Food Insecurity

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How Inflation and High Interest Rates Have Changed the Economy

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As inflation cools and the Federal Reserve cuts rates, an era of economic upheaval is coming to a close, but not without lingering marks.People with jobs have started showing up at homeless shelters in Atlanta. Families who can’t cover their grocery bills are pushing up demand at a Boston food bank. A dearth of available houses is plaguing Sacramento. Yet reports of recent raises abound, and a partly retired homeowner near Pittsburgh is happy about his savings.America’s bout of painfully high inflation — and the period of high interest rates meant to cure it — is finally drawing toward a close. Price increases are nearly back to a normal pace, so much so that the Federal Reserve voted on Wednesday to lower borrowing costs for the first time in more than four years.But even as the nation’s tumultuous pandemic economic era begins to approach its end, the period is destined to leave lingering marks.There are many things to celebrate about the current moment. Inflation has so far cooled without a major economic pullback, a development few economists thought possible. Consumers are still spending at a solid clip. Years of strong job growth and solid wage gains have lifted up many workers, and a run-up in stock prices is padding retirement accounts.The Greater Boston Food Bank has delivered more than 100 million pounds of food every year since 2020, up from less than 70 million in 2019.Sophie Park for The New York TimesYet the past several years have also brought serious and lasting challenges. Prices remain sharply elevated compared with their prepandemic levels, and many families are still struggling to adjust. Some have seen their wages fall behind costs. For others, pay gains have kept pace with inflation, but the memory of cheaper egg and rent prices endures, leaving an ongoing sense of sticker shock. And across the country, housing affordability has tanked, a trend that could take time and even policy changes to reverse.Grocery Inflation Jumped, Then CooledGrocery inflation was even more rapid than overall price increases in 2022, though it has recently calmed notably.

Source: Bureau of Labor Statistics Consumer Price IndexBy The New York TimesWe are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Poverty Increased in 2023 as Prices Rose and Pandemic Aid Programs Expired

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    More faced hardship in the United States last year, the Census Bureau said, as inflation and the end of subsidies outweighed higher incomes.The nation’s poverty rate rose last year even as incomes improved, the government reported on Tuesday, reflecting higher prices and the expiration of the last pandemic relief programs.The share of Americans living in poverty as defined by the Census Bureau’s “supplemental” measure, which takes into account a broader range of benefits and expenses than the official poverty rate, rose to 12.9 percent in 2023, from 12.4 percent in 2022. The median household income, adjusted for inflation, rose to $80,610, finally regaining its prepandemic level.Poverty levels have risen anew in recent years after a wave of pandemic relief aid — and an exceptionally strong labor market that lifted the wages of many at the bottom of the pay spectrum — collided with the most rapid inflation in a generation.Stimulus checks, extra unemployment insurance and expanded tax credits for low-income families cut child poverty in half in 2021, to the lowest rate since record keeping began, in 1967. But the expiration of those supports, along with the jump in prices for food and other necessities, reversed the gains in 2022.“You need two kinds of strategies to keep poverty down: One is the economic strategy, and one is the investments in core programs and the safety net,” said Olivia Golden, interim executive director of the Center for Law and Social Policy, a progressive advocacy group. “To me, the idea that policies have high stakes in terms of the lives of families and their material hardship is very vivid as you look over the last few years.”The income gains were particularly pronounced for low-wage households, rural households and men, with the gap between male and female earnings rising for the first time since 2003. Census officials say that may have been because of an increase in the labor force participation of Hispanic women, who tend to earn less.Poverty Rebounded Sharply in 2022 and 2023As pandemic aid expired and prices rose, the share of Americans living below the poverty threshold went back up.

    Data is the “supplemental” poverty rate, which accounts for taxes and subsidies. Gaps in data are due to changes in Census Bureau methodology.Source: Columbia Center on Poverty and Social Policy analysis of U.S. Census Bureau dataBy The New York TimesWe are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Low-Income Families Brace for End of Extra Food Stamp Benefits

