Poverty Article Analysis

In today’s society, it is substantially impossible to dissociate the economic issues and poverty as they are both related. Before discussing these two notions, it is imperative to first understand their respective connotations. The economy as defined the Business Dictionary, is an entire network of producers, distributors and consumers of goods and services in a local, regional or national community. On the other hand poverty is the state for the majority of world’s people and nations. Poverty has become a global concern as it tremendous affects the global and national economies. However, the Los Angeles Times article written by Peterson (2002), and debating on the economy and poverty will be appropriate for this analysis.

Overview of the Poverty and Income per Jonathan Peterson

In the Los Angeles Times Article titled the Nation, Household Income Drops U.S. Says; Economy: In addition, the poverty rate rose in 2001, Census Bureau reports. The Last time this happened was in the early 1990s; Peterson (2002) presents the correlation that exists between poverty and income in the early 1990s. According to him the trends on poverty and income undermined the reality that a less-favorable economic climate has taken over the noticeable growth of the 1990s.

The article states that too many workers suffered the 2001 recession by losing their jobs and undergoing a cut in work hours. These changes contributed to the decrease on family income that forced people into poverty in the United States. However, in 1999 the U. S saw an improvement in this area with significant improvement in the number announced for poverty and income.

Model or Economic Theory Relating to the Poverty

In this article, Peterson (2002) states that the 2001 recession was the result of falling income for American households and the increase rate in poverty for the first time since early 1990s. During the 2001 recession many U.S workers lost their jobs and many others suffered a reduction in work hours that leaded to the human capital and labor resources issues (Sharp, Register and Grimes, 2013).

Furthermore the article also raises the issue of income inequality in some communities and households in the U.S. during the recession. The household income generation as seen in the article influenced the renewed interest in distributional issues, and the fluctuation of income in household for decades. It also shows how the drop on household’s income can tremendously affect people’s well-being in any economy as they need decent incomes to participate in the development of a healthy economy. Burgess and Propper (1996) support this assertion by elaborating on the rise in inequality