Poverty in the United States

Developing Social Welfare Policy for the Twenty-First Century

A. Dobelstein

• Publisher: Palgrave Macmillan
• Year: 2014
• Print ISBN:
  9781137485472
• eBook ISBN:
  9781137476630
• Topic: Politics & International Relations
• Subtopic: Business General
• Index: Politics & International Relations

This book attributes American poverty to consequences 19th Century social welfare policies within an economy stretching to meet its 21st Century economic potential, arguing that American poverty persists as economic and political structures have moved into the world of fiscal planning but social welfare remains in its Depression-era structure.

Part I Poverty: America’s Shame

1. Poverty’s Elusive Heredity

Give me your tired, your poor, Your huddled masses yearning to breathe free, the wretched refuse of your teeming shore. Send these, the homeless, tempest-tossed to me. I lift my lamp beside the golden door!

Emma Lazarus, The New Colossus (1883)

Strange that 130 years after this verse was written, and 110 years after it was enshrined at the Statue of Liberty, the golden door is tarnished, and now our shore is teeming with the tired, poor, and huddled masses yearning to breathe free. Young, old, women, men, and, sadly, children—as many as 25 percent of our children—have become America’s twenty-first-century “tempest-tossed.”

John Kenneth Galbraith’s observations about American poverty more than 50 years ago sound familiar today:

Poverty—grim, degrading, and ineluctable—is not remarkable in India. For few, the fate is otherwise. But in the United States the survival of poverty is remarkable. We ignore it because we share with all societies at all times the capacity for not seeing what we do not wish to see. . . . But while our failure to notice can be explained, it cannot be excused.¹

America was a dream for those who came and still come, and many who freely came early did, indeed, realize their dream. Yet many did not. Industrialized America created urban slums equal to those the immigrants had fled; labor was exploited in the mines and on factory floors; children were fated to forced labor. There also were those who came involuntarily—African Americans who are still emancipating—and those who were already here that we conquered—Indians (Native Americans) who we forced onto reservations, and who live in deep poverty today. America has always had a large share of its people in poverty, and some critics continue to advise caution over efforts to do anything about it.

George Gilder, a well-respected conservative critic of American social welfare, advised,

The moral hazards of current programs [to respond to poverty] are clear. Unemployment compensation promotes unemployment. Aid for Families with Dependent Children (AFDC) makes more families dependent and fatherless. Disability insurance in all its multiple forms encourages the promotion of small ills into temporary disabilities and partial disabilities into total and permanent ones. Social security payments may discourage concern for the aged and dissolve the links between generations. . . . All means-tested programs (designed exclusively for the poor) promote the value of being “poor” (the credential of poverty), and thus perpetuate poverty. To the degree that the moral hazards exceed the welfare effects, all these programs should be modified, usually by reducing benefits.²

ANTECEDENTS TO PRESENT-DAY POVERTY CONCERNS

Judging from its long-standing prevalence and the sheer volume of literature, America has been obsessed with poverty, but it has not been willing to do very much about it. After all, America was presumed to offer the opportunity to escape poverty. Instead early immigrants found more of what they had supposedly left. Poverty in early America was so widespread that whole communities of workers rose up, spawning political activity that addressed the conditions of the poor. Confusions over what poverty is and what causes it have been dwarfed by unsuccessful struggles to reduce or eliminate it whenever poverty uprisings occurred.

Perhaps the first person to study poverty in a systematic manner was Amos Warner, an economics graduate from Johns Hopkins and onetime director of the Baltimore Charity Organization Society. In 1894, Warner studied 28,000 applications for “charity” (welfare) from which he developed two categorical determinants of poverty: “internal factors that included ‘shiftlessness,’ and ‘lack of judgment,’ and ‘external factors’ that included ‘inadequate wages,’ and ‘limited education’,” among others. Warner estimated that over 42 percent of all people seeking charity at that time were ill, “insane,” or had other disabling physical defects.³

The ferment of the nineteenth-century social reform movement forced a number of structural social changes highlighted by the rise of organized labor, restrictions on child labor, and improved housing standards for working class poor. But as the financial rewards from increased productivity were passed down reluctantly to the poor, as political and social organizations began to engage actively in many structural issues related to poverty, such as poor working conditions, and as ideas of “Social Darwinism” gained prominence for explaining poverty, the social urgency to attack it gradually gave way to public economic optimism and a preference for social stability.⁴ Gradually separated from its structural economic roots and tempered by political compromise, poverty lost its social urgency and instead developed as an ethical issue of personal failure, repulsive individual behavior, and family breakdown. The federal government reflected the nation’s reluctance to become involved in poverty issues when President Pierce vetoed legislation sought by Dorthea Dix to extend federal land grants to states to care for the mentally ill in 1854.

