US Poverty

WASHINGTON (Reuters) - Four decades after a U.S. president declared war on poverty, more than 37 million people in the world's richest country are officially classified as poor and their number has been on the rise for years.

Last year, according to government statistics, 1.1 million Americans fell below the poverty line. That equals the entire population of a major city like Dallas or Prague.

Since 2000, the ranks of the poor have increased year by year by almost 5.5 million in total. Even optimists see little prospect that the number will shrink soon despite a renewed debate on poverty prompted by searing television images which laid bare a fact of American life rarely exposed to global view.

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But the black-equals-poor scenes from New Orleans do not portray the full picture. There are three times as many poor whites as blacks in the United States and the poverty rate for whites has risen faster than that for blacks and Hispanics.

Academic experts also say the government's figures minimize the true scale of poverty because they are outdated. The formula for the poverty level was set in 1963 on the assumption that one third of the average family's budget was spent on food.

This is no longer true. Housing has become the largest single expense and tens of thousands of the "working poor," the label for those who work at or near the minimum wage, are forced to sleep in cars, trailers, long-term motels or shelters.

U.S. POVERTY WORST IN INDUSTRIALISED WORLD

"Every August, we Americans tell ourselves a lie," said David Brady, a Duke University professor who studies poverty.

"The poverty rate was designed to undercount because the government wanted to show progress in the war on poverty.

"Taking everything into account, the real rate is around 18 percent, or 48 million people. Poverty in the United States is more widespread, by far, than in any other industrialized country."

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The world's 500 richest people, according to U.N. statistics, have as much income as the world's poorest 416 million.

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The minimum wage, which rose by 15 cents to $6.35 an hour on October 1, is not enough to keep you above the poverty line. Yet minimum wage jobs, without health insurance or vacations, are the only jobs available to millions of people with only basic education.

The well-paid unskilled jobs in heavy industry which once lifted working-class Americans into the middle class are largely gone and the decline continues. Since 2001, the United States has lost more than 2.7 million manufacturing jobs. Low-paid clerical work is being outsourced to developing countries.

Another U.S. president, the late Ronald Reagan, had it right when he said, in 1988: "The federal government declared war on poverty, and poverty won."