- Key Facts
- The $22 trillion U.S. taxpayers have spent on anti-poverty programs does not include Social Security or Medicare.
- In 2014 was 14.8 percent - about the same rate as in 1967.
- The federal government now operates 122 different anti-poverty programs.
- Norway is the only nation that spends more per person than the U.S. spends on social welfare.
- In 2008 enrollment in Food Stamp program was below 30 million. In 2015, it is at 46.5 million.
America has always been considered the land of opportunity. Unfortunately, our welfare system has become one that can actually discourage those who want to make a better life for themselves and their families. Many of our programs encourage individuals to stay on welfare instead of joining the workforce, holding them hostage in the never-ending cycle of poverty and stopping them from reaching their full potential. That’s why the House Ways and Means Committee has been taking a deep dive into the real issues that face our welfare system, setting the stage for “welfare reform 2.0,” so that, ultimately, we can help make the American idea a reality for anyone who wants it.
- The $22 trillion U.S. taxpayers have spent on anti-poverty programs since President Johnson declared his War on Poverty (adjusted for inflation) does not include Social Security or Medicare. This cost – $22 trillion – is 3 times the cost of all military wars in U.S. history since the Revolutionary War.
- One third of all Americans receive benefits from at least one welfare program, according to the U.S. Census.
- The federal government now operates 122 different anti-poverty programs.
- Only one nation (Norway) spends more per person than the U.S. spends on social welfare.
- As scholar Robert Rector of the DeVos Center for Religion and Civil Society writes, “(There are) claims that the U.S has a far higher poverty rate than other developed nations have. These claims are based on a ‘relative poverty’ standard, in which being ‘poor’ is defined as having an income below 50 percent of the national median. Since the median income in the United States is substantially higher than the median income in most European countries, these comparisons establish a higher hurdle for escaping from ‘poverty’ in the U.S. than is found elsewhere. Measuring the poverty-fighting success of the United States versus Europe according to this uneven standard is like having a race in which the European sprinters run 100 meters and the American runner runs 125 meters. The Europeans reach the finish line first and are declared faster. Using such non-uniform standards to compare countries is obviously misleading.”
- The food-stamp program has grown substantially over the last decade. In 2008, enrollment was below 30 million, and the program cost $40 billion. By 2013, enrollment rose to 47.6 million — with food stamps costing $80 billion. Food stamp enrollment has dipped slightly in the last few years, with enrollment at nearly 43 million in January 2017.
Additional Reading on anti-poverty and social welfare spending
John Goodman, “Why We Lost the War on Poverty,” Forbes.
Daniel Halper, “Over $60,000 in Welfare Spent Per Household in Poverty,” The Weekly Standard. \
NRO Symposium, “The War on Poverty at 50,” National Review Online.
Thomas G. West writes in the Heritage report “Poverty and Welfare in the American Founding:”
“From the earliest colonial days, local governments took responsibility for their poor. However, able-bodied men and women generally were not supported by the taxpayers unless they worked. They would sometimes be placed in group homes that provided them with food and shelter in exchange for labor. Only those who were too young, old, weak, or sick and who had no friends or family to help them were taken care of in idleness. The Founders had little to say about the topic of poor relief. Like the family, welfare was not a controversial topic.
Poor children whose families could not provide for them, including orphans, were put out to suitable persons as apprentices so that they would learn ‘some art, trade, or business’ while being of use to those who were training them. However, this was not to be done, in Jefferson’s plan, until they had attended public school for three years, if necessary at public expense.“
Interestingly, all the typical features of early American welfare policy can be seen in Thomas Jefferson’s descriptions and proposals from the earliest colonial days:
- The government of the community, not just private charity, assumes responsibility for its poor. This is far from the ‘throw them in the snow’ attitude that is so often attributed to pre-1900 America.
- Welfare is kept local so that the administrators of the program will know the actual situations of the persons who ask for help. This will prevent abuses and freeloading. The normal human ties of friendship and neighborliness will partly animate the relationship of givers and recipients.
- A distinction between the deserving and undeserving poor is carefully observed. Able-bodied vagabonds get help, but they are required to work in institutions where they will be disciplined. Children and the disabled, on the other hand, are provided for, not lavishly but without public shame. The homeless and beggars will not be abandoned, but neither will they populate the streets. They will be treated with toughness or mercy according to their circumstances.
- Jefferson’s idea of self-reliance was in fact family reliance, based on the traditional division of labor between husband and wife. Husbands were legally required to be their families’ providers; wives were not. Nonsupporting husbands were shamed and punished by being sent to the poorhouse.
- Poor laws to support individual cases of urgent need were not intended to go beyond a minimal safety net. Benefit levels were low. The main remedy for poverty in a land of opportunity was marriage and work.
Two centuries ago, most Americans—at least 90 percent—were desperately poor by today’s standards. Most houses were small, ill-constructed, and poorly heated and insulated. Based on federal family income estimates, 59 percent of Americans lived in poverty as late as 1929, before the Great Depression. In 1947, the government reported that 32 percent of Americans were poor. By 1969, that figure had declined to 12 percent, where it remained for 10 years.Since then, the percentage of poor Americans has fluctuated but has remained near the same level. As of 2013, the poverty rate was 14.5 percent.
In other words, before the huge growth in government spending on poverty programs, poverty was declining rapidly in America. After the new programs were fully implemented, the poverty rate stopped declining.
