Tag Archives: poverty

Child Care, Poverty

FACT SHEET: Biden-Harris Administration Actions to Keep Children and Families Safely Together and Supported

The White House hosts a convening on transforming child welfare and announces new policy to prevent family separation due to poverty

 

President Joe Biden  and Vice President Kamala Harris believe every child should have the opportunity to reach their full potential and grow up in a safe and loving home with their families. The White House announced new policies that focus on preventing family separation and supporting and creating opportunities for families and youth. © Karen Rubin/news-photos-features.com

The President and Vice President believe every child should have the opportunity to reach their full potential and grow up in a safe and loving home with their families. Over four million families are referred to child protective services each year, and around 200,000 children enter foster care.  Child welfare systems are prepared to step in when a child’s safety is at risk, but they are frequently tasked with intervening when families are simply impoverished and could  be best helped in the long run by helping meet their economic and service needs. Since Day One, the Biden-Harris Administration has been committed to improving child and family well-being by keeping families together safely, including through helping connect them to community and economic supports, increasing the use of kinship care, and improving foster care so that when it is needed, it preserves and strengthens lasting emotional bonds.
 
Today, the White House hosted a convening on transforming child welfare to announce new policies that focus on preventing family separation and supporting and creating opportunities for families and youth. The convening brought together policymakers across federal, state, local, and tribal governments, philanthropy, child welfare and family support organizations, and young people and families who have personal experiences, to encourage further innovation, build new partnerships, and exchange best practices. The new announcements focus on four key areas:
 
Separating Poverty and Neglect
Children should not be separated from their families due to financial hardship alone. Several states, like Kentucky, Indiana, South Carolina, Wisconsin, Pennsylvania, Washington, and Kansas have already clarified that poverty alone should not cause child removal. And there is emerging evidence connecting these actions to improvements in family outcomes. The Biden-Harris Administration is encouraging states to follow their lead and make clear the distinctions between child maltreatment and financial hardship. Today, the Department of Health and Human Services (HHS) is:

  • Issuing new policy guidance that encourages states to update their maltreatment definitions under the Child Abuse Prevention and Treatment Act to exclude the inability to provide adequate housing, child care and other material needs if the family has insufficient financial means to do so from the definition of child neglect. The state should first seek to help the family. 
  • Committing to develop guidance on training mandated reporters so that they recognize the need to connect economically fragile families to supports and know these changes to neglect definitions.

 
Prevention Services
Prevention services, including services to help families economically and provide parenting and behavioral health treatment, need to be well resourced, tailored to best meet the needs of families and grounded in evidence. New Biden-Harris actions will expand how states and Tribes can use federal funding for prevention activities to provide greater assistance to children and families before a crisis point. These actions include new policies to:  

  • Provide more flexibility to Tribal governments to use Tribally accepted prevention services when they collaborate with state child welfare agencies.
  • Permit federal administrative funding to help families get to and engage with prevention programs, such as case management, peer navigation and transportation to help families engage with services. Policy will also clarify how federal funds can support evaluations of interventions and activities that improve service implementation.
  • As well as, forthcoming new guidance on ways to integrate and leverage the Temporary Assistance for Needy Families program to prevent involvement in the child welfare system.

 
Prioritizing Kin and Youth Needs
Children who cannot be with their parents but live with relatives and other kin have better outcomes than those who are not, including in stability, behavioral health, and education. New Biden-Harris actions will incentivize jurisdictions to do more to ensure children can live with kin, and meet youth needs by:

  • Allowing child welfare agencies to draw on federal funds to finance background check operations to facilitate quicker licensing for kin and others who provide foster care.
  • Rolling out a new website spotlights states and Tribes that have adopted new kinship licensing rules, as well as data on their kinship placement rates.
  • Publishing a resource guide on federal programs that provide supports to grandparents and kin in their caregiving roles. 
  • Conducting a series of listening sessions to identify federal flexibilities needed for states and Tribes to adopt kinship licensing rules and kinship first approaches.

 
Innovations and Research
The Biden-Harris Administration is committed to further developing actionable research on the intersection between prevention, family support and child well-being outcomes. HHS announced several projects that:

  • Highlight innovative prevention approaches that rely on service integration and agency collaboration to prevent homelessness among youth aging out of foster care and to build family resilience.
  • Enable researchers to study linked Medicaid and child welfare data to understand the health needs of children and parents involved in child welfare.
  • Examine the characteristics and experiences of certain families who relinquished or voluntarily placed their children in child welfare custody to better identify the needs for community-based behavioral health and disability services.

