Politics of Poverty

Ideas and analysis from Oxfam America's policy experts

New statistics tell the sad tale of poverty as a policy choice

Posted by
child poverty
The child poverty rate in the U.S. more than doubled from 2021 to 2022 (5.2 percent to 12.4 percent), with 5.1 million kids sliding below the poverty line in one year. Photo: noophoto

2022 saw a doubling of U.S. children living in poverty for a simple reason: Congress failed to act.

We just sat down with Patricia Stottlemyer, Senior Domestic Policy Advisor at Oxfam America, to figure out why the new Census Bureau statistics tell such a sorry tale about poverty in the U.S.

POLITICS OF POVERTY: The Census Bureau just released income and poverty statistics for 2022, and the numbers reveal a lot about how policy choices at the federal level have fundamental, on-the-ground impact on people’s lives. Let’s start with the child poverty rate, which more than doubled from 2021 to 2022 (5.2 percent to 12.4 percent), with 5.1 million kids sliding below the poverty line in one year.

What the hell happened?

PATRICIA STOTTLEMYER: Well, for one, Congress refused to extend the expanded Child Tax Credit (CTC) that expired at the end of 2021. The American Rescue Plan’s anti-poverty investments, including the expanded CTC, cut child poverty almost in half, dropping it to the lowest rate ever.

The reduction in child poverty was even greater among Black and Hispanic children. Nine million kids in rural areas benefitted from the expanded CTC.

In addition to the expanded CTC and Earned Income Tax Credit, pandemic-era programs like stimulus checks, expanded SNAP benefits, enhanced unemployment coverage, investment in child care providers and access to child care, and a limited national paid leave program are all things working families still need today.

These programs were so obviously effective, it’s hard to fathom that our legislators would choose to abandon them. The 2022 census data shows us the predictable result of scaling back these investments: people are suffering, because of policy choices.

POLITICS OF POVERTY: So, you’re saying that there’s a cure for poverty: put money in people’s hands?

There’s certainly evidence that these types of programs cut poverty rates. And they help reduce racial inequality, too, because policies like the expanded CTC help to offset some of the harms in our tax code and holes in our economic and social safety nets that fuel the racial wealth gap.

According to ITEP, Black and Hispanic kids are nearly twice as likely as white and Asian children not to receive the full tax credit now that the expansion expired. It’s really clear that these policy decisions have a measurable—and rapid—impact on people’s lives.

POLITICS OF POVERTY: Any chance the CTC will be revived?

PATRICIA STOTTLEMYER: There’s actually some really encouraging bipartisan movement on this in both the House and Senate. Rep. Fitzpatrick, a Republican who co-chairs the Problem Solver’s Caucus, said they plan to launch a subcommittee to work on the CTC.

In 2025, Congress will be focused on updating the tax code, and legislators on both sides of the aisle have said they intend to make CTC changes part of that effort. On the Senate side, we’ve seen some really interesting exchanges between Democrats and Republicans on this issue: Sen. Thune, who’s the #2 Republican, said there’s “a lot of support among Republicans for the CTC.” They may not support reviving the expanded CTC as we saw it during the pandemic, but it’s really encouraging that we have folks reaching across the aisle to try to figure this out. And we’ve got this irrefutable evidence that the expansion we saw made a major difference.

POLITICS OF POVERTY: Are there other lessons we can learn from the way the government responded to the pandemic, and tried a new model of supporting working families?

PATRICIA STOTTLEMYER: Yes. Cash assistance, protection from evictions, national paid leave standards, expanded tax credits for struggling families, enhanced food supports--these things work to pull people out of poverty and fight many of the racial and gender inequalities we see in our society.

We know, for instance, that women and Black families were hit much harder by the pandemic because of the structural inequities built into our systems that make shocks harder to weather for marginalized groups. These policies are a no-brainer. As Rep. Rosa DeLauro said about the expanded CTC, it pays for itself.

POLITICS OF POVERTY: Let’s dig in a bit on some other statistics. Real median household income declined a bit from 2021 to 2022; but I’m struck that the gaps between income by race stayed almost exactly the same: white households at $81,060, Hispanic households at $62,800, and Black households at $52,860. These seem like pretty big gaps to me, and I wonder how we just shrug and move on.

PATRICIA STOTTLEMYER: They are indeed big gaps, and the fact that they’re persisting reveals the depth of the structural racial inequities in our economy that aren’t just some academic concern: they make a huge difference in families’ abilities to get by—let alone thrive.

The racial income gap is a major factor behind the racial wealth gap. People of color, and particularly women of color, are overrepresented in low-wage jobs. And when you combine this racial income inequality with the cumulative intergenerational barriers and contemporary barriers that cause Black households in particular to have less access to capital, you get the racial wealth gap.

