As a result of the current debt ceiling turmoil, Americans can look forward to a slate of budget cuts, sometimes cheerlessly referred to as austerity measures.
It is still unclear where the budget cuts will fall, although substantial budget cuts to social welfare programs have been one of the prevalent topics. It is looking increasingly likely that the fiscal conservatives who wield significant power in the majority-Republican House of Representatives will be able to include cuts to Medicaid and Medicare, among other programs, as part of a debt package.
A recent proposal from Speaker of the House John Boehner proposes "$1.8 trillion in savings, expected to come largely from government benefit programs and entitlements such as Medicare and Medicaid," according to David Rogers of Politico.
This is gloomy news for American families in dire straits who are some of the biggest beneficiaries of government spending. Michael Snyder of The Economic Collapse compiled a list of 10 horrifying facts about the current situation of the poorest members of American society. Here are a few of the lowlights.
- Only 58% of Americans currently have jobs.
- The poorest 50% of all Americans own only 2.5% of all the wealth in the U.S.
- 21% of all children in the US were living below the poverty line in 2010.
- Over 44 million Americans are on food stamps. Nearly half of them are children.
In a press conference Tuesday, new IMF head Christine Lagarde warned that "drastic cuts in spending" could lead to a "jobless recovery" (via the BBC).
The report adds, "Ms Lagarde warned that while a package to cut the U.S. deficit was essential, quick cuts in spending could damage the economy."
If Lagarde's assessment is accurate, then low-income families could be in for increased hardship.
In light of this sullen news, here is a list of companies that serve the shopping, health care, and financial needs of low-income families.
List sorted by market cap. (Click here to access free, interactive tools to analyze these ideas.)
1. Wal-Mart Stores
2. Dollar General
3. Family Dollar Stores
5. Cash America International
7. Avista Corp.
8. 99 Cents Only Stores
9. Dollar Financial Corp.
10. Advance America, Cash Advance Centers
Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the stocks mentioned above. Analyst ratings sourced from Zacks Investment Research.
Kapitall's Andrew Dominguez does not own any of the shares mentioned above. Data sourced from Finviz.
The Motley Fool owns shares of PepsiCo, Wal-Mart Stores, and Coca-Cola. Motley Fool newsletter services have recommended buying shares of Kellogg, Wal-Mart Stores, Procter & Gamble, Coca-Cola, PepsiCo, and AMERIGROUP. Motley Fool newsletter services have recommended creating a diagonal call position in Wal-Mart Stores. Motley Fool newsletter services have recommended creating a diagonal call position in PepsiCo.
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