THE WAR ON POVERTY: MEASUREMENT,TRENDS, AND POLICY

We present a 50‐year historical perspective of the nation's antipoverty efforts, describing the evolution of policy during four key periods since 1965. Over this half‐century, the initial heavy reliance on cash income support to poor families has eroded; increases in public support came largely in the form of in‐kind (e.g., Food Stamps) and tax‐related (e.g., the Earned Income Tax Credit) benefits. Work support and the supplementation of earnings substituted for direct support. These shifts eroded the safety net for the most disadvantaged in American society. Three poverty‐related analytical developments are also described. The rise of the Supplemental Poverty Measure (SPM)—taking account of noncash and tax‐related benefits—has corrected some of the serious weaknesses of the official poverty measure (OPM). The SPM measure indicates that the poverty rate has declined over time, rather than being essentially flat as the OPM implies. We also present snapshots of the composition of the poor population in the United States using both the OPM and the SPM, showing progress in reducing poverty overall and among specific socioeconomic subgroups since the beginning of the War on Poverty. Finally, we document the expenditure levels of numerous antipoverty programs that have accompanied the several phases of poverty policy and describe the effect of these efforts on the level of poverty. Although the effectiveness of government antipoverty transfers is debated, our findings indicate that the growth of antipoverty policies has reduced the overall level of poverty, with substantial reductions among the elderly, disabled, and blacks. However, the poverty rates for children, especially those living in single‐parent families, and families headed by a low‐skill, low‐education person, have increased. Rates of deep poverty (families living with less than one‐half of the poverty line) for the nonelderly population have not decreased, reflecting both the increasing labor market difficulties faced by the low‐skill population and the tilt of means‐tested benefits away from the poorest of the poor.     

Scraping by: Income and Program Participation After the Loss of Extended Unemployment Benefits

Many Unemployment Insurance (UI) recipients do not find new jobs before exhausting their benefits, even when benefits are extended during recessions. Using Survey of Income and Program Participation (SIPP) panel data covering the 2001 and 2007 to 2009 recessions and their aftermaths, we identify individuals whose jobless spells outlasted their UI benefits (exhaustees) and examine household income, program participation, and health‐related outcomes during the six months following UI exhaustion. For the average exhaustee, the loss of UI benefits is only slightly offset by increased participation in other safety net programs (e.g., food stamps), and family poverty rates rise substantially. Self‐reported disability also rises following UI exhaustion. These patterns do not vary dramatically across household demographic groups, broad income level prior to job loss, or the two business cycles. The results highlight the unique, important role of UI in the U.S. social safety net.     

The impact of child SSI enrollment on household outcomes

We use data from the Survey of Income and Program Participation (SIPP) to investigate the impact that child Supplemental Security Income (SSI) enrollment has on household outcomes, including poverty, household earnings, and health insurance coverage. The longitudinal nature of the SIPP allows us to control for unobserved, time‐invariant differences across households by measuring outcomes in the same household in the months leading up to and immediately following the first reporting of child SSI income. Our regression analyses demonstrate that for every $100 increase in household SSI income, total household income increases by roughly $72, reflecting some modest offset of other transfer income and conditional household earnings. Our analyses further demonstrate that child SSI enrollment is associated with a statistically significant and persistent reduction in the probability that a child lives in poverty of roughly 11 percentage points. Additional analyses suggest that program enrollment has virtually no impact on health insurance coverage because most new SSI recipients have health insurance from Medicaid or another source at the time of enrollment. © 2007 by the Association for Public Policy Analysis and Management     

A “third way” in welfare reform? Evidence from the United Kingdom

U.S. welfare reforms, whether promoting work first or human capital development, have had in common an emphasis on employment as the key to improving the life chances of children living in single‐mother families. We describe in this article a different type of reform—a “third way” in welfare reform. The welfare reforms carried out in the United Kingdom since the “New Labour” government of Tony Blair was elected in 1997 have included promotion of paid work, but alongside two other components—an explicit commitment to reduce and eventually eliminate child poverty, and a campaign against long‐term disadvantage under the label of tackling “social exclusion.” Welfare‐to‐work reforms promoting employment for single mothers have been active but not as punitive as in the United States. At the same time, the tax credit and cash benefit system has been radically overhauled, benefiting low‐income families with children, whether or not parents are working. Early indications suggest a more rapid fall in child poverty in the United Kingdom since its reforms began than in the United States since its reforms, and a faster rise in single‐mother employment. © 2004 by the Association for Public Policy Analysis and Management.     

