ABSTRACT

The poverty rate in the United States increased from 11.3% in 2000 to 15.1% in 2010.2 The increase in poverty during 2000-10 is in exact contrast to the previous decade, where poverty systematically reduced from a peak of 15.1% in 1993 to 11.3% in 2000. In 2011, 46.2 million persons were estimated to have income below the official poverty line. Since 2006, when the poverty rate stood at 12.3% (most recent low), the number of poor has increased by 9.7 million. Also, the 46.2 million persons counted as poor in both 2010 and 2011 are the largest numbers counted in the measure’s recorded history, going as far back as 1959 (Gabe, 2012). Though the rise in poverty during the last decade is a phenomenon in itself which needs to be investigated, a more interesting and pressing enquiry would be to look into how poverty among different socio-economic groups has changed during the past decade and the associated reasons behind the changes. Just to make a case: poverty rates for Blacks and Hispanics greatly exceed the national average; in 2011, 27.6% of Blacks and 25.3% of Hispanics were poor, compared to only 9.8% of the non-Hispanic Whites and 12.3% of Asians. This chapter investigates the second question, that is, how inequality in poverty across different groups has changed in the United States in the past decade (2002-11). To this end, we primarily use data from the Current Population Survey Annual Social and Economic Supplements (CPS ASEC). We also relate the changes in the inequality in the distribution of poverty across groups to the process of globalization. To be specific, we examine how the unemployment-population ratio, unemployment rate, loss of employment (and subsequent reemployment), and average weeks of unemployment among different socio-economic groups have changed due to the rise of neoliberal capitalism in the context of globalization, with a special focus on the increasing disparity in the above indicators. Though globalization is a very broad term, it can be used to refer to changes leading to the free flow of goods, services, and factors of production between countries (Jaffee, 2008). There are primarily two reasons for choosing the period 2002-11 for this study. First, beginning in 2002, CPS respondents could identify themselves as being of more than one race; consequently, the racial data for 2002 and after are not comparable to earlier years (Gabe, 2012). Second, many scholars, for example Thomas L. Friedman, divide the history of globalization into three periods, “Globalization 1” (1492-1800), “Globalization 2” (1800-2000), and “Globalization 3” (2000-present), with each period substantially different from the others (Friedman, 2005). Globalization 1 was marked by countries globalizing for resources and imperial conquest whereas Globalization 2

was spearheaded by companies globalizing for labor and markets. Globalization 3 on the other hand is shrinking the world very fast and is flattening the playing field for all. The unique thing about Globalization 3 is that of the globalization of individuals and small groups (Friedman, 2005). This era of globalization has also seen an increased amount of offshoring and outsourcing of jobs from the developed countries of the West to the developing countries of (mostly) Asia. Globalization 3 further differs from Globalization 1 and 2 in the sense that Globalization 1 and 2 were driven mainly by the European and the American countries and companies but Globalization 3 is also driven by very diverse non-Western companies and groups of individuals. We therefore, in this chapter, focus on the third period of globalization which has seen an accelerating pace of globalization throughout the world.