Poverty in the Southern United States: the Facts and What Could Be Next

​Poverty is a pressing issue in the United States that requires immediate attention. As an incredibly wealthy country with vast governmental resources, we must have minimal poverty rates. Unfortunately, poverty continues to claim its place as an international eyesore, a condemnation of hyper capitalism, and, worst of all, a public health problem. This study presents the status and implications for the future, urging us to act.

Perhaps the Saddest Matter is Children in Poverty

The Southern United States is characterized by poor governance and repressive policies, including explicitly racist policies intended to suppress the power of minorities. Economic growth and progressive governance are strongly correlated. Repressive governance keeps the American South poor and backward and is self-destructive at its core. 
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Thus, the correlation between economic growth and progressive governance cannot be denied.  A recent study of seven states in the south-central part of the United States, including Alabama, Arkansas, Kentucky, Louisiana, Mississippi, Tennessee, and West Virginia, confirmed that they lagged the United States.  From 1997 to 2019, these states had a GDP growth of 1.3% annually, compared to the United States' rate of 2.3%, so they fall farther behind the rest of the United States annually.  After the end of Apartheid in South Africa, GDP growth rose to nearly 3% from 1.25% from 1980 to 1994.  

Percent of the United States Living in Poverty from 1990 to 2023

However, there is hope. Federal legislative action has the power to override this repressive governance, paving the way for improved outcomes for all Americans. There is precedence for addressing pockets of poverty, most notably the Tennessee Valley Authority (TVA) created in 1933. The TVA's purpose, authorized by the TVA Act, was to make cheap energy and provide it for environmental management and economic development. Civil works included power production, flood control, and reforestation. This is a testament to the transformative power of legislative action.

The penal system in the United States is a clear example of the pervasive resistance to social engineering. The prevailing ideology that individuals are solely responsible for their destiny and its consequences, regardless of what they are, is deeply ingrained. While this ideology is an American ideal, it is time to question its validity. Generational poverty is a national burden, and its significant economic and societal challenges hinder economic vitality and overall welfare. It is high time for a new ideology to inspire hope for a better future.
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Poverty rates fell through the 1960s but rose and fell with economic cycles since then. They did not fall measurably during the two expansions before the pandemic until between four and six years after the expansion. The current economic recovery has not broken this pattern: the most recent recession occurred from February to April 2020, and the current expansion began in May 2020. The official poverty rate did not show a year-to-year decline during the first two years. 

Counties in Persistent Poverty 1989 to 2019 Demonstrate Concentration in the American South

Between 2019 and 2020, the number of people living in poverty and the poverty rate increased in both the South and West. Among the regions, the South had the highest poverty rate, which increased to 13.3 percent, with 16.6 million individuals living in poverty. In the West, the poverty rate has increased to 10.6 percent, with 8.3 million people in poverty in 2020. In the Midwest and Northeast, neither the poverty rates nor the number of people living in poverty in 2020 were statistically different from 2019. In the Midwest, 10.1 percent and 6.8 million people were in poverty in 2020, while in the Northeast, the poverty rate was 10.1 percent, with 5.6 million individuals in poverty.

The official overall poverty rate for the United States experienced no statistically detectable shift between 2021 and 2022; the official poverty rates among most demographic groups remained steady. Notable exceptions were the decline in the official poverty rate among Black people to a historically low 17.1% or 8.6 million people and a rise among non-Hispanic Whites to 8.6% or 15.8 million people. The rising rates among whites partially explain the attraction of politicians, such as Donald Trump, as the future of this cohort continues to decline in various measures of prosperity and public health.
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People living in poverty tend to have higher disease burdens. Poverty at the county level is associated with death from many chronic conditions, such as heart disease, liver afflictions, and kidney problems. Other studies have also shown a correlation between low income and dental problems. During the COVID-19 pandemic, poverty became a predictor of infection risk, adverse health outcomes, and mortality.

Women Now Earning 83% of Men, a Major Civil Rights Issue

Women have higher poverty rates than men: 12.5% compared to 10.5% in 2022 (no meaningful change from 2021). Historically, families with a female householder and no spouse (female-householder families) have had higher poverty rates than married-couple families and families with a male householder and no spouse (male-householder families). This remained true in 2022: the poverty rate among female householder families was 23.0% (not different from 2021), compared with 11.5% for male householder families and 5.0% for married couples.
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A significant issue here is the historic disparity between pay for women and men. An equal pay law would address this quickly, but business interests would object. Thanks to the Citizens United Supreme Court decision, wealthy interests control the United States legislative branch, making the passage of an equal pay measure problematic.

States Without Medicaid Expansion Show the Majority in the American South

The Affordable Care Act (ACA) included Medicaid expansion nationwide. In June 2012, the Supreme Court ruled that states should not be compelled to increase their Medicaid programs. Each state determines whether to participate.

Before ACA, Medicaid was not available to non-disabled adults under the age of sixty-five, except if they had children under the age of 18 years. In addition, the income caps eligible as parent/caretakers were extremely low. By expanding Medicaid, the ACA created a feasible path to cover millions of low-income Americans.

The federal government finances most of the expenses of expanding Medicaid, and ten percent is paid by participating states. States that refuse to expand Medicaid still get their normal federal Medicaid funding rather than the 90% funding they would gain to cover the recently qualified people if they were to expand.

Just ten states have not expanded Medicaid – mainly in the American South, where Republicans dominate state legislatures. However, a decade after the Affordable Care Act made the option available, Medicaid expansion became more challenging to resist.

Fast facts about Medicaid expansion:

• Uninsurance rates would drop by 25% if the ten states expanded their Medicaid programs.
• Women of reproductive age would see a considerable reduction in uninsurance (a drop of 31%), older women would see a decline of 23.2%, and men would see a reduction of 22.4%.  
• Black women of childbearing age would see a 51.3% reduction in uninsurance.
• Non-Hispanic Black adults would see the most significant reduction in the uninsured rate of all racial or ethnic groups (43.2% reduction).
• Young adults ages 19 to 24 have the highest uninsured rate, with nearly one in five uninsured individuals (19.9%). They would see the most significant decrease in the uninsurance rate (a drop of 32.4%). 
• States that have expanded Medicaid found new spending counterbalanced by long-term savings in healthcare expenditures and new revenue.
• State spending on Medicaid in the remaining ten states would increase by $1.5 billion (a 3% increase).  
• Federal spending on Medicaid in these ten states would rise by approximately $24 billion (a 17.5% increase). 

 
States that have expanded Medicaid see sizable health and economic gains that impact all residents, not just those who would gain coverage.  The denial of Medicaid expansion is an example of self-destructive behavior. This proves that the existing oligarchy in these states prefers to keep people with low incomes and minorities as an underclass, even if it costs them money.  
 
Another remedy for poverty would be subsidized childcare, allowing parents freedom to work, and increasing family income.  The number of job openings in the United States was unchanged at 8.2 million on the last business day of June 2024.  Subsidized childcare would help fill some of those openings, and aside from lifting people from poverty, the additional employment would increase gross domestic product, help create wealth, and help lift the country's economy.
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There is a substantive argument that the American South is a failed experiment in nation-building.  Further, generational planning and implementation will be necessary in the long term to remove these hard-core poverty areas and improve national vitality.  Does the federal government have the moxy to implement such dramatic action?  Provided that the Democrats run the table in November’s election, gaining the presidency, house, and senate, progressive legislation stands a chance, but only that, given the power of dark money due to the Supreme Court’s Citizen United ruling.