California is the state with the highest poverty rate in the United States.

California has about 7 million people who cannot afford basic living needs, accounting for 17.7% of the state’s population.

In 2021, California’s poverty rate hit a historic low of 11%, but as pandemic-era policies ended, the rate rose in California and across the US – Photo: REUTERS

According to a new report cited by the Guardian on September 18, California is now the state with the highest poverty rate in the US, on par with Louisiana, and this situation shows almost no sign of improvement.

Despite being a wealthy state with many billionaires, California still has about 7 million people – equivalent to 17.7% of the population – who cannot afford basic living needs.

In 2021, the state’s poverty rate fell to a record low of 11%. But as pandemic support policies ended, poverty rates rose again in California and across the country, according to a report released last week by the California Budget and Policy Center.

The nonprofit research organization said California’s poverty rate is “little changed” from 2023, with people of color, renters and children being hit hardest.

Notably, the child poverty rate has doubled compared to 2021.

“These figures reflect a worrying trend, which began when historic anti-poverty investments – designed to mitigate the harms of the COVID-19 pandemic – were cut back, suggesting that poverty is essentially a policy choice,” the report said.

The paper notes that measures like the child tax credit helped reduce poverty to record levels. But when those policies expired, they reversed progress and led to the largest increase in national poverty in 50 years.

California has made investments and policies during the pandemic, including housing for the homeless, eviction moratoriums, and rental assistance. But when those programs ended, poverty rates rose.

The report highlights budget cuts at both the federal and state levels that could make the situation worse.

The authors cite as examples the federal budget signed by President Donald Trump earlier this year, which slashed health care programs, food assistance and many other benefits, as well as California’s state budget with “significant cuts” in health care.

Experts warn that this budget will have a major impact on the social security system and call it “the most severe bill ever seen in the past 40 years since the budget deficit issue emerged”.

The authors call for California to take “bolder action,” including adopting a progressive corporate income tax, eliminating some corporate tax incentives and other measures.

“For California to be a place where everyone has a chance to thrive — regardless of race, gender, or other identity — leaders must take bold action to curb rising poverty and offer a vision that is different from the federal guidance imposed in recent months,” the report stressed.