By Angelo Bosworth and Hector Cordon

25 January 2011 – WSWS

The Office of the Superintendent of Public Instruction (OSPI) reported in December that 21,826 of Washington state’s 1.04 million school children were homeless in 2009-2010. This represents a 5 percent increase from 2009 and a 56.5 percent increase from 2005-2006. Child homelessness overall totaled 24,038, placing Washington 25th in the nation.

These figures suffer from underreporting due to the difficulty in locating the homeless, as well as the reluctance of many individuals and families to admit their circumstances.

A persistently high level of unemployment—hovering around 9 percent for the last year and a half and currently at 9.3 percent—has contributed to these grim statistics. But it is only one of many factors, which include low wages, high housing costs, poverty, and rising foreclosures.

For school children, year over year, the number living in motels was up by 12 percent, whereas those that doubled up with friends and relatives increased by 9 percent. The higher rates of change in these two figures—as compared to the 5 percent increase in child homelessness overall—reveal a pattern of homelessness creeping up on previously stable families as well as the overcrowding of homeless shelters.

Melinda Dyer, program supervisor for the education of homeless children and youth at OSPI, cautions that the actual homeless numbers are probably higher due to internal reporting issues as well as families not revealing their homeless status due to the stigma attached. The paltry sum of $850,000 provided by the federal government under the McKinney-Vento Act of 1986 cannot begin to address a problem as acute and complex as child homelessness.

According to a December 2010 US Conference of Mayors study, the three most common causes of homelessness in families are unemployment, lack of affordable housing, and poverty.

According to a study by budgetandpolicy.org published in March 2009, a full-time worker earning the then minimum hourly wage of $8.07 in Washington needed to work close to 80 hours a week, 52 weeks a year, to afford a two-bedroom apartment built under HUD Section 8 regulation—a program that purports to provide more affordable housing to poor people. This is in fact the 40th percentile of market rents and many needy people are compelled to rent at higher rates.

The typical homeless family consists of a single mother and her two children, and affordable housing is even more out of reach for these families. The average income for a single mother in Washington receiving public support is less than $550 per month, which would allow her to pay $157 in monthly rent. The cost of a two-bedroom apartment at the HUD Section 8 rate would be $672 higher than that.

Bank owned foreclosure inventories in Washington rose by 59.68 percent from December 2009 to December 2010. Month-to-month foreclosure filings have dropped 8.5 percent over that time period, which nevertheless saw 2,228 new filings for December 2010.

A report from the Institution of Taxation and Economic Policy shows that between 1979 and 2003, the bottom 20 percent of Washington residents experienced no perceptible income growth when adjusted for inflation. During this period, however, the income of the wealthiest 1 percent (some 67,000 individuals) increased a full 111 percent above inflation.

According to a report from the National Center on Family Homelessness, “America’s Youngest Outcasts,” 84 percent of homeless families with children are headed by a single mother in her late 20s with two young children. These young parents often have no more than a high school diploma or GED. Nearly all of them have histories of violent victimization, and more than one third suffers from Post Traumatic Stress Disorder—three times the rate of the general female population.

More than 50 percent of mothers experience a major depressive episode while homeless and 85 percent report having had a major depressive episode in the past. Forty-one percent have become dependent on alcohol and drugs, a rate twice as high as in the general female population. Over one third have a chronic medical problem such as asthma, chronic bronchitis or hypertension.

Within a single year, 97 percent of homeless children have moved, 25 percent have witnessed violence and 22 percent have been separated from their families. About half of all school-age children experiencing homelessness have problems with anxiety and depression. Twenty percent of homeless preschoolers have emotional problems that require professional care. Their education is often disrupted and challenges in school are common.

The situation is even worse for youth living on their own, where a documented 42 percent have been abused and those with sexual orientations outside the conventional norm are seven times more likely to be a victim of a violent crime.

More than one in seven homeless children have moderate to severe health conditions—asthma being a common complaint—compared to less than one in sixteen middle-class children who report these conditions. Proficiency rates for homeless children in reading and math are on average 16 percent lower than scores for all students. Less than one in four homeless children graduates high school.

The substantial cuts in the proposed 2011-2013 Washington state budget are guaranteed to further increase child homelessness and general social misery in the coming two years. Governor Christine Gregoire’s submitted budget for 2011-2013 will exacerbate many of the leading causes of child homelessness as well as remove support for programs that deal with the inevitable fallout from homelessness.

