The War on Poverty

The year 2014 marked the 50th anniversary of President Lyndon Johnson’s launch of the War on Poverty – aimed mainly at the urban poor but also included the rural poor. In January 1964, Johnson declared “unconditional war on poverty in America.” Since then, the taxpayers have spent $22,000,000,000,000 (that’s trillion) on Johnson’s War. Adjusted for inflation, that’s three times the cost of all military wars since the American Revolution.

In 2015, government spent $943 billion providing cash, food, housing and medical care to poor and low-income Americans. (That figure doesn’t include Social Security or Medicare.) More than 100 million people, or one third of Americans, received some type of welfare aid, at an average cost to taxpayers of $9,000 per recipient. If converted into cash, this spending was five times what was needed to eliminate all poverty in the United States.

The U.S. Census Bureau releases an annual poverty report. The latest report claims that in 2013, 14.5 percent of Americans were poor. Remarkably, that’s almost the same poverty rate as in 1967, three years after the War on Poverty started. How can that be? How can government spend $9,000 per recipient and have no effect on poverty? The answer is, of course, it can’t. To have no effect on poverty, that $943 billion has not been “spent”, it has been wasted.

The static nature of poverty is especially surprising because poverty fell dramatically during the period before the War on Poverty began. In 1950, the poverty rate was 32.2 percent. By 1965 (the first year during which any War on Poverty programs began to operate), the rate had been cut nearly in half (47%) to 17 percent. In the 50 years since, it has declined only 14.7% – less than one-sixth the rate of the preceding 25 years!

The Census counts a family as poor if its “income” falls below certain thresholds. But in counting “income,” Census ignores almost all of the $943 billion in annual welfare spending. This, of course, makes Census’ poverty figures very misleading, to say the least. They certainly do not convey the truth about the spending capability of the nation’s poor.

This fact is demonstrated by the actual living conditions of households labeled as poor by Census – which are surprising to most people. According to the government’s own surveys, 80 percent of poor households have air conditioning; nearly two-thirds have cable or satellite television; half have a personal computer; 40 percent have a wide-screen HDTV. Three-quarters own a car or truck; nearly a third have two or more vehicles. Less than 2 percent of the poor are homeless. Only 10 percent live in a mobile home.

Ninety-six percent of poor parents state that their children were never hungry at any time during the year because they could not afford food. Some 82 percent of poor adults reported that they were never hungry at any time in the prior year. As a group, poor children are far from being chronically undernourished. The average consumption of protein, vitamins and minerals is virtually the same for poor and middle-class children and in most cases is well above recommended norms – so far above, in fact, that obesity is now a crisis among the “poor”.

The average poor American lives in a house or apartment that is in good repair and not overcrowded. In fact, the average poor American has more living space than the typical non-poor individual living in Sweden, France, Germany or the United Kingdom. Do these living conditions mean the War on Poverty was a success? Not really.

The United Nations defines poverty as follows: “Fundamentally, poverty is a denial of choices and opportunities, a violation of human dignity. It means lack of basic capacity to participate effectively in society. It means not having enough to feed and clothe a family, not having a school or clinic to go to, not having the land on which to grow one’s food or a job to earn one’s living, not having access to credit. It means insecurity, powerlessness and exclusion of individuals, households and communities. It means susceptibility to violence, and it often implies living on marginal or fragile environments, without access to clean water or sanitation.”

Using this definition, almost no one in the United States lives in poverty (or has since the 1930s). Virtually everyone participates in society – mostly free schooling through high school, athletic events, demonstrations, church, politics, musical events, television, motion pictures, cell phones, electronic games, etc. No mentally stable citizen has starved to death, no one runs around unclothed and un-arrested, all children have access to school, healthcare, fresh water and sanitary facilities. People of all races have poor credit and all Americans now feel insecure and powerless.

Are there still pockets of poverty? Of course but, they are few – mostly parts of Appalachia, some tribal reservations and some remote neighborhoods in our inner-cities where even law enforcement does not go. In fact, President Johnson used a widely publicized photo opportunity staged in one of the worst pockets of poverty in the United States to demonstrate the need for his “war”. That well-chronicled trip was – wait for it – not to an inner-city African-American community but, to Appalachia.

