Poverty can be defined as a condition of deprivation due to economic circumstances that is severe enough that the individual in this condition cannot live with dignity in his or her society. The administration of Lyndon Johnson established a wide range of antipoverty programs in the 1960s—programs for education, job training and placement, housing—as a part of its “War on Poverty.” Within just a few years, many of these programs, and the whole ideology behind them, had come under attack. At the core of the debate about poverty in America is the question of whether poverty is the cause of social ills such as crime, poor educational outcomes, and divorce or their result. Perverse incentives are reward structures that lead to suboptimal outcomes by stimulating counterproductive behavior; unintended consequences are results of a policy that were not fully anticipated at the time the policy was implemented, particularly outcomes that are counter to the intentions of the policy makers. The Culture of Poverty
The culture of poverty theory argues that poor people adopt certain practices, which differ from those of middle-class or “mainstream” society, in order to adapt and survive in difficult economic circumstances and that sometimes they continue to rely on these practices even after they are no longer useful and are potentially detrimental. The culture of poverty theory was part of a backlash against the policies implemented by President Johnson, and it was used to bolster the arguments of welfare critics. While it may be true that reliance on welfare generates a sense of helplessness and dependency in some people, there are also structural reasons why it can be difficult to transition from welfare to work. In the 1980s, journalist Ken Auletta introduced the concept of the underclass—a much more negative view of poor people—and Charles Murray reemphasized perverse incentives by arguing that welfare regulations make work and marriage less attractive and rising welfare benefits more attractive. Sociologist William Julius Wilson turned the focus from welfare to factors such as deindustrialization, globalization, suburbanization, and discrimination as causes of urban poverty. In the past 20 to 30 years, policies to combat poverty have focused on encouraging work and offering benefits that directly serve children. In her book What Money Can’t Buy, sociologist Susan Mayer wrote that she found very little evidence to support the widely held belief that parental income has a significant effect on children’s outcomes. In The Bell Curve, Charles Murray and Richard Hernstein argued that it’s not poverty or education or parenting that ultimately has the most impact on children’s outcomes, but simply genes. James Rosenbaum’s study of the Gautreaux Assisted Living Program in Chicago and the Moving to Opportunity (MTO) study begun by the U.S. Department of Housing and Urban Development in 1994 were both efforts to see how moving families from high-poverty to low-poverty communities might affect parental employment, children’s outcomes, and a host of other factors. The results of these studies were mixed for various reasons, but the MTO study in particular seemed to show that living in a quieter, less stressful environment did have very positive effects on children. Poverty amid Plenty
Absolute poverty is the point at which a household’s income falls below the necessary level to purchase food to physically sustain its members. The official poverty line in the United States is calculated using a formula developed in the 1960s by Mollie Orshansky that estimates food costs for a variety of family types based on U.S. Department of Agriculture recommendations for minimum food requirements and then applies a multiplier. This formulation has not changed since it was introduced, but it has been heavily criticized for not evolving to reflect broad changes in people’s circumstances over the past 40 years. A more fundamental...
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