 
THE BIDEN-HARRIS RECORD ON CHILD WELFARE
 
The Biden-Harris Administration has a long record of actions consistent with its commitment to keeping families together safely, providing supports as an alternative to child removals, and increasing the use of kinship care and other foster care best practices:

  • Accelerating uptake of the Title IV-E Prevention Program. This groundbreaking program provides open-ended funding for proven approaches to keeping children with their families.  This Administration has approved 38 prevention plans, bringing the total to 42 states, the District of Columbia, and four Tribes. 
  • Expanding evidenced-based services to use in the Prevention Program.  This month HHS announced changes to the title IV-E Prevention Services Clearinghouse review procedures that will enable the review and approval of diverse new programs that can be funded through the Prevention Program, beyond the 85 already approved.  These changes clarify how services that include economic supports can be reviewed, offer more flexible evaluation designs to meet evidence standards, and create more engagement and transparency in the review process.
  • Respecting Tribal sovereignty. The Administration expanded the scope of Public Law 102-477 plans, which now deliver over $300 million in flexible funding to 298 Indian Tribes to strengthen the economic stability and mobility of families in Indian Country – including by braiding child welfare funding with workforce funding to help preserve families. And just over a year ago, the President celebrated the Supreme Court’s decision in Haaland v. Brackeen, which upheld the Indian Child Welfare Act as a necessary safeguard to ensure that whenever possible, children should be kept with their extended families or community.
  • Expanding home visiting. The Administration has doubled total authorized funding for home visits from $400 million in FY 2022 to $800 million by FY 2027 in the Maternal, Infant, and Early Childhood Home Visiting Program and quadrupled funding to $48 million to Tribes over the same period, increasing efforts that can identify challenges facing families and enable solutions that keep children healthy and families together.  Most recently, HHS announced $3 million in grant funding to six new tribal entities for a home visiting programs to support and promote the well-being of expectant families and those with young children in Indigenous communities.
  • Prioritizing kinship care. In September 2023, HHS issued a final rule that allows a child welfare agency to adopt simpler licensing or approval standards for all kin foster family homes. The rule also requires that states provide kinship caregivers with the same level of financial assistance that any other foster care provider receives, an important step forward to strengthen the financial security of kinship families. In April 2024, HHS hosted a national convening on kinship care to highlight innovative strategies to bolster kinship care. Six states and three Tribes have taken up the kinship licensing rules in the first six months, and three more are pending approvals to do so.  
  • Supporting young people in foster care. HUD has increased public housing authority uptake of the Foster Youth to Independence Program, which provides housing vouchers for up to three years for older youth transitioning from foster care. Since the beginning of the Biden-Harris Administration, HUD awarded $60.3 million, providing 4,364 vouchers for older youth. HHS also funded 11 state and Tribal demonstration grants to test community approaches to prevent youth from becoming homeless. And USDA and HHS are working to ensure that young people experiencing homelessness or transitioning out of foster care can keep their SNAP benefits without work reporting requirements, as secured by the President through the Fiscal Responsibility Act of 2023.
  • Protecting parents and children with disabilities from discrimination. HHS issued a final rule to protect parents and children with disabilities involved with the child welfare system. The final rule seeks to ensure that children with disabilities are served in the most integrated setting appropriate to their needs, and that parents and prospective parents do not face discrimination in visitation, reunification, child placement, and other child welfare services based on stereotypes about their disability.
  • Cutting child poverty. The Biden-Harris Administration saved nearly 40 million working families with 65 million children an average of $2,600 by expanding the Child Tax Credit in 2021—helping to cut child poverty nearly in half, lifting 1.2 million Hispanic children, 800,000 Black children, and almost 100,000 Asian American children out of poverty.
  • Providing affordable child care for families. The President has secured nearly a 50% increase in child care funding, keeping providers open during the pandemic and bolstering women’s labor force participation. HHS made changes to the child care subsidy program to lower costs for families with low-incomes by capping their out of pocket child care costs to 7% of their income. 
  • Providing housing relief for families. The Biden-Harris Administration has provided rental assistance to more than 5 million households, including an additional 100,000 low-income families. The Administration established a ceiling for annual rent increases for the two million apartments that are financed by federal tax credits—reducing the maximum allowable annual rent increase for those renters by an average of nearly $500 this year. And during the pandemic, the Administration provided rental assistance to 8 million renters to help pay rent, keep them in their homes, and cover utilities bills.
Biden Administration, Economic Development, Economic Policies, Inequality, News & Photo Features, Poverty, President Joe Biden

White House: How American Families Plan Will Support Children, Teachers, and Working Families in Rural America