But, what these overall conditions tell us is that the War on Poverty was unnecessary for the vast majority of Americans for whom it was intended. It was a political stunt by the PLDC that has, inadvertently (I hope) led to the destruction of the urban African-American family and community! And now, we have a much larger problem – millions of African-Americans in broken families, living in middle-class (per United Nations definition) dependency upon the federal government.

When Johnson launched the War on Poverty, he wanted to give the poor a “hand up, not a hand out.” He stated that his war would shrink welfare rolls and turn the poor from “tax-eaters” into “taxpayers.” Johnson’s aim was to make poor families self-sufficient – able to rise above poverty through their own earnings without dependence on welfare.

The exact opposite happened. For a decade-and-a-half before the War on Poverty began, self-sufficiency in America improved dramatically. For the past 50 years, though, there has been no improvement at all. In fact, things have gotten worse as many groups are less capable of self-support today than when Johnson’s war started.

The culprit is, in significant part, the welfare system itself, which discourages work and penalizes marriage and the nuclear family. When the War on Poverty began, 7% of American children were born outside marriage. Today, the number is about 25% however, about 75% – that’s right, 75% – of African-American babies are born out-of-wedlock! The collapse of traditional marriage is the main cause of child poverty today.

Now, many advocates for the welfare state will argue that the collapse of the family in the African-American community is due to the lack of eligible men in the community  – because most of them are incarcerated and that the solution is to change the criminal justice system to allow offenders to remain in the community. Opponents ask; “To do what – commit more offenses and father more children to observe how to offend?”

The solution to the high incarceration rates in the black community is a subject for its own treatise but, suffice it to say that the solution begins with respect and respect begins at home with respectable behavior by parents, siblings and the extended family. Children growing up in a home environment where they are constantly exposed to invectives   against “whitey” or the police or authority in general or America’s “racist” society will enter that society with no respect for teachers, for first-responders, for other races, for the system of justice or for the law.

Such conditioning produces the rule breaking in school and the law breaking after schooling is over. Until that cycle is broken, incarceration rates will, and should, remain high because the root-cause of the problem will not have been addressed. In present-day America, the problem cannot even be mentioned. It’s not politically correct.

Not all African-Americans perpetuate this cycle, of course but, a critical mass of them do, to the extent that a significant percentage of children and young adults in the black community have suspiciously common and  convenient excuses for the disrespectful behaviors that result in the disciplinary actions from society that lead to wasted lives even where opportunities abound for those who would forsake the easy excuses and apply their God-given talents to the hard work necessary for success.

Unfortunately, the welfare state is self-perpetuating – how fortunate for those who make a living – or a career – from perpetuating dependence upon federal government handouts. By undermining the social norms necessary for self-reliance, welfare creates a need for even greater assistance in the future and the government plans to spend $13 trillion more over the next decade on welfare programs that will continue to discourage work, penalize marriage and undermine self-sufficiency. That brings the total “Great Society” wasted spending to $35 trillion! We could retire the national debt twice for that amount.

Here are some worthwhile thoughts from Louis Woodhill of Forbes Magazine (edited for clarity for non-economists). “Has the War on Poverty been a failure? Well, of course it has. If you devote 50 years and $21.5 trillion (in 4Q2013 dollars) to anything, and people are arguing about whether it was a success or a failure, then you can be sure that it was a failure.

Have you noticed that, 50+ years from its inception, no one is suggesting that the Apollo program was a failure? The Apollo program was an unchallenged success because it accomplished its stated goal: “…to land a man on the moon, and to return him safely to the earth (within 10 years).”

The stated goal of the War on Poverty, as enunciated by Lyndon Johnson on January 8, 1964, was, “…not only to relieve the symptom of poverty, but to cure it and, above all, to prevent it.” In other words, President Johnson was not proposing a massive system of ever-increasing welfare benefits, doled out to an ever-enlarging population of beneficiaries. His proclaimed goal was not a massive new system of government handouts but an increase in self-sufficiency: a new generation capable of supporting themselves out of poverty without government handouts.

