Brookings: number of people in poverty drops below one billion

A new report from the Brookings Institution gives us some very good news that has gone largely unreported in the press. The rise of India and China's economies over the past decade has made a major impact of the number of people living in poverty. The huge populations within the two countries accounted for a huge drop in the number of poor people. India and China alone dropped the world's poverty population by two thirds. According to the Bookings Institution there are now 878 million people living in poverty, compared to over one billion in 2005.

From a Washington Post op-ed piece announcing the report, Laurence Chandy and Geoffrey Gertz summarize the conclusions. A download of the full report is available here.

Yet on one issue our understanding remains impervious to this new reality: the state of global poverty. Our sense of this topic remains firmly rooted in the year 2005 - the last year for which the World Bank has produced data on the number of people living on less than $1.25 a day. Thus we are routinely told that "today," 1.37 billion people around the world are poor, including 456 million in India and 208 million in China, but such figures are six years out of date.

A lot has changed in the past six years. The economies of the developing world have expanded 50 percent in real terms, despite the Great Recession. Moreover, growth has been particularly high in countries with large numbers of poor people. India and China, of course, but also Bangladesh, Tanzania, Ethiopia, Vietnam, Uganda, Mozambique and Uzbekistan - nine countries that were collectively home to nearly two-thirds of the world's poor in 2005 - are all experiencing phenomenal economic advances.

In the new Brookings Institution report "Poverty in Numbers: The Changing State of Global Poverty from 2005 to 2015," we updated the World Bank's official $1.25-a-day figures to reveal how the global poverty landscape has changed with the emergence of developing countries. We estimate that between 2005 and 2010, nearly half a billion people escaped extreme hardship, as the total number of the world's poor fell to 878 million people. Never before in history have so many people been lifted out of poverty in such a short period. The U.N. Millennium Development Goals established the target of halving the rate of global poverty between 1990 and 2015; this was probably achieved by 2008, some seven years ahead of schedule. Moreover, using forecasts of per capita consumption growth, we predict that by 2015, fewer than 600 million people will remain poor. At that point, the 1990 poverty rate will have been halved and then halved again.

The decline in poverty is happening in all the world's regions and most of its countries, though at varying speeds. The emerging markets of Asia are recording the greatest successes; the two regional giants, China and India, are likely to account for three-quarters of the global reduction between 2005 and 2015. Over this period, Asia's share of the world's poor is anticipated to fall from two-thirds to one-third, while Africa's share is expected to rise to nearly 60 percent. Yet Africa, too, is making advances; we estimate that in 2008 its poverty rate dropped below the 50 percent mark for the first time. By 2015, African poverty is projected to fall below 40 percent, a feat China did not achieve until the mid-1990s.

US unveils new effort to meet the Millennium Development Goals

One of the big stories that happened during our vacation involved US efforts on the Millennium Development Goals. US Aid unveiled the Obama Administration strategy to meet the goals by 2015. The US says it is going to concentrate on four strategies to meet the MDGs including leveraging innovation, investing in sustainability, tracking development outcomes, and enhancing the principle and practice of mutual accountability.

The full report from the US government can be downloaded from here, you can also download US Aid director Rajiv Shah statement on the report from here.

The Brookings Institution has already analyzed the report and posted a reaction. David Gartner works as a Co-director for Global Education efforts at the institution and says that the US should not forget education in its strategy.

President Obama is releasing a plan for achieving the Millennium Development Goals (MDGs) by 2015 in advance of the largest gathering of world leaders in at least a decade at the United Nations. While the Administration’s outline includes useful ideas on tracking development outcomes and increasing transparency and accountability, it also represents a missed opportunity to deliver on Obama’s commitment to invest $2 billion in a Global Fund for Education to achieve universal primary education. For most of the MDGs, particularly those that are most off-track, success will be nearly impossible without the achievement of universal primary education, MDG 2. With 72 million children still not in primary school, achieving universal education would offer extraordinary leverage in the broader fight against global poverty.