President Biden knows a strong middle-class is the backbone of America and that rural and tribal communities are essential to the economic growth of our country. Rural communities require targeted investments that meet the needs of their children and families, along with workforce development for those providing childcare and education. The American Families Plan represents a generation-defining investment in rural America, and a commitment to grow the middle-class and expand the benefits of economic growth to all Americans. By extending and building upon the provisions of the American Rescue Plan, the American Families Plan would cut the rural poverty rate by more than 21 percent and the rural child poverty rate by 50 percent, relative to the projected poverty rate for 2022 © Karen Rubin/news-photos-features.com

The White House issued a fact sheet explaining how President Joe Biden’s American Families Plan will support children, teachers and working families in rural America:

President Biden knows a strong middle-class is the backbone of America and that rural and tribal communities are essential to the economic growth of our country. Rural communities require targeted investments that meet the needs of their children and families, along with workforce development for those providing childcare and education. The American Families Plan represents a generation-defining investment in rural America, and a commitment to grow the middle-class and expand the benefits of economic growth to all Americans. All told, by extending and building upon the provisions of the American Rescue Plan, the American Families Plan would cut the rural poverty rate by more than 21 percent and the rural child poverty rate by 50 percent, relative to the projected poverty rate for 2022.
 
UNIVERSAL PRE-SCHOOL FOR 3- AND 4-YEAR OLDS
 
Low population density, physical isolation, and broad spatial distribution make access to preschool more challenging for low-income families in rural areas. President Biden’s American Families Plan will:

  • Provide free universal pre-school to all 3- and 4-year-olds, benefitting 5 million children. This historic investment in America’s future will first prioritize high-need areas and enable communities and families to choose the settings that work best for them, whether that’s a preschool classroom in a public school, a center, or a Head Start program. The President’s plan will invest in tuition-free community college and teacher scholarships to support those who wish to earn a bachelor’s degree or other credential that supports their work as an educator or their work to become an early childhood educator. And educators will receive job-embedded coaching, professional development, and wages that reflect the importance of their work. All employees in participating Pre-K programs and Head Start will earn at least $15 per hour, and those with comparable qualifications will receive compensation and benefits similar to elementary school teachers.

FREE COMMUNITY COLLEGE AND OTHER POSTSECONDARY INVESTMENTS
 
There are approximately 250 rural community colleges across the U.S., with an even greater number of community colleges that serve a primarily rural student population. Colleges and universities are important anchor institutions in rural communities, providing jobs to residents, attracting businesses, and boosting local economies.
 
President Biden’s American Families Plan will:

  • Provide two years of free community college so that first-time students and workers wanting to reskill can enroll in a community college without paying tuition and fees.
  • Increase the maximum Pell Grant award by approximately $1,400 to provide additional assistance to low-income students and also allow DREAMers to access the grant.
  • Provide grants to increase college retention and completion, allowing states, territories, and Tribes to support the adoption and expansion of evidence-based practices and promising solutions that help students complete their degrees.
  • Increase funding to support Historically Black Colleges and Universities (HBCUs), Tribal Colleges and Universities (TCUs), and institutions such as Hispanic-serving institutions (HSIs), Asian American and Native American Pacific Islander-serving institutions (AANAPISIs), and other Minority-Serving Institutions (MSIs), and the students they serve. This will provide two years of subsidized tuition, as well as funding to support institutional development and the strengthening of the health care workforce, which will benefit rural areas where the need for physicians, nurses, and other providers continues to limit access to care.

Education and Preparation for Teachers
 
More than 9 million students—nearly one in five students—attend a rural school in the U.S. But these schools face challenges in hiring and retaining teachers, particularly in special education and specialized instruction.
 
President Biden’s American Families Plan will:

  • Address teacher shortages, improve teacher preparation, and strengthen pipelines for teachers of color. President Biden is calling on Congress to double scholarships for future teachers from $4,000 to $8,000 per year while earning their degree and expand it to early childhood educators. The President’s plan would also invest $3.2 billion to cultivate and recruit teachers from the communities that schools serve, provide year-long, paid residency programs, and invest in teacher preparation at HBCUs, TCUs, and MSIs.
  • Support the development of special education teachers. There has been a 17 percent  decline in the number of special educators over the last decade. Additionally, while only about half of the students receiving special education services are white, approximately 82 percent of special education teachers are white. The American Families Plan will invest $900 million in personnel preparation funds under the Individuals with Disabilities Education Act (IDEA), funding pathways to additional certifications and strengthening existing teacher preparation programs for special educators.
  • Help current teachers earn in-demand credentials. President Biden is calling on Congress to create a new fund to provide educators with opportunities to obtain additional certifications in high-demand areas like special education, bilingual education, and certifications that improve teacher performance. This fund will support over 100,000 educators, with priority for public school teachers with at least two years of experience at schools with a significant number of low-income students or significant teacher shortages.
  • Invest in educator leadership. President Biden is calling on Congress to invest $2 billion in programs that leverage teachers as leaders to multiply their impact within their school, such as high-quality mentoring programs that leverage current teachers as mentors for new teachers, which improve student outcomes and increase teacher retention rates while keeping great teachers in the classroom.