LBJ actually planned to reduce, not increase, welfare dependence. He declared, “We want to give the forgotten fifth of our people opportunity, not doles.” He claimed that his war would enable the nation to make “important reductions” in future welfare spending: The goal of the War on Poverty, he stated, would be “making taxpayers out of tax eaters.” Because he viewed the War on Poverty as a means to increase self-support, Johnson proclaimed that it would be an “investment” that would “return its cost manifold to the entire economy.” [Now, of course, all government spending is called “investment”.]

Measured against these objectives, the War on Poverty has not just been a failure, it has been a catastrophe. It was supposed to help America’s poor become self-sufficient, and it has made them dependent and dysfunctional.”

This, is fact, is illustrated most vividly by the stupifyingly named “Anchored Supplemental Poverty Measure Before Taxes and Transfers” (ASPMBTAT). Stick with me here! This metric was devised to assess the ability of people to earn enough, not counting taxes and subsidies – welfare, food stamps, etc. – to keep themselves and their dependent children out of poverty. The income required to do this varies by family size and composition, but, for a family comprising two adults and two children, it is $25,500/year (in 4Q2013 dollars).

The ASPMBTAT is the ultimate quantitative test of the success (or failure) of the War on Poverty, at least in terms of its stated objective. Shortly after the War on Poverty got rolling (1967), about 27% of Americans lived in poverty. In 2012, the last year for which data is available, the number was about 29%. This result would be shocking, even if we had not spent $21.5 trillion “fighting poverty” over the past 50 years. Here’s why. (This is not hard – just basic arithmetic)

Between 1967 and 2012, U.S. Real Gross Domestic Product (RGDP) per capita (in 4Q2013 dollars) increased by 127.3%, from $23,706 to $52,809 for a typical family of four. In other words, to stay out of poverty in 1967 (earn $25,500 in 4Q2013 dollars), the two adults in a typical family of four had to capture 26.9% of their family’s proportionate share of RGDP (i.e., average RGDP (per capita), that is, times four: $23,706 x 4=$94,824, so that  $25,500/$94,824=26.9%). To accomplish the same thing in 2012, they only had to pull in 12.1% of their family’s share of RGDP ($52,809×4=$211,236; $25,500/$21,236=12.07%). And yet, fewer people were able to manage this in 2012 than in 1967.

Simply put, more poor people were dependent upon government subsidies to maintain their lifestyles in 2012 than were successfully managing their economic status – to the tune of the government providing more than half of their income.

What actually turned the War on Poverty into a social and human catastrophe was that the enhanced welfare state created a perverse system of incentives, and people adapted to their new environment – as critics of the plan pointed out at the time. That people would adapt to a changed social/economic environment should have surprised no one. After all, everyone living today is here because 50,000+ generations of their ancestors managed to adapt to whatever circumstances they found themselves in, at least well enough to produce and successfully raise offspring.

The adaptation of the working-age poor to the War on Poverty’s expanded welfare state was immediately evident in the growth of various social pathologies, especially unwed childbearing. The adaptation of the middle class to the new system took longer to manifest, but it was no less significant.

Even people with incomes far above the thresholds for welfare state programs were forced to adapt to the welfare state. As crime rates (driven by rising numbers of fatherless boys) rose in the cities, and urban schools’ systems became dangerous and dysfunctional, the middle class (of all races) was forced to flee to the suburbs. (Almost three-quarters of the children, who are able, choose to leave urban public schools.) Because many middle-class mothers had to go to work to permit their families to bid for houses in good school districts (as well as pay the higher taxes that the expanded welfare state required), self-supporting families had fewer children.

Before we look at how the poor adapted to the War on Poverty’s enhanced means-tested welfare programs, let’s look, for enlightenment, at how America adapted to Medicare and enhanced Social Security benefits.