The Democratic governor proposes the elimination of pre-school help for 1,324 poor children, eliminating health benefits for 27,000 children, cutting the Basic Health Plan that provides coverage for 66,000 low-income residents, doing away with Disability Lifeline Medical for 21,000 low-income disabled adults, and eliminating the State Food Assistance Program that provides food benefits for low-income legal immigrants.

Meanwhile, the various cuts to the wages and benefits of state employees will push this sector of workers a step closer to poverty and possible homelessness. The budget demands a 3 percent reduction in compensation on top of no wage increases since 2008, while unpaid temporary layoffs have cost an average employee $178 per month in 2010. Health care premiums for the average state employee would rise to $147 (from $86 in 2010) and workers will pay more in pension contributions, some up to 4.5 percent from 3.9 percent in 2009-2011.

In the light of these progressively more deplorable conditions, Governor Gregoire’s claim in her State of the State address that her budget will set “our state on a trajectory that ensures a strong financial foundation for our kids and grandkids” is a blatant lie. What is actually being proposed is the evisceration of those social programs that provide for the welfare of the most vulnerable sections of society.

Source.

By David DeGraw

September 23, 2010 “AlterNet” – While the shocking new poverty statistics from the Census Bureau indicating that a record 43.6 million Americans lived in poverty in 2009 emphatically demonstrates the severity of the economic crisis, the Census is drastically undercounting this demographic. Apparently the government’s poverty statistics are as accurate as its unemployment statistics.

I have read many reports that simply restate what the government has said without questioning the fact that the metrics it uses to calculate poverty are extremely outdated.

News reports say that in 2009 the poverty rate “skyrocketed” to 43.6 million — up from 39.8 million in 2008, which is the largest year-to-year increase, and the highest number since statistics have been recorded — putting the poverty rate for 2009 at 14.3 percent. This is obviously a tragedy and horrific news. However, this is also the result of lazy reporting.

Let’s revisit the 2008 Census total stating that 39.8 million Americans lived in poverty. It turns out that the National Academy of Science did its own study and found that 47.4 million Americans actually lived in poverty in 2008. The Census missed 7.6 million Americans living in poverty that year.

How did that happen? The Census Bureau uses a long outdated method to calculate the poverty rate. The Census is measuring poverty based on costs of living metrics established back in 1955 — 55 years ago! They ignore many key factors, such as the increased costs of medical care, child care, education, transportation, and many other basic costs of living. They also don’t factor geographically based costs of living. For example, try finding a place to live in New York that costs the same as a place in Florida.

So the Census poverty rate increase of 3.8 million people will put the 2009 National Academy of Science (NAS) number at a minimum of 51.2 million Americans. And if the margin of discrepancy is equivalent to the 7.6 million of 2008, we are looking at a NAS number of at least 52 million people for 2009.

Let’s also consider the fact that more than 20 million people were on unemployment benefits last year. A Center on Budget and Policy Priorities analysis concluded that unemployment insurance temporarily kept 3.3 million people out of poverty. Food stamp assistance kept another 2.3 million people out of poverty. If we were to include all of these people, we’d be looking at almost 60 million Americans living in poverty. Which means the government number doesn’t account for over 14.1 million Americans in poverty.

Now let’s look at the poverty line these numbers are based on: $22,050 for a family of four. Let me repeat that: $22,050 for a family of four. That breaks down to $5,513 per person, per year. I don’t know about you, but I can’t imagine living in the United States on $459 per month. That amount will barely get you a good health insurance policy, never mind food, clothes and a roof over your head. No wonder why a record 50.7 million Americans do not have health insurance. (Beware: 50.7 million Americans without health insurance is a government-based number. If you had health insurance for only one day last year, you are not counted in this total.)

Clearly, the Census is setting the income level for its poverty measurement extremely low. If we were to increase that measure by just a small increment, to $25,000 for a family of four, I estimate that the National Academy of Science would come up with a number of nearly 100 million Americans in poverty.

