Tuesday, April 01, 2008

Brits Think We're in Depression

A headline & photo in a U.K. paper declare 2008 Depression in U.S. (via Drudge). This is based on the higher number of food stamp users. The article itself is entitled: Food stamps are a continuing reminder of widespread poverty. Food stamps, as we know them, were a product of Pres. Johnson's "War on Poverty" in 1964. While many of recall the coupons being handed in at the grocery story cash register, "... they usually take the form of a credit on an electronic debit card, reducing the visible stigma of their use for people too proud to admit they could not cope on their own."

"At least six states, including Florida, Arizona and Maryland, have had a 10 per cent increase in the past year. In Rhode Island, the segment of the population on food stamps has risen by 18 per cent in two years. "
Food stamp use declined during the second half of the 1990s thanks to the controversial 1996 welfare reform bill, and the exclusion of legal immigrants from the programme. Those provisions have now been reversed, and both state and federal governments have taken measures to make people more aware they are eligible.

... food stamps are also a reminder of the continuing existence of widespread poverty in the US, and the ever expanding gulf between rich and poor in the world's wealthiest country intensified, experts say, by the Bush administration's tax cuts. Upper income brackets have seen their disposable income soar, while earnings of the lowest paid have struggled to keep pace with inflation.

The minimum wage had stood unchanged for a decade – its longest freeze ever – until it was increased to $5.85 an hour from the $5.15 set in 1997. The national poverty rate stands officially at around 13 per cent, a level little changed from the 1970s. Poverty is currently defined as an income of $21,500 for a family of four [The minimum wage in Eng. is 5.52 pounds-double for dollar amount].

Inevitably, comparisons with the Great Depression, when food stamps did not exist, are being made. Then, a quarter of the workforce was unemployed, compared with just 5 per cent today. By one estimate, 60 per cent of the populace lived in poverty in the depths of the Depression. The 30 per cent poverty experienced in some US inner cities and depressed rural areas today is showing signs it is capable of reaching that level.
What's causing the problem are overall increased food costs (up an average of 10%), higher fuel costs (used to transport food products), a downturn in employment & the economy. Then, of course, one can't ignore our huge deficits & war costs.

It's too bed our local paper hasn't even touched the topic beyond exploring local business problems. Expect to see even more closings locally. At some point you'll see local governments having trouble collecting tax monies, not to mention the pressure on local food banks.
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