Poverty News in US and Texas

There were two important new reports on poverty released this week. First, the US Census Bureau released its annual report Income, Poverty, and Health Insurance Coverage in the United States (pdf). And yesterday, Texas' own Center for Public Policy Priorities released The Family Budget Estimator: What It Really Takes to Get by in Texas, which analyzes living costs for a family of four in several Texas metro areas compared to the official US poverty guidelines.

The reports show that more Texans and more Americans lack health insurance, and, while the official US poverty rate dropped for the first time in five years, household incomes are still below 1999 levels.

Much of the news coverage on the Census Bureau's annual report has focused on the drop in the US poverty rate from 2005 to 2006. According to the Bureau: "the nation’s official poverty rate declined for the first time this decade, from 12.6 percent in 2005 to 12.3 percent in 2006. There were 36.5 million people in poverty in 2006, not statistically different from 2005."

Although the poverty rate declined in 2006, household incomes in the US and Texas were still lower in real dollars than in 1999. Nationally, median household income dropped two percent from 1999 to 2006, from $49,244 to $48,201. In Texas, median household income dropped from $48,314 in 1999 to $44,922 in 2006—a decline of seven percent.

The Census Bureau report also showed that health insurance continues to decline. The Bureau reported, "the number of people without health insurance coverage rose from 44.8 million (15.3 percent) in 2005 to 47 million (15.8 percent) in 2006."

CPPP's family budget model assumes a family with access to employer-sponsored health insurance. Given that only 24 percent of small employers in Texas offer health insurance to their employees, the model is probably overly optimistic. According to the Texas Department of Insurance, "a family of four – two parents and two children -- living at two-times (or 200 percent) the FPL in 2005 made
about $40,000 per year. With average annual premiums at $11,000, health insurance premiums would consume over 25 percent of their income."