(MintPress) – Nearly 50 millions Americans are now living in poverty, according to a study released last week by the U.S. Census Bureau. The data would be alarming if it were not for the proliferation of cuts to social entitlements and essential services preventing millions of U.S. citizens from falling into poverty. Decades of devastating Reaganomics proves that the mass privatization of social services has failed to alleviate poverty.

Yet many within Washington continue to stir up support for cuts that disproportionately affect lower income Americans. While the wealthiest 1 percent profit handily from Bush-era tax cuts, “belt-tightening” it seems only applies to those who can ill afford it.

Contrary to the well-worn conservative tropes decrying public assistance as “handouts” for unmotivated Americans, these programs have actually prevented millions from falling into poverty. The myth of the manipulative, lazy “underclass” is destroyed when labor statistics show that thousands of Americans are actually working full-time and still rely upon food stamps to feed their families.

The study

The Supplemental Poverty Measure, a new statistic recorded by the Census Bureau, measures the effectiveness of social programs in helping to lift Americans out of poverty.

“They provide crucial information on the effectiveness of work and income supports in lifting families above the poverty line,” said Melissa Boteach, director of the Poverty and Prosperity Program for Center for American Progress and director of Half in Ten.

This is a salient point, when Paul Ryan (R-Wis.) and other Republicans in Congress seek to look only at the waste in government programs without considering how these services improve the lives of poor Americans.

This new Supplemental Poverty Measure shows that refundable tax credits for working families and child tax credits, among other policies, helped lift 8.7 million Americans out of poverty in 2011. The crisis of poverty would clearly be much worse without such programs.

Indeed, the new data provides a much needed critical lens for assessing the true source of the problem — that is, poor regulation of the private sector.

For many families, food stamps are the only way to feed their families, despite holding full-time employment. The so called “culture of dependency” has actually been exacerbated by poor regulation of the private sector where many corporations fail to extend living wages and proper benefits to their workers.

This is exemplified in the abusive corporate policies of Wal-Mart, one of the biggest employers in the U.S. Wal-Mart’s low wages cost taxpayers an estimated $1.02 billion per year to provide their employees with food stamps and other benefits.

Passing this cost along to taxpayers is criminal and can easily be resolved should Washington demand private sector employers provide a living wage, health care and adequate benefits to all employees.

No full-time worker in America should live in poverty, and yet this is exactly the case with Wal-Mart workers and millions of others across the U.S.

Abandoning the poor in the US

The topic of poverty seldom reaches the halls of Congress as millions of Americans continue to struggle with this issue. However, when it is discussed, it is usually in the context of cutting aid to poor Americans, not extending it.

Barack Obama, referred to as the “welfare president,” by Newt Gingrich (R-Ga.), and others, has made a modest attempt to repair a broken safety net — namely through the passage of the Affordable Care Act and the expansion of the Supplemental Nutritional Assistance Program (SNAP).

However, these programs do not sufficiently improve the situation as poverty continues to rise through neoliberal policies that have created wealth for a relatively small segment of society.

This was not always the case in the U.S. Historical economic data shows that from 1947-1979, all classes of society grew relatively equally, sharing in the profits of a strong post-World War II manufacturing economy. According to the Economic Policy Institute, wealth disparities increased markedly during the next few decades, from 1979-2008.

The top 1 percent of income earners in the U.S. grew their share of wealth a staggering 228 percent, while the bottom 20 percent actually lost 7 percent of their wealth relative to inflation.

In short, the U.S. economy is becoming a gross caricature of a plutocratic system run amok. Six members of the Walton family, the owners of the world’s largest retail store Wal-Mart, have more wealth than the bottom 30 percent of Americans.

Lessons from Europe

The reckless criminal activities of Wall Street that created the 2008 financial crisis also contribute to this dire problem.

Housing has become a commodity, a privilege for middle and upper-class families. With more than 3 million homeless people in the U.S., the problem is not a matter of housing shortages. Rather, because of the foreclosure crisis, there are currently 22 vacant homes for every homeless person in America.

If the U.S. declared a moratorium on home foreclosures and publicly assumed control of vacant, unused buildings, the problem of homelessness could all but be eliminated. Instead, banks with no interest in keeping families in their homes continue to evict Americans from their homes at a record pace.

One million families are expected to lose their homes in 2013, a testament to the destructive influence of the subprime mortgage swindle.

In this area, U.S. policy makers can learn from the lessons of Spain, a country fraught with a deep economic crisis. Spain decided to take the humane approach to halting the increase in poverty and homelessness last week, deciding to call for a two year moratorium on home foreclosures.

However, austerity continues to send shockwaves through Europe as millions continue to fight for employment, decent wages and pensions. Public sector workers and trade unions called for a general strike on Wednesday, a work stoppage that brought millions to the street in Spain, Portugal and other states in the European Union affected by the austerity crisis.

The European Trade Union Confederation (ETUC) was a major proponent of the strike, stating, “The ETUC strongly opposes the austerity measures which are plunging Europe into economic stagnation, recession, and dismantling the European social model. These measures, far from restoring confidence, are only aggravating imbalances and creating injustices.”

If American austerity continues, poverty and unemployment will continue to get worse, creating a crisis of European proportions. The only remedy is one that values employment, housing, education and health care as rights of citizenship, not exclusive commodities driven by profit and speculation.