Application of experimental poverty measures to the aged

The U.S. Census Bureau recently released new, experimental measures of poverty based on a National Academy of Sciences (NAS) panel's recommendations. This article examines the effects of the experimental measures on poverty rates among persons aged 65 or older in order to help inform policy debate. Policymakers and analysts use poverty rates to measure the successes and failures of existing programs and to create and defend new policy initiatives. The Census Bureau computes the official rates of poverty using poverty thresholds and definitions of countable income that have changed little since the official poverty measure was adopted in 1965. Amid growing concerns about the adequacy of the official poverty measure, a NAS panel undertook a study of the concepts, methodology, and data needed to measure poverty. The panel concluded in its 1995 report that the current measure no longer provides an accurate picture of relative rates of poverty for different groups in the population or of changes in poverty over time. The panel recommended changes in establishing the poverty thresholds, defining family resources, and obtaining the required data. The Census Bureau report shows how estimated levels of poverty would differ from the official level as specific recommendations of the NAS panel are implemented individually and how estimated trends would differ when many recommendations are implemented simultaneously. It computes nonstandardized and standardized poverty rates. (The latter constrains the overall poverty rate under the experimental measures to match the official rate.) This article reports poverty rates that have not been standardized and provides considerably more detail than the Census report about the effects of the experimental measures on poverty among the aged. It examines the effects of changing the poverty thresholds and the items included or excluded from the definition of available resources. It also explores the effects of the experimental measures on persons aged 65 or older by age group, gender, race and ethnicity, and marital status. Results indicate that: Poverty rates in 1997 for persons aged 65 or older under the experimental NAS poverty measure are 17.3 percent, compared with 10.5 percent under the official poverty measure. This 65-percent increase is largely driven by the NAS-based measure's subtraction of medical out-of-pocket (MOOP) expenses from resources. Under the NAS-based measures, poverty rates increase for all major groups of older persons, and increase the most for groups for whom the incidence of official poverty is the lowest. The experimental NAS poverty measure shows narrower differences between genders, racial and ethnic groups, and among persons of different marital statuses than the official poverty measure. For example, white Hispanic women aged 65 or older have poverty rates that are 450 percent higher than those for white non-Hispanic men under the official poverty measure and 181 percent higher under the NAS measure. The NAS-based measure's subtraction of MOOP expenses from resources has a disproportionate effect on poverty rates among non-Hispanic whites and men as compared with other groups. However, changes in relative poverty between groups appear to be most influenced by the NAS midpoint equivalence scale. Because this scale decreases poverty rates for persons who live alone or with unrelated individuals and increases them for persons who live with others, poverty rates differ meaningfully under the NAS and official measures among demographic groups. This article highlights issues concerning the elements of the experimental NAS poverty measure that are particularly important to the measurement of poverty among the aged population. Results suggest that the research community's future efforts to refine, enhance, and build upon the NAS panel's recommendations will yield important insights about poverty among the older population.     

RURAL AND URBAN POVERTY: AN INCOME/NET WORTH APPROACH

This paper examines rural and urban changes in the distribution of poverty that would result from modifying the conventional poverty measure to include the annuity value of household net worth.
Use of this new income/wealth measure caused numerous shifts in the location and demography of the poverty population. Among those more often found to be in poverty under the new measure were young, renter, and large central city resident households. Age, homeownership, farm employment, education, retirement status, public assistance participation, and residence in the West were important factors in explaining the divergence of the WH and INC measures. The age and retirement impacts were significantly different in rural and urban areas. Rural residence itself was not an important factor in explaining WH and INC differences.     

The long‐term effects of public housing on self‐sufficiency

Recent years have witnessed an intensification of the debate about the fundamental purpose of public assistance to the poor and the effects of these programs on children. This study uses enriched data from the Panel Study of Income Dynamics to examine the effects of living in public housing as a child at some point between 1968 and 1982 on four young adult outcomes: welfare receipt; individual earnings; household earnings relative to the federal poverty line; and employment. Living in public housing during childhood increased employment, raised earnings, and reduced welfare use, but had no effect on household earnings relative to the poverty line. The beneficial effects could have arisen because public housing improved physical living conditions, reduced residential mobility, or enabled families to spend more of their income on items that benefit children's development. Whether these effects apply to contemporary public housing is unknown. © 2002 by the Association for Public Policy Analysis and Management.     

Does it pay to move from welfare to work?

