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American Seniors: Poor No More

A rich, senior man Photo by Nick Dolding via Getty images.

Wednesday’s post on the release of 2011 census economic data brought the predictably downbeat news that inequality continued to increase in America last year, as it has for decades. But in poring over the numbers with Bob Lerman (Urban Institute, American University), I came upon a statistic that seems astonishing, even a day later.

If you’ve downloaded the PDF of the Census Bureau report, go to page 56 and compare the columns for people “18 to 64 years” and “65 years and older” in terms of “Below poverty” percent. For web potatoes who can’t make that much effort, we’ve created a chart that summarizes the data. What it shows seems incontrovertible.

Since 1966, the percentage of Americans ages 18-64 who live below the poverty line (a line adjusted for inflation) has risen by almost one third. The numbers dropped substantially during the War-on-Poverty ’60s and ’70s, but have been climbing unsteadily since 1980. The steepest climb has been since the year 2000, following the boom years of President Clinton’s second term.

As Bob Lerman points out, benefits for the poor like food stamps and housing vouchers are not included in these numbers. Count benefits as income, and the totals drop. But, says Lerman, the pattern still holds, with the number of Americans in poverty rising even in the supposed boom years before the Crash of ’08. During those years, I had considered a series of NewsHour reports we never got around to: “Those the Boom Left Behind.” And here those people are — in the data.

But what I find “astonishing” are the data for Americans 65 and older. In 1966, more than one quarter of them lived below the poverty line, with few if any of the benefits the poor get today and no Medicare, which became law only in 1968. Look at the line for seniors. Through good times and bad, booms and busts, Republicans and Democrats, the percentage of seniors in poverty has gone down. Counting from 1966, when more than a quarter of all seniors were “in poverty” to 2011 (less than one in ten), that’s a drop of about 70 percent.

This has, of course, been a great achievement for America, and for my generation. The old are no longer poor. My cohort and I have been provided for. But when you consider that non-seniors have been getting poorer, it makes one wonder: are we robbing the young to pay old Paul?

Our Social Security maven, Boston University’s Larry Kotlikoff, has become a phenomenon here on Making Sen$e, revealing Social Security secrets answering your Social Security questions Monday after Monday. But to the rest of the world, Larry is chiefly known for his work on what he once called “the coming inter-generational storm.” His argument has long been: yes indeed, we have been robbing the young to pay the likes of seniors like myself — robbing them by borrowing money to pay for senior benefits that juniors will have to pay back on some day of reckoning, by hook or crook.

This is not the occasion to tussle with Larry over the particulars of his argument, as I often have in private. But let me admit publicly, in case he’s reading this: Larry, yesterday’s census data certainly do support your point. I only hope they won’t stop you from telling the seniors flocking here how to maximize the very benefits that will wind up on the juniors’ collective tab.

This entry is cross-posted on the Making Sen$e page, where correspondent Paul Solman answers your economic and business questions

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