Child Care
 
Lack of access to affordable, high-quality child care is making it hard for parents to work and provide for their families. Many rural families have to go without care, and without sufficient demand, it can be challenging for centers to afford to operate. Over half of rural families live in a child care desert, meaning there are few or no child care options. In particular, rural families disproportionately lack access to child care centers serving infants and toddlers.  
 
The American Families Plan builds on investments in President Biden’s American Jobs Plan and will further expand access to high-quality child care in rural areas.
 
President Biden’s American Families Plan will:

  • Make child care more affordable. Families will pay only a portion of their income on child care based on a sliding scale. For the most-hard pressed working families, child care costs for their young children would be fully covered and families earning up to 1.5 times their state median income will spend no more than 7% of their income on child care for young children.
  • Ensure this child care is high quality. The American Families plan will ensure child care providers, including centers and home-based providers, receive funding to provide the true cost of quality early childhood education—including a developmentally appropriate curriculum, small class sizes, and culturally and linguistically responsive environments that are inclusive of children with disabilities.
  • Invest in the care workforce across rural America. Early childhood educators are among the most underpaid workers in the country and nearly half rely on public income support programs. The typical child care worker earned $12.24 per hour in 2020—while receiving few, if any, benefits, leading to high turnover and lower quality of care.  The American Families Plan will ensure a $15 minimum wage for early childhood educators. Those with comparable qualifications to elementary school teachers will receive comparable compensation and benefits. And, the American Families Plan will ensure educators receive job-embedded coaching and professional development, along with additional training opportunities.

Paid Leave
 
Paid family and medical leave supports workers and families and is a critical investment in the strength and equity of our economy. However, many rural workers lack access to paid family and medical leave programs, particularly low-wage workers. According to one nation-wide survey, over fifty percent of non-metro (including rural) workers said they would very likely face hardship if they had to take a few months of unpaid time off work, compared to 40 percent of metro area workers. Furthermore, many small rural businesses struggle to compete for and retain talent compared to urban areas. These businesses often cannot afford to provide workplace supports like paid family and medical leave. Rural areas are also more likely to have older populations, increasing the need for both medical and caregiving leave. One study found that California’s paid leave program accounted for an 11-percent relative decline in elderly nursing home usage, saving costs for both the state and families.
 
President Biden’s American Families Plan will:

  • Create a national comprehensive paid family and medical leave program. The program will ensure workers receive partial wage replacement to take time to bond with a new child, care for a seriously ill loved one, deal with a loved one’s military deployment, find safety from sexual assault, stalking, or domestic violence, heal from their own serious illness, or take time to deal with the death of a loved one. It will guarantee twelve weeks of paid parental, family, and personal illness/safe leave by year 10 of the program, and also ensure workers get three days of bereavement leave per year starting in year one. The program will provide workers up to $4,000 a month, with a minimum of two-thirds of average weekly wages replaced, rising to 80 percent for the lowest wage workers. We estimate this program will cost $225 billion over a decade.


Nutrition
 
With higher child poverty rates and longer distances to grocery stores, accessing nutritious food can be challenging for families in rural areas. Eighty-six percent of counties with high child food insecurity are rural, and children in rural areas are 25 percent more likely to be obese than those in urban areas. To foster positive long-term health outcomes through nutrition security, President Biden’s American Families Plan will:

  • Expand summer EBT to all eligible children nationwide. The Summer EBT Demonstrations help low-income families with children eligible for free- and reduced-price meals during the school year purchase food during the summer. The American Families Plan builds on the American Rescue Plan’s support for Summer Pandemic-EBT by making the successful program permanent and available to all 29 million children receiving free- and reduced-price meals. Research shows that this program decreases food insecurity among children and leads to positive changes in nutritional outcomes.
  • Expand school meal programs. Currently, just 70 percent of eligible schools have adopted Community Eligibility Provision (CEP), which allows high-poverty schools to provide meals free of charge to all of their students—breaking down barriers for students who may be eligible for school meals but may not apply for them due to stigma or not fully understanding the application process. The President’s plan will allow more schools in high poverty districts to offer meals free of charge to all of their students by reimbursing a higher percentage of meals at the free reimbursement rate through CEP. Additionally, the plan will target elementary schools by lowering the threshold for CEP eligibility for elementary schools. The plan will also expand direct certification to automatically enroll more students for school meals based on Medicaid and Supplemental Security Income data. This will especially help rural schools, which often have limited administrative capacity for food purchasing and accounting.
  • Launch a healthy foods incentive demonstration to further improve the nutrition standards of school meals and support the development of healthy lifestyles throughout the school environment.

