1. Poverty (cont.)
Individuals classified as living in poverty have incomes that fall below the poverty threshold.
Simplified poverty thresholds appear as poverty guidelines and are used to determine eligibility for federal programs.
Poverty Guidelines
Section 3

2. Reasons for Income Inequality (cont.)
Reasons for varied income
Education- income gap between skilled & less skilled workers
Wealth – top fifth hold 75% of wealth
Tax law changes – favor wealthy/higher incomes
Decline of unions – unions negotiate to provide workers with benefits and higher wages
Section 3

3. Reasons for Income Inequality (cont.)
More service jobs- once high paying manufacturing jobs are no longer available.
Monopoly power – professional organizations making it more difficult to enter their field
Discrimination – minorities and women still face difficulty to advance in the workplace
Changing family structure – more single parent families and relatives/retirees raising children
Section 3

4. Poverty People are described as living in poverty if they live below an income level called the poverty threshold. Poverty has a number of causes, and governments have established some programs to reduce it.
VS 3

5. Antipoverty Programs (cont.)
Welfare programs designed to help the needy
Income assistance – direct cash assistance to those in need.
Temporary Assistance for Needy Families
Supplemental Security Income
General assistance – assist the poor with direct cash assistance
Food stamps
Medicaid
Section 3

6. Antipoverty Programs (cont.)
Social service programs – job training, day care, family planning, child welfare, etc.
Tax credits
Earned Income Tax Credit (EITC)
Enterprise zones – businesses locate free of restrictions and taxes
Workfare programs – welfare recipients work for their benefits
Negative income tax – cash payments to certain groups below the poverty line
Section 3

7. Antipoverty Programs (cont.)
Economic growth by itself is not sufficient to reduce poverty.
Section 3