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Census Data Show the Value of the Safety Net

Yesterday the Census Bureau released its annual data on poverty in America, which revealed that more than 46 million people lived in poverty last year. Women and children were particularly likely to be poor, with the data showing that more than one in seven women and more than one in five children lived in poverty in 2014 (compared to nearly one in nine men).                                                                                                                   

However, the official poverty numbers don’t accurately reflect the impact of some government programs targeted at reducing poverty. Programs like SNAP (food stamps) or refundable tax credits like the Earned Income Tax Credit provide low-income families with extra assistance that is not counted as income when the Census Bureau calculates official poverty rates. If these benefits were counted as income, many more Americans would have been above the poverty line.

In fact, the Census releases additional poverty data called the Supplemental Poverty Measure (SPM), which does consider the effect of these assistance programs. For the first time, the Census released the Supplemental Poverty Measure data [PDF] on the same day as the traditional Census poverty data. The SPM data confirms what we already knew to be true—the safety net helped lift millions of families out of poverty. For example:

  • Refundable tax credits reduced the overall SPM poverty rate by 3.1 percentage points, and these credits were particularly important for children: without these tax credits, the SPM poverty rate for children would be 23.8 percent instead of 16.7 percent.
  • SNAP benefits were also especially important for families with children; without them, the SPM poverty rate for children would be 19.5 percent instead of 16.7 percent.
  • Social Security benefits had an especially large impact, reducing the overall SPM poverty rate by 8.2 percentage points. Among seniors, without Social Security, the poverty rate would rise from 14.4 percent to 50.0 percent! (Note that Social Security benefits are counted as income under the official poverty measure as well, so the official poverty rate would also be much higher without Social Security.)

Both the official poverty measure and the Supplemental Poverty Measure show there is still much more work to be done. As poverty rates remain high, especially for single mothers, women and children of color, elderly single women, and women with disabilities safety net programs continue to be essential. Programs like SNAP, Social Security, and tax credits for low-income families all help lift women and their children out of poverty and must be protected. However, if Congress doesn’t act to end the sequester, many already under-funded programs will face further cuts. Yesterday’s Census data confirm that investing in programs that help low-income families and children works, but that these programs need to be strengthened, not cut, as we continue to work to ensure that everyone has a way out of poverty.