Dan Walters: California poverty increasing

By Dan Walters - Bee Columnist

Published 12:00 am PST Sunday, January 14, 2007
Story appeared in MAIN NEWS section, Page A3

Gov. Arnold Schwarzenegger's elaborate rollout of his second-term agenda last week contained many moving parts and -- either inadvertently or by design -- underscored one of California's most salient trends: increasing socioeconomic stratification.

As Schwarzenegger delivered his inaugural and State of the State addresses and released a new state budget, he celebrated a vibrant economy that has driven unemployment rates to a 30-year low and pushed personal income and state tax revenue to historic highs.

But in the midst of those celebratory occasions, Schwarzenegger unveiled a sweeping plan to bring health care insurance to the estimated 6.5 million Californians -- the working poor, for the most part -- who lack it, thus focusing attention on a growing underclass.

California is becoming a society in which some are prospering immensely -- high-income taxpayers are the ones filling state coffers -- many are striving for the California dream, and a disturbingly large number are barely making it.

That condition is a product of several interrelated factors, including high population growth driven by immigration, especially from Latin America, and a fundamental shift in the state's economy, generating an insatiable demand for low-skill, low-wage workers who struggle to find affordable housing and health care and whose children, often lacking English language skills, struggle in the schools.

The dimensions of the expanding underclass are found in new statistical studies by Robert Mogull, an emeritus professor of business statistics at California State University, Sacramento, concluding that despite its evident prosperity, California is seeing a rising incidence of poverty.

In one study, Mogull found that the state's poverty rate was 14.4 percent in 1959 and dropped to 11.1 percent in 1969, but "there has been a constant increase over the past 30 years," which he describes as "an ominous upward trend."

The rate was 14.2 percent in 1999 -- nearly 5 million people -- and is projected to rise again in this decade. By 2009, due to both population growth and a rising incidence of poverty, Mogull expects the number of poverty-stricken Californians to increase by another 25 percent.

Los Angeles County has been the epicenter of California's socioeconomic transformation over the last couple of decades. The collapse of the aerospace industry sent hundreds of thousands of Angelenos fleeing to other states, while at least as many immigrants filled the gap, spectacularly altering the county's dynamics. And a second Mogull analysis demonstrates that the rise in poverty is very pronounced in Los Angeles.

He calculated that 4.7 million Californians lived in poverty in 1999 and a third of them lived in Los Angeles County, with Latinos by far the largest single poverty-stricken ethnic group. Latinos were a quarter of the Californians in poverty in 1969, a third in 1979, 44 percent in 1989 and more than 50 percent in 1999, reflecting both rapid growth in the state's Latino population and the simple fact that so many are immigrants with little education.

Half of Latino Californians living in poverty are in Los Angeles, and Mogull also notes that with housing costs much higher in Los Angeles than the nation as a whole, the data -- which are based on federal designations of income -- may be understating the actual incidence of poverty.

This is not a pretty picture. As California's population continues to grow due to immigration, the challenge presented by poverty will also increase and the issues that arise out of that trend, such as high rates of medically uninsured and low rates of academic achievement in schools, will also expand. Politicians will have plenty of work to do.