Let’s also consider the staggering amount of Americans – 52 million, roughly 17 percent of the population — who are currently enrolled in “anti-poverty” programs. Over 50 million are on Medicaid, 41 million on food stamps, 10 million on unemployment, 4.4 million receive welfare. Not counted in this “anti-poverty” total are 30 million children enrolled in the National School Lunch Program. Another metric: if it wasn’t for Social Security — note to deficit hawks – 20 million more would be added to the poverty total.

The effect of people moving in with family members instead of living on their own has further masked the severity of the poverty crisis. Foreclosures, unemployment, increased cost of education and health insurance have led the average household to grow in size. As Patrick Martin reports:

The number of multifamily households increased by 11.6 percent from 2008 to 2010, and the proportion of adults 25-34 living with their parents rose from 12.7 percent in 2008 to 13.4 percent in 2010. The poverty rate for these young adults was 8.5 percent when they were considered part of their parents’ household, but would have been 43 percent if they had been living on their own.

This trend is currently increasing. Although it is terribly under-reported, foreclosure rates continue to rise. We just experienced the worst month of foreclosures in history; the generation just graduating from college is carrying record levels of student-loan debt, and they are being forced into much lower income levels than anticipated, if they can even find employment.

Another glaring factor clouding our view of poverty in America is that the Census does not calculate a person’s assets and liabilities. Considering the massive debts most Americans are carrying, this would make the poverty rate explode. Stephen Crawford and Shawn Fremstad from Reuters concisely summed up this point:

As Nobel laureates Joseph Stiglitz and Amartya Sen, along with economist Jean-Paul Fitoussi, write in their new book Mis-measuring Our Lives, “Income and consumption are crucial for assessing living standards, but in the end they can only be gauged in conjunction with information on wealth.” This point is just as relevant to poverty measurement as it is to other measures of living standards.

To understand why this is the case, consider two families: one had an income that puts them a few thousand dollars below the poverty line, which was $22,050 for a family of four in 2009; the other has an income a few thousand dollars above the line. Looking only at income, the first family is worse off than the second.

Now add what the family owns and owes into the mix. Let’s say the first family has substantial net equity in its home and moderate liquid savings for a “rainy day,” while the latter has no liquid savings or, as is becoming too common these days, has liabilities that dwarf their assets such as an “underwater” mortgage. Using this more comprehensive method, the latter family, despite a modestly higher income, is actually the poorer one.

In my analysis, a key metric to judge the overall economic security and hardship level of a country is the percentage of the population living paycheck to paycheck. Anyone who lives paycheck to paycheck can tell you about the stress and psychological impact it has on you when you know your family is one sickness, injury or downsizing away from economic ruin. The employment company CareerBuilder, in partnership with Harris Interactive, conducts an annual survey to determine the percentage of Americans currently living paycheck to paycheck. In 2007, 43 percent fell into this category. In 2008, the number increased to 49 percent. In 2009, the number skyrocketed up to 61 percent.

In their most recent survey, this number exploded to a mind-shattering 77 percent. Yes, 77 percent of Americans are now living paycheck to paycheck. This means in our nation of 310 million citizens, 239 million Americans are one setback away from economic ruin.

So when I hear the government and media tell me that 43.6 million Americans lived in poverty in 2009, while that is horrifying enough, I get extraordinarily frustrated knowing that even that sad statistic is putting a major positive spin on this economic disaster that is still far from over. While the economic top half of 1 percent now fears a “double-dip,” the overwhelming majority of Americans are still in the same downward spiral they’ve been on.

For one last missing piece to this equation, corporate profits are soaring while all this is devastation is occurring. Despite this economic crisis, it’s not like our country doesn’t have the money. A recent study done by Capgemini and Merrill Lynch Wealth Management found that a mere 1 percent of Americans are hoarding $13 trillion in “investible wealth.” Yep, 1 percent of Americans are hoarding $13 TRILLION in “investible wealth,” and that doesn’t even factor in all the money they have hidden in offshore accounts.

As American philosopher John Dewey once said, “There is no such thing as the liberty or effective power of an individual, group, or class, except in relation to the liberties, the effective powers, of other individuals, groups or classes.”

The United States now has the highest inequality of wealth in our nation’s history. Tens of millions of Americans are wondering how they are going to pay their bills, while the people who caused this crisis are rolling around in $13 trillion. The robber barons have been displaced as America’s most despotic and depraved ruling class.

© 2010 Independent Media Institute. All rights reserved.