 
Tax Cuts for America’s Families and Workers
 
While the American Rescue Plan provided meaningful relief to hundreds of millions of Americans, that was just a first step. Now is the time to build back better, to help families and workers who for too long have felt the squeeze of stagnating wages and an ever-increasing cost-of-living.  Direct assistance to families in the form of tax credits paid on a regular basis lifts children and families out of poverty, makes it easier for families to make ends meet, and boosts the academic and economic performance of children over time. President Biden’s American Families Plan will:

  • Extend expanded ACA premiums tax credits in the American Rescue Plan. Health care should be a right, not a privilege, and Americans facing illness should never have to worry about how they are going to pay for their treatment. No one should face a choice between buying life-saving medications or putting food on the table. President Biden has a plan to build on the Affordable Care Act and lower prescription drug costs for everyone by letting Medicare negotiate prices, reducing health insurance premiums and deductibles for those who buy coverage on their own, creating a public option and the option for people to enroll in Medicare at age 60, and closing the Medicaid coverage gap to help millions of Americans gain health insurance. The American Families Plan will build on the American Rescue Plan and continue our work to make health care more affordable.  The biggest improvement in health care affordability since the Affordable Care Act, the American Rescue Plan provided two years of lower health insurance premiums for those who buy coverage on their own. With those changes, more than three in four uninsured people living in rural areas are now eligible for low-cost health care, and more than four in five current HealthCare.gov enrollees in rural counties are eligible for low-cost health care. The American Families Plan will make a $200 billion investment to make those premium reductions permanent. As a result, nine million people will save hundreds of dollars per year on their premiums, and four million uninsured people will gain coverage.  The Families Plan will also invest in maternal health and support the families of veterans receiving health care services.
  • Extend the Child Tax Credit (CTC) increases in the American Rescue Plan through 2025 and make the CTC permanently fully refundable. Rural child poverty rates are higher than the national average, and more than 200 rural counties qualify as “persistent-poverty counties,” meaning they have experienced poverty rates of 20 percent or higher for at least 30 years.  The President is calling for extending the Child Tax Credit expansion first enacted in the American Rescue Plan, which increases the Child Tax Credit from $2,000 per child to $3,000 per child for 6-year-olds and above and $3,600 per child for children under 6. It also makes 17-year-olds eligible for the first time and makes the credit fully refundable, meaning that the nearly half of low-income rural families that historically did not qualify for the full credit because they earned too little, can now receive the same credit as middle-income families. If extended, this would be the single largest contributor to this plan’s historic impact of lifting a projected 620,000 children in non-metro areas out of poverty in 2022 and cutting rural child poverty in half.
  • Permanently increase tax credits to support families with child care needs. To help even more families, President Biden is calling on Congress to make permanent the temporary expansion of the Child and Dependent Care Tax Credit (CDCTC) enacted in the American Rescue Plan. Families will get back as a tax credit as much as half of their spending on child care for children under age 13, so that they can receive a total of up to $4,000 for one child or $8,000 for two or more children. Making the American Rescue Plan expansion of CDCTC permanent will also ensure the credit will continue to be fully refundable, making it more equitable by allowing low-income working families to receive the full value of the credit towards their eligible child care expenses regardless of how much they owe in taxes.
  • Make the Earned Income Tax Credit (EITC) expansion for childless workers permanent. President Biden believes our tax code should reward work and not wealth. And that means rewarding people who work hard every day at modest wages to provide their communities with essential services. Before this year, the federal tax code taxed low-wage childless workers into poverty or deeper into poverty — the only group of workers treated this way. The American Rescue Plan addressed this problem by roughly tripling the EITC for childless workers, benefitting 17 million low-wage workers, many of whom are essential workers including cashiers, cooks, delivery drivers, food preparation workers, and childcare providers. For example, a childless worker who works 30 hours per week at $9 per hour earns income that, after taxes, leaves them below the federal poverty line. By increasing her credit to more than $1,100, EITC expansion helps pull such workers out of poverty. The President is calling on Congress to make this expansion permanent. All told, the expansion will directly benefit more than one in five rural workers without children.


To view this fact sheet in your browser, click here. 
 

Economic Policies, Economy

Census Data: Household Income Grew at Record Pace; Poverty Rate Fell Fastest since 1968; Uninsured Rate Continued to Fall in 2015

WASHINGTON, DC – Jason Furman, Chairman of the Council of Economic Advisers; Sandra Black, Member of the Council of Economic Advisers; and Matt Fielder, Chief Economist of the Council of Economic Advisers; issued the following statement today on the Census Income, Poverty, and Health Insurance Data. You can view the statement HERE.

