Income Inequality: A Growing Threat to Eliminating Rural Child Poverty

Rural child poverty fell by 3 percentage points from 2012 to 2014. Over the past seven years, USDA and the Obama Administration have taken action to address the root causes and reduce the devastating effects of rural child poverty.  As a record streak of private sector job creation has cut nationwide unemployment in half, to 5 percent, average incomes for rural and urban families alike climbed nearly 6 percent in the last two years of data, returning to 2003 levels.  While we have made important progress in increasing incomes and reducing the rural child poverty rate, it remains unacceptable that 1.5 million children in rural America – 23.7 percent of all rural youth – live in poverty.

No child in this country should grow up in poverty.  And as a new analysis by USDA’s Economic Research Service (ERS) makes clear, to end that injustice we must do more to tackle growing income inequality.  The study, released today, found that rising income inequality explains an overwhelming 93 percent of the increase in rural child poverty between 2003 and 2014.  As the report notes, income inequality was considerably higher in 2014 than in 2003 in both urban and rural areas.  Over the past seven years, USDA and the Obama Administration’s work to bring economic opportunity to rural America has produced concrete results: rural areas are seeing income growth; two-thirds of rural communities have demonstrated job growth; and for the first time in years, rural areas are gaining population rather than losing residents.  But this new research on the pervasive effects of income inequality underscores that broader Administration priorities, like raising the minimum wage, must be part of any comprehensive approach to rural poverty.

At USDA, we are fulfilling our commitment to driving rural economic development by making targeted investments in the Four Pillars of a new economy in rural America: exports and production agriculture fueled by increased productivity and research; local and regional food systems creating an entrepreneurial and innovation attitude; the bio-based economy; and conservation and natural resources.  To complement these efforts, in 2010, USDA launched the StrikeForce Initiative for Rural Growth and Opportunity, which has since expanded to 970 persistent poverty counties in 25 states and Puerto Rico.  USDA has invested more than $23.5 billion in nearly 190,000 projects in StrikeForce counties since the initiative began, creating opportunity where it is needed most.

The White House Rural Council, which I am proud to chair, has generated even more momentum.  In April 2015, the Council launched Rural Impact, a cross-agency effort to combat poverty and improve upward mobility in rural and tribal places.  In September 2015, 10 rural and tribal communities were selected to participate in Rural Impact demonstrations, which are helping communities adopt a two-generation approach to addressing the needs of both vulnerable children and their parents.  The goal of these demonstrations is to increase parents’ employment and education and improve the health and well-being of their children and families, by helping communities adopt a comprehensive, whole-family framework for addressing child poverty.

USDA has also established the USDA Rural Child Poverty Nutrition Center at the University of Kentucky.  This year, the Center awarded $1.3 million in grants to help 17 rural communitiesimplement creative strategies to better coordinate between existing nutrition programs, making it easier for families to navigate and access assistance.

All of these efforts are part of the Administration’s modern approach to addressing poverty and expanding economic mobility.  Investments in economic development, and programs like the Supplemental Nutrition Assistance Program (SNAP) and the Earned Income Tax Credit (EITC), which have been proven effective at lifting millions of Americans out of poverty and improving children’s long-term health and educational outcomes, are complementary elements of that comprehensive approach.  Because hardworking families should be able to thrive, the President’s agenda includes raising the minimum wage, closing the gender wage gap, fighting for paid family and sick leave, and broadening access to college and high quality training.  This approach creates good jobs, strengthens the safety net, invests in workers’ skills, and ensures that the economy works for all Americans.

To eliminate rural child poverty, we must extend that same bold, innovative approach to reach all rural communities – no matter how small.