While there is some progress in poverty reduction for MDG 1: “Eradicate extreme poverty and hunger,” there is much less progress on the commitment to halve the number of people suffering from hunger by 2015. Child malnutrition is a key dimension of world hunger and 137 million children under the age of 5 are still underweight globally. Educating women is an important tool for reducing child hunger, according to a cross-country analysis of 63 countries. The study found that educational gains in women’s education accounted for 43 percent of all progress in reducing child malnutrition.

MDG 3: “Eliminate gender disparity,” commits to closing the gender gap in all education levels and increasing female representation in the wage employment and national parliaments. The latest data indicate that 28 countries still have fewer than 9 girls in school for every 10 boys. Nearly two-thirds of these countries are located in sub-Saharan Africa, where there are fewer than 8 girls for every 10 boys enrolled in secondary school. A focus on educating girls, especially in Africa, is not only essential to achieving universal education, but it is also vital to achieving the nutrition and health MDGs.

The goal that is most off-track is MDG 4: “Reduce child mortality,” the commitment to cutting child mortality by two-thirds between 1990 and 2010. A recent study published in the Lancet finds that despite progress in the last 20 years in all regions, child mortality will still need to be reduced by another 3.7 million over the next five years in order to meet that goal. Half of all child deaths now occur in Sub-Saharan Africa with rates as high as 180 deaths per 100,000 children in Equatorial Guinea; compare that to just 2.5 deaths per 100,000 children in Singapore.

Brookings Institution: suburbs contain biggest increase in US poor

The Brookings Institution has issued a new report that measures the numbers of poor in the United States. It finds that the biggest increases were concentrated on suburban areas of the nation's metropolitan communities. Suburban poverty has increased 25 percent since 2000, rising at a rate five times faster than the central cities.

The Brookings report also found that the biggest increases in poverty rates were found in Midwestern cities, while Northeastern poverty rates declined. 30 percent of Americans are now below 200 percent of the federal poverty level.

To download the full report from the Brookings website click here, there is also a city by city breakdown of the stats available here. US newspapers are localizing the study for today's issues, what follows are snippets of three such stories that caught our eye.

From The Birmingham News writer Jeff Hansen reveals a surprising trend for Birmingham, Alabama.

The Brookings Institution today reports that the poverty rates in the city of Birmingham and in the rest of the seven-county metro area declined from 2000 to 2008, by 2.4 and 0.6 percentage points, respectively.

That defied the overall trend seen in the nation's 95 largest metro areas, where the number of American poor increased by 5.2 million, with almost half of that growth occurring in what Brookings calls "the suburbs."

Birmingham's outlier status in an anomaly. The metro region was late in joining the Great Recession: Birmingham metro unemployment averaged 4.5 percent in 2008, but then 9.1 percent through the first 11 months of 2009.

Brookings expects the Birmingham-Hoover metro poverty rate will to climb by 2.4 percentage points from 2008 to 2009, based on that surge of unemployment already seen for 2009. And Brookings expects poverty rates in the other 94 metro areas will also rise.

The Brookings Institution said the trend of more poor people living in suburbs means that "the balance of metropolitan poverty has passed a tipping point."

James Rosen of McClatchy Newspapers gives us the statistics for the Carolinas.

More than one of every four Columbia residents is now living in poverty.

Columbia has been hit harder than other cities in the Carolinas, but Charleston, Charlotte and Raleigh are also home to a growing number of poor people.
...

More than 15.8 percent of Charlotte's residents are poor. That's only a slightly larger share than the 14.1 percent poverty rate in Charlotte metro area suburbs in Mecklenburg, Gaston, Union and York, S.C., counties.

York County, though, has been hit worse, with 16.3 percent of its residents living in poverty.

Things are bleaker still along the S.C.-Georgia border: Aiken County, part of the Augusta, Ga., metropolitan area, has a 19.2 percent poverty rate.

The suburban-city disparity is sharper in Columbia: The city proper has a poverty rate of 27.7 percent, compared with a 13.6 percent in its suburbs in Richland, Lexington, Kershaw and other nearby counties.

The Indianapolis Star gives us the results for that area.

