California now shares the highest poverty rate in the United States with Louisiana, according to a new report, raising urgent questions about the state’s economic disparities. Despite its immense wealth and concentration of billionaires, nearly 7 million Californians struggled to cover basic needs in 2024. Child poverty has more than doubled since 2021, with renters and people of color bearing the brunt of the crisis. Experts warn that cuts at both state and federal levels could push poverty even higher.
Read: Newsom Faces Criticism as California Dominates List of Worst U.S. Cities for Retirees
Poverty Rate Remains Stagnant
The California Budget and Policy Center report revealed that poverty rates in the state remained “statistically unchanged” from 2023. In 2024, about 17.7% of Californians, around 7 million people, could not meet essential living costs. This comes despite California being home to more billionaires than any other U.S. state, highlighting the severe wealth inequality within its borders.
Also read: Trump Warns of Government Shutdown and Blames Democrats for Crisis
Historic Low Reversed
In 2021, California reached a historic low poverty rate of 11%, largely due to pandemic-era policies that bolstered households with financial support. As these protections expired, however, poverty levels surged across the nation, including California. The report underscored how quickly progress was undone, illustrating that “poverty is a policy choice” shaped by government action or inaction.
Also read: Trump Explodes at Reporter Over Family Business Questions
Impact on Children and Families
One of the most alarming findings was the dramatic rise in child poverty, which has more than doubled since 2021. The report emphasized that children, renters, and people of color are disproportionately impacted by the rollback of anti-poverty measures. Without targeted interventions, the long-term effects on education, health, and stability for families could be devastating.
Also read: Hundreds of Filipino Activists Storm San Francisco in Protest of Trump’s ICE Crackdowns
Federal Policy Rollbacks
The report directly linked the reversal in poverty trends to the expiration of pandemic-era policies such as the federal child tax credit. “When Congress allowed these effective policies to expire, they immediately reversed progress, causing the largest increase in the national poverty rate in 50 years,” it stated. Cuts to healthcare, food assistance, and other safety net programs under Donald Trump’s new federal budget are expected to deepen the crisis further.
Also read: Trump Lashes Out at Media, Calls Negative Coverage ‘Illegal’
State Cuts Worsen Outlook
California also scaled back key protections introduced during the pandemic, including rental assistance, eviction moratoriums, and programs supporting unhoused residents. The latest state budget includes “significant reductions” in healthcare spending, raising concerns that the combined impact of federal and state cuts will push more Californians into hardship.
Also read: King Charles’ Chefs Clash with Trump’s Security Service During State Banquet
Call for Bold Action
The report urged state leaders to pursue “bold action” to counter the deepening crisis, suggesting a graduated corporate tax rate and the elimination of certain tax breaks. “For California to be a state for all to thrive, regardless of race or ethnicity, gender, and other identities, state leaders should take bold action to mitigate the rise in poverty and present a different vision for California than the one the federal government has put forth in recent months,” it declared.