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    When a pandemic-era boost ends on Wednesday, more than 30 million people will lose a significant amount of assistance.WASHINGTON — Tens of millions of low-income families are set to lose additional food stamp benefits on Wednesday after the expiration of a pandemic-era policy that had increased the amount they received, leaving food banks bracing for a surge in demand and some advocates predicting a rise in hunger nationwide.For nearly three years of the pandemic, emergency legislation enacted by Congress sought to cushion the economic blow of the coronavirus, allowing all participants in the Supplemental Nutrition Assistance Program to receive the maximum monthly benefit, regardless of income. The extra cash, along with other economic assistance programs, helped keep food insecurity at bay and cut poverty rates to a record low.But that temporary increase lapses for more than 30 million people across 35 states and territories on Wednesday, effectively cutting benefits for the vast majority of recipients as inflation remains persistently high and many other coronavirus-era programs end.“This is a cost shift from the federal government,” said Ellen Vollinger, the SNAP director at the nonprofit Food Research & Action Center. “It just shifts the burden of hunger onto states and counties, to the charitable sector, but of course, most harshly, it shifts the burden to that household to try to make do with even less.”Under the pandemic-era policy, each recipient got a monthly average of $251. That is expected to decline by about a third, or $82, in March, according to the Agriculture Department, which administers the food stamp program.Those who qualify for the minimum benefit under the standard income guidelines — many of whom are older Americans relying on Social Security — will see the steepest decrease, from $281 in monthly benefits to only $23, according to Ms. Vollinger.Even though the extra benefits will lapse, food stamp benefits will remain more generous than three years earlier, because the Biden administration permanently increased benefits by 25 percent over prepandemic levels. Inflation F.A.Q.Card 1 of 5What is inflation? More

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    Families Struggle as Pandemic Program Offering Free School Meals Ends