“Desperate to spin the disastrous War on Poverty as a success, progressives/liberals have tried to divert our attention from America’s growing underclass by pointing to the large decline in the Official Poverty Measure (OPM, which includes cash transfer payments) for senior citizens. The OPM for Americans age 65 and above fell from about 30% in 1967 to about 9% in 2012. But, it is not clear that the OPM for seniors would be higher today if the War on Poverty had never been mounted.

Because the War on Poverty made Social Security benefits more generous, and also created Medicare, it produced an instantaneous reduction in the OPM for senior citizens. And, obviously, if Social Security and Medicare were terminated tomorrow, the OPM for senior citizens would rise. However, because both Medicare and enhanced Social Security have now been in place for the entire working lifetimes of the people retiring today, these calculations prove nothing. Progressives want us to believe that the people that started working after 1965 would have managed their lives and their finances exactly the same way if the welfare state had not been expanded during the mid-1960s. This is not likely.

More importantly – and more damaging to the capital-based economy (where institutions, like savings-banks, lend money to businesses for expansion and the hiring of new employees), as Social Security and Medicare benefits were made more generous, people reduced their savings. The Personal Savings Rate (which is calculated as a percent of disposable income) has fallen by more than half since 1967 (from 12.2% to 5.6%). In other words, when people found that they didn’t need to save as much to avoid being poor in old age, they didn’t save as much during their working years. Also, because of higher payroll taxes, workers had less money to save.

This was particularly problematic because GDP is driven by capital investment – which is dependent upon personal savings accounts which banks use for lending purposes. America’s lower savings rate translated into slower economic growth. Because, as Albert Einstein once said, “…compound interest is the most powerful force in the universe”, our economy is considerably smaller today than it would have been if people had been encouraged and able to save more for retirement. And, there are far fewer good-paying jobs (for African-Americans as well as everyone else) than there would have been with more investment and higher GDP.

Among other things, a smaller GDP means that supporting our non-working senior citizens imposes a larger burden upon today’s working people than it would have if savings and investment had been higher over the past 50 years. So, it is not clear at all that the War on Poverty-enhanced welfare state for senior citizens produced any long-term benefit, even for seniors. However, at least we can afford it.

With correct economic policies, the U.S. can sustain RGDP growth rates of 3.5% or higher, and this level of growth would make Social Security and Medicare affordable, with no tax increases and no benefit cuts. [Unfortunately, the Obama Recovery from the “Great Recession” of 2007-8 has averaged only slightly more than 1%!] What America cannot afford is a welfare state that makes government dependency a feasible career option for its young people.

The War on Poverty made welfare (broadly defined) into a viable entry-level job, and poor people signed up for it in droves. The pathologies that resulted from the War on Poverty were not the fault of the poor themselves. They simply adapted, in a logical and predictable way, to a welfare state designed and promoted by our progressive/liberal elites.”

It is amazing that progressive/liberals, who treat Darwin’s theory of evolution as religious dogma, also seem to believe that there is no such thing as “human nature.” They also seem to believe that “nurture” (which presumably includes exhortation from government bureaucrats) trumps “nature.” Unfortunately for progressive programs like those making up the War on Poverty, there is an essential human nature that we all share, and humans respond predictably to the incentives present in the environment around them.

“Children are programmed by evolution to rebel against their parents’ control, and to seek to be independent. Prior to the welfare state, the only way for girls to escape the authority of their parents was to become economically self-sufficient, by getting a job and/or getting married. The progressive welfare state, especially after it was expanded by the War on Poverty, provided a third option for teenage girls seeking to get away from their parents’ control – have a baby. As soon as a young, unmarried girl had a baby, she officially became a “poor family,” and the government would force taxpayers to support her and her baby.

Unfortunately, the damage to poor communities was done long before the half-hearted welfare reforms of 1996. Once the number of responsible fathers in a community falls below a certain level, the adults lose control of the adolescent males. Gangs take over the streets, and gang values (mainly, getting “respect,” by violence if necessary – a perverse and evil definition of respect, to be sure) become established among the young males.

