I can appreciate the fact that the Census Bureau’s report on poverty, released earlier this week, is an embarrassment for the Bush administration. After all, no administration has seen four consecutive years of increases in the poverty rate since the government began keeping track of the data, a feat this administration has managed to accomplish.
But to understand just how discomforting the reality has become for the Bush gang, consider how unpersuasive their spin is.
“The poverty rate seems to be the last lonely lagging indicator of the business cycle,” said E.R. Anderson, chief of staff in the Commerce Department’s economic directorate, which oversees the Census Bureau.
True? Well, it depends on what the meaning of “last” and “lonely” are.
To hear Bush’s Commerce Department tell it, nearly every economic indicator is encouraging, except for that pesky poverty rate that keeps increasing. But the Center on Budget and Policy Priorities reviewed the same report the Commerce Department did and found that poverty has worsened — as has the earnings of full-time workers, the median income of working-age households, and employer-provided health insurance coverage rates.
If the Bush gang is confused about why so much of the public continues to disapprove of the way the president is handling the economy, this might be a big hint.
Likewise, the second part of the administration’s spin hopes to put the latest data in a historical context.
“This is the fourth consecutive year in which the poverty rate has increased,” [Charles Nelson, the Census Bureau’s assistant division chief of housing and household economic statistics] said. “Past experience tells us that it is not uncommon to have several years of rising poverty following a recession.”
This might be persuasive, if it were in any way true.
In no prior recession dating back to 1960 (when poverty data began to be collected) did poverty increase between the second and third years of the economic recovery. Between 2003 and 2004, by contrast, poverty rose.
In all previous recessions, with the sole exception of the recession of the early 1990s, the poverty rate was, by the third year of the recovery, at or below its level at the end of the recession. In 2004, in contrast, the poverty rate is a full percentage point higher than it was in the recession year, 2001.
Some previous downturns did produce larger increases in poverty than have occurred since 2000. But in no other recovery in the last 45 years did poverty increase in the third full year of economic growth following the recession. The movement in the wrong direction at this stage of the recovery represents a break from the past.
Moreover, this recovery is unusual not only for its rising poverty but also for its failure to lift the incomes of middle-income Americans. It is the only recovery of the past 45 years in which the income of the typical (or median) household did not grow between the second and third years of the recovery.
I’m sure the vaunted Bush communications team will come up with some new talking points to tell us how the poverty data isn’t nearly as bad as it seems. Any day now.