America’s television addiction

I. FAMILY LIFE
Percentage of households that possess at least one television: 99
Number of TV sets in the average U.S. household: 2.24
Percentage of US homes with three or more TV sets: 66
Number of hours per day that TV is on in an average US home: 6 hours, 47 minutes
Percentage of Americans that regularly watch television while eating dinner: 66
Number of hours of TV watched annually by Americans: 250 billion
Value of that time assuming an average wage of $5/hour: $1.25 trillion
Percentage of Americans who pay for cable TV: 56
Number of videos rented daily in the US: 6 million
Number of public library items checked out daily: 3 million
Percentage of Americans who say they watch too much TV: 49

II. CHILDREN

Approximate number of studies examining TV’s effects on children: 4,000
Number of minutes per week that parents spend in meaningful conversation with their children: 3.5
Number of minutes per week that the average child watches television: 1,680
Percentage of day care centers that use TV during a typical day: 70
Percentage of parents who would like to limit their children’s TV watching: 73
Percentage of 4-6 year-olds who, when asked to choose between watching TV and spending time with their fathers, preferred television: 54
Hours per year the average American youth spends in school: 900 hours
Hours per year the average American youth watches television: 1,500

III. VIOLENCE
Number of murders seen on TV by the time an average child finishes elementary school: 8,000
Number of violent acts seen on TV by age 18: 200,000
Percentage of Americans who believe TV violence helps precipitate real life mayhem: 79

IV. COMMERCIALISM
Number of 30-second TV commercials seen in a year by an average child: 20,000
Number of TV commercials seen by the average person by age 65: 2 million
Percentage of survey participants (1993) who said that TV commercials aimed at children make them too materialistic: 92
Rank of food products/fast-food restaurants among TV advertisements to kids: 1
Total spending by 100 leading TV advertisers in 1993: $15 billion

V. GENERAL
Percentage of local TV news broadcast time devoted to advertising: 30
Percentage devoted to stories about crime, disaster and war: 53.8
Percentage devoted to public service announcements: 0.7
Percentage of Americans who can name The Three Stooges: 59
Percentage who can name at least three justices of the U.S. Supreme Court: 17

Compiled by TV-Free America
1322 18th Street, NW
Washington, DC 20036

By Jack Hough

June 30, 2009 “Smart Money” — How’s the economy treating you? Chances are, your answer is colored largely by three things: whether you’re working (if you want to), how much you’re making and how quickly your expenses are rising. Economists rely heavily on the same factors to judge the nation’s health. At last count, 9.4% of the workforce is jobless. Compared with a year ago, the goods and services we produce are worth 5.7% less while the ones we buy are 0.7% cheaper.

Two bright people might see sharply different things in those numbers. To one, the shrinking economy is a healthy unwinding of past excess, for example, while to another it’s a dangerous downturn that calls for bold government action. But what if the numbers themselves are something we should be debating? In the alarming view of a vocal few, America’s economic measures are misstated — rigged, really.

The accusation goes like this: Surveyors collect the nation’s data and statisticians compile and report it. Politicians naturally want the numbers to show improvement. Not being able to change the facts, they focus on the handling of facts, pressuring statisticians to change their measurements. It’s not quite one grand conspiracy but decades of minor ones compiled. Today’s reports are so perverted, the theory holds, that the numbers have detached from common experience.

Pollyanna Creep

If the theory has a chief architect, it is John Williams, a semi-retired grandfather of five living in Oakland, Calif. The son of a chainsaw importer, Williams sold the family business in the 1970s and began consulting for corporations, recalculating government economic data to arrive at what he says were more reliable measures, and with them, truer forecasts. Today Williams runs Shadow Government Statistics (ShadowStats.com) from his home. For $175 a year subscribers get economic data and analysis adjusted to back out the accumulated effects of what Williams has dubbed the Pollyanna Creep — Pollyanna being the orphan protagonist of the 1913 children’s book who learns to play the “glad game” to find cheery perspectives on life’s sorrows. In other words, he provides figures he feels are properly miserable, to offset government ones he says are too prettied-up.

If Williams is right, unemployment is over 20%, gross domestic product is shrinking by 8% and consumer prices are jumping by nearly 7%. His forecasts border on apocalyptic. The government is creating so much new money, he says, that the all but inevitable result is hyperinflation, where “your highest denomination, the $100 bill, becomes worth more as toilet paper than money.” Buy physical gold, he advises.