Urban crime rates rose rapidly from the 1960s through the early 1990s, at which point the public got angry, rebelled against soft-on-crime progressives, elected conservatives who cracked down hard on criminals. [Aggressive New York City Mayor Rudy Guiliani is the most prominent example. During his tenure, the city experienced a 66% reduction in murders, a 72% decline in shootings and a 56% decline in the FBI Crime index compared to the national average of 16%, mostly by removing the repeat offenders from the streets!] The result was an exploding prison population, with the majority of those incarcerated being young, fatherless males – black and white alike. The consequence of adapting to the expanded welfare state has been no less devastating for poor young men than it has been for poor young women.

Nearly 2000 young people (mostly minority – ages 17-24) are injured by assaults [in and around their own neighborhoods] every day! The incarceration rate of black males is over six times higher than that of white males, with a rate of 4,749 per 100,000 US residents. Black youths, who make up 16% of the youth population, accounted for 52% of juvenile violent crime arrests, including 58.5% of youth arrests for homicide and 67% for robbery. Black youths were overrepresented in all offense categories except DUI, liquor laws and drunkenness.

Blacks accounted for 52.5% of homicide offenders from 1980 to 2008, with whites 45.3% and “Other” 2.2%. The offending rate for blacks was almost 8 times higher than whites (per 100,000), and the victim rate 6 times higher (per 100,000). Most murders were intra-racial, with 84% of white homicide victims murdered by whites, and 93% of black victims murdered by blacks.”

In 1950, the life-plan for young men was, “Get a job, make money, get married, and support a family.” The War on Poverty changed this to, “Just show up. Don’t worry, you won’t have to support the children that you might father – the government will force taxpayers to do that. In fact, you might even be able to live off the women and children that are living off the welfare state.”

We are the descendants of the early human males who had the most surviving children. Given human nature, a male’s ideal reproductive strategy is to have sex with as many women as he can, and sire as many children as he can, while (somehow) getting other people to support his children, so that they will survive to reproduce and he can spend his efforts exclusively on reproductive strategies.

Because an attempt by one male to implement this ideal reproductive strategy in a civilized society conflicts with the interests of the mothers of his children (who want him to stick around and help raise them), and with the interests of the other males (who could get stuck having to support children that are not their own), Western Civilization evolved strong defenses against this strategy. It’s called marriage – one male, one female in a committed relationship centered on the rearing of their children into responsible adults able to rear their own children and contribute positively to a vibrant and growing society.

The War on Poverty changed this. The expanded welfare state transferred the burden of supporting the offspring of culturally-irresponsible males from family members and/or the local community to a diffuse group of taxpayers. This burden-shifting benefited irresponsible males in an evolutionary biological sense, but there were huge costs to society.

As the dependent underclass expanded and required more taxes to be paid, struggling middle-class families were increasingly forced to delay having their own children, and to have fewer of them. This was because the middle-class not only had to pay the taxes required to support the welfare state, but also found itself forced to pay for private schools, or to bid for expensive housing in school districts where their children would not be exposed to the pathologies of the increasingly chaotic underclass.

None of this was exclusively related to race. The black middle-class fled Detroit for exactly the same reasons as the white middle-class fled Nashville. Even our Presidents, who presumably are not a racist, live in the heart of Washington, DC, but send their kids to private schools. And, as Charles Murray has documented in his book, Coming Apart, underclass social pathologies are also taking hold among poor whites, Hispanics and other minorities.

“Compounding the damage done by the welfare state is the long-term shift in the “gender ratio”, which is the number of adult males per 100 adult females. Western civilization as we know it, evolved during a time when women were in relatively short supply, due mainly to death in childbirth. Due to improving, though still primitive, medical standards, from 1790 to 1910, the gender ratio in the U.S. hovered around 104. Around 1910, medical science began to get a handle on death in childbirth, and the gender ratio began falling. It hit 100 in 1945 and bottomed out at about 95 in 1970.