The number of people living in poverty in Indianapolis increased in the years 2000 through 2008, but the city's poverty rate remains below that of the 95 largest U.S. cities, according to a new report from a Washington think tank.
...

In the Indianapolis suburbs, defined as 10 surrounding and nearby counties, the number of people living in poverty increased to 65,684 in 2008, up by 29,741 since 2000, the report said. The poverty rate in the Indianapolis suburbs increased from 5 percent in 2000 to 7.3 percent in 2008.

The Metropolitan Policy Program 2006:

from The Guardian

Ten years since its inception, the Metropolitan Policy Program continues to provide the demographic, economic, and spatial framework with which to understand the challenges facing metropolitan America.

Within that framework in 2006, the program re-emphasized the power of economic prosperity, and prosperity for all, as the unifying goal of reform.

Because big picture, although national statistics portray a rebounding economy, many parts of the country, and many households, are not sharing in that success.

Poverty rates are on the rise in both cities and suburbs, with more poor people now living in suburbs than in cities. The Midwest continues to bear the brunt of America's manufacturing job loss. And the very emblem of the American Dream, the middle-class neighborhood, is shrinking as the costs of daily necessities for working families continues to rise.

And as many communities grapple with greater economic insecurity, some are simultaneously dealing with other rapid changes, such as the demands of new immigrants, refugees, and population growth in general (symbolized by the arrival of America's 300 millionth American), the needs of declining older suburbs, and the growth pressures of exurban development on the fringe.

It is against this backdrop that we are learning that political and civic leaders are craving solutions to achieving and maintaining economic prosperity. While this year's mid-term elections were dominated by frustrations with Iraq and the war on terror, state and local elections—and even referendum results—signaled the need for practical problem solving to the issues around the economy, infrastructure, and income security for workers.

This proved true in every case where the program has engaged: fact-driven, comprehensive (yet practical) problem solving to achieve prosperity proved in demand and successful, whether at the metro, state, regional, or national level.

Central to these holistic efforts are three components to prosperity that guide the Metropolitan Policy Program's efforts:

# robust growth that boosts productivity and innovation, generates quality jobs, and helps the U.S. maintain its economic leadership in the face of rapid global, corporate, and technological change;

# sustainable growth that strengthens cities and older communities, reduces the costs of government, and conserves resources from energy to the environment; and

# inclusive growth that fosters a strong middle class while reducing racial and ethnic disparities in education, income, and wealth.

In New Orleans, the Metropolitan Policy Program documented the progress, or lack thereof, in the region's recovery throughout the year via the monthly Katrina Index. And while most commentary at the one-year anniversary of the storm was focused on the speed (or slow speed) of federal spending and government response, we pushed for a quality economic turnaround of the region, publishing a holistic proposal for a revived, inclusive, and sustainable New Orleans including an elucidation of the proper roles for federal, state, and local government.

In Maine, the program entered a state at a critical economic cross-roads. On the one hand, we found that after a period of demographic stagnation the state is growing quite rapidly again, driven by a major acceleration of domestic in-migration from Massachusetts and the growth of new service and innovation businesses.

On the other hand, "Charting Maine's Future" argued forcefully that sustainable prosperity is not inevitable, and that the state urgently needs to respond to a series of challenges involving the fragility of emerging clusters of innovative companies; the pace of its chaotic, low-density sprawl; and government's high and misdirected expenditure levels and taxes.

To respond, we advocated a state policy reform agenda that linked environmental assets, an innovative service economy, and fiscal discipline into a comprehensive sustainable prosperity agenda for Maine that was comprehensive and grounded in political reality. The agenda was also budget-neutral, calling for a "cutting to invest" approach and providing an alternative to the hot TABOR ballot question fight.

Key precepts included a $190 million Quality Places Fund for land conservation and community/downtown revitalization and a $200 million Innovative Jobs Fund to double R+D and support emerging clusters of the economy.

To fund these critical investments, government can be streamlined and more of the tax burden should be shifted to tourists. Also, more growth in existing towns and cities should be accommodated by reducing regulations and improving planning.

