Go Ask ALICE

Today I added another update to my January 23rd post titled “Balance.”  That post addresses the topic of economic balance and lists out, what I think, are some very interesting statistics.  The stats become illuminating when you start looking at them together as a whole, instead of in isolation.

So, today’s update concerns ALICE.  ALICE is an acronym that stands for “Asset Limited, Income Constrained, Employed.”  Basically, this is the number of American households living above the poverty line, but which still cannot afford all basic services or commodities – ordinary expenses.

Based on 2016 data, there were 34.7 million ALICE households — double the 16.1 million that are in actual poverty.  Total these up and have 51 million households, or about 43% of the US population that cannot afford basic goods and services.

“At a time of rock-bottom joblessness, high corporate profits and a booming stock market, more than 40% of U.S. households cannot pay the basics of a middle-class lifestyle — rent, transportation, child care and a cellphone, according to a new study.”

The study is very extensive and it takes some time to wade through it all, but here are some of the results from the Executive Summary section:

WHY ARE THERE SO MANY ALICE HOUSEHOLDS?

• Low-wage jobs: The majority of jobs in the U.S. are low-wage jobs. More than half of all jobs in every state except for Connecticut paid less than $20 per hour in 2014. The percent of jobs paying less than $20 per hour ranged from 49 percent in Connecticut to 71 percent in Idaho. The majority of these low-wage jobs paid less than $15 per hour (if working full-time, this equals $30,000 per year), not enough to support a family Household Survival Budget in any state.

• Basic cost of living: The ALICE Household Survival Budget is significantly higher than the FPL (Federal Poverty Level). For example, for a family of four (two adults with one infant and one preschooler), the FPL was $23,850 in 2014, while the Household Survival Budget, which takes into account geographic differences in the cost of living, ranged from $46,020 in Louisiana to $70,788 in Connecticut.

• Lack of savings: The majority of households in every state do not have savings to cushion them during a period of unemployment or for an unexpected expense. The percent of households with an asset that could be used for an emergency (such as a savings account or 401k) ranged from 16 percent in Louisiana to 28 percent in Connecticut. In other words, 72 to 84 percent of households did not have a financial cushion.

• Economic challenges: Local job opportunities and affordable housing are critical to the financial stability of ALICE families, yet it remained difficult to find jobs in locations that are near to affordable housing.

People can debate all they want about the various reasons for these disparities, but the fact remains, current social policy in the US is designed to empower and enrich the upper 1% of the country at the expense of the other 99%.

***

Links:

Exclusive: 40% in U.S. can’t afford middle-class basics

Executive Summary

Do You Know Alice?

Alice By State

All links are subject to Link Rot.

Photo: Saguaro cacti in the Sonoran Desert.  This may not seem to fit with a discussion on economics, but while this is a beautiful terrain, it is at the same time bleak and it can kill you.  That seems to parallel the American condition a bit; glitz mixed with bleakness and despair, abundance and sparseness  🙂

4 thoughts on “Go Ask ALICE”

  1. Since 2008 I have lived in an Alice household. To be fair, I am a creative and have always made my living with music or art. I HAVE been able to keep myself employed but don’t ask me about little things like health insurance. Or gas. Or a car for that matter. I don’t feel like these things should be exclusive to the wealthy.

    Liked by 1 person

  2. I recall Ross Perrot warning against NAFTA 30 years ago predicting that free trade would produce a circumstance where the wages in the first world would fall as the wages in the third world would rise until they were equal….thanks to free trade and globalization. It seems he was obviously right as we are witnessing now in mid trend. The only entities this has benefitted are the corporations, so it seems!

    Liked by 1 person

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