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    A federal benefit guaranteeing free school meals to millions more students has expired as food prices have risen. Many families are feeling the pinch.Like other parents, April Vazquez, a school nutrition specialist in Sioux Falls, S.D., is cutting coupons, buying in bulk and forgoing outings and restaurant meals. Still, a hot lunch in the school cafeteria for her three children is now a treat she has to carefully plan in her budget.The expiration of waivers that guaranteed free school meals for nearly 30 million students across the United States during the pandemic has meant that families like Ms. Vazquez’s who earn just over the income threshold no longer qualify for a federal program allowing children to eat at no cost.As pandemic-era assistance programs lapse and inflation reaches record highs, Ms. Vazquez is hardly alone. The number of students receiving free lunches decreased by about a third, to around 18.6 million in October, the latest month with available data. In comparison, about 20.3 million students ate free in October 2019, before the pandemic. That drop can be attributed to several factors, like being on the cusp of eligibility, lack of awareness that the program had ended by the start of the school year and fewer schools participating in the program overall.“It’s just making things a hell of a lot harder at the most difficult moment that I think American families have seen in a generation,” said Keri Rodrigues, co-founder and president of the National Parents Union network.For Ms. Vazquez, returning to a reality where she must pay full price for a school meal — about $3 or $4 for each child — is trying, and most days, her children bring a packed lunch. (Bagels, cream cheese and apples are typical; grapes and strawberries are rare because they are too expensive.)“It’s painful to know that my kids aren’t going to get free or reduced,” she said.The number of students receiving free lunches decreased by about a third, to about 18.6 million last October.Amber Ford for The New York TimesBefore the pandemic, Ms. Vazquez worked part-time as a special education assistant and her children teetered between qualifying for free or reduced-price meals year to year. But when she took a full-time job as a nutritionist in August 2021, her salary was just enough to bump her family above the income threshold for either benefit: about $42,000 annually for free meals for a family of five and $60,000 for reduced-price meals.“That was actually a worry when I applied for this position, because you don’t know what’s going to happen, am I going to get disqualified for this?” she said, adding that she ultimately took the job with a view toward long-term financial stability.Even as some parents have seen their wages increase and the criteria for free and reduced-price meals expand, those boons have done little to blunt the impact of rising food costs.From the 2019-20 school year to this school year, the income eligibility for free and reduced-price meals has increased by about 7.8 percent. Average hourly wage growth in that same period grew by 15.1 percent. Consumer prices, though, have risen by 15.4 percent, and food prices by 20.2 percent, surpassing wage growth.More on U.S. Schools and EducationChatGPT: OpenAI’s new chatbot is raising fears of students cheating on their homework. But its potential as an educational tool outweighs its risks, our columnist writes.Boosting Security: New federal data offers insight into the growing ways that schools have amped up security over the past five years, as gun incidents on school grounds have become more frequent.Teaching Climate Change: Many middle school science standards don’t explicitly mention climate change. But some educators are finding ways to integrate it into lessons. In Florida: The state will not allow a new Advanced Placement course on African American studies to be offered in its high schools, stating that the course is not “historically accurate.”In the Sioux Falls School District — where Ms. Vazquez works and where her children attend school — about 41 percent of children qualified for free or reduced-price lunch this school year, compared with about 49 percent before the pandemic, said its nutrition director, Gay Anderson. Some parents have remarked that they would be “better off missing half a week’s work to get that free meal,” she said.“The income eligibility guidelines are just not keeping pace with inflation, and families are barely making ends meet. So what we’re seeing is a lot of people are saying, ‘I can’t believe I don’t qualify as I always did.’ If they are making a dollar more, or whatever, that will do it,” Ms. Anderson said.At Wellington Exempted Village Schools in northeastern Ohio, Andrea Helton, the nutrition director, described denying the program to nearly 50 families in a school district of about 1,000 students. She recalled a single mother who lamented, “I missed the cutoff for reduced meals by $100 of gross income.”But Ms. Helton said, “There’s nothing I can do, and it’s heartbreaking.”Andrea Helton is the nutrition director at Wellington Exempted Village Schools in northeastern Ohio. Amber Ford for The New York TimesFamilies are also struggling to navigate a maze of new rules or, unaware that the program had ended, contending with having to pay for meals that had once been free.Megan, a mother of three school-aged children in Ms. Helton’s district who asked to be identified only by her first name because of privacy concerns, said that she had grown accustomed to the program. So when the school pressed her for money owed for unpaid lunches, “it was a shocker.”By the end of the fall semester, she had racked up $136 in debt.When Megan learned that holiday donations to the school district had wiped out that sum, “I just melted into a puddle because when you’re down to that last $100, the last thing you want to have to worry about is whether your kids are eating or not,” she said through tears.It is difficult to estimate how many students are now going hungry. But school officials and nutrition advocates point to proxy measurements — debt owed by families who cannot afford a school meal, for example, or the number of applications for free and reduced-price meals — as evidence of unmet need.In a survey released this month by the School Nutrition Association, 96.3 percent of school districts reported that meal debt had increased. Median debt rose to $5,164 per district through November, already higher than the $3,400 median reported for the entire school year in the group’s 2019 survey.The end of universal school meals has led fewer schools to participate in the program overall: 88 percent of public schools are operating a meal program this school year.Alyssa Schukar for The New York TimesAt school, Ms. Vazquez described witnessing children sitting in the cafeteria with packed lunches consisting of only a bag of chips or an apple. Others have inched toward the cash register with a lunch tray, a look of fear and recognition flashing across the “kid’s eyes when they see the computer, like, ‘Yeah, I know I’m negative, but I want to eat,’” she said.“You see other kids struggle and knowing, hey, I’m in the same boat,” she added. “I know exactly what you’re going through.”The end of universal school meals has led fewer schools to participate in the program overall: About 88 percent of public schools are operating a meal program this school year, compared with 94 percent in the previous school year, and 27.4 million children were eating a school lunch in October, compared with about 30 million in May, the last month of the school year with the program in place. That can create a vicious cycle in which lower participation translates to higher costs per meal, forcing schools to raise the price of a meal and squeezing out even more families, said Crystal FitzSimons of the Food Research and Action Center, which routinely talks to schools about their nutrition programs. Schools and families alike face other administrative and financial complications as school officials grapple with soaring wholesale costs and labor shortages, highlighting other challenges in increasing participation. Now officials must process paperwork to verify income eligibility, devote time and personnel for debt collection and plan ahead for expected revenue and reimbursement rates.At Prince William County Schools in Virginia, Adam T. Russo, the nutrition director, said his office has had to dedicate more resources for outreach and education to inform parents of the policy change. Already, he relies on a multilingual staff to serve the 90,000 students in his district, one of the most diverse in the state.Adam T. Russo relies on a multilingual staff to serve the 90,000 students in his district.Alyssa Schukar for The New York TimesFor many parents, he said, the process was new and potentially confusing given that universal free meals had been in place since some of their children had started school.“If your kid was in kindergarten, first grade, second grade, this is a completely foreign process to your family,” he said. “It’s been table stakes, and we’ve pulled the tablecloth out from under our families.”The application process, as well as the stigma associated with receiving a free or reduced-price lunch, can be prohibitive, advocates say. In 2019, even as some 29.6 million students were eligible for free or reduced-price meals, only 22 million received one, according to research. And about 20 percent of eligible households whose children did not receive either benefit reported food insecurity.“The effort it takes to make sure these resources actually hit those kids, for what that costs, it’s a hell of a lot easier to just say, listen, food is free,” Ms. Rodrigues said.The universal free school meal program pushed the federal cost of school nutrition programs from $18.7 billion in the 2019 fiscal year to $28.7 billion in the 2022 fiscal year, according to data from the Agriculture Department, which administers the program. The department does not have an official estimate of the cost of permanently enacting the policy, a spokeswoman said.Such an initiative has drawn widespread support, with polls showing 74 percent of voters and 90 percent of parents favoring the idea, but federal enactment seems unlikely. Republican lawmakers in Congress oppose permanently extending the policy, arguing that free meals should serve only the neediest and that pandemic-era policies must eventually end.Still, some states — and some parents — have been spurred to take action. For Amber Stewart, a mother of five in Duluth, Minn., the program was lifesaving.Before the pandemic, when the family owed money for meals, her daughter would receive a cold cheese sandwich and a carton of milk, signaling to classmates she could not afford the hot meal. Stern letters demanded repayment and warned of consequences.“Then the pandemic rolled around and everybody was eligible for the free meals, and they delivered it or you could go pick it up,” said Ms. Stewart, who asked to be identified by her maiden name. “It was amazing.”Intent on seeing the program enacted permanently, Ms. Stewart is now lobbying the Minnesota legislature to adopt universal free schools meals statewide, a policy that the governor recently endorsed. Under the new income guidelines, Ms. Stewart’s children now qualify for reduced-price meals. And because of a state law that covers the fees normally owed by families in that category, they are not charged the 35 or 50 cents for breakfast or lunch.That has been crucial, she said, because even after weekly trips to the food bank, she does not have nearly enough to get by.“Our money is really tight,” she said. “With the cost of groceries and everything, we’re barely making it.” More