The 1996 Personal Responsibility and Work Opportunity Reconciliation Act requires welfare recipients to look for work and has made it more difficult for nonworking recipients to remain on the welfare rolls. In addition, the economic boom of the 1990s and changes in federal and state policies have raised the net income gain associated with moving from welfare to work. This paper analyzes data from a panel survey of single mothers, all of whom received welfare in February 1997. In 1999, those who left welfare and were working had a higher household income and lower poverty rate, experienced a similar level of material hardship, engaged in fewer activities to make ends meet, and had lower expectations of experiencing hardship in the near future than did nonworking welfare recipients. Estimations of fixed‐effect regressions of income that control for both observable and unobservable time‐invariant characteristics show that monthly net income increases by $2.63 for every additional hour of work effort. About 60 percent of the observed monthly income difference between wage‐reliant and welfare‐reliant mothers can be attributed to differences in their work effort. Thus, after welfare reform, it does pay to move from welfare to work. © 2002 by the Association for Public Policy Analysis and Management.     

Child characteristics and successful use of housing vouchers: Estimates from the moving to opportunity demonstration

Abstract

Voucher‐based programs have become the most common form of housing assistance for low‐income families in the United States, yet only a slim majority of households that are offered vouchers actually move with them. This article uses data from 2,938 households in the Moving to Opportunity demonstration program to examine whether child characteristics influence the probability that a household will successfully use a housing voucher to lease‐up.

Our results suggest that while many child characteristics have little bearing on the use of housing vouchers, child health, behavioral, and educational problems, particularly the presence of multiple problems in a household, do have an influence. Households with two or more child problems are 7 percentage points less likely to move than those who have none of these problems or only one. Results suggest that such families may need additional support to benefit from housing vouchers or alternative types of affordable housing units.     

Nonmoney income and the elderly: The case of the tweeners

This paper examines the degree of economic security experienced by the population aged 65 and over. Elderly people in the United States now enjoy an average degree of economic well being that is high relative to the younger population. Within that average there is variance, however. This analysis finds that elderly persons in the lower-middle income range—within 100 and 200 percent of the poverty line—are economically more vulnerable than either those of high income or those below the poverty threshold. Virtually all of the elderly benefit from social security retirement income (OASI) and Medicare. The poor receive in addition substantial means-tested cash and in-kind transfers, and the well-to-do receive enough additional subsidies and tax-free income to leave them better off after government intervention than before it. But those in between—the tweeners—are more likely to rent unsubsidized housing, are less likely to have non-Medicare health subsidies, and are more likely to rely on OASI as their primary source of income. When facing economic or health problems, the only way they can improve their well being is to spend themselves down to penury and thereby qualify for means-tested cash and in-kind transfers, in the form of Medicuid and Supplemental Security Income. Policy implications of these findings are discussed in closing.     

A new measure of housing affordability: Estimates and analytical results

Abstract

Affordable housing has often been described in terms of rent burden or owner cost burden. This article introduces the concept of housing‐induced poverty to describe the situation that arises when a household, after paying for housing, cannot afford the poverty basket of nonhousing goods. This is similar to Stone's shelter poverty concept, except that it is linked to a better‐known measure—the official poverty thresholds.

On the basis of the 1999 American Housing Survey, it is estimated that 3.8 million households that were above the official thresholds could not afford the poverty basket of nonhousing goods. In 1999, the housing‐induced poverty rate in the United States was 2.7 percentage points higher than the official rate. Results from an analytical model reveal that regional and locational variables are significant determinants of the probability of housing‐induced poverty. Housing assistance significantly decreases the probability that near‐poor renters will fall into housing‐induced poverty.     

中国社会安全网研究——青岛市“阳光救助工程”的创新实践

"阳光救助工程"是青岛市2002年7月开始对中国的社会安全网建设进行的创新实践.它有效地保障了城市贫困人口特别是下岗、失业职工的基本生活权益.以青岛市"阳光救助工程"的创新实践为例,研究了中国地方政府创新对社会安全网建设的作用.通过分析"阳光救助工程"产生和发展的动力机制,并对该项举措的创新绩效进行评估后,认为,"阳光救助工程"的创新实践对完善中国社会安全网带来了许多启示.这些启示主要包括:第一,对城市贫困进行综合治理时,应在政府主导下扩大社会参与;第二,贫困问题并不单单体现在收入匮乏上,实际上还涉及到行为主体的物质、精神、社会地位等多个方面的表现;第三,从社会救济到社会救助体系的发展和完善中,应该充分发挥个人的主体性和能动性;第四,城市社会救助体系是一个多目标、多层次的社会系统,包括救济、就业、医疗等针对弱势群体的社会救助制度;第五,社区在社会安全网建设中应起到积极作用,充分发挥社区的社会保障作用.     

