Three Barriers to Improving Poverty Rates in America
As the election is well underway, the United States’s political discussion has intensified about the living standards of the poorest in the country and the solution to their poverty. The Democrats, as usual, have proposed extended welfare benefits and greater government aid to poor families.
This experiment began in the 1960s when President Lyndon Johnson initiated the War on Poverty programs. As he signed them into law, poverty levels were already plummeting, according to data collected from the Census Bureau, thanks to substantial increases in productivity and wages. Since the 1960s, although approximately $20 trillion have been spent on the programs, poverty levels have basically flatlined, often ticking up due to the occasional recession.
There is a fundamental reason for this. The War on Poverty programs lowered the relative cost of single parenthood in terms on poverty. Under the War on Poverty, subsides to single parent families became greater than two-parent families. This is why, since the programs were initiated, rates of single parenthood have ballooned. In 1960, less than 10 percent of all children were born out of wedlock in the US. In 2008, it hit 40 percent.
Single parenthood is a potent predictor of poverty. According to the Census Bureau, in 2019 the poverty rate for two-parent families was estimated to be 5.2 percent. The estimated poverty rate for single parent families, however, was 25.9 percent. The Heritage Foundation puts the numbers at 6.4 percent and 36.5 percent. It is also well documented that children who grow up in single parent households are much more likely to suffer psychologically and, when they grow older, commit crime, as documented by a study published in the Journal of Political Economy. Getting single motherhood to drop (or, at least, stop rising) would require reforming the welfare system: either by withdrawing welfare benefits from single parent families or increasing them for two-parent families. But either way, the message is clear: one of the side effe
Article from Mises Wire