Summary: In 2015, household income grew at the fastest rate on record, the poverty rate fell faster than at any point since 1968, and the uninsured rate continued to fall. 

Today’s report from the Census Bureau shows the remarkable progress that American families have made as the recovery continues to strengthen. Real median household income grew 5.2 percent from 2014 to 2015, the fastest annual growth on record. Income grew for households across the income distribution, with the fastest growth among lower- and middle-income households. The number of people in poverty fell by 3.5 million, leading the poverty rate to fall from 14.8 percent to 13.5 percent, the largest one-year drop since 1968, with even larger improvements for African Americans, Hispanic Americans, and children. Meanwhile, the ratio of earnings for women working full-time, full-year to earnings for men working full-time, full-year increased to 80 percent in 2015, the highest on record. Every State has seen declines in its uninsured rate since 2013 as the major coverage provisions of the Affordable Care Act have taken effect. Solid employment growth and robust real wage growth so far this year suggest that incomes are continuing to rise in 2016, and, building on the progress shown in today’s Census report, the President will continue to call on Congress to take steps to invest in job creation, wage growth, and equal pay for equal work.

SIX KEY POINTS IN TODAY’S REPORT FROM THE CENSUS BUREAU

1. Real median household income rose by 5.2 percent in 2015, the fastest growth on record. Median household income grew $2,798 to $56,516 in 2015, the first time that annual real income growth exceeded 5 percent since the Census Bureau began reporting data on household income in 1967. Data from 2016 so far point to further strong gains in real household incomes, which depend on employment, nominal wages, and inflation. As of August, total nonfarm job growth has averaged a solid 182,000 jobs a month so far in 2016, and hourly earnings for private-sector workers have increased at an annual rate of 2.8 percent, much faster than the pace of inflation (1.3 percent as of July, the latest data available).

2. The total number of Americans below the poverty line fell by 3.5 million from 2014 to 2015, and the official poverty rate fell to 13.5 percent due to the largest one-year drop since 1968. The poverty rate for children under age 18 fell by 1.4 percentage point (p.p.) from 2014 to 2015, equivalent to more than 1 million children lifted out of poverty. Meanwhile, the poverty rate for those ages 18 to 64 saw its largest one-year decline on record (-1.1 p.p.), and poverty fell 1.1 p.p. for those ages 65 and older. As noted below (see point 5), the official poverty rate does not reflect the full effect of antipoverty policies because it includes only pre-tax income and excludes the direct effect of key policies like the Supplemental Nutrition Assistance Program (SNAP) and the Earned Income Tax Credit (EITC). The Supplemental Poverty Measure, which is designed to include the effects of these programs but also takes into the cost of basic needs when setting the poverty threshold, decreased 1.0 percentage point in 2015, from 15.3 percent to 14.3 percent.

3. Households at all income percentiles reported by the Census Bureau saw gains in income, with the largest gains among households at the bottom of the income distribution. While real median household income increased 5.2 percent, gains were even larger in the lower half of the income distribution, ranging from an increase of 5.5 percent for households at the 40th percentile to an increase of nearly 8 percent for households at the 10th percentile. While households at the top half of the income distribution also saw increases, their gains were smaller, with an increase of 2.9 percent in the 90th percentile of household income. 2015 marked the first time real household income grew at all percentiles reported by the Census Bureau since 2006, and real income growth in 2015 was the fastest since 1969 for the 10th, 20th, 40th, 50th, and 60thpercentiles. Although the level of income inequality remains high, multiple measures of inequality—including the Gini coefficient, the ratio of the 90th percentile of income to the 10th percentile, and the share of income going to households at the top of the income distribution—fell modestly in 2015 as a result of this pattern of income growth.

4. All racial and ethnic groups saw increases in household incomes and decreases in poverty in 2015. As shown in the chart below, all racial and ethnic groups saw gains in real median household income and reductions in their respective poverty rates. Hispanic Americans saw both the largest gains in median income (6.1 percent), while Black Americans and Hispanic Americans saw the largest reductions in poverty (-2.1 p.p. and -2.2 p.p., respectively). The Supplemental Poverty Measure (SPM), which includes the effects of a number of important antipoverty programs (see point 5 below), shows a similar pattern, with all racial and ethnic groups seeing reductions in poverty.