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    Russia’s War on Ukraine Worsens Global Starvation

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    Moscow blocks most shipments from Ukraine, one of the world’s largest wheat producers, and its attacks on the country’s energy grid also disrupt the flow of food.ISTANBUL — Hulking ships carrying Ukrainian wheat and other grains are backed up along the Bosporus here in Istanbul as they await inspections before moving on to ports around the world.The number of ships sailing through this narrow strait, which connects Black Sea ports to wider waters, plummeted when Russia invaded Ukraine 10 months ago and imposed a naval blockade. Under diplomatic pressure, Moscow has begun allowing some vessels to pass, but it continues to restrict most shipments from Ukraine, which together with Russia once exported a quarter of the world’s wheat.And at the few Ukrainian ports that are operational, Russia’s missile and drone attacks on Ukraine’s energy grid periodically cripple the grain terminals where wheat and corn are loaded onto ships.An enduring global food crisis has become one of the farthest-reaching consequences of Russia’s war, contributing to widespread starvation, poverty and premature deaths.The United States and allies are struggling to reduce the damage. American officials are organizing efforts to help Ukrainian farmers get food out of their country through rail and road networks that connect to Eastern Europe and on barges traveling up the Danube River.But as deep winter sets in and Russia presses assaults on Ukraine’s infrastructure, the crisis is worsening. Food shortages are already being exacerbated by a drought in the Horn of Africa and unusually harsh weather in other parts of the world.The United Nations World Food Program estimates that more than 345 million people are suffering from or at risk of acute food insecurity, more than double the number from 2019.“We’re dealing now with a massive food insecurity crisis,” Antony J. Blinken, the U.S. secretary of state, said last month at a summit with African leaders in Washington. “It’s the product of a lot of things, as we all know,” he said, “including Russia’s aggression against Ukraine.”The food shortages and high prices are causing intense pain across Africa, Asia and the Americas. U.S. officials are especially worried about Afghanistan and Yemen, which have been ravaged by war. Egypt, Lebanon and other big food-importing nations are finding it difficult to pay their debts and other expenses because costs have surged. Even in wealthy countries like the United States and Britain, soaring inflation driven in part by the war’s disruptions has left poorer people without enough to eat.A line for food aid in Kabul. An enduring global food crisis has become one of the farthest-reaching consequences of Russia’s war.Agence France-Presse — Getty Images“By attacking Ukraine, the breadbasket of the world, Putin is attacking the world’s poor, spiking global hunger when people are already on the brink of famine,” said Samantha Power, the administrator of the United States Agency for International Development, or USAID.The State of the WarAerial Attacks: A deadly New Year’s Eve assault is the latest strike in Russia’s three-month campaign on Ukraine’s energy infrastructure, which analysts say is an effort to demoralize the Ukrainian population by plunging it into cold and darkness.A New Alliance: The United States is scrambling to stop Iran from producing drones, as officials believe the Middle Eastern nation is building a partnership with Russia.Hopes Dim for Peace Talks: Both Ukrainian and Russian officials say they are willing to discuss making peace, but their terms for sitting down at a negotiating table suggest otherwise.Clergymen or Spies?: To Ukraine’s security services, the Russian Orthodox Church poses a uniquely subversive threat — a trusted institution that is not only an incubator of pro-Russia sentiment but is also infiltrated by priests, monks and nuns who have aided Russia in the war.Ukrainians are likening the events to the Holodomor, when Joseph Stalin engineered a famine in Soviet-ruled Ukraine 90 years ago that killed millions.Mr. Blinken announced on Dec. 20 that the U.S. government would begin granting blanket exceptions to its economic sanctions programs worldwide to ensure that food aid and other assistance kept flowing. The action is intended to ensure that companies and organizations do not withhold assistance for fear of running afoul of U.S. sanctions.State Department officials said it was the most significant change to U.S. sanctions policy in years. The United Nations Security Council adopted a similar resolution on sanctions last month.But Russia’s intentional disruption of global food supplies poses an entirely different problem.Moscow has restricted its own exports, increasing costs elsewhere. Most important, it has stopped sales of fertilizer, needed by the world’s farmers. Before the war, Russia was the biggest exporter of fertilizer.Its hostilities in Ukraine have also had a major impact. From March to November, Ukraine exported an average of 3.5 million metric tons of grains and oilseeds per month, a steep drop from the five million to seven million metric tons per month it exported before the war began in February, according to data from the country’s Ministry of Agrarian Policy and Food.That number would be even lower if not for an agreement forged in July by the United Nations, Turkey, Russia and Ukraine, called the Black Sea Grain Initiative, in which Russia agreed to allow exports from three Ukrainian seaports.Russia continues to block seven of the 13 ports used by Ukraine. (Ukraine has 18 ports, but five are in Crimea, which Russia seized in 2014.) Besides the three on the Black Sea, three on the Danube are operational.The initial deal was only for four months but was extended in November for another four months. When Russia threatened to leave it in October, global food prices surged five to six percent, said Isobel Coleman, a deputy administrator at USAID.