Did we win the War on Poverty?

Summary:  Despite their role in building America, a long campaign of misinformation by the Right has discredited government programs (except for war). Their top target has been the anti-poverty programs of the Great Society. Here we take a brief look at the numbers to see the actual results to this, one of America’s greatest collective efforts.  {1st of 2 posts today.}

“This administration today, here and now, declares unconditional war on poverty in America. I urge this Congress and all Americans to join with me in that effort. It will not be a short or easy struggle, no single weapon or strategy will suffice, but we shall not rest until that war is won.”
— Lyndon Johnson’s State of the Union Address, 8 January 1964.

“Some years ago, the federal government declared war on poverty, and poverty won.”
— Ronald Reagan’s State of the Union Address, 25 January 1988.

LBJ

 

Excerpt from “The War on Poverty: Was It Lost?

By Christopher Jencks
New York Review of Books, 2 April 2015

Review of Legacies of the War on Poverty, edited by Martha J. Bailey and Sheldon Danziger.

Lyndon Johnson became president in November 1963. In January 1964 he committed the United States to a war on poverty. In August he sought and gained authority to expand the war in Vietnam. Of course, the War on Poverty was only a figure of speech — a political and economic promise, not a war from which young men would return in body bags. Nonetheless, most Americans look back on the two wars as kindred failures. Both have had an exemplary part in the disillusionment with government that has been reshaping American politics since the 1970s.

Asked about their impression of the War on Poverty, Americans are now twice as likely to say “unfavorable” as “favorable.” In one poll, given four alternative ways of describing how much the War on Poverty reduced poverty, 20% chose “a major difference,” 41% chose “a minor difference,” 13% chose “no difference,” and 23% chose “made things worse.”  {See this survey by the Center for American Progress}

Legacies of the War on Poverty is a set of 9 studies, edited by Martha Bailey and Sheldon Danziger, that assess the successes and failures of the diverse strategies that Johnson and his successors adopted to reduce poverty. The chapters are packed with evidence, make judicious judgments, and suggest a higher ratio of success to failure than opinion polls do.

… Census Bureau publishes a table every September showing its estimate of the “official” poverty rate for the previous calendar year, along with the rate in every prior year back to 1959. Figure 1 (see below) shows these estimates. They indicate that 19% of Americans were poor in 1964. Five years later, in 1969, the official rate had fallen by roughly a third, to 12.1%.

 

Poverty rate over time

… According to Figure 1, however, there was no clear trend in poverty after 1969, either up or down. … If you believe Figure 1, therefore, the War on Poverty got off to a promising start between 1964 and 1969 but then turned into a stalemate. Before accepting that conclusion, however, you need to ask where the numbers in Figure 1 come from and whether you should believe them. The Census Bureau derives the numbers from a large household survey called the Annual Social and Economic Supplement (ASEC) …

Figure 2 provides a first approximation of how correcting the 2013 poverty rate for noncash food and housing benefits, refundable tax credits, and upward bias in the CPIU would change the 2013 poverty rate. With these corrections the official poverty rate falls from 14.5 to 4.8%, making the 2013 rate roughly a quarter of the 1964 rate (19.0%). If we were to lower the poverty threshold for cohabiting couples to match that for married couples the 2013 poverty rate would have fallen even more.

The Poverty rate adjusted for more accuracy

The estimates in Figure 2 are not exact. More important, their combined effect may be smaller than the sum of their separate effects, making the drop in the “true” poverty rate smaller than Figure 2 suggests. But even if the true poverty rate was 6 or 7% in 2013, it would have fallen by about two thirds since 1964, putting it considerably closer to what Lyndon Johnson had promised in 1964 than to what Ronald Reagan had claimed in 1988.

Fixing these flaws in the official poverty rate helps reconcile trends in poverty with trends in more direct measures of material well-being. Today’s poor live in less crowded housing, are more likely to have a complete bathroom and air conditioner in their residence, have bigger TV screens, are more likely to have a telephone, and more likely to have a cell phone.

Nonetheless, most of the poor are still beset by constant financial anxiety. In part, that is because the poverty line was set so low in 1964.

… Both liberals and conservatives tend to resist the idea that poverty has fallen dramatically since 1964, although for different reasons. Conservatives’ resistance is easy to understand. They have argued since the 1960s that the federal government’s antipoverty programs were ineffective, counterproductive, or both. Since the 1970s they have cited the stability of the post-1969 poverty rate to support those judgments. To them, the suggestion that poverty has fallen sounds like a suggestion that the War on Poverty succeeded.

Liberals hear the claim that poverty has fallen quite differently, although they do not like it any better than conservatives do. Anyone, liberal or conservative, who wants the government to solve a problem soon discovers that it is easier to rally support for such an agenda by saying that the problem in question is getting worse than by saying that although the problem is diminishing, more still needs to be done.

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About the Author

Christopher Sandy Jencks is a Professor of Social Policy at Harvard. His recent research deals with changes in family structure over the past generation, the costs and benefits of economic inequality, the extent to which economic advantages are inherited, and the effects of welfare reform.
Christopher Jencks

He is currently a member of the Editorial Board of the American Prospect. Click here for his papers at the Social Science Research Network. His books include…

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4 thoughts on “Did we win the War on Poverty?

    1. Hans,

      Thanks for catching the template errors! Fixed!

      As for Ben, he’s following pattern set by previous Fed Chairmen by discussing big issues. And the possibility (the theory) of secular stagnation is high on that list. Mentioning the big issues can usually be seen as “scaring people”, but that’s inevitable since the big issues are usually scary.

      I’ve written 8 posts about secular stagnation, citing a wide range of economists. It’s the other side of the coin — the mirror image scenario — to the robot revolution (aka the 3rd industrial revolution) — about which I’ve written far more, and which I consider far more likely (although it might take a decade or two to take effect).

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