Cairo Association of Teachers - Newsletter

CAT Tracks for April 17, 2008 WARNING, WARNING...POVERTY

Report: Poverty a threat to region

BY BECKY MALKOVICH, the southern

Eight of 22 Illinois counties named to a poverty warning list are in Southern Illinois, according to a report issued today by Heartland Alliance's Mid-America Institute on Poverty, while eight other area counties made the report's poverty watch list.

The 2008 Report on Illinois Poverty is the result of a comprehensive evaluation of poverty indicators and shows that statewide, the number of citizens living in poverty grew by 19 percent in the past five years and now totals more than 1.53 million Illinoisans.

The report also showed an increase in poverty in 74 of the state's 102 counties.

Area counties making the poverty warning list include Alexander, Franklin, Gallatin, Jefferson, Perry, Randolph, Saline and Union.

Of the 44 counties on the poverty watch list, eight are in Southern Illinois: Hamilton, Hardin, Johnson, Massac, Pope, Pulaski, Washington and Williamson.

Of the counties in the southernmost region of the state, only Jackson County managed to avoid an appearance on either list.

The lists were compiled from an analysis of four factors reflecting a county's susceptibility to pronounced poverty: High school graduation rates, unemployment rates, teen birth rates and poverty rates.

Key indicators for the counties on the poverty warning list signaled poverty trends "that are the most alarming in the state," while the Illinois counties on the watch list have poverty indicators that "need to be monitored closely," a press release from the Heartland Alliance said.

Declining incomes and skyrocketing costs play a role in the state's poverty, the release said.

Illinoisans have less purchasing power to pay for their needs after average weekly wages fell in seven of 11 job sectors from 2001 to 2007, the report said, while during the same time period the cost of gasoline went up by 92.7 percent; energy by 60 percent and medical care by 31.2 percent.

Many of the state's citizens are also caught in a debt/asset trap, the report said, with 15.4 percent of Illinois households having a zero or negative net worth, or owing more in debt than they own in assets.

The state's regressive tax system, when both state and local taxes are taken into account, leaves the state's poorest families with an effective tax rate nearly triple the share assessed on the top 1 percent of households, the report said.

Also contributing to poverty in the state, the report said, is a failure to connect supports such as Temporary Assistance for Needy Families to those who need them.

Increasing the TANF cash assistance grant by 15 percent is one recommendation offered in the report to help alleviate poverty. Increasing the Illinois Earned Income Tax Credit, currently one of the lowest in the nation, could also help with the problem.

Also, because of the proliferation of payday lenders in the state - one payday lending license for every 160 poor families - the report recommends improving the Payday Loan Reform Act to "strengthen provisions that protect Illinois families from abusive predatory lending practices that can lead them down the path to financial ruin."

The report also recommends the establishment of a Commission on the Elimination of Poverty in Illinois. The commission would be charged with coming up with a plan to cut the number of people living in poverty in half by 2015.

The report was presented to state legislators at the eighth annual briefing of the Illinois Poverty Summit, a bipartisan group that analyzes poverty trends in Illinois.

Read the full report here