5. In 2015, refundable tax credits like the Earned Income Tax Credit (EITC) and the Child Tax Credit (CTC) lifted 4.8 million children out of poverty. The Supplemental Poverty Measure (SPM), which includes the effects of a large number of antipoverty programs, is widely acknowledged to measure poverty more accurately than the official measure. Unlike the official poverty measure, the SPM measures post-tax and post-transfer resources, combining earnings with assistance from government programs—including in-kind transfers like food assistance—minus net tax liabilities and necessary expenditures on work, child care, and health care. The measure also bases the poverty line on the cost of meeting basic expenses. Together, in 2015, 9.2 million Americans, including 4.8 million children, were lifted above the poverty line by refundable tax credits, including the EITC and the CTC, illustrating their critical importance to the social safety net. Additionally, research has shown that helping low-income working families through the EITC and CTC not only reduces poverty, but also has positive longer-term effects on children, including improved health, educational outcomes, and labor force participation and earnings in adulthood. Expansions to the EITC and CTC signed into law by President Obama as part of the American Recovery and Reinvestment Act of 2009 lifted 1.0 million children out of poverty in 2013 according to the Center on Budget and Policy Priorities; these provisions were made permanent under the bipartisan agreement at the end of 2015. The President’s Fiscal Year 2017 Budget includes a number of provisions to further strengthen tax credits for working families, including an expansion of the EITC to workers without qualifying children. (Note that some of these estimates rely on survey data, which research has shown tend to underreport household use of certain programs like the Supplemental Nutrition Assistance Program, leading to underestimates of the poverty-reducing effects of these programs.)

6. In 2015, the share of people without health insurance declined in almost every State, and all States have seen gains since 2013, reflecting continued progress under the Affordable Care Act (ACA). Today’s new data from the American Community Survey (ACS) show that 49 States and the District of Columbia saw their uninsured rates decline in 2015. The uninsured rate has fallen in every State (as well as in the District of Columbia) since 2013. While the ACS is not the first survey to report estimates of State-level insurance coverage in 2015, the survey’s extremely large sample size allows it to provide particularly reliable estimates.

While all States have seen increases in insurance coverage since the ACA’s major coverage provisions took effect in the beginning of 2014, the extent of those gains have varied widely by State. Notably, States that have expanded Medicaid under the ACA have seen larger coverage gains on average, particularly if they started with a larger uninsured population. If Medicaid non-expansion States had seen coverage gains comparable to those seen by Medicaid expansion states with similar uninsured rates, the uninsured rate in these states would have been nearly 3 percentage points lower in 2015, increasing the magnitude of these states’ coverage gains since 2013 by almost two-thirds.

Today’s Census release also included an estimate of the national change in the uninsured rate based on the Current Population Survey (CPS). According to the CPS, the national uninsured rate dropped by 1.3 percentage points from 10.4 percent in 2014 to 9.1 percent in 2015, bringing the cumulative gain since 2013 to 4.3 percentage points. The new data from the CPS are broadly consistent with evidence from other Federal and private surveys showing that coverage gains continued during 2015; those surveys show that gains have continued into early2016. The cumulative coverage gains since 2013 have put the uninsured rate at its lowest level ever.

Jason Furman is Chairman of the Council of Economic Advisers. Sandra Black is a Member of the Council of Economic Advisers. Matt Fiedler is Chief Economist of the Council of Economic Advisers.

Poverty, Social Safety Net

White House Report: SNAP Food Stamps Program Lifted 4.7 Million Out of Poverty in 2014

A new report released today from the White House Council of Economic Advisers (CEA) finds that the Supplemental Nutrition Assistance Program (SNAP), formerly known as Food Stamps, is highly effective at reducing food insecurity—the government’s measure for whether households lack the resources for consistent and dependable access to food. The report highlights a growing body of research that finds that children who receive food assistance see improvements in health and academic performance and that these benefits are mirrored by long-run improvements in health, educational attainment, and economic self-sufficiency. The report also features new research that shows benefit levels are often inadequate to sustain families through the end of the month—resulting in high-cost consequences, such as a 27 percent increase in the rate of hospital admissions due to low blood sugar for low-income adults between the first and last week of the month, as well as diminished performance on standardized tests among school age children.

Each month, SNAP helps about 46 million low-income Americans put food on the table. The large majority of households receiving SNAP include children, senior citizens, individuals with disabilities, and working adults. Two-thirds of SNAP benefits go to households with children.

Today’s CEA report draws on a growing body of high-quality research about food insecurity and SNAP, finding that:

SNAP plays an important role in reducing both poverty and food insecurity in the United States—especially among children.

  • SNAP benefits lifted at least 4.7 million people out of poverty in 2014—including 2.1 million children. SNAP also lifted more than 1.3 million children out of deep poverty, or above half of the poverty line (for example, $11,925 for a family of four).
  • The temporary expansion of SNAP benefits under the American Recovery and Reinvestment Act of 2009 (ARRA) lifted roughly 530,000 households out of food insecurity. 

SNAP benefits support vulnerable populations including children, individuals with disabilities, and the elderly, as well as an increasing number of working families.

