Poverty continues to impact 1 in 5 North Carolinians, according to 2012 Census Bureau Data released last week. The extent of poverty would be far greater without the safety net and work supports, however. This post is part of a blog series that will explain how the new poverty data demonstrates the important role public programs play and the need for continued support. See our posts on the Supplemental Nutrition Assistance Program, Social Security, and Unemployment Insurance.
Despite economic growth from 2011 to 2012, North Carolina saw no meaningful improvement in either poverty rates or household incomes over the same period. New US Census data shows that safety-net programs, such as the Earned Income Tax Credit (EITC), blunted the extent of poverty’s reach across the United States. If not for the federal EITC, an additional 5.5 million Americans—including 2.9 million children—would have lived in poverty last year.
The EITC goes to families that work but struggle to get by on low wages. It helps them pay for basic necessities, reduces child poverty more than any other program, and improves kids’ chances of success as adults. The tax credit’s anti-poverty effect is not yet available for North Carolina or other states but we do know that it lifted approximately 293,400 North Carolinians—half of whom were children—out of poverty during the 2009-2011 period.
We also know that state EITCs build on the success at the federal credit. Yet, state lawmakers enacted a tax plan that allows North Carolina’s EITC to expire at the end of 2013. Read More