“The effects of this war are hugely, hugely disruptive,” she said. “Putin is pushing millions of people into poverty.”While increases in the price of food this past year have been particularly sharp in the Middle East, North Africa and South America, no region has been immune.“You’re looking at price increases of everything from 60 percent in the U.S. to 1900 percent in Sudan,” said Sara Menker, the chief executive of Gro Intelligence, a platform for climate and agriculture data that tracks food prices.Before the war, food prices had already climbed to their highest levels in over a decade because of pandemic disruptions in the supply chain and pervasive drought.The United States, Brazil and Argentina, key grain producers for the world, have experienced three consecutive years of drought. The level of the Mississippi River fell so much that the barges that carry American grain to ports were temporarily grounded.The weakening of many foreign currencies against the U.S. dollar has also forced some countries to buy less food on the international market than in years past.Russia attacked the port of Kherson, on Ukraine’s Black Sea coast, in November. Before the war, farmers shipped out 95 percent of the country’s wheat and grain exports through the Black Sea.Finbarr O’Reilly for The New York Times“There were a lot of structural issues, and then the war just made it that much worse,” Ms. Menker said.U.S. officials say the Russian military has deliberately targeted grain storage facilities in Ukraine, a potential war crime, and has destroyed wheat processing plants.Many farmers in Ukraine have gone to war or fled their land, and the infrastructure that processed and carried wheat and sunflower oil to foreign markets has broken down.At a farm 190 miles south of Kyiv, 40 of the 350 employees have enlisted in the army. And the farm is struggling with other shortages. Kees Huizinga, the Dutch co-owner, said Russia’s attacks on the energy grid have led to the shutdown of a plant that provides his farm and others with nitrogen fertilizer.Other fertilizer plants in Europe were forced to shut down or slow production last year as natural gas prices soared, a result of the war. Natural gas is critical for fertilizer production.“So this year’s harvest has already been reduced,” Mr. Huizinga said in November. “And if Russians continue like this, next year’s harvest might even be worse.”He added that transportation costs have risen sharply for farmers in Ukraine.Before the war, farmers shipped out 95 percent of the country’s wheat and grain exports through the Black Sea. Mr. Huizinga’s farm paid $23 to $24 per ton to transport its products to ports and onto ships. Now, the cost has more than doubled, he said. And an alternative route — by truck to Romania — costs $85 per ton.Mr. Huizinga said Russia’s compromise on Black Sea shipments has helped, but he suspects Moscow is hobbling operations by slowing inspections. Under the arrangement, each vessel leaving one of three Ukrainian ports on the Black Sea has to be inspected by joint teams of Ukrainian, Russian, Turkish and United Nations employees once the ship reaches Istanbul.The teams look for any unauthorized cargo or crew members, and vessels heading to Ukraine need to be empty of cargo, said Ismini Palla, a spokeswoman for the U.N. office overseeing the program.U.N. data shows that the rate of inspections has dropped in recent weeks. The parties agreed to deploy three teams each day, Ms. Palla said, adding that the United Nations has requested more.“We hope that this will change soon, so that the Ukrainian ports can operate again at higher capacity,” she said. “Ukrainian exports remain a vital element in combating global food insecurity.”Ms. Palla said the parties’ decision in November to extend the agreement contributed to a 2.8 percent drop in global wheat prices.Over the last six months, food prices have retreated from highs reached this spring, according to an index compiled by the United Nations. But they remain much higher than in previous years.An uncertainty for farmers this winter is the soaring price of fertilizer, one of their biggest costs.Farmers have passed on the higher cost by increasing the price of food products. And many farmers are using less fertilizer in their fields. That will result in lower crop yields in the coming seasons, pushing food prices higher.Subsistence farms, which produce nearly a third of the world’s food, are being hit even harder, Ms. Coleman said.Food rations were distributed in Sana, Yemen. The war in that country has left its people vulnerable to food insecurity.Yahya Arhab/EPA, via ShutterstockIn a communiqué issued at the close of their meeting in Bali, Indonesia, in November, leaders of the Group of 20 nations said they were deeply concerned by the challenges to global food security and pledged to support the international efforts to keep food supply chains functioning.“We need to strengthen trade cooperation, not weaken it,” Ngozi Okonjo-Iweala, the director general of the World Trade Organization, said at the summit.The U.S. government spends about $2 billion per year on global food security, and it started a program called Feed the Future after the last big food crisis, in 2010, that now encompasses 20 countries.Since the start of the Ukraine war, the United States has provided more than $11 billion to address the food crisis. That includes a $100 million program called AGRI-Ukraine, which has helped about 13,000 farmers in Ukraine — 27 percent of the total — gain access to financing, technology, transportation, seeds, fertilizer, bags and mobile storage units, Ms. Coleman said.The efforts could help rebuild the country while alleviating the global food crisis — one-fifth of Ukraine’s economy is in the agriculture sector, and a fifth of the country’s labor force is connected to it.“It’s hugely important for Ukraine’s economy,” she said, “and for Ukraine’s economic survival.”Edward Wong More