Declining social concern over poverty was not only complicated by confusion over its character, but also by vague information about its extent. Although the first census took place in 1790, its purpose was strictly to count the number of American citizens for congressional apportionment. It was not until the 1850 census that there was any formal recognition of poverty in America. That census counted 66,434 “paupers” in 1849 who had been financially supported, wholly or in part, out of a total of 22 million residents. The census was not able to give a full account of additional people living in “poor houses,” nor was it able to certify the number of paupers who might have received support from a large number of sources that were not registered as charities. Of course neither slaves nor Native Americans were counted as paupers. There was no estimate of the number of paupers who did not receive charity for various reasons; only those who received charity were counted. Yet this census did give attention to poverty in a limited way, and subsequent census counts continued to do so.

EMERGING FEDERAL INVOLVEMENT IN THE PROBLEM OF POVERTY

James Patterson’s comprehensive history of America’s extensive, complex, and frequently contradictory efforts to respond to poverty during the past 100 years certainly confirms America’s ambivalence toward poverty.⁵ Patterson notes that early twentieth-century social reformers began to infuse a national debate about poverty’s social manifestations against a background of public discourse over personal characteristics that caused poverty. Patterson argues, perhaps correctly, that the social reformers emerged from a class of social and economic elites who undertook social reform as a method of preventing poverty to avoid direct spending on the poor. The social reformers, however, did lay a foundation for a national social welfare coalition that forced the federal government into hesitant steps that had significance for the development of the Social Security Act itself. These early social advocates varied in their specific political objectives, but they were united in their fervor to obtain the fruits of broad-scale social and municipal reform. While not always focused on the structural economic determinants of poverty the social reformers certainly drew attention to the plight of the poor early in the twentieth century and wrestled the federal government into several national undertakings. A political deconstruction of several high-profile federal government commitments the reformers achieved offers perspective on America’s hesitant steps to engage with poverty. These early commitments reflect social welfare reference points as America continues to struggle to make today’s social welfare endeavors more responsive to poverty.

Children: The creation of the Children’s Bureau is arguably the first among several significant social welfare shaping events. The municipal and political reform movement, agitated by the growing suffrage movement of the late nineteenth and early twentieth centuries, focused sharply on the rights and welfare of children, highlighted by an unique White House Conference on Care of Dependent Children. At the behest of Lillian D. Wald, founder of the Henry Street Settlement in New York City, and her friend Florence Kelley, President Theodore Roosevelt agreed to call and keynote this 1909 Conference. Financial inadequacy was one of three forms of “dependency” discussed by the more than 100 conference participants. Julian Mack, a former judge of the Juvenile Court in Chicago closed the two-day conference asking, “How should we stop dependency? . . . Until we eradicate poverty, until social justice shall prevail we shall have dependents among us and therefore we must study best how to deal with them.”⁶ Yet there were no clear criteria for determining which children or their families were poor, let alone what to do for them.⁷ One of the products from this Conference was the creation of the Children’s Bureau in 1912 that was charged with collecting information about the welfare of children and recommending steps that could be taken to lessen their poverty.

