The poverty affecting 14.5 million U.S. children living below the poverty line poses long-term effects, including risks to health, educational achievement, family stability, and employment prospects. This report provides compelling evidence of the substantial costs of poverty among children to our nation's economic well-being, and shows that policies to reduce the poverty rate among children must be a fundamental part of efforts to build a healthy economy for the 21st century. The report examines: (1) the odds against poor children; (2) whether ending poverty can really help; (3) updated estimates of economic costs of children's poverty; (4) why poverty hurts children; and (5) how to end poverty. Key findings noted in the report include the following: (1) poverty puts children at a greater risk of falling behind in school than does living in a single-parent home or being born to teenage parents; (2) reasons for poor children's problems appear to include their families' inability to afford adequate housing, nutritious food, or adequate child care, as well as problems of lead poisoning, limited learning opportunities at home, and severe emotional stress and family breakup caused by economic strains on the parents; and (3) research indicates that problems manifested by children in poverty are not the side effects of race, mother's educational or marital status, nor deep-seated traits inherent in poor families. Recommendations noted in the report include: (1) ensuring availability of jobs with family-supporting wages; (2) expanding education and training; (3) ending disincentives for marriage; and (4) ensuring a safety net for those exiting welfare. (HTH)