Important Steps to Combating Poverty
In partnership with Opportunity Lives, AEI, and Economic Innovation Group, the Jack Kemp Foundation hosted “Expanding Opportunity,” a special presidential-candidate forum focusing on poverty. This January 2016 event was the first to focus exclusively on combating poverty and expanding opportunity where it’s needed most in the United States. Speaker Paul Ryan and Senator Tim Scott moderated the discussions with Governor Jeb Bush, Dr. Ben Carson, Governor Chris Christie, Ms. Carly Fiorina, Governor John Kasich, and Senator Marco Rubio.
Bob Woodson, Founder and President of Center for Neighborhood Enterprise, also attended the Kemp Forum as one of Speaker Ryan’s guests of honor. Woodson led the Speaker on a “listening and learning” tour with faith-based neighborhood healers around the country, and he promotes neighborhood-based programs to combat poverty, championing the community’s role in empowering people to become self-sufficient — rather than federal anti-poverty programs.
You can watch some highlights from the Kemp Forum below. Also see Public Interest Fellow Ian Lindquist’s “An Emerging Republican Education Agenda at the Kemp Forum,” for a synopsis of the innovative education policies discussed.
Takeaways on Poverty
These important facets of anti-poverty work were highlighted by the then-presidential candidates and moderators who participated in the forum.
1 – Look for solutions in the community. The preeminent takeaway from the Kemp Forum was: Go to where people are living lives of poverty, talk to them and understand them. Follow the leaders who have pulled themselves out of bad situations and away from abject poverty, and look to them as a guide.
2 – Education reform. We are living in the information age, and our education system is outdated. We do not customize education for student needs or the needs of our economy. Specific policy reforms mentioned virtual classrooms and coupling vocational training with a high school diploma so students are getting the best possible education, with the tools they need to be college and work ready.
3 – School Choice. Building from the consensus that we need to customize our policies to the needs of individual Americans, charter schools successes were widely discussed during the forum. School choice was identified as a way to help students earn an education in an environment that supports their needs.
4 – Criminal Justice reform. Treatment should be the main focus for individuals guilty of drug related offenses, as long as that individual is deemed non-violent and is not dealing drugs. Allowing judges to have more discretion in sentencing and understanding that drug addiction is a disease are important components of bipartisan criminal justice reform and breaking the cycle of poverty.
5 – Job Training. For many American’s who have lost a job or are stuck in the poverty trap, as outlined by Speaker Ryan, access to new skills and a job can preclude a fall into poverty. States have led the way by combining welfare services with interviews and job training services in and effort to better to determine the skills of individuals and connect them to job opportunities.
6 – Regulatory Reform. Dodd Frank has hurt entrepreneurs by limiting access to loans needed to create or expand a business. Additionally, our nation is suffering under an increasingly burdensome regulatory environment. The costs of goods and services go up as a result of regulations. So, in addition to stifling innovation and entrepreneurship, our out-of-control regulations are hurting the poor.
7 – Tax Reform for Job Creation. It is important to foster an environment in which entrepreneurship can strive and new jobs are created to ensure that every American has a chance to earn a paycheck. Reforming the corporate tax code is an important step in creating American jobs.
Here’s a TEDx Pennsylvania Avenue video, featuring Paul Ryan U.S. Representative and House Ways & Means Committee Chairman, presenting a new way to fight the war on poverty:
Evidence-Based Policy Making
Another step in making government work better for people is analyzing whether or not programs are actually effective. The Evidence-Based Policymaking Commission Act of 2016 is a law that establishes a 15-member commission to study how best to expand the use of data to evaluate the effectiveness of federal programs. The commission would give agencies a better grasp of how effective programs are, and would give lawmakers a better grasp of how to improve them. As Chairman Ryan so simply said upon introducing the bill in April 2015, “If we want to make government more effective, we need to know what works.” The bill received bi-partisan support and was signed into law on March 30, 2016.
Programs that work: Americans Overcoming Adversity
Opportunity Lives and Bob Woodson collaborate on this uplifting project, which showcases inspiring, true stories of real-life Americans overcoming adversity in our nation’s cities and communities.
Woodson believes that “low-income people must become agents of their own uplift instead of being assigned the role of a client of professional service providers. People are motivated to change and improve when they are shown victories that are possible, not injuries to be avoided.” The “Comeback” series of videos highlights the power of such self-empowerment in practice.
Another success story is Shelters to Shutters. Across the country, Shelters to Shutters pairs leading property management professionals with homeless individuals who are ready to work. The result is an innovative program that provides mentorships for careers in property management, along with full-time employment and housing opportunities for individuals facing homelessness and a pipeline of high quality, motivated employees for the multifamily housing industry.
Finally AEI Scholar Robert Doar summarizes in “Ten Welfare Reform Lessons,”, how New York City embraced an ethic of work to run a successful program.
Additional Resources on Poverty, Social Welfare Reform, and Opportunity
Andrew Biggs, “A Social Security Reform Plan that Can Pass,” AEI
Robert Doar, “Ten Welfare Reform Lessons,” National Review
Robert Rector, “Reforming Food Stamps to Promote Work and Reduce Poverty and Dependence,” Heritage.
Diana Furchtgott-Roth, “Welfare in America 1998-2013: The Case for Further Reform,” Manhattan Institute.
Questions for Discussion
- What do you think the role of government should be in fighting poverty?
- What do you see your role to be in fighting poverty?
- What should we be asking our legislators to do and how could we reach them?
- Do you think our current social welfare system remains true to Thomas Jefferson’s sense of government’s obligation to the poor in the early American era?
- What can we do to reform the current anti-poverty programs?
- What do you think about the Kemp Forum’s proposals for fighting poverty?
- What are other ways we can empower and enable people to achieve upward mobility, specifically in our respective communities?