The double whammy of poverty and unemployment
24th September 2012 · 0 Comments
By Julianne Malveaux
Earlier in September, we learned that African-American unemployment rates stayed level last month, with an absurdly high official unemployment rate of 14.1 percent. Unemployment rates for African-American men fell, while those for African-American women rose. These rates are way too high and understate the extent of pain that exists in the African American community.
The philosopher Albert Camus wrote, “Without work all life is rotten” because so many people value and define themselves by the work they do. Indeed, at many professional social gatherings the first, second, or third question is: “What do you do?” Work seems to anchor us to stability, and to the world. Too many African-American people have no anchor.
While President Obama, Vice President Biden and other key Democrats have acknowledged that unemployment rates are not falling quickly enough, few deal with the psychic effects that unemployment has on the person. For many, it causes a malaise and a sense of absolute disconnection. Others feel disillusioned and depressed, although others use their own talent at entrepreneurship to create work where there is none, using skills to offer goods and services to their neighbors.
We don’t need government data to validate the pain that many in the African-American community experience, far more pain than experienced in other communities. The overall unemployment rate dropped from 8.3 to 8.1 percent with African-American unemployment staying level, means some are enjoying our tepid economic recovery, while others are waiting for gains to trickle down.
Unemployment data were released on September 7, and the poverty data released on data released on September 12. That’s a double whammy for African Americans. Not only is the employment situation stagnant, with “real” unemployment rising as high as 25 percent, but new data on income and poverty suggest, again, that African Americans experience a greater burden than others in our society. The poverty rate among African Americans rose from 27.6 to 27.8 percent.
Some might describe these numbers as “not statistically significant,” but try telling that to the 200,000 more African Americans in poverty. Overall, poverty rates dropped slightly from 15.2 to 15.1 percent. This means that nearly one in six Americans experience poverty, while one in four African Americans and Hispanics experience poverty.
Incomes have dropped by more than eight percent in 2007, and again African Americans have lost more. While household incomes fell by 1.5 percent between 2010 and 2011, African Americans incomes fell by 2.7 percent, the largest drop of any racial or ethnic group. I don’t mean to underestimate anyone’s pain. All incomes fell, but African-American incomes fell most. African-American incomes hit their peak in 1999 at $38,700. Today, with dollars adjusted, the amount is $32,200, the lowest level since 1997. At the top or at the bottom, African Americans lost ground.
In the face of this double whammy, how do we answer the Reagan question: “Are you better off than you were four years ago?” Economists have described the “misery index” as the sum of unemployment rates and poverty rates, and using that index, all of America has seen erosion in status.
Still, legislation to improve both poverty and unemployment rates has been stuck in legislative gridlock because House Republicans would rather see people suffer than to see President Obama appear successful. But for the obduracy of House Majority Leader John Boehner (R-OH) and his posse, including Vice Presidential candidate Paul Ryan (R-WI), we might see lower unemployment and poverty rates.
More importantly, the Congressional Budget Office says that extreme spending cuts and lower tax rates for the wealthy will plunge us into recession in six months or so. As President Barack Obama says, we have choices; we are at a fork in the road. With an unresponsive Congress, I am not sure how quickly President Obama can lead us to economic recovery, but with a change in strategy, I am absolutely certain that Romney-Ryan will plunge us into disaster. The double whammy of poverty and unemployment is a body blow. Spending and tax cuts will take African Americans from the hospital into the emergency room.
Julianne Malveaux is a Washington, D.C.-based economist and writer. She is President Emerita of Bennett College for Women in Greensboro, N.C.
This article originally published in the September 24, 2012 print edition of The Louisiana Weekly newspaper.