Poverty grows in Rick Perry's Texas

Tami Luhby
September 18, 2011
http://money.cnn.com/2011/09/18/news/economy/poverty_perry_texas

Texas Governor Rick Perry likes to brag that his state is an economic powerhouse.

But don't tell that to the nearly one in five Texans who are living below the poverty line.

While it's true that Texas is responsible for 40% of the jobs added in the U.S. over the past two years, its poverty rate also grew faster than the national average in 2010.

Texas ranks 6th in terms of people living in poverty. Some 18.4% of Texans were impoverished in 2010, up from 17.3% a year earlier, according to Census Bureau data released this week. The national average is 15.1%.

And being poor in Texas isn't easy. The state has one of the lowest rates of spending on its citizens per capita and the highest share of those lacking health insurance. It doesn't provide a lot of support services to those in need: Relatively few collect food stamps and qualifying for cash assistance is particularly tough.

"There are two tiers in Texas," said Miguel Ferguson, associate professor of social work at University of Texas at Austin. "There are parts of Texas that are doing well. And there is a tremendous number of Texans, more than Perry has ever wanted to acknowledge, that are doing very, very poorly."

Perry, for his part, believes that creating jobs is the best way to help every Texan. The state is doing "everything we can to ensure that every Texan who wants a job has one," a spokeswoman for the governor said.

Poor in the Lone Star State

A combination of demographic and economic factors contribute to the high poverty rate in Texas, where many families, particularly in the southern swath, live in ramshackle housing with no utilities or indoor plumbing.

More than half the state are minorities, many of them Hispanic. This population often has lower levels of education, making it harder for them to escape poverty, said Steve Murdock, sociology professor at Rice University. And the state's population is younger and the families there larger, on average, which also puts them at greater risk of being poor.

Meanwhile, the Great Recession has driven a new crop of Texans into poverty's grip: the formerly middle class.

Texas Neighborhood Services started seeing a crush of new people seeking help last year, said Bradley Manning, executive director of the Weatherford-based agency. Many of them were unemployed and couldn't find new positions, even after going through job training.

"The middle class are losing their jobs and are not able to replace them fast enough," Manning said. "That's driving them straight into poverty."

Even those lucky enough to get one of the new jobs created in Texas may still find themselves struggling to make ends meet. Many of the positions that have been created are on the lower end of the pay scale.

Some 550,000 workers last year were paid at or below the federal minimum wage of $7.25, more than double the number making those wages in 2008, according to the Bureau of Labor Statistics. For someone working full-time, that's just over $15,000 a year before taxes, which is under the poverty line for a single parent with two children.

Some 9.5% of Texas' hourly workforce are minimum-wage workers, the highest percentage in the nation -- a dubious title it shares with Mississippi.

Little help for Texans in need

For residents living in poverty, the state doesn't offer many services or even make federally-funded benefits easily accessible.

For instance, it has one of the tightest income limits -- less than 12% of the poverty level -- to qualify for federal cash assistance payments and one of the most meager benefits, a maximum of about $260 a month for a family of three, said Celia Cole, senior research analyst at the Center for Public Policy Priorities, which advocates for low-income residents. The program serves less than 6% of poor children in the state.

Texas' Medicaid program covers virtually no non-disabled adults. And only an estimated 55% of those eligible for food stamps had signed up for the program in 2008, among the lowest participation rates in the country.

Enrollment has since improved after the state legislature allocated more money for administering the system after coming under pressure from the federal government and being hit with a class action lawsuit. However, Cole says, need has greatly increased as well.

Experts chalk up the minimal services and take-up rates to Texas' anti-welfare attitude. In the Lone Star State, you are expected to pull yourself up by your bootstraps.

"The Texas mentality is you don't ask for help," Ferguson said.

Raising a family on less than $600 a month

Perry, a Republican candidate for president, echoes this view. Asked about the high poverty rate, a governor's spokeswoman said Perry is focusing on creating jobs so Texans can sustain themselves and their families. She pointed out that 95% of the state's jobs are above the minimum wage.

"We're trying to create a culture of independence rather than dependence," said Lucy Nashed, noting the state provides an adequate safety net for children, seniors, the disabled and pregnant mothers.

But advocates say more needs to be done to help people rise or return to self-sufficiency. The state should invest more in public education, job training, health programs and work assistance, such as child care subsidies. Also, it should focus on creating jobs with higher wages and decent benefits.

"We don't have the support system in place to provide economic support or economic opportunity to help families lift themselves out of poverty," said Frances Deviney, senior research associate at the center