US poverty: chronic ill, little hope for cure

WASHINGTON (Reuters)

Four decades after a U.S. president declared war on poverty, more than 37 million people in the world's richest country are officially classified as poor and their number has been on the rise for years.

Last year, according to government statistics, 1.1 million Americans fell below the poverty line. That equals the entire population of a major city like Dallas or Prague.

Since 2000, the ranks of the poor have increased year by year by almost 5.5 million in total. Even optimists see little prospect that the number will shrink soon despite a renewed debate on poverty prompted by searing television images which laid bare a fact of American life rarely exposed to global view.

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"Every August, we Americans tell ourselves a lie," said David Brady, a Duke University professor who studies poverty.

"The poverty rate was designed to undercount because the government wanted to show progress in the war on poverty.

"Taking everything into account, the real rate is around 18 percent, or 48 million people. Poverty in the United States is more widespread, by far, than in any other industrialized country."

Poverty is a universal problem, as is inequality. The world's 500 richest people, according to U.N. statistics, have as much income as the world's poorest 416 million.

The post-hurricane poverty scenes were so remarkable for most of the world because of the perception of the United States as the rich land of unlimited opportunity.

No other country spends so much money -- billions of dollars -- to keep job-hungry foreigners out; no other country has an annual lottery in which millions of people play for 50,000 permanent resident "green cards," no other country has as many legal and illegal immigrants, all drawn by dreams of prosperity.

For many Americans they remain just that: dreams. While there are arguments over how poverty is measured -- conservatives say the census overstates it because it does not take into account food stamps and other subsidies -- there is consensus on one thing.

The minimum wage, which rose by 15 cents to $6.35 an hour on October 1, is not enough to keep you above the poverty line. Yet minimum wage jobs, without health insurance or vacations, are the only jobs available to millions of people with only basic education.

The well-paid unskilled jobs in heavy industry which once lifted working-class Americans into the middle class are largely gone and the decline continues. Since 2001, the United States has lost more than 2.7 million manufacturing jobs. Low-paid clerical work is being outsourced to developing countries.