Anti-Poverty Programs’ Success Refutes Rep. Ryan’s Claims

July 26, 2013 at 11:19 am

Well, we knew this was coming.  Just last week, our Senior Fellow, Arloc Sherman, wrote a blog that began this way:

Next year, the nation will mark the 50th anniversary of the War on Poverty, which President Johnson proclaimed in his State of the Union address of January 1964.  Sadly, we should expect to hear a drumbeat of attacks claiming that, as President Reagan said long ago, we fought a war on poverty and “poverty won.”  Indeed, House Budget Committee Chairman Paul Ryan said recently of the anti-poverty effort, “We don’t have much to show for it.”

So, right on cue, Chairman Ryan said yesterday:

Next year marks the 50th anniversary of the War on Poverty.  We’ve spent approximately $15 trillion and the question we ought to be asking ourselves is, ‘where are we?’  With a 15 percent poverty rate today — the highest in a generation — and with 46 million people in poverty, I would argue it’s not working very well.

Needless to say, we have a different take.  Here, in anticipation of such attacks, is the rest of what Arloc Sherman wrote last week:

The truth is very different.  A number of anti-poverty programs — including some key efforts that have their origins in the War on Poverty and some that came later, often the product of bipartisan agreement — have an impressive record of achievement.  Together, programs such as food stamps (now known as the Supplemental Nutrition Assistance Program, or SNAP), the Earned Income Tax Credit (EITC), Medicaid, college financial assistance and broader based programs such as Medicare, have reduced poverty and malnutrition, expanded access to health care, and opened doors of opportunity for millions of people.  To be sure, poverty remains a serious problem in the United States and remains higher here than in many western industrialized countries.  And, not every program begun in the 1960s or more recently has been effective.  But, a bumper sticker analysis of the War on Poverty and today’s safety net that implies that “poverty won” misses the mark.

Take SNAP.  Chairman Ryan’s budget would cut the program by $135 billion over the next ten years.  Yet, the program is a prime example of a major national accomplishment.  Before food stamps and other nutrition programs were widely available, it was not hard to find large numbers of children in very poor areas of America with distended bellies or other indications of malnutrition.  That’s no longer the case.

A recent academic study looked back at the babies who benefited from the introduction and expansion of food stamps in the 1960s and 1970s and found that they grew up to be healthier and more likely to finish high school than their peers born in counties where the program had not yet been instituted.

Medicaid, created in 1965 as another core piece of the War on Poverty, also continues to make a major difference in people’s lives, improving health and reducing infant mortality and childhood deaths.  The program now provides health coverage to nearly 65 million low-income Americans, including children, parents, seniors, and people with disabilities.

Various newer programs also have been effective in reducing or alleviating poverty.  Consider, for example, the EITC, a program for working families created under President Ford and expanded under President Reagan and later presidents and congresses of both parties.  Not only does the program directly reduce poverty — this tax credit kept more than 6 million Americans above the poverty line in 2011, including more than 3 million children — but research has shown that it increases employment among single mothers and helps lead to better academic achievement among low-income children in participating families.

Those who claim that we don’t have much to show from anti-poverty programs often cite the fact that the poverty rate under the government’s official measure of poverty is similar now to what it was in the mid-1960s.  Such a comparison, however, is grossly misleading.  The official poverty measure counts only families’ cash income before taxes.  It fails to count food stamps, the EITC, rental subsidies, and the like.  As a result, it counts the forms of assistance that have shrunk dramatically since the 1960s such as cash welfare payments to poor families with children, while leaving out the key forms of assistance that were created or expanded during this period and have powerful anti-poverty effects.

That’s why analysts from a variety of political perspectives prefer the government’s newer Supplemental Poverty Measure (SPM), which includes both cash assistance and “non-cash” benefits such as SNAP, the EITC, and rental assistance, and which also nets out income and payroll taxes that people must pay.  The SPM shows that without the safety net, the percentage of Americans in poverty would be nearly double what it is:  29 percent of Americans would have been poor in 2011, rather than the 16 percent who were poor when safety net programs are taken into account.  SNAP alone kept 4.7 million above the poverty line (see chart).

As we approach the 50th anniversary of the War on Poverty, we’ll have more to say about anti-poverty programs.  Stay tuned.

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1 Comments Add Yours ↓

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  1. Kenneth McClintock #
    1

    It’s a shame that the EITC is not available to federal taxpayers in Puerto Rico, USA, and that, even though we pay full Medicare taxes, we only receive a fraction of its benefits.



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