California
currently has more than 600,000 millionaires and 85 billionaires in the Forbes 400
list, far more than
any other state in the nation. At the same time, California is now the poorest
state in the nation, with the highest percentage of residents living at or
below the poverty level. According to the Census Bureau, 23.5% (8.7 million Californians) are
living in poverty. Florida
is number 2 at 19.5%.
These
numbers reflect a revision in how the Census Bureau measures poverty. In the
past, it looked solely at income versus food costs. Under this system, the
poverty rate would be only 16%. Under the new system, it now considers income
plus assistance programs (e.g., food stamps, welfare) versus tax rate,
childcare, housing and medical costs, in addition to food expenses, providing a
much more realistic (though still incomplete) picture of families’ financial
challenges.
Nearly 50%
of California’s children live in or “perilously close” to poverty according to
the newer metric, probably the single biggest reason for the state’s low test
scores. True poverty rates are further obscured by the arbitrary and absurdly
low federal threshold of $23,021 for a family of four. Considering that average
monthly rents are $1552 in Los Angeles, $1431 in San Diego, $1938 in San Jose and $2106 in San Francisco, families must spend between $17,172
and $25,272 per year just to place a roof over their heads.
It is not
just that better methods are providing a more accurate measure of poverty. The
recession has also contributed to a dramatic increase in poverty. Between 2008
and 2011, for example, poverty rose 12% in Los Angeles County to 24.3%, and
rose even more in some of the state’s rural counties. Conditions have grown so
bad that California has seen negative migration patterns for the
past eight years, according to the WSWS. A combination of low unemployment rates in Mexico (roughly
half of California’s in recent years) and increased militarization of the
border and deportations (a record 400,000 in 2012) has significantly reduced
migration from Mexico. This has led to labor shortages in the state’s
agriculture sector, with some farmers opting to let unpicked produce rot rather
than increasing wages to attract domestic employees, since the former increases
sales prices and profits, while the latter only cuts into profits.
While the
state’s economy “recovers,” job growth has been primarily in low-wage service
jobs. Thus many formerly unemployed are now earning far less than they did
prior to the recession, contributing to the ranks of the working poor. Cuts to
social programs has placed further downward pressure on living standards and
contributed to the growing number of poor Californians under the new
measurement system.