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    Pandemic Aid Cut U.S. Poverty to New Low in 2021, Census Bureau Reports

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    A measure that accounts for all federal subsidies also showed a reduction of almost half in the number of children below the poverty level.A second year of emergency pandemic aid from the federal government drove poverty to the lowest level on record in 2021 and cut the number of poor children by nearly half, the Census Bureau reported on Tuesday.The poverty rate fell to 7.8 percent, down from 9.2 percent the previous year, according to the Supplemental Poverty Measure, a yardstick that includes wages, taxes and the fullest account of government aid. In addition, the share of children in poverty sank to another record low of 5.2 percent, down 4.5 percentage points from 2020, a sharp acceleration of a long-term trend. In large part, those changes reflect the trillions of stimulus dollars approved by Congress, culminating in the Democrats’ American Rescue Plan of March 2021, especially the expanded child tax credit, which temporarily provided an income guarantee to families with children.Real median household income reached $70,800, not significantly different from 2020, as increases in full-time employment were offset by rising inflation and decreases in unemployment insurance, which had been supplemented above normal levels through the summer of 2021. The “official” poverty rate, generally considered outdated because it omits hundreds of billions spent on programs like tax credits and housing assistance, also did not change significantly from the previous year.How Poverty Has DecreasedThe official poverty rate was 11.6 percent last year, but the supplemental rate — which accounts for the impact of government programs — fell to 7.8 percent.

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    Share of the population living in poverty
    The supplemental rate adjusts for geographic differences. It also includes wage income, taxes and the fullest account of government aid.Sources: Census Bureau; Columbia UniversityKarl RussellThis data covers a year that was profoundly influenced by a set of emergency programs that have largely expired. Since then, many families have again found themselves under financial strain.Progressives see the reduction in poverty — even if temporary — as evidence that the federal government has the power to give people a better standard of living and that it should continue to do so in the future.“Man, I’m just grinning ear to ear,” said Luke Shaefer, who runs a center on poverty at the University of Michigan and sees the expanded child tax credit as a blueprint for a permanent program. “Americans wonder if the government can shape successful policies that address poverty. This offers incontrovertible evidence that it can.”Inflation F.A.Q.Card 1 of 5What is inflation? More