Perhaps most novel, and talked about, has been Brookings' proposal of a BRAC-like commission to identify inefficiencies in state government and submit a reform package for savings and reorganization to the legislature for up or down vote.

This and other packages promise to be central issues in the coming legislative session.

As our first of future forays into multi-state reform, "The Vital Center" examined the Great Lakes region's industrial legacy and the economic hangover from the seismic shifts in American manufacturing.

However, the region retains many significant assets such as its universities and natural amenities. In its conclusion, the report argues for a new federal-state compact around a series of educational, economic, social, and infrastructure initiatives that can help the region reassert its global economic leadership. It, too, continues to reverberate in the region's wrangling over its future.

Also creating legislative impact is "Prosperity at Risk: Toward a Competitive New Jersey," a project designed to diagnose the state's competitive position structured around housing, development, and social challenges.

In short, the project found that although New Jersey's economy has performed exceedingly well in the past, the state is losing its competitive edge. It argues that the threat to the state's prosperity comes from multiple forces—dysfunctional land use, rising housing costs, and growing race and place disparities—forces that are not normally associated with competitiveness.

Additionally, beside being cited extensively, several recommendations from the report focusing on housing and land use were recently embraced by Gov. Corzine in his new economic growth strategy.

In sum, we have learned that the reforms needed to bring quality economic growth, sustainable growth, and inclusive growth have strong political resonance—and impact—when packaged in pursuit of prosperity.

For 2007, Brookings hopes to take these on-the-ground lessons to the national level. It is time to demonstrate that the nation's economic prosperity is based on the health of metro areas, signaling a need for new federal and state reforms to promote metro prosperity.

Though the Metropolitan Policy Program relentlessly gathers local data for its analyses, the program nonetheless continues to look abroad for both lessons and opportunities.

In particular, the program continues its close collaboration with the London School of Economics on several fronts. This fall, Bruce Katz led a delegation of U.S. practitioners to London to participate in a trans-Atlantic conference on the economic recovery of industrial, "weak market" cities. Brookings is already applying the lessons on market recovery from cities like Bilbao, Sheffield, and Torino to its work in states such as Pennsylvania, New York, and Michigan.

Katz has also been a senior advisor to another LSE initiative—the "Urban Age"—that is designed to develop policies that can address the rapid urbanization in China, India and elsewhere and the stresses experienced by global cities throughout the world. His presentation on "An Urban Agenda for an Urban Age," delivered at a major international conference in Berlin this fall, demonstrates that cities and city regions are the vehicles for achieving major global objectives in the 21st century, and require radically different multidimensional interventions if they are to realize their potential.

And while the Urban Age agenda tends to be more infrastructure-oriented than the Metropolitan Policy Program, it does fit into the program's vision of comprehensive reform.

The Metro Program remains committed to attacking the concerns around economic prosperity, and has demonstrated that efforts to strengthen industry and other economic assets, investing in existing communities and infrastructure, and growing the middle class all only enhance the goals of prosperity.

Also, wherever possible the program advances solutions that do not require more public subsidies but can be achieved through market and regulatory reforms, maximizing existing programs, or ensuring that new investments are offset by savings in other programs.

All of these efforts are of course in service of our three primary goals of robust growth, sustainable growth, and inclusive growth.

Ten years in, we hope you'll stay with us or join us. Subscribe to our email newsletters, or send us comments.

We look forward to hearing from you in 2007.

Central Valley’s Stockton shows nation’s biggest drop in poverty

from Central Valley Business Times

The Stockton metropolitan area had the biggest percentage drop in poverty of any of the nation’s 100 largest metro areas, according to a study released Thursday by the Brookings Institution.

Stockton is one of just two large metro areas in the West that had decreases in poverty rates between 1999 and 2005, the report says. The other was Los Angeles, which saw a 1.2 percent drop.

Stockton’s poverty rate is still high – 14.6 percent of the metro area’s population – but it’s down 1.8 percent since 1999, the report says.

The poverty rate in Bakersfield, Modesto and Sacramento remained essentially the same over the 1999-2005 period, but Fresno’s saw a drop of 0.4 percent, according to Brookings.