The decline in the gender ratio broke the “female sex cartel,” which had permitted women to demand marriage and fidelity as the price of dependable sex. Today, only men who want to get married for reasons other than sex get married. Lots of college-educated men seem to want to be married, but it appears that a much lower percentage of high school dropout males are looking to wed. This may be because those men feel that they have little to offer to a family, or because today’s welfare state strongly discourages low-income people from marrying each other.

The impact of the shift in the national gender ratio has been amplified in poor communities by mass incarceration. This has produced extremely low gender ratios in areas of concentrated poverty. It does little good to promote marriage as a solution to poverty, if there are no marriageable [meaning, personally responsible] men. Also, America needs to understand that poor women are getting married. They are marrying the welfare state, in many cases “until death do us part.” As the welfare state expanded, marriage stagnated and single parenthood soared. There has been no significant increase in the number of married-couple families with children (both poor and non-poor) in the U.S. since 1965!

By contrast, the number of single-parent families with children has skyrocketed by nearly 10 million, rising from 3.3 million such families in 1965 to 13.2 million in 2012 – a 400% increase. Since single-parent families are roughly four times more likely than married-couple families to lack self-sufficiency [and to be “officially” poor by American political standards], this unraveling of family structure has exerted a powerful downward pull against self-sufficiency and substantially boosted the “official” child-poverty rate.

Since the beginning of the War on Poverty, the number of single-parent families in official poverty (or lacking self-sufficiency) has more than tripled, increasing from 1.6 million in 1965 to 4.8 million today. When the War on Poverty began, 36 percent of poor families with children were headed by single parents; today, the figure is 68 percent – and 75 percent among African-American families. During the Harlem Renaissance, less than 30 percent of African-American families were headed by a single-parent!

Over 100 million people, about one third of the U.S. population, received aid from at least one welfare program at an average cost of $9,000 per recipient in 2013. If converted into cash, current means-tested spending is five times the amount needed to eliminate all poverty in the U.S. in counting family “income.” The federal government currently runs more than 80 means-tested welfare programs. Qualifying families can now have all of their children’s meals (breakfast, lunch and dinner provided free by the state at their public schools during the school year – and also during vacation periods – in a growing number of states.

For most Americans, the word “poverty” means significant material deprivation, an inability to provide a family with adequate nutritious food, reasonable shelter and clothing. But only a small portion of the more than 40 million people labeled as poor by Census fit that description. The media frequently and simplistically associate the idea of poverty with being homeless.

This whole area of government social-engineering is called the “Welfare–Poverty Paradox”. Lyndon Johnson’s “Great Society” has become the “Guns and Grievance Society”.

So here we sit, no closer to a color-blind, economically self-sufficient society than we were fifty years ago. Legislative solutions have proven to be more detrimental than beneficial. Change can only come from an acquaintance with and acceptance of, the truth – beginning with an acknowledgement that there is only one truth – based on known facts processed by the educated and informed human mind.

We know the truth when we hear it and we only kid ourselves if we ignore that still, small voice of conscience that nags and nags until it is either acknowledged – or the penalty is paid. You know as well as I do – it never fails. The popularly described state of poverty in America today is, in fact, a big, fat lie!

Worse than that, after fifty years of utter dependence upon government for the most basic of life’s necessities, the African-American community has now arrived at the point where, even if all obstacles to economic success were eliminated for everyone, most would be unprepared to enter the greater society as non-dependent citizens and take full advantage of opportunities because they lack access to the truth, education, experience and expertise in the basic founding principle of America – the individual, independent initiative to “risk” success – the very opposite of their experience which has been, for half a century, to have everything securely provided by government – risk free.

Make no mistake, there are inner-city “angels among us” who work tirelessly with the poor in every community to help those who are the new pioneers – those poor and disadvantaged with a spirit of their own “manifest destiny”, like that which animated the founding generation for whom the Constitution was written – and who possess the American spirit that is not willing to accept the slavery of a state sponsored cradle-to-grave “umbilical cord” – in order to strike out on their own without the stifling “support” of big government?

Next time: The Reverend Jeremiah Wright

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