  • Nearly one in two households receiving SNAP benefits have children, and three-quarters of recipient households have a child, an elderly member, or a member with a disability. Fully 67 percent of the total value of SNAP benefits go to households with children as these households on average get larger benefits than households without children.
  • Over the past 20 years, the overall share of SNAP recipient households with earned income rose by 50 percent. Among recipient households with children, the share with a working adult has doubled since 1990.

SNAP’s impact on children lasts well beyond their childhood years, providing long-run benefits for health, education, and economic self-sufficiency.

  • Among adults who grew up in disadvantaged households when the Food Stamp Program was first being introduced, access to Food Stamps before birth and in early childhood led to significant reductions in the likelihood of obesity and significant increases in the likelihood of completing high school.
  • Early exposure to food stamps also led to reductions in metabolic syndrome (a cluster of conditions associated with heart disease and diabetes) and increased economic self-sufficiency among disadvantaged women.

SNAP has particularly large benefits for women and their families.

  • Maternal receipt of Food Stamps during pregnancy reduces the incidence of low birth-weight by between 5 and 23 percent.
  • Exposure to food assistance in utero and through early childhood has large overall health and economic self-sufficiency impacts for disadvantaged women. 

The majority of working-age SNAP recipients already participate in the labor market, and the program includes important supports to help more recipients successfully find and keep work.

  • Fifty-seven percent of working-age adults receiving SNAP are either working or looking for work, while 22 percent do not work due to a disability. Many recipients are also the primary caregivers of young children or family members with disabilities.
  • SNAP also supports work through the Employment and Training program, which directly helps SNAP beneficiaries gain the skills they need to succeed in the labor market in order to find and retain work. During fiscal year 2014, this program served about 600,000 SNAP recipients. 

Even with SNAP’s positive impact, nearly one in seven American households experienced food insecurity in 2014.

  • These households—which included 15 million children—lacked the resources necessary for consistent and dependable access to food.
  • In 2014, 40 percent of all food-insecure households—and nearly 6 percent of US households overall—were considered to have very lowfood security. This means that, in nearly seven million households, at least one person in the household missed meals and experienced disruptions in food intake due to insufficient resources for food. 

While SNAP benefits allow families to put more food on the table,current benefit levels are often insufficient to sustain them through the end of the month, with substantial consequences.

  • More than half of SNAP households currently report experiencing food insecurity, and the fraction reporting very low food security has risen since the end of the temporary benefits expansion under ARRA.
  • New research has linked diminished food budgets at the end of each month to high-cost consequences, including:

o   A drop-off in caloric intake, with estimates of this decline ranging from 10 to 25 percent over the course of the month;

o   A 27 percent increase in the rate of hospital admissions due to low blood sugar for low-income adults between the first and last week of the month;

o   An 11 percent increase in the rate of disciplinary actions among school children in SNAP households between the first and last week of the month;

o   Diminished student performance on standardized tests, with performance improving only gradually again after the next month’s benefits are received.

Administration Efforts to Build on Progress

To reduce hunger and improve family well-being, the Obama administration has been and remains dedicated to providing American children and families with better access to the nutrition they need to thrive. These investments make a real and measurable difference in the lives of children and their families, and ensure a brighter, healthier future for the entire country.

Through the Recovery Act, the Administration temporarily increased SNAP benefits by 14 percent during the Great Recession to help families put food on the table.  Reports indicate that food security among low-income households improved from 2008 to 2009 amidst a severe recession and increased unemployment; a significant part of that improvement is likely attributable to SNAP.

The Administration has also developed several initiatives to improve food security and nutrition for vulnerable children.  Through the Community Eligibility Provision, schools in high-poverty areas are now able to offer free breakfast and lunch to all students with significantly less administrative burden. Recent revisions to the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) added a cash benefit to allow participants to purchase fruits and vegetables, a change that substantially increased the value of the package. The Administration also has expanded access for low-income children to nutritious food during the summer months when school meals are unavailable and the risk of food insecurity is heightened. The results of these efforts have been promising. In 2014, the U.S. Department of Agriculture (USDA) delivered 23 million more summer meals than in 2009.  And the Administration has successfully implemented Summer Electronic Benefits Transfer for Children (SEBTC) pilots, which provide additional food assistance to low-income families with children during the summer months. These pilots were found to reduce very low food security among children by 26 percent.  The President’s 2016 Budget proposed a significant expansion of this effort.

Finally, this Administration has provided select states waivers to test ways of reducing the administrative burdens of SNAP for elderly households, a population that continues to be underserved. After seeing positive results in participating states, including an increase of elderly participation by more than 50 percent in Alabama, the President’s 2016 Budget included a proposal to create a state option that would expand upon these efforts to improve access to SNAP benefits for the elderly.