The aged: The Children’s Bureau provided the first national center for research and advocacy on behalf of children within the structure of the federal government, itself a precedent-setting event. The Children’s Bureau had a profound impact on setting public policy on behalf of children and reducing poverty among them, at least up to 1996.⁸ Although out of historical sequence, a similar example is provided by the formation of the Administration on Aging (AOA) in 1965 that followed a 1963 White House Conference on the Aged. Poverty among the aged was an important focus during the early years of AOA research and advocacy on behalf of the aged, and it contributed significantly to the development of Medicare in 1965, the 1972 changes in Social Security benefits that cut poverty among the elderly in half, and the Pension Reform Act of 1974 that established the Pension Benefit Guarantee Corporation to protect the value of private retirement pensions.⁹

Economic calamity: The Great Depression (circa 1929–34) certainly refocused the nation on poverty but in the context of large-scale economic collapse. The poverty of the Great Depression was viewed as a product of an economy that failed to provide jobs, and the early efforts of the Roosevelt administration was concentrated in creating jobs that would get people back to work. The Social Security Act of 1935 focused its attention on economic protection for the aged and unemployed who lost income when work was not available, and it also strengthened and standardized ongoing state efforts to provide financial assistance to the poor.

But achieving the Social Security Act rested on more than the prevailing economic meltdown. The social reformers had successfully badgered state governments to set up programs of welfare aid in their states, beginning with Illinois in 1903. By the time the social Security Act became law, every state had some mixture of state-funded public aid programs for children, the aged, the sick, and/or others who were considered financially needy in that state. In other words a national welfare architecture had begun to take shape, and the Social Security Act was able to rest a major part of its commitments on these widely diverse state welfare administrations. The social reformers also previously had worked assiduously to convince President Harding and the Congress to create a program of aid for mothers and infants with programs of mother and child hygiene and general public health care in 1920. Nor should the advocacy of Francis Townsend and the widespread politically influential Townsend group members be minimized when examining the development of Social Security itself. In other words the Social Security Act put in place pieces of a complex puzzle, which had been created by varied advocacy groups.¹⁰

Even though the Social Security Act did not deal specifically with poverty, it established a national social welfare architecture that addressed poverty marginally through programs designed to lessen personal economic need. During the following decade a gradually improving economy assisted by the economic stimulus of WWII ushered in a time of American economic prosperity in which poverty continued to prevail, but it seemed politically irrelevant in the existing economic euphoria. Having a policy document in the form of the Social Security Act, however, allowed gradual expansion of programs, particularly Social Security, which progressively chipped away at poverty (see Figure 1.1).

Figure 1.1 Poverty rates by age: 1960–2012

Source: Census Bureau Historic Poverty, 2014.

Public recognition of poverty: With national income at peak levels, and with relatively full employment, Michael Harrington shook the gradual attrition of concern about poverty after WWII. Well before his galvanizing polemic The Other America was published in 1962, Harrington had been chipping away at America’s indifference to poverty. His own religious experiences led him to the Social Gospel movement, and then to Dorothy Day and the Catholic Worker Movement, and then on to his socialist future. Along the way he discovered the “invisible poor” of the 1950s.

The poor are politically invisible. It is one of the cruelest ironies of social life in advanced countries that the dispossessed at the bottom of society are unable to speak for themselves. The people of the “Other America” do not, by and large, belong to unions, to fraternal organizations, or to political parties. They are without lobbies of their own; they put forward no legislative program. As a group they are atomized. They have no face; they have no voice. Thus, there is not even a cynical political motive for caring about the poor as in the old days.¹¹

Candidate John Kennedy was among those moved by Harrington’s passionate call for the end of the two American nations (the Other America was the America of poverty). With the help of the Ford Foundation, Kennedy put in motion a political process that led to President Johnson’s commitment to a War on Poverty in 1964: the Economic Opportunity Act (EOA). The EOA was the first national effort to recognize poverty, specifically: its elimination, or at the very least its containment, thus became a legitimate social welfare policy objective. President Johnson’s design to eliminate poverty set it apart from previous initiatives to help poor people by creating a new set of social programs generated outside the authority of the Social Security Act and other existing social programs. These new programs were administered und...

Table of contents

• Cover
• Title
• Introduction
• Part I Poverty: America’s Shame
• Part II The Cash Support Programs: New Wine in Old Bottles
• Part III Integration of Social Welfare and the American Economy to Reduce Poverty
• Appendix I.1 America’s Cash Support Commitments
• Appendix 1.1 Number and Percent of People in Poverty by Different Poverty Measures: 2010
• Appendix 3.1 Changes in Social Security Beneficiaries: 1935–81
• Appendix 6.1 Highlights of the Simpson/Bowles Recommendations on Social Security
• Notes
• Bibliography
• Index