"Beware the Wrong Lessons from Poverty and Income Data" Jeff Madrick:

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"Beware the Wrong Lessons from Poverty and Income Data"

Jeff Madrick:

Beware the Wrong Lessons from Poverty and Income Data, by Jeff Madrick: ...The poverty data released by the Census Bureau last week may well be the straw that broke the camel’s back — the camel being those deliberately blind people who can’t seem to acknowledge that most Americans are doing poorly. Average Americans should not be the ones who have to shoulder the burden of balancing the budget, even if it needed balancing soon.

The poverty rate is now as high as it was during the war on poverty of the 1960s — about 15 percent. The Census also revealed that median household income went nowhere under George W. Bush and is now down to its lowest level since 1997, essentially before the Clinton boom.

Even more deplorable, the young in America have been hit hardest. Economists at Northeastern University have been showing for years how low wages are for those in their twenties, if they can find a job at all. Now they calculate that 37 percent of young families with children live in poverty — more than one in three. It was one in five when Bush came to office.

But the reason I am writing this is ... that the elderly have taken a far smaller hit than the rest. Is this going to be the new argument for reducing Social Security and Medicare benefits?

The truth is much the opposite: These findings are an argument for a stronger safety net. The reason the elderly are not doing as poorly is precisely because of Social Security, Medicare, and Medicaid. ...

So let’s not use these data to claim justification for cutting back social programs for the elderly. They show that the safety net is doing what it is supposed to do, which is to protect people from the ravages of a damaged economy. What we should be doing is expanding the safety net and getting the economy to start producing good old-fashioned American-style wage gains again. Can we afford new social programs for the young? Of course we can. We are among the lowest taxed of rich nations. ...

The argument that the elderly don't need Social Security is like arguing the bars on the windows are not needed because nobody's ever broken in.