Information Shocks and the Take‐Up of Social Programs

The causes of participation in social programs have been studied extensively, with prominent roles found for program rules and benefits. A lack of information about these programs has been suggested as a cause of low participation rates among certain groups, but it is often difficult to distinguish between the role of information sharing and other features of a neighborhood, such as factors that are common to people of the same ethnicities or socioeconomic opportunities, or uniquely local methods of program implementation. We seek to gain new insight into the potential role of information flows by investigating what happens when information is disrupted. We exploit rich microdata from Florida vital records and program participation files to explore declines in Women, Infants, and Children (WIC) participation during pregnancy among foreign‐born Hispanics in the “information shock” period surrounding welfare reform. We identify how the size of these reductions is affected by having a high density of neighbors from the same place of origin. Specifically, we compare changes in WIC participation among Hispanic immigrants living in neighborhoods with a larger concentration of own‐origin immigrants to those with a smaller concentration of own‐origin immigrants, holding constant the size of the immigrant population and the share of immigrants in the neighborhood who are Hispanic. We find strong evidence that having a denser network of own‐origin immigrants mediated the information shock faced by immigrant women in the wake of welfare reform.     

The private safety net: The role of charitable organizations in the lives of the poor

Abstract

As welfare reform unfolds, nonprofit social service agencies will increasingly be called upon to help fill the gap between what unskilled and semiskilled mothers can earn in the low‐wage labor market and what they need to meet their monthly expenses. This article draws on in‐depth interviews with low‐income single mothers and multiyear observational studies of two nonprofit social service agencies.

Using these data, the authors show what kinds of resources these agencies provide low‐income single mothers, how mothers mobilize the resources available, to what degree agencies actually contribute to mothers’ cash and in‐kind resources, how agencies distribute their resources, and what effect agencies’ distribution practices have on these women. The analysis shows that although nonprofit social service agencies are a crucial part of many low‐income mothers’ economic survival strategies, they cannot come close to substituting for the eroding public safety net.     

Revenue Cyclicality and Changes in Income and Policy

The past two recessions have proved alarming to state government finances. In 2001, a relatively shallow national recession led to a severe downturn in state revenues that took three years to unwind. In the wake of the recent economic downturn, signs of fiscal stress are readily apparent. In this paper, we investigate whether the revenue patterns surrounding these two recessions are the result of state government revenues having grown more sensitive to economic conditions. We find that the responsiveness of revenues to measures of business cycle conditions has grown since the 1990s. We use data on state government revenues, state‐specific information on economic conditions, and measures of state policy to examine fiscal performance and budgeting practice over the economic cycle. Our findings suggest that increasing income cyclicality, in particular of investment income, has made state revenues more responsive to the business cycle since the mid‐1990s. We also find that changes in policy making have served to increase revenue cyclicality.     

Ineligible spouses of SSI beneficiaries, December 1976.

A study based on program records showd that about 200,000 persons receiving supplemental security income (SSI) payments in December 1976 were living with a spouse who was not eligible for payments. In most cases, the beneficiaries were disabled and the spouses were too young to be eligible. Some spouses were receiving help indirectly from the program through the essential-person increment, State supplementary payments, or the deeming-of-income provision. Fewer than half the spouses had income of their own, however, and even when the income of both partners was combined, 55,000 households had no income other than the SSI payment. A sizable number of families included dependent children and thus may have been eligible for aid to families with dependent children.     

