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BRIEFS: Incomes down, poverty up; 50M lack insurance

Mon, Sep 19th 2011 12:00 am

Real median household income declined 6.4 percent from 2007 to 2010, according to the U.S. Census Bureau, and now stands at $49,445.

More than 46 million Americans were in poverty last year, as the poverty rate increased for the third year in a row to 15.1 percent. That's the highest poverty rate since 1993. The number of Americans in poverty was the highest recorded in the 52 years it has been tracked by the Census Bureau. (The bureau's definition of poverty varies by family size; for a family of four, the threshold is $22,314 in income.)

Half in Ten, a campaign that aims to cut poverty in half over the next decade, said the census report shows the need for Congress to continue emergency unemployment benefits, extend the payroll tax cut, invest in infrastructure, subsidize employment opportunities for low-income Americans, and provide aid to state and local governments - all of which are part of President Barack Obama's jobs plan.

"We cannot have a shared economic recovery while leaving millions of our citizens behind," said Melissa Boteach, manager of Half in Ten. "More families in poverty means fewer consumers for American goods and services and a less-educated work force to build the jobs and industries of the future."

Meanwhile, the number of Americans without health insurance increased to 49.9 million in 2010, up from 49 million in 2009.

The percentage of Americans with employer-based insurance continued to decline, from 56.1 percent in 2009 to 55.3 percent in 2010, while the percentage covered by government insurance programs increased from 30.6 percent to 31 percent.

This trend away from employer-based health care may continue in the future, despite tax credits that are now available to some small businesses to help them cover part of the cost of insurance.

"Obamacare puts this trend on the fast track by pushing more Americans onto government coverage, specifically Medicaid and the new subsidized government exchanges," said Nina Owcharenko, director of the Center for Health Policy Studies at the Heritage Foundation.

Small-biz indicators drop as confidence fades

The National Federation of Independent Business' monthly index of small-business indicators fell nearly 2 points in August to 88.1 points, its sixth decline in a row.

NFIB called August's number "disturbingly low" and said it showed that small businesses were not encouraged by the last-minute deal to avert a default on the federal government's debt.

"In fact, hope for improvement in the economy faded even further through the month, proving that short-term fixes will not help," said NFIB Chief Economist Bill Dunkelberg. "Private-sector decision makers think longer term, and they don't like what they see. There is little clarity or certainty. When people are uncertain about the future or fear it, the don't spend or invest."

The present isn't very pretty either. More small businesses reported that sales declined in August. Few business owners expect sales to improve in the next three months.

The net percentage of owners who expect better business conditions in six months fell 11 points from July.

"Owners appear to have lost confidence in the economy and the government's ability to assist the recovery," NFIB concluded.

President Barack Obama's jobs plan will do little to improve their outlook, according to NFIB President and CEO Dan Danner.

"The truth is that small businesses need the government out of their way," Danner said. "Tax breaks are always a welcome help to small businesses, especially in these tough economic times."

But the tax breaks proposed by Obama are temporary, he noted, and don't offset the "the threat of higher taxes and the thousands of pending federal regulations."