Whether we believe the forecasts or not, the possibility of a Pollyanna Creep has serious implications. Social Security payments are just one benefit adjusted each year for increases in the cost of living. If the figures hadn’t been corrupted, says Williams, checks might be close to double what they are.

Williams has managed to attract plenty of press. A year ago, Harper’s magazine featured a cover drawing of a grinning Uncle Sam fondling numeral-shaped party balloons, with the headline, “Numbers Racket: Why the Economy is Worse Than We Know.” The story centered on Williams’ data. The San Francisco Chronicle followed with “Government Economic Data Misleading, He Says.” Last fall in the London Times: “Forget Short-Sellers and Manipulators, Pollyanna Creep Could Be the Culprit.”

Government statisticians are frustrated. “Economic Data Seems Accurate” doesn’t make for a catchy headline, so the press, they say, are too quick to give credence to conspiracy theories. “We go out of our way to be transparent,” says Thomas Nardone, who during 32 years at the Bureau of Labor Statisticshelped implement many of the changes in calculating the unemployment rate. “We’d be remiss if we didn’t make changes,” he says. “I’ve never seen measurement changes that were politically motivated.”

Katherine Abraham served as commissioner of BLS during the Clinton administration. Commissioners, unlike the statisticians who work for them, are political appointees. Now a professor at University of Maryland, Abraham says she did see political pressure, but rarely, and never with results. Once, she says, a prominent lawmaker told her the BLS might get more funding if it would agree to propose changes that reduce the appearance of inflation. Abraham says she rebuffed the offer.

Decide for yourself. Here’s a roundup of measurement changes at the heart of Williams’ claims, along with responses from people who work closely with the measurements. I’ll focus on unemployment and inflation, but not GDP, since the chief flaw with it, according to Williams, is how problems with the inflation measure overstate real, or after-inflation, growth. (There’s a different case to be made — that GDP measures some fairly undesirable things, like the cost of war and divorce lawyers, and so isn’t a great proxy for economic well-being — but I’ll save that subject for another day.)

Disappearing Jobless?

About 13 million people were unemployed during the Great Depression, or around 25% of the work force, but those are fairly recent estimates. At the time, the government simply didn’t track data like it does today, which made it difficult to judge whether things were getting better or worse. Two main developments in the 1930s made tracking unemployment feasible. The first was an improvement in the way statistics are used to turn a relatively small sample into a faithful representation of the larger population. That allowed for the use of surveys. The second was the notion of basing one’s status as part of the unemployed work force on actions. Whether someone wants to work, after all, is a subjective thing. Whether they’re looking for work is not.

Today the BLS reports six measures of unemployment, called U-1 through U-6, for which the definition of unemployment gradually broadens. For example, 4.5% of the work force has been unemployed for 15 weeks or longer and is actively looking for work (U-1), while 15.8% is unemployed if we count those who say they want work but aren’t looking, and those who work part-time for lack of full-time options (U-6).

Williams takes issue with a 1994 change that coincided with a shift to computerized data collection from pencil and paper. Until then, a discouraged worker was someone who wanted to work but had given up looking because there were no jobs. The BLS tightened the restrictions with additional questions, which reduced the ranks of discouraged workers by half. As Williams puts it, “The Clinton administration dismissed to the non-reporting netherworld about five million discouraged workers.” Add those in, he says, and unemployment approaches Great Depression levels.

Nardone, the longtime BLS economist who today serves as assistant commissioner for current employment analysis, says the 25% unemployment rate often cited for the Great Depression is based on research that corresponds with today’s U-3, the unemployment rate most commonly reported by the media. It stands at 9.4%, recall — not close to Depression-era levels. The 1994 changes did reduce the ranks of discouraged workers, but also introduced a new category: the marginally attached, who want jobs but aren’t looking for reasons like transportation problems and child-care requirements. The most commonly watched measure (now U-3, before the change U-5) is mostly unaffected, since it doesn’t include discouraged workers. The benefit of the changes, explains Steven Haugen, a BLS economist, is a less subjective measure of discouragement, and some additional ways to judge whether the nation is not only working, but working up to its ability. Williams says the change reduced the broadest measure of unemployment in a way that “doesn’t match with public perception, and for good reason.”

