“Let them eat cake,” said Marie Antoinette about the poor who could not even afford bread. During the Clinton era income for the poor increased in the USA. Then with George W. Bush, the Great Recession, and continuing through Barack Obama the poor just got poorer. Legal Services of NJ reported: “Poverty in New Jersey continued to grow even as the national recession lifted, reaching a 52-year high in 2011, according to the most recent report.”
The federal government (primarily Republicans) and our NJ governor have played a major role in this downward slope leaving the poor today in a precarious position. Below are key factors that substantially impact the poor (and the middle class) in NJ:
Unemployment: Throughout Gov. Christie’s tenure the unemployment level has been higher than both the national average and the level of neighboring states. The persistence of high unemployment disproportionally affects the poor as well as the middle class. As the Urban Institute explains, loss of a job not only leads to loss of income but can result in “permanently lower wages, worse mental and physical health, higher mortality rates and severe problems for affected family members.”
Jobs: NJ Policy Perspectives (NJPP) indicates “We’ve regained only 59 percent of the jobs we lost in the Great Recession (neighboring New York, by comparison, has regained 150 percent). Worse, this November drop in the unemployment rate is largely attributable to the fact that 30,600 New Jerseyans gave up looking for work.”
Earned IncomeTax Credit: The EITC encourages and rewards work by reducing the income tax due on low and middle income wage earners. Starting in 2011 and continuing through today Governor Christie reduced the tax credit from 25% to 20%. NJPP provides a map that shows the number of households and individuals in each county who lost Earned Income Tax Credit funding in 2011 and 2012. In Essex County for example 211,162 individuals lost $14,150,964.
SNAP (food stamps): These federal benefits were recently cut. The Center on Budget and Policy Perspectives says, “The depth and breadth of the SNAP cuts that took effect in November are unprecedented.” CBPP indicates that between November 2013 and September 2014 NJ will receive $90 million less in food stamp funds which will impact 873,000 NJ recipients. $90 million would also be a boost to our economy, but our Governor is not getting involved. Congress (ie. the Republicans) are considering further cuts. Will Christie protest?
Federal Emergency Unemployment Benefits, which add multiple weeks to the initial 26 weeks paid by the State, expired Saturday. Extension of these benefits was not included in the recent compromise budget package. NJPP points out, “The expiration will harm New Jersey more than any other state since the Garden State has the highest share of its labor force on extended benefits.” NJPP estimates the expiration will immediately impact 90,000 New Jerseyans and another 89,000 in the first six months of 2014. Democratic legislators in the U. S. Senate might pass a bill to extend the benefits, but getting it passed in the Republican-majority House is a heavy lift.
Minimum Wage: The one bright spot: effective Wednesday the NJ minimum wage will increase from $7.25 per hour to $8.25. NJPP estimates, “it will impact a total of 429,000 working New Jerseyans, or 11 percent of the state’s workforce.” This happened through a popular ballot initiative after Gov. Christie vetoed the legislature’s bill. President Obama would like a national increase to an even higher level, but prospects are not good for congressional passage.
Recently Pope Francis debunked the “trickle-down” theory and said, “Meanwhile, the excluded are still waiting.”