Six decades later, the War on Poverty made a huge difference in Appalachia and elsewhere | Opinion
At the dawn of the 1960s nearly 1 in 4 Americans lived in poverty, and today that figure stands at 1 in 8. What accounts for this progress against poverty? Part is attributable to economic growth that led to an improvement in living standards, but part is also due to public policies adopted at the federal, state, and local levels designed to assist those in need.
This month marks the 60th anniversary of the “War on Poverty,” when President Johnson traveled to Inez, Ky. to make the case to the people of Martin County and the nation that the dire economic conditions facing too many Americans was morally unacceptable in a nation of such great abundance. In subsequent months, Johnson, with bipartisan support of the Congress, rolled out a series of programs that would collectively come to be known as the “Great Society.” These include health insurance from Medicare and Medicaid, food assistance from food stamps and school breakfast and lunch, and pre-K from Head Start. Later, Presidents Nixon and Ford would launch new assistance to the disabled and the elderly poor with Supplemental Security Income, nutrition benefits for pregnant and post-partem women with the Women, Infants, and Children program, housing subsidies through Section 8 vouchers, and wage subsidies to low-income workers with the refundable Earned Income Tax Credit. There were also important improvements to Social Security during this period, most notably the decision to tie retirement benefit payments to inflation in order for seniors to maintain purchasing power over time.
Research shows that the social safety net lifts millions out of poverty each year, and reduces economic hardship among those who still remain poor after receipt of aid. Beyond income, research also shows that these programs improve a variety of other dimensions of family life, and long-term benefits for children later in adult life. This includes evidence that children in Head Start or whose parents receive the EITC are more likely to graduate high school, be employed, and have lowers odds of contact with the criminal justice system. Children who have access to food stamps have better long-term health outcomes in adulthood such as reduced risk of food insecurity and fewer chronic health conditions compared to similarly situated children not exposed to food assistance. Medicaid improves birth outcomes of mothers, and those children have better birth outcomes of their own decades later as adults.
While it is tempting to look at the safety net through rose-colored glasses, that would be a mistake because all programs have costs associated with them. These costs come in the form of direct expenditures on program benefits and administration, mainly financed by taxes on income, as well as indirect costs from possible disincentives on whether and how much to work. Economists have written scores of papers examining whether social programs reduce incentives to work, and the surprising answer is that these work disincentives, if they exist, tend to be small in magnitude. One program that does have more moderate size reductions in work activity is housing assistance. This is perhaps not surprising because housing vouchers are heavily rationed and receiving one often takes years of waiting and is like winning the lottery (meaning most don’t win at all!).
Thus, for a correct assessment of safety net programs it is necessary to compare the benefits and costs, and on this metric research suggests that programs targeted to children such as education, health, and nutrition assistance tend to have benefits that far exceed the costs. This is because the programs tend to be well targeted and have decades to reap returns on the investment. These net benefits extend to several adult-focused programs as well.
But more progress is needed. Too many still struggle to make ends meet, and when they seek help, often discover they are ineligible because of stringent income and asset limits established decades ago, or face complicated barriers to apply for assistance and thus leave money on the table by not enrolling. Delivery of assistance can be made more effective if certain automatic triggers are established during economic downturns. Unemployment insurance during the Covid-19 Pandemic is a case in point. Current law requires an act of Congress to expand eligibility for UI during a severe economic recession, which can slow down the delivery of assistance to those struggling to pay monthly food, rent, and utilities. Establishing a set of automatic triggers, for example an increase of the unemployment rate above a certain threshold, could speed up the delivery to those in need and improve program effectiveness. Triggers of this sort should also be extended to other programs providing food and medical aid in order to be more nimble during periods of economic distress.
Six decades later the War on Poverty has had many policy successes, and while some programs have not lived up to expectations, the evidence suggests that as a nation we are healthier and wealthier with a robust safety net than without.
James Ziliak Ph.D. is director of the University of Kentucky Center for Poverty Research.
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