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    Economic Aid, Once Plentiful, Falls Off at a Painful Moment

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    Food insecurity is rising again as relief provided by President Biden’s $1.9 trillion stimulus package wanes.PORTLAND, Ore. — For the better part of last year, the pandemic eased its grip on Oregon’s economy. Awash in federal assistance, including direct checks to individuals and parents, many of the state’s most vulnerable found it easier to afford food, housing and other daily staples.Most of that aid, which was designed to be a temporary bridge, has run out at a particularly bad moment. Oregon, like states across the nation, has seen its economy improve, but prices for everything from eggs to gas to rent have spiked. Demand is growing at food banks like William Temple House in Northwest Portland, where the line for necessities like bread, vegetables and toilet paper stretched two dozen people deep on a recent day.“I’m very worried, like I was in the first month of the pandemic, that we will run out of food,” said Susannah Morgan, who runs the Oregon Food Bank, which helps supply William Temple House and 1,400 other meal assistance sites.In March 2021, President Biden signed into law a $1.9 trillion aid package aimed at helping people stay afloat when the economy was still reeling from the coronavirus. In addition to direct checks, the package included rental assistance and other measures meant to prevent evictions. It ensured free school lunches and offered expanded food assistance through several programs.Those programs helped the U.S. economy recover far more quickly than many economists had expected, but they have run their course as prices soar at the fastest pace in 40 years. The Federal Reserve, in an attempt to tame inflation, is rapidly raising borrowing costs, slowing the economy’s growth and stoking fears of a recession. While the labor market remains remarkably strong, the Fed’s interest rate increases risk slamming the brakes on the economy and pushing millions of people out of work, which would hurt lower-wage workers and risk adding to evictions and food insecurity.Several factors have driven prices higher in the last year, including a shift in spending toward goods like couches and cars and away from services. Supply chain snarls, a buying frenzy in the housing market and an oil price spike surrounding the Russian invasion of Ukraine have also contributed. While gas prices have fallen in recent months, rent continues to rise, and food and other staples remain elevated.Another factor fueling inflation, at least in small part, is the stimulus spending that helped speed the economy’s recovery and keep people out of poverty. More money in people’s bank accounts translated into more consumer spending.While the extent to which the rescue package fed inflation remains a matter of disagreement, almost no one, in Washington or on the front lines of helping vulnerable people across the country, expects another round of federal aid even if the economy tips into a recession. Lawmakers have grown increasingly concerned that more stimulus could exacerbate rising prices.In the meantime, the progress that the Biden administration hailed in fighting poverty last year has faded. The national child poverty rate and the food hardship rate for families with children, which dipped in 2021, have both rebounded to their highest levels since December 2020, according to researchers at Columbia University’s Center on Poverty and Social Policy. Two in five Americans surveyed by the Census Bureau at the end of July said they had difficulty paying a usual household expense in the previous week, the highest rate in two years of the survey.What is happening at the William Temple House is emblematic of the economic situation. Demand for food is swelling again, and officials here blame rising prices and lost federal aid. The people seeking help come from a wide variety of backgrounds: parents, retirees struggling to stretch Social Security benefits, immigrants who speak Mandarin, college graduates with jobs.Inflation F.A.Q.Card 1 of 5Inflation F.A.Q.What is inflation? More

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    Governments Tighten Grip on Global Food Stocks, Sending Prices Higher