Trends in the economic status of the elderly, 1976-2000

The economic well-being of elderly Americans (aged 65 or older) improved between 1976 and 2000. Overall, poverty rates fell during this period, median real income rose, and median income relative to the working-age population was relatively stable. Most population subgroups shared in the reduced poverty rates; however, the economic status of elderly Hispanics did not improve. This article attempts to explain those economic trends by identifying changes in five sources of income for the elderly and analyzing the changes in the context of demographic changes in the elderly populations over the past 25 years. As a result of increased longevity, for example, larger proportions of elderly men and women are now 80 or older, and smaller proportions are 65 to 69. Hispanics and Asian Americans make up a larger share of the elderly population and whites a smaller share. The fraction of women who are married has increased, the fraction who are widowed has fallen, and the fraction who are divorced has grown. Such demographic changes can greatly affect the economic status of subgroups as well as the overall elderly population. Of the five sources of income for the elderly, Social Security remains the most prevalent and important. While both the rate of receipt and the share of aggregate income from Social Security benefits stayed relatively steady over the past 25 years, the average real Social Security benefit increased because of rising wages. Income from assets, the second most important source of income for the elderly, fluctuated. Because the elderly are more likely to hold interest-bearing assets such as bonds rather than stocks, their asset income is responsive to changes in nominal interest rates and bond yields. Receipt of pension income increased during this period, although it leveled off during the 1990s. Factors contributing to this pattern include enactment of the Employee Retirement Income Security Act of 1974, which increased protections of pension benefits for spouses, and improved labor market opportunities for blacks and women. In recent years, defined contribution pension plans have become more prevalent than defined benefit plans, but the full effect of this change on pension income may not yet be apparent. After decades of decline, labor force participation rates of older men leveled out in the mid-1980s and then increased. For older women, the trend before the mid-1980s was flat, but since then rates have risen substantially. The increased use of part-time jobs or self-employment to ease the transition into retirement, the economic expansion of the 1990s, and the liberalization of the Social Security earnings test may all have contributed to those trends. Although the percentage of elderly people with earnings has increased only modestly in the past few years, the share of income from earnings has grown substantially--from 16 percent of income in 1984 to 23 percent in 2000. Finally, Supplemental Security Income (SSI) benefits are indexed for inflation but not for growth in real wages. As real incomes of the elderly rose, therefore, fewer elderly persons were eligible to receive SSI or, for those receiving SSI, were eligible for smaller benefits. The proportion of elderly persons receiving public assistance, primarily SSI, declined from 11 percent in 1976 to 5 percent in 2000.     

Amor,Que Piensas?: Spousal Political Socialization in Mexican Immigrant Communities

This article examines the role of spousal political socialization among Mexican immigrants in the United States. Political socialization literature has often dismissed the socializing influences of spouses or significant others due to a focus on native born respondents. In immigrant communities, however, spousal political socialization plays a more vital role given the presence of a non-native born spouse. The result is a distinct dynamic that influences immigrant political socialization in previously under-explored ways. I use the theory of multi-tiered membership to examine the interactions of spouses within Mexican households, and immigrants specifically, to explain their subsequent informal and formal membership in the US. I use quantitative data from the Developing Civic Actors survey to model these experiences. I hypothesize that Mexican origin households where one spouse is an immigrant will rely more heavily on their spouses for political information and communication, compared to native born Mexican origin or white respondents. Early findings indicate that immigrant parents already rely on informal and familial resources like their children, and they subsequently hold their spouse as an important source of political information. This indicates a possible predictive measure for understanding how spousal political socialization may in fact lead to more engaged citizenship.     

Modifying children's court care plans to acknowledge poverty and disadvantage

This think piece suggests that Children's Court Care Plans should include a new section that documents poverty and social disadvantage, especially of Aboriginal and Torres Strait Islander families, when they are under investigation for child abuse and neglect. New South Wales in Australia is used as the exemplar state, but this suggestion may find an echo elsewhere.

Points for practitioners

• As a general proposition social and economic circumstances should be considered in addition to parental dysfunction in child protection proceedings in Children's court.
• Care Plans prepared for hearings in the NSW Children's Court, often developed in response to serious harm report investigations, currently do not contain information about parents' poverty and social disadvantage and hence decontextualise family living circumstances.
• Consistent with international evidence, Care Plans should require information about parents' socioeconomic situation, including social disadvantage of residential neighbourhood, status and cost of household tenancy, and household income.
• Taking account of social and economic circumstances has the potential to generate savings in out-of-home care that can be re-allocated to support services to reduce poverty and social disadvantage and thereby reduce the need for removal of children from parental care.

     

Recent Trends in U.S. Income and Expenditure Poverty

After many years of following similar trends, U.S. poverty rates measured by household spending in data from the U.S. Consumer Expenditure Survey (CE) fell between 2000 and 2008, while poverty measured by income rose. Comparisons of spending and income poverty in the CE with income poverty in other surveys, spending data from the Panel Study of Income Dynamics, and a time series of employment levels, find the CE to be the outlier. The findings do not bear directly on the primary use of CE data in providing category weights for calculation of the Consumer Price Index, but do require explanation not available in CE public‐use files.