Congresswoman Lee of Oakland, thank you so much for raising the consciousness of a Nation again. I rise to join my colleagues tonight in support of raising consciousness about how important the…
Congresswoman Lee of Oakland, thank you so much for raising the consciousness of a Nation again.
I rise to join my colleagues tonight in support of raising consciousness about how important the programs have been over the years to reduce poverty in our country since the half-century-old effort of the war on poverty started by Lyndon Johnson, a Democrat, who wanted to replace despair with opportunity.
Mr. Speaker, at this time, I would like to place into the Record an executive summary of the Council of Economic Advisors, dated January 2014, that summarizes the great progress that has been made: poverty in our country declining by more than a third since 1967 because of important programs that Democrats created--Social Security, Medicare, the earned income tax credit, and unemployment compensation, which is being tested as we speak here today. The speaker from Ohio, where unemployment has just gone up, should bring up that bill to extend unemployment benefits that impacts millions of Americans across our country.
People who understand the value of work, they don't want any subsidy, they want a job--they want a job. The most important work we can do is to create jobs, but when they can't get a job, then to give them their earned benefits.
What is great about this evening is I was thinking back to the 1960s--I was pretty young back then--but there was a book written by Michael Harrington, ``The Other America.'' For whatever reason--maybe it was because President Kennedy was President--that book became almost like a small Bible. People read it and it raised their consciousness. I can remember President Kennedy campaigning in the mines in West Virginia and raising consciousness again about the conditions of miners and what they were enduring.
It is very important that we have that same kind of effort across our country to raise consciousness about how important these programs are for our children, for our seniors, for those who are out of work. By working together we, as a people, really do make a difference.
Congresswoman Lee, I want to thank you tonight for being part of that clarion call to raise consciousness of people who really care. The majority of Americans really do. As they are listening to Wall Street announce bigger and bigger and bigger bonuses, they know that there is a war on the middle class right now. So many Americans are falling out of that middle class. They know something is wrong. They want us to champion jobs here in Washington, D.C., and they want to make sure that that safety net is there for them if they hit the skids.
I just thank you so very much for doing this. I thank all of my colleagues who took the time tonight to be here and to issue a clarion call for consciousness for jobs in this country, for extending unemployment benefits, for maintaining Social Security, for maintaining the earned income tax credit, and making sure that our vigilant efforts continue to eliminate poverty in this country.
[From The Council of Economic Advisers, Jan. 2014]
The War on Poverty 50 Years Later: A Progress Report
Executive Summary
``Unfortunately, many Americans live on the outskirts of
hope--some because of their
poverty, and some because of their color, and all too many
because of both. Our task is to help replace their despair
with opportunity. This administration today, here and now,
declares unconditional war on poverty in America. I urge this
Congress and all Americans to join with me in that effort.''
--President Lyndon B. Johnson, January 8, 1964
Fifty years ago, in January of 1964, President Lyndon B.
Johnson declared a ``War on Poverty'' and introduced
initiatives designed to improve the education, health,
skills, jobs, and access to economic resources of those
struggling to make ends meet. While there is more work to do,
in the ensuing decades we have strengthened and reformed many
of these programs and had significant success in reducing
poverty. In this report, the Council of Economic Advisers
presents evidence of the progress made possible by decades of
bipartisan efforts to fight poverty by expanding economic
opportunity and rewarding hard work. We also document some of
the key steps the Obama Administration has taken to further
increase opportunity and economic security by improving key
programs while ensuring greater efficiency and integrity.
These steps prevented millions of hardworking Americans from
slipping into poverty during the worst economic crisis since
the Great Depression.
Poverty has declined by more than one-third since 1967.
The percent of the population in poverty when measured to
include tax credits and other benefits has declined from 25.8
percent in 1967 to 16.0 percent in 2012.
These figures use new historical estimates of the Census
Bureau's Supplemental Poverty Measure (SPM) anchored to
today's poverty thresholds. The SPM is widely acknowledged to
measure poverty more accurately than the official poverty
measure, which excludes the value of refundable tax credits
and benefits like nutrition assistance and has other
limitations.
By anchoring the measure to today's poverty standards we
are able to ask how many people in each year since 1967 would
have had inflation-adjusted family resources below the 2012
SPM poverty thresholds.
Despite real progress in the War on Poverty, there is more
work to do.
In 2012, there were 49.7 million Americans grappling with
the economic and social hardships of living below the poverty
line, including 13.4 million children.
While the United States is often seen as the land of
economic opportunity, only about half of low-income Americans
make it out of the lowest income distribution quintile over a
20-year period. About 40 percent of the differences in
parents' income are reflected in children's income as they
become adults, pointing to strong lingering effects from
growing up in poverty.
This significant decline in poverty is largely due to
programs that have historically enjoyed bipartisan
support and increase economic security and opportunity.
A measure of ``market poverty,'' that reflects what the
poverty rate would be without any tax credits or other
benefits, rose from 27.0 percent to 28.7 percent between 1967
and 2012. Countervailing forces of increasing levels of
education on the one hand, and inequality, wage stagnation,
and a declining minimum wage on the other resulted in
``market poverty'' increasing slightly over this period.
However, poverty measured taking antipoverty and social
insurance programs into account fell by more than a third,
highlighting the essential role that these programs have
played in fighting poverty.
Programs designed to increase economic security and
opportunity lifted over 45 million people from poverty in
2012, and led to an average of 27 million people lifted out
of poverty per year for 45 years between 1968 and 2012.
