The Herald Bulletin

Morning Update

Community

November 24, 2012

COLUMN: Low salaries need supplemental benefits

ANDERSON, Ind. — “You are working at a $7.50 an hour job and get a 50-cent raise, but lose your food stamps … and you still need $16 an hour to live. I am seeing this more often.”

This comment was made earlier this month during a discussion by the Community Access Network (CAN) partners.  Everyone nodded in agreement.  Those around the table spend their days fielding requests for assistance to keep on the heat, put food on the table, and pay the rent.

The comment described a situation documented in a recent report by the Indiana Institute for Working Families, “The Cliff Effect: One Step Forward, Two Steps Back.” It describes the impact on low income working families that even a small increase in salary can have when it leads to sudden termination of essential benefits such as Supplemental Nutrition Assistance Program (SNAP, commonly known as food stamps), child care subsidy and public health care.

The report holds up the Earned Income (EITC) and Child Care Tax Credits as examples of policies that work. According to the Brookings Institution, “The EITC alone is responsible for raising 6.6 million people out of poverty, including 3.3 million children.”

Specific examples for Indiana are included with a clear chart of the impact on a single parent with two children earning $10 per hour. This annual household income of $20,800 falls short of self-sufficiency by more than $19,000 without supports; by more than $12,000 with tax credits only, but stays in the red by $4,685 with SNAP, public health insurance and childcare subsidy. However, as this parent works up the income ladder toward a more self sufficient wage, there are several points where even a 50-cent raise results in thousands of dollars in lost household income supports.

The report concludes that policies with a sudden income cut-off create a situation where people who are working harder become economically worse off.  It also makes specific recommendations for state policies that can help more people achieve and sustain self sufficiency.  The report is available at www.unitedwaymadisonco.org. Click on financial stability/additional resources.  There is also a short video that outlines the issue in just over two minutes at www.incap.org/cliffeffectreport.html.

The working poor are a growing population in Indiana, according to a recent report in The Indianapolis Star (Indiana’s income gap is among the fastest-growing, indystar.com). Indiana ranks sixth in the nation in greatest income inequality between richest and poorest households, a trend that began more than 30 years ago but has accelerated in the past decade.  Indiana is one of seven states where the average income of the poorest households fell during this time. At the same time, the average income for the top households grew 57 percent.

Our financial stability partners understand the effects of these policies because we see them every day.  It is why our financial stability work targets low income working households – those that are working, but are not earning enough to be self sufficient without supports.  However, we can’t fill the gap created by the cliff effect, so it’s important to help everyone understand how policies can and should build bridges to self sufficiency.

Nancy Vaughan is president of United Way of Madison County Inc. Her column appears the fourth Sunday of each month. She can be reached at n.vaughan@unitedwaymadisonco.org or 608-3061.

 

1
Text Only
Community
  • FEA - HB0728 - Fresh Orientation - SH Elwood freshmen learn the ways of high school through mentoring program About half the 112 incoming freshmen at Elwood Jr./Sr. High School got a jump on their friends recently by attending a freshman orientation session. Joan Mercer, an English teacher who helped organize the the orientation, said the mentor program, which has been in place for several years, has been effective in new students make the high school transition.

    July 28, 2014 1 Photo

  • FEA-HB0727-MCWinery-JC6.JPG Having a wine time

    Cathy Hensley’s never been much of a drinker. It wasn’t something that interested her very much, so it seemed unfathomable that she would ever run a winery. But after her son Eric offered her and her husband, Duke, some wine he made, it changed things.

    July 26, 2014 1 Photo

  • Lanane among LifeStream honorees Dr. Jon Hendrix and Katie Lucas, both of Muncie; Janet Privett, Montezuma, Ohio, and Sen. Tim Lanane (D), Anderson, will be honored during a reception Aug. 7 in Muncie for their work in making a difference in the lives of aging adults and people with disabilities.

    July 26, 2014

  • Community Briefs: July 27 A compilation of community news items as published in the Sunday edition of The Herald Bulletin.

    July 26, 2014

  • FEA HB0727 Homes 0113 Storage solution The key to creating a beautiful home on a budget is to look beyond the intended purpose of an item, and beyond its appearance. Instead, check for sturdiness of the frame, and the functionality of the components.

    July 26, 2014 5 Photos

  • What's Where: July 27-Aug. 2 Local meetings and activities are scheduled this week.

    July 26, 2014

  • Help available locally to navigate health care options If you feel like you’re drowning in the shifting sea of health care options, don’t panic: SHIP, a local Navigator and Life Stream are ready to help.

    July 26, 2014

  • FEA HB0727 Camp Chesterfield Spiritualists' home Camp Chesterfield is one of 10 spiritualist camps in the United States, and the only one of its kind in Indiana. Founded in the late 1800s, It's home to the Indiana Association of Spiritualists and listed on the National Register of Historic Places.

    July 26, 2014 1 Photo

  • Back in the News: July 27 The Herald Bulletin looks back at stories from the Anderson Daily Bulletin and The Anderson Herald newspapers.

    July 26, 2014

  • Jim Bailey: Traveling by passenger train was a page from the past My wife doesn’t remember riding on a full-fledged passenger train as a baby. Our children have never ridden. It’s an experience rapidly going the way of the horse and buggy and the stagecoach throughout a nation now obsessed with jumbo jets and sport-utility vehicles.

    July 26, 2014

Reader Pet Photos


We're looking for your best pet photos! Share your photos of your favorite non-human companions in our new photo gallery. Click here to upload your photos

Hyperlocal Search
Premier Guide
Find a business

Walking Fingers
Maps, Menus, Store hours, Coupons, and more...
Premier Guide
Parade
Magazine

Click HERE to read all your Parade favorites including Hollywood Wire, Celebrity interviews and photo galleries, Food recipes and cooking tips, Games and lots more.
More Resources from The Herald Bulletin