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    Dozens of countries have thrown up trade barriers in the past two months to protect scarce supplies of food and commodities, but experts say the policies will only exacerbate a global food crisis.WASHINGTON — Ukraine has limited exports of sunflower oil, wheat, oats and cattle in an attempt to protect its war-torn economy. Russia has banned sales of fertilizer, sugar and grains to other nations.Indonesia, which produces more than half the world’s palm oil, has halted outgoing shipments. Turkey has stopped exports of butter, beef, lamb, goats, maize and vegetable oils.Russia’s invasion of Ukraine has unleashed a new wave of protectionism as governments, desperate to secure food and other commodities for their citizens amid shortages and rising prices, erect new barriers to stop exports at their borders.The measures are often well intended. But like the panic-buying that stripped grocery store shelves at various moments of the pandemic, the current wave of protectionism will only compound the problems that governments are trying to mitigate, trade experts warn.Export restrictions are making grains, oils, meat and fertilizer — already at record prices — more expensive and even harder to come by. That is placing an even greater burden on the world’s poor, who are paying an ever-larger share of their income for food, increasing the risk of social unrest in poorer countries struggling with food insecurity.Since the beginning of the year, countries have imposed a total of 47 export curbs on food and fertilizers — with 43 of those put in place since the invasion of Ukraine in late February, according to tracking by Simon Evenett, a professor of international trade and economic development at the University of St. Gallen.“Before the invasion, there’s a very small number of attempts to try and restrict exports of food and fertilizers,” Mr. Evenett said. “After the invasion you see a huge uptick.”The cascade of new trade barriers comes as the war in Ukraine, and the sanctions imposed by the West on Russia, are further straining supply chains that were already in disarray from the pandemic. Russia is the world’s largest exporter of wheat, pig iron, nickel and natural gas, and a major supplier of coal, crude oil and fertilizer. Ukraine is the world’s largest exporter of sunflower seed oil and a significant exporter of wheat, pig iron, maize and barley.With countries facing severe threats to supplies of basic goods, many policymakers have quickly dropped the language of open markets and begun advocating a more protective approach. Recommendations range from creating secure supply chains for certain critical materials in friendly countries to blocking exports and “reshoring” foreign factories, bringing operations back to their home countries.In a speech last week, Janet L. Yellen, the Treasury secretary, said the pandemic and the war had revealed that American supply chains, while efficient, were neither secure nor resilient. While cautioning against “a fully protectionist direction,” she said the United States should work to reorient its trade relationships toward a large group of “trusted partners,” even if it meant somewhat higher costs for businesses and consumers.Ngozi Okonjo-Iweala, the director general of the World Trade Organization, said in a speech on Wednesday that the war had “justifiably” added to questions about economic interdependence. But she urged countries not to draw the wrong conclusions about the global trading system, saying it had helped drive global growth and provided countries with important goods even during the pandemic.“While it is true that global supply chains can be prone to disruptions, trade is also a source of resilience,” she said.The W.T.O. has argued against export bans since the early days of the pandemic, when countries including the United States began throwing up restrictions on exporting masks and medical goods and removed them only gradually.Now, the Russian invasion of Ukraine has triggered a similar wave of bans focused on food. “It’s like déjà vu all over again,” Mr. Evenett said.Protectionist measures have cascaded from country to country in a manner that is particularly evident when it comes to wheat. Russia and Ukraine export more than a quarter of the world’s wheat, feeding billions of people in the form of bread, pasta and packaged foods.Mr. Evenett said the current wave of trade barriers on wheat had begun as the war’s protagonists, Russia and Belarus, clamped down on exports. The countries that lie along a major trading route for Ukrainian wheat, including Moldova, Serbia and Hungary, then began restricting their wheat exports. Finally, major importers with food security concerns, like Lebanon, Algeria and Egypt, put their own bans into effect.Mr. Evenett said the dynamic was “still unfolding” and likely to get worse in the months to come. Ukraine’s summer growing season for wheat is being disrupted as fighting keeps farmers away from their fields and pulls workers off to war. And grocery stores in Spain, Greece and Britain are already introducing restrictions on the amount of cereals or oil people can buy.“We’re already feeling the pinch in Europe of limited supplies of these key crops,” he said.Several other consequential export bans on food are unrelated to the war, but they will still play into the global dynamic of rising prices.A palm oil processing plant in Indonesia’s Riau Province. The country has halted outgoing shipments of palm oil, a key ingredient in packaged food.Kemal Jufri for The New York TimesChina began ordering its firms to stop selling fertilizer to other countries last summer, in order to preserve supplies at home, Chad Bown, a senior fellow at the Peterson Institute for International Economics, and Yilin Wang, a research analyst at the institute, wrote in a recent blog post. Now that Russia has also cut off exports of fertilizer, China’s ban will be even more harmful.“China’s decision to take fertilizer supplies off world markets to ensure its own food security only pushes the problem onto others,” they wrote, adding that “China’s ongoing export restrictions could hardly come at a worse time.”Indonesia’s restrictions on palm oil, a key ingredient in packaged foods, detergent and cosmetics, are in line with similar bans the country placed on exporting the product before the war in an attempt to keep the price of oil affordable for Indonesian households.Those measures will add to skyrocketing prices for vegetable oils, driven by a disruption in the supply from Ukraine, the world’s largest producer of sunflower oil.Governments that put these restrictions in place often argue that their duty is to put the needs of their own citizens first, and the W.T.O.’s rules allow countries to impose temporary measures for national security or safety. But the measures can easily backfire, helping to push up global prices further.Price increases for food have been felt particularly keenly in poorer countries in the Middle East and sub-Saharan Africa, which depend on imported food.The Russia-Ukraine War and the Global EconomyCard 1 of 6Rising concerns. More