We can’t just shrug and move on. Because there are policy solutions that can help us close these gaps. And this persistent racial inequality in our economy hurts everyone.

Don’t take it from me; take it from the U.S. Department of Treasury: policies that target racial wealth disparities benefit the economy, including encouraging growth in GDP and investment in public goods like education, infrastructure…things that benefit everyone. Economic security is, of course, a human right everyone deserves regardless of race, and the economic security of people of color is absolutely fundamental to our economy. We cannot ignore it.

POLITICS OF POVERTY: Okay, let’s talk about wages, as broken down by race and gender. Here’s where we see some really distressing gaps, and they’re really not moving.

All women compared to all men
Full time: 84 cents
All earners: 78 cents

Black women compared to non-Hispanic white men
Full time: 69 cents
All earners: 66 cents

Latina women compared to non-Hispanic white men
Full time: 57 cents
All earners: 52 cents

They’re not really moving. The numbers for full-time working women haven’t moved since the 2021 Census data figures, and for Latinas, the gap is getting worse. They’re actually earning two cents less for every dollar a white man earns than they were in 2021.

What is happening with Latinas at work, in particular? What jobs are they doing, and why are they so underpaid? A few years ago, Oxfam published a study of women’s jobs, and found that jobs associated with work historically considered “women’s work” just paid less than “men’s work”–for example, early educators, who often have degrees, are paid less than gas station attendants.

PATRICIA STOTTLEMYER: The truth is that women’s work is undervalued and underpaid. And that’s even more true for Latinas and Black women, who face both gender and racial barriers to equal pay and economic security.

Women, and particularly women of color, are more likely than men to work low-wage jobs without access to essential workplace supports like paid leave, healthcare, and retirement. The Joint Economic Council found that Latinas are more impacted by the gender wage gap than any other major racial or ethnic group.

Occupational segregation—which is when certain demographics are overrepresented in certain jobs and sectors—traps many Latinas, like other women of color, in working poverty. Latinas are overrepresented in low-wage jobs, including service occupations, healthcare support jobs, food prep jobs, and underrepresented in the highest-paying jobs.

This, again, leaves them not only without the money they need to support themselves and their families, but also without access to essential supports like paid leave and healthcare coverage—and it subjects them to wage theft, harassment and sexual assault at work, and unhealthy, dangerous working conditions.

POLITICS OF POVERTY: How do we crack this?

PATRICIA STOTTLEMYER: We crack this by passing common-sense, and long-overdue labor policy reforms. The Raise the Wage Act and the PRO Act would lift millions of Latina workers’ earnings and give them the power to bargain for better working conditions and compensation. They would do the same for other workers who are overrepresented in low-wage jobs, namely women and people of color.

Union members experience lower pay gaps, and collective bargaining agreements enhance salary transparency, which helps us root out pay discrimination based on gender and race. The Paycheck Fairness Act would strengthen our equal pay laws, including by protecting salary transparency and banning employer reliance on salary history.

Policies that enable workers to care for themselves and their loved ones—like access to paid sick time and paid family leave, access to flexible and predictable work schedules, and access to affordable child care—are also essential to enabling women, and particularly women of color, to participate fully in the economy. Without struggling to put food on the table.

POLITICS OF POVERTY: When Oxfam produces research about low wages in the U.S., it’s always clear that raising the federal minimum wage would make a huge difference to women, and women of color especially. Is this part of the reason that it hasn’t been raised in 14 years?

PATRICIA STOTTLEMYER: It’s hard to say with certainty that gender and racial discrimination are among the reasons for Congress’ failure to raise the minimum wage and eliminate minimum wage exclusions, but gender and racial discrimination are certainly embedded in our current labor laws.

And gender and racial inequality are definitely perpetuated by the lack of policy change. Fixing these laws would help us fix the structural inequalities that women and people of color face in our economy. So, it’s hard to say that racism and sexism are not part of the reason.

POLITICS OF POVERTY: I’m also struck that women working part time earn much less per hour than women working full time. And women often are compelled to work fewer hours because of care responsibilities. And that’s not factoring in the loss of benefits like paid leave and health insurance.

How do we build an economy that works for people–for women–who have responsibilities outside of work?

PATRICIA STOTTLEMYER: We need policies that prioritize care: both paid and unpaid care work. Policies that support caregivers in the workplace, like paid sick leave and paid family and medical leave, fair and flexible scheduling, protections against harassment and pay discrimination. Policies that extend protections to part-time workers and domestic workers.

Policies that support unionizing and collective bargaining, so that workers can build power and fight together for better pay, benefits, and working conditions. Policies that invest in care workers, pay them more, and make care—whether it’s child care, elder care, care for people with disabilities, or care for any loved one—more affordable and accessible.

And we can end where we started: Congress should permanently expand the Child Tax Credit and lift millions of kids out of poverty.