For a BLS paper describing changes to its unemployment measure, see here.

Rent, Geometry and Hedonism

The same agency that reports unemployment, the BLS, also reports the consumer price index. It tracks changes in the prices of more than 8,000 goods and services, from apples in New York to gasoline in San Francisco. There are several variants of the CPI index. For example, CPI-W weights things like fuel more heavily to better reflect the commutes of workers, and is the basis for Social Security adjustments. CPI-U, the measure most often reported in the media, includes items a typical urban consumer might buy, and determines adjustments to inflation-indexed Treasury bonds. Note that “core” inflation, which excludes food and fuel, isn’t used as the basis for any federal spending program (and isn’t called “core” by the BLS, which reports but doesn’t seem to especially prize the measure).

Most CPI criticism is based on three changes that affect all indexes. In 1983 the BLS replaced house prices with something called owners’ equivalent rent to measure the cost of shelter. Williams and other critics say it understates the cost, since house prices, until recently, had outpaced rents. John Greenlees, a BLS economist, says the new method is the most widely used among developed nations and is meant to fix a flaw in the old one. The CPI is supposed to measure things people buy to use, not things they invest in. For many people, houses are a little of both. The new measure attempts to isolate the portion of housing expenditures that best reflects the cost of living. Williams says the purchase price of housing is an important factor in determining a constant standard of living, and he doubts the ability of “the government to accurately calculate how much a person would pay to rent his own house.”

Another change: In 1999 the BLS adopted a geometric mean formula to replace its arithmetic mean one. The new method weights goods less as their prices rise, and is supposed to reflect patterns of consumer substitution. Critics say that treats consumers as if they’re no worse off when they switch to hamburger from steak. Greenlees says the analogy is flawed; the methodology allows substitution only between similar goods in the same region — from steak in Chicago to a different type of steak in Chicago, and not to hamburger. The old measure was really an overstatement of price increases, one that assumed consumers don’t react at all to higher prices, he says. Also, the impact is relatively small. The BLS has continued to calculate prices under both methodologies and says over five years ended 2004 the new measure reduced CPI growth by 0.28 percentage points a year. Williams says geometric weighting has moved the CPI away from measuring a constant standard of living. He says that when the effects are combined with those of other changes, like increased price surveying among discount stores (which he contends offer poorer service and thus a lower standard of living than the shops they replaced) the overall impact is larger than the BLS states.

Finally, in 1999 the BLS began using what it calls hedonic adjustments. Williams explains the approach with a dash of sarcasm: “That new washing machine you bought did not cost you 20% more than it would have cost you last year, because you got an offsetting 20% increase in the pleasure you derive from pushing its new electronic control buttons instead of turning that old noisy dial.” He calls the impact on CPI “substantial.” Greenlees says the name “hedonic” was an unfortunate choice, since the technique has little to do with making judgments about pleasure. It’s designed to measure the quality difference between goods when one is discontinued and must be replaced in the index with another that’s not quite the same. Adjustments can push the index in either direction, but Greenlees says the overall impact since the change has been a tiny increase in the CPI — about 0.005% a year. Williams says some hedonic adjustments are indeed necessary, like when the size of a box of crackers changes from 12 ounces to 10 ounces. But more theoretical adjustments, he says, “overstate the quality of what the public is buying.”

The BLS has published a 17-page paper countering what it calls misconceptions about the CPI. Find it here.

Williams suspects his charges motivated the paper, and has issued a response — a rebuttal to the rebuttal, if you like — here.

Many people are unaware of the false figures that official unemployment rates represent. The media hardly ever touches on this sore spot. Nevertheless, recently the big lies of statistics and official unemployment figures begin to get mainstream coverage:

From Washington Post:

This morning’s news that U.S. unemployment has hit 13.7 million, pushing the rate to 8.9 percent, tells only half the story of this recession.

The total number of Americans who are not working full-time but ought to be is actually about 22 million, or 15.8 percent, according to the Bureau of Labor Statistics.

Who are those other 8.3 million Americans? Call them the unofficially unemployed.

As The Ticker points out each time the Bureau releases the monthly unemployment figure, it does not include many out-of-work Americans.

Fact is countless countries around the world operate with such “false methods of accounting”. Are we delusional or just blind? Is it all wishful thinking or just another way of burying one’s head in the sand?