Cumulatively these efforts prevented 1.2 billion ``person
years'' of poverty over this period.
Social Security has played a crucial role in lowering
poverty among the elderly. Poverty among those aged 65 and
older was 35 percent in 1960. Following rapid expansions in
Social Security in the 1960s and 1970s, poverty among the
elderly fell to 14.8 percent in 2012.
These programs are especially important in mitigating
poverty during recessions. Despite an increase in ``market
poverty'' of 4.5 percentage points between 2007 and 2010, the
poverty rate, appropriately measured, rose only 0.5
percentage points due to both existing programs and immediate
actions taken by President Obama when he took office in
response to the worst financial crisis since the Great
Depression.
``Deep poverty''--defined as the fraction of individuals
living below 50 percent of the poverty line has declined as a
result of these programs. Without government tax credits or
other benefits, 19.2 percent of the U.S. population would
have been in deep poverty in 2012, but only 5.3 percent were
in deep poverty when these benefits are included.
Programs that strengthen economic security and increase
opportunity continue to be essential in keeping millions
of Americans out of poverty and helping them work their
way into the middle class.
Social Security benefits reduced the 2012 poverty rate by
8.5 percentage points among all individuals, and by 39.9
percentage points among those aged 65 or older.
Tax credits such as the Earned Income Tax Credit (EITC) and
Child Tax Credit (CTC) reduced the 2012 poverty rate by 3.0
percentage points among all individuals, and by 6.7
percentage points among children.
The Supplemental Nutrition Assistance Program (SNAP)--
formerly known as the Food Stamp Program--reduced poverty in
2012 by 1.6 percentage points among all individuals, and by
3.0 percentage points among children.
Unemployment Insurance (UI) reduced poverty by 0.8
percentage points in 2012.
Antipoverty programs have been increasingly oriented around
rewarding and encouraging work and are an important
source of opportunity for low-income working families.
Both the EITC and the partially refundable component of the
CTC increase the reward to work, offsetting payroll taxes and
providing a supplement to labor market earnings. Research has
shown this increases work and earnings, and increases
participation in the workforce, particularly for single
parents.
Some traditional antipoverty programs have been redesigned
to encourage and promote work. The vast majority of Americans
receiving nutrition assistance have a job or are either too
young to work, are over age 65 or are disabled. Meanwhile,
bipartisan welfare reform signed by President Clinton in 1996
strengthened work requirements and put a greater emphasis on
employment.
Despite concerns that antipoverty programs may discourage
employment, the best research suggests that work disincentive
effects are small or nonexistent for most programs.
Programs that help fight poverty and provide economic
security touch a wide swath of Americans at some point in
their lives.
Programs that fight poverty help a broad range of Americans
get back on their feet after economic misfortune. For
example, about half of taxpayers with children used the EITC
at some point between 1979 and 2006, and over two-thirds of
Americans aged 14 to 22 in 1979 received income from SNAP,
AFDC/TANF, Supplemental Security Income (SSI) or UI at some
point between 1978 and 2010.
Social Security Old Age and Survivors' Insurance, Social
Security Disability Insurance, and UI are available to all
Americans with a steady work history. These social insurance
programs play an important role in keeping out of poverty
those who retire, experience a work-limiting disability, lose
a parent or spouse, or lose a job through no fault of their
own.
The economic and social benefits from these programs go
beyond just helping reduce poverty in the current
generation.
Increased access to SNAP for children has been found to
lead to better health and greater economic self-sufficiency
in adulthood.
Increased family income in childhood from the EITC and CTC
leads to higher student achievement.
The long-term effects of Head Start and other high-quality
preschool programs include higher educational attainment,
employment, and earnings, and lower rates of teen pregnancy
and crime, as beneficiary children become teenagers and young
adults.
President Obama's policies to restore economic security and
increase opportunity have helped reduce poverty.
The Affordable Care Act ensures all Americans have access
to quality, affordable health insurance, by providing the
resources and flexibility states need to expand their
Medicaid programs to all people who are in or near poverty as
well as financial help so hardworking families can find a
health plan that fits their needs and their budgets.
The President significantly expanded the refundability of
the Child Tax Credit, making it available to millions of
working parents who were previously ineligible. He also
expanded the EITC for larger families, who face
disproportionately high poverty rates, and for low-income
married couples. Together these expansions benefit
approximately 15 million families by an average of $800 per
year. The President is proposing to make these tax credit
improvements permanent and also to raise the minimum wage.
The Administration has advanced investments in early
learning and development programs and reforms for coordinated
State early learning systems. President Obama has proposed
the expansion of voluntary home visiting programs for
pregnant women and families with young children; Early Head
Start-Child Care Partnerships to improve the quality of care
for infants and toddlers; and high-quality preschool for
every child.
President Obama has advanced reforms of the nation's K-12
education system to support higher standards that will
prepare students to succeed in college and the workplace;
pushed efforts to recruit, prepare, develop, and advance
effective teachers and principals; and encouraged a national
effort to turn around our lowest-achieving schools. The
Administration has also put forward proposals to redesign the
Nation's high schools to better engage students and to
connect 99 percent of students to high-speed broadband and
digital learning tools within the next five years.
President Obama has proposed Promise Zones where businesses
partner with local communities hit hard by the recession to
put people back to work and communities can develop and
implement their own sustainable plans for a continuum of
family and community services and comprehensive education
reforms.
President Obama has proposed increased employment and
training opportunities for adults who are low-income or long-
term unemployed, and summer and year-round opportunities for
youth along with reforms