Des Moines Register
08-29-07
State income, poverty rates improve
Health coverage better, too, but some see economy plodding along
BY JANE NORMAN AND JONATHAN ROOS
REGISTER STAFF WRITERS
Washington, D.C. - Median household income rose a little in Iowa between 2004
and 2006, and the poverty rate slightly declined, according to new census
estimates released Tuesday.
In addition, Iowa was one of five states in a statistical tie for the lowest
percentages of residents lacking health insurance, the census says.
About 9.3 percent of Iowans on average lacked health insurance in 2004 through
2006, or about 271,000 people. Census officials said that was the best rate in the
nation along with Minnesota, Maine, Hawaii and Wisconsin.
Still, other indicators showed an uncertain picture for Iowa and the nation as the
census issued its annual findings on income, poverty and health insurance.
This year, the new numbers also provided fodder for a renewed national debate
on the economy and health care as Congress prepares to return next week and
the presidential race kicks into high gear.
Nationally, the number of Americans without health insurance increased by 2.2
million, rising to 47 million in 2006. The number of children lacking insurance also
increased, just as Congress battles over expansion of a state-federal children's
insurance program.
Census officials said the growing number of uninsured people reflects private
employers dropping coverage.
But across the nation, U.S. median household income was up between 2005 and
2006, rising to $48,200, the second consecutive year income has risen.
The official national poverty rate also declined for the first time this decade, to
12.3 percent, though there was no statistical difference in the number of
Americans living in poverty - about 36.5 million.
Using two-year averages, Iowa median household income rose from $47,170
between 2004 and 2005 to $48,075 between 2005 and 2006.
Again using two-year averages, statewide poverty rates declined from 11.1
percent between 2004 and 2005 to 10.8 percent between 2005 and 2006, the
census said.
Yet there's been no slackening of use of the Churches United Shelter in Des
Moines. Beds at the homeless shelter have been full for the last couple of weeks,
said Jean Brown, the director.
"I don't see the numbers of people decreasing that seem to need affordable, lowrent housing in the area. There is still a need," Brown said.
Other figures in a separate set of census estimates also released Tuesday
suggest Iowa is lagging behind its Midwestern neighbor states when it comes to
2006 household income, and that poverty rates may be about the same.
David Osterberg, executive director of the liberal-leaning Iowa Policy Project,
called that "worrisome."
He pointed out that in a one-year comparison in those estimates, called the
American Community Survey, median Iowa household income fell from $45,150
in 2005 to $44,491 in 2006.
That meant the state's household income was lower than incomes in Kansas,
Nebraska, Wisconsin, Illinois and Minnesota, he said.
Osterberg also said the 10.8 percent Iowa poverty rate between 2005 and 2006
was up by 3 percentage points compared to poverty rates five years ago.
In addition, that survey, which specializes in local information, shows persistent
and high rates of poverty in Iowa's cities and largest school districts.
For example, in the Des Moines school district, 21.7 percent of children under 18
were living below the poverty level in 2006, while in Davenport the figure was
23.9 percent.
Even with Iowa's relatively high rate of insurance coverage, too many children go
without, Osterberg said.
He said census estimates found 44,000 Iowa children without insurance in 2006.
While the elderly in Iowa generally are covered, "kids do really badly," Osterberg
said.
Nonetheless, Iowa stands out more than ever as a place where most of its
residents have health insurance, said Peter Orazem, an Iowa State University
economics professor.
"Given how important health insurance is for the U.S., that's a positive for Iowa
that we look like one of the better insured states," Orazem said.
He was less impressed with the slight increase in Iowa's median household
income.
"The best estimate is 1.9 percent growth," Orazem said. "It's not bad news. It's
not good news. It means that incomes in Iowa have been keeping pace with
inflation."
It comes as no surprise that Iowa's poverty rate remains below the national
average, Orazem said.
"We're going to look better on those sorts of things, anyway," he added.
The Iowa economy in 2006 expanded for a fifth year in a row. Most industries
were hiring workers despite a slowdown in housing and higher energy prices.
State revenue grew by 3.6 percent in fiscal 2006, topping the predicted rate of
increase of 2.1 percent.
Improvements in Iowa's economy were trumpeted last September by then-Gov.
Tom Vilsack, who was getting ready to enter the presidential race. Iowa had
"clawed itself back" from the economic downturn at the beginning of the decade,
he declared.
Orazem said Iowa's economy has been expanding with the national economy.
"We're just not doing better than average," he said. While farmers have been
benefiting from higher crop prices, "the nonfarm economy is sort of just plugging
along," he said.
The state's unemployment rate climbed in July to 3.9 percent, its highest in 16
months.
Iowa Gov. Chet Culver praised the census numbers that showed increases in
median household income and a drop in the poverty rate.
"The new census numbers prove what those of us in Iowa already know: Iowa is
on the rise and our quality of life is second to none," Culver said in a statement.
President Bush said the new national numbers show that his tax cuts are working
to boost the economy. "The census data shows that income gains in 2006 were
substantial and widespread across all income categories," Bush said.
Republican members of the House Ways and Means Committee said the poverty
numbers are deceiving because they don't account for non-cash aid such as food
stamps given to poor people.
But Robert Greenstein, head of the Center on Budget and Policy Priorities, a
liberal-leaning group, said the numbers are "disappointing" for the fifth year of an
economic recovery. Economic gains have been concentrated among wealthy
Americans, he said.
Reporter Jane Norman can be reached at (202) 906-8137 or at
jnorman@dmreg.com