Poverty affects more Americans than we think

While 15.1 percent of Americans lived below the official poverty line in 2010, this number is only a snapshot. At the same time more than 100 million Americans were struggling to get by on low incomes, earning below twice the poverty line ($44,700 a year for a family of four), and experiencing many of the same hardships as those officially defined as poor).

Rising poverty among children is particularly harmful to society

In 2010 more than one in five children—22 percent—lived below the official poverty line. Children who live in families below the poverty line, even for short periods, are at greater risk of lower cognitive development, educational attainment, increased reliance on public benefits, and increased rates of incarceration. 

Poverty increases health risks

Poor children are much more likely to have lower birth weight, and infants living in poor households face higher rates of food insecurity, which impairs healthy development. As adults, lower-income individuals experience higher rates of illness, disease, and disabilities than those who have higher incomes.

Poverty weakens families

Low-income and poor families face significant economic pressure as they struggle to pay bills and make ends meet. This economic pressure, coupled with other stressful events that are more prevalent in the lives of poor families, create high levels of psychological distress, including depression among poor parents. As couples struggle to make ends meet, their interactions become more hostile, and they tend to withdraw from each other—leading to fractures in relationships and poor parenting. 

Poverty traps individuals and decreases mobility

Children who grow up in poor families are more likely to be poor as adults compared to children from upper-income families, undermining the American Dream. These poor adults are also more likely to have poor children of their own. 

Poverty costs our economy billions of dollars annually

High rates of poverty hurt everyone in the United States because it strips limited resources from the government that could be invested in other areas to promote economic growth. Child poverty alone is estimated to cost the U.S. economy more than $500 billion annually in lost productivity, increased health care costs, and higher criminal-justice expenditures.

Poverty weakens the middle class, the engine of America’s economic growth

High rates of poverty hurt everyone in the United States because it strips limited resources from the government that could be invested in other areas to promote economic growth. Child poverty alone is estimated to cost the U.S. economy more than $500 billion annually in lost productivity, increased health care costs, and higher criminal-justice expenditures.

Poverty costs our economy billions of dollars annually

America’s economic strength is based on a strong middle class with purchasing power to fuel our economy and workforce contributions to increase our economic growth and productivity. The increasing number of Americans who slip from the middle class into poverty places downward pressure on our nation’s revenues due to the impact of lower earnings.

Poverty weakens communities and access to the American Dream

The long-term impact of concentrated poverty contributes greatly to the increasing income and wealth gap in the United States. Children living in neighborhoods that experienced a 10 percentage-point decline in poverty saw a $7,000 increase in family income as adults compared to those children living in neighborhoods without a reduction in the poverty rate. This cycle of poverty creates generations of individuals who are trapped in economically isolated communities with low incomes. This is at odds with our American values of opportunity for all.

Poverty lowers U.S. long-term competitiveness

Poverty also dramatically harms long-term human-capital development, a critical component in our nation’s global economic competitiveness. A substantial body of research shows that children who grow up in poverty underperform in school, have limited access to higher education, and are less likely to be prepared for the high-skilled jobs of the future. With 22 percent of the nation’s children living in poverty, we are imperiling future generations of workers who will be needed to lead U.S. productivity and competitiveness.

Poverty weakens our democracy

Disparities of income, wealth, and access to opportunity are growing more sharply in the United States. The result is a system with unequal voices in which millions of low-income Americans do not fully exercise their rights as citizens. Those who enjoy higher incomes are more likely to make their values known to government officials. Consequently, when Americans with different income levels differ on policy preferences, the policy outcomes strongly reflect the values of the wealthy at the expense of the middle class and the poor. This reality conflicts with the cherished American ideals of equal representation and political equality.