 6 percent drop in inflation adjusted income. By contrast the richest 25 percent saw their incomes increase by 19 percent.

Race has a dramatic effect on family income. While the median family income of white families has dropped from $30,800 to $29,900 since 1979, the family income for African-American families dropped from $16,700 to $15,000, and for Hispanic families from $12,100 to $9,800,

Family income changes have also taken their toll on young men. In 1963, 60 percent of men aged 20 to 24 earned enough to keep a family of three out of poverty. In 1984, only 42 percent of the men in that age group could do so. A young man's income affects the chances that he will get married; these decreases in income have contributed to the increase in the number of men who do not marry the mothers of their children. One commentator notes the decline in overall teenage birth rates but the increase in out-of-wedlock births in the last 30 years and adds: "[Nineteen] Fifties teens didn't say 'no'; they slipped on wedding rings." Nineteen-nineties teens can't afford the ring.

It's not just the market economy that has produced these changes. The total package of federal taxes and of state and local taxes has become more regressive, extracting a higher percentage of low-income workers' salaries than middle- and upper-income workers'. These changes have made the working poor, poorer. While the federal Tax Reform Act of 1986 now excuses families earning $16,000 or less from paying any federal income tax, poor families have seen an increase in the percentage of income that goes to federal taxes because of increases in the very regressive Social Security tax. (All workers pay the

38/June 1990/Illinois Issues

same 7.65 percent of their income for Social Security except workers earning over $51,300 who pay no Social Security taxes on income above that amount.) The Illinois General Assembly hasn't helped on the tax front. The poorest 20 percent of families in Illinois pay almost 11 percent of their income in the combination of state and local taxes. In contrast the richest 1 percent spend less than 5 percent of their incomes on those taxes.

Meanwhile government support programs for low-income families have been cut. When Ronald Reagan became president, the federal government was spending $35 billion a year on a variety of housing programs for low-income families. Those programs brought over $280 million into Illinois. By 1987 those programs had declined to $7 billion, and Illinois' share to $36 million. (Meanwhile housing subsidies to middle-income families via mortgage interest and property tax relief on the federal income tax now exceed $50 billion.) Health care policy is equally disastrous. Twenty percent of children in this country have neither public nor private health insurance.

So what is an Illinois politician in the waning days of the Thompson administration to do? While there are no perfect answers, there are enough reasonable strategies. Politicians genuinely committed to children's issues could support those programs that increase the next generation's capacity to compete in the workforce. Well-run, publicly subsidized preschool programs have the double advantage of doing just that and partly subsidizing a low-income family's child-care bill. Lawmakers could reduce the inequity in the state and local tax structure by passing the proposed Children in Poverty Tax Credit that would give low-income working families with children a tax rebate. Most important, they could spare a second from the agonies of redistricting to suggest that their Washington colleagues demand a peace dividend that targets housing, health and education. That way we may just make this country one nation for our children as well as for God.

Malcolm Bush is senior vice president of Voices for Illinois Children, a not-for-profit policy analysis and advocacy group, and is author of the book. Families in Distress: Public, Private and Civic Responses (University of California Press).

June 1990/Illinois Issues/39

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