Nationally, poverty has increased and in most communities since 1999, as results from the 2005 American Community Survey says. The proportion of children in poverty has risen, too, eroding much of the progress made in the 1990s, says the Brookings report.

“Many cities witnessed increases in poverty over this period, but the most striking developments have affected suburbs, which for the first time contain a majority of the nation’s poor population,” the report says. “These trends are in large part the function of the 2001-02 recession and slow wage growth thereafter for lower-skilled workers.”

The “poverty rate” represents the proportion of family members and unrelated individuals in a particular place with incomes below the applicable federal poverty threshold, Brookings says.

In 1999 large cities and their suburbs had nearly equal numbers of poor individuals, but by 2005 the suburban poor outnumbered their city counterparts by at least 1 million, the report says.

In all, more than 12 million suburban residents were living in poverty in 2005, according to the study.

U.S. poverty is moving to suburbs, study finds

from The Seattle Times

By Stephen Ohlemacher

WASHINGTON — As Americans flee the cities for the suburbs, many are failing to leave poverty behind.

The suburban poor outnumbered inner-city counterparts for the first time last year, with more than 12 million suburban residents living in poverty, according to a study of the nation's 100 largest metropolitan areas released today.

"Economies are regional now," said Alan Berube, who co-wrote the report for the Brookings Institution, a Washington think tank. "Where you see increases in city poverty, in almost every metropolitan area, you also see increases in suburban poverty."

Nationally, the poverty rate leveled off last year at 12.6 percent after increasing every year since the decade began. It was a period during which the country went through a recession and an uneven recovery that is sputtering in parts of the Northeast and Midwest.

"Looking back at the 1970s, you would have seen cities suffering and suburbs staying the same," said Berube, research director at the Brookings Institution's Metropolitan Policy Program. "But the story is different today."

The federal government defined the poverty level as $15,577 for a family of three in 2005.

Berube said several factors are contributing to an increase in suburban poverty:

• Suburbs are adding people much faster than cities, making it inevitable that the number of poor people living in suburbs would eventually surpass those living in cities.

• The poverty rate in large cities (18.8 percent) is higher than it is in the suburbs (9.4 percent). But the overall number of people living in poverty is higher in the suburbs, in part because of population growth.

• U.S. suburbs are becoming more diverse, racially and economically. "There's poverty really everywhere in metropolitan areas because there are low-wage jobs everywhere," Berube said.

• Recent immigrants are increasingly bypassing cities and moving directly to suburbs, especially in the South and West. Those immigrants, on average, have lower incomes than people born in the United States.

Berube and research analyst Elizabeth Kneebone studied poverty figures for the 100 largest metropolitan areas, measuring changes from 1999 to 2005, the most recent data available.

In 1999, the number of poor people living in cities and suburbs was roughly even, at about 10.3 million each, according to the report. Last year, the suburban poor outnumbered their urban counterparts by about 1.2 million.

Cleveland was the city with the highest poverty rate last year, at 32.4 percent. McAllen, Texas, was the suburb with the highest poverty rate, at 43.9 percent.

Expert Espouses Marriage To Reduce Poverty

from The Hartford Couriant

By COLIN POITRAS, Courant Staff Writer

Is promoting marriage a key to lifting Connecticut's low-income children out of poverty?

A national expert on welfare reform believes it is.

Ron Haskins, a senior fellow at the Brookings Institution, a Washington, D.C., think tank, and a special adviser to President Bush on welfare policy, pushed marriage - including same-sex marriage - as a tool for reducing poverty during an appearance this week in Hartford.

Haskins, a Republican and former staffer on the House Ways and Means Committee who helped write the country's 1996 welfare reform legislation, said his research shows marriage as the second most influential factor in reducing poverty rates, according to a computer simulation he created based on census data for 2001.

The single most effective factor was an obvious one, full-time work. But marriage ranked second, Haskins said, more effective, in fact, than increasing education, reducing family size and doubling cash payouts for welfare recipients.

Haskins was a guest speaker at the Connecticut Association for Human Services' annual release of its Kids Count report Monday at the Legislative Office Building. This year's report focused on helping children of low-income working families. The association recommended creating a state earned income tax credit, expanding worker training and education and restoring budget cuts to state-funded child care as ways to address the issue.

The report mentioned nothing about the advantages of promoting marriage, which has become a hot-button issue among some conservative Republicans in Congress.

"If you are concerned about children, then children will have a better chance in a married-couple family," Haskins said. "There are advantages to children living in a married-couple family," Haskins said. "And government cannot make up that difference."

Haskins told his audience that the "bully pulpit" - politicians, policy-makers and other opinion-formers must stress the case that marriage is one of the surest means of furthering the interests of poor children. He did not press for any specific governmental policies.

Notably, Haskins said that his theory on the benefits of marriage includes gay couples, an admitted break from the position held by many conservative Republicans. Creating jobs, providing support for low-income parents entering the workforce and expanding quality preschool programs are also crucial in helping improve the lives of impoverished families and children over the long term, Haskins said.

The human services association had invited Haskins to spark a dialogue about addressing poverty in Connecticut, a major social issue here yet one that often gets overlooked because of the state's stature and wealth.

In 2006, 215,770 children - one in four - in Connecticut live in low-income families, defined as those families with income below 200 percent of the federal poverty level or $40,000 for a family of four, according to the association for human services report.

And while the Constitution State continues to enjoy its stature as one of the wealthiest states in the country, it has the third largest income gap in the nation. Over half of urban Connecticut children live in low-income families, according to the Kids Count report. Only 15 percent of children in Connecticut suburbs live in low-income families, the report said.

Hartford continues to have the second-highest child poverty level for a city its size in the country - 41 percent, second only to Brownsville, Texas.

Jodie Levin-Epstein, deputy director and senior policy analyst at the Washington, D.C.-based Center for Law and Social Policy, conceded that Haskins' position on marriage has some merit. Research has shown that children reap significant benefits when they are in stable, supportive married couple households, she said.

But Levin-Epstein, who was also an invited speaker Monday, said that some of that benefit is a direct result of having two working parents and two incomes in the average family.

Levin-Epstein said putting money into the hands of low-income parents through an earned income tax credit also helps. She said existing research in the United Kingdom, where officials are trying to eradicate poverty by 2020, shows that low-income families do not use the additional money for alcohol or tobacco as some might believe, but for work-related costs such as improving their transportation, buying a phone or getting better food for their kids.

Levin-Epstein, a Democrat, said her main concern about advocating marriage is when it becomes a matter of government policy. She said there are also studies that show children of couples who divorce are sometimes worse off than those in single-parent households because of the resulting emotional turmoil and other issues. Stability and support in a two parent home is key, she said.

Haskins, who also serves as co-director of the Center on Children and Families at Brookings and is a senior consultant to the prominent Annie E. Case Foundation helping disadvantaged children in Baltimore, countered that government is already in the marriage business. He listed state regulations regarding marriage licenses and the federal tax code for married families as two instances where government directly intervenes.

Connecticut's requirements for issuing a marriage license - that there must be a man and a woman - are being challenged in a lawsuit now before the state Supreme Court. The suit, filed by eight same-sex couples, says the state law authorizing civil unions did not go far enough and that gay marriages should not be denied.

Levin-Epstein said that Connecticut, with its Republican governor and Democratic legislature and with its commitment to reduce poverty by half by 2014, stands to be a national model for other states to follow.

The gap between Connecticut's most wealthy and most needy is growing, she said. Research shows that the greatest competition for new jobs in Connecticut through 2012 will be for either highly paid, highly skilled jobs or low paid, low-skilled jobs.

Unless currently low-paid workers get training, education and support for advancement, the despair and disparity that now exists will only grow at taxpayer expense.

"Hope fosters creativity and risk and it is that creativity that brings advancement," Levin-Epstein said. "With increased disparity, we increase despair and with increased despair it is hard to move forward as a community."

Contact Colin Poitras at cpoitras@courant.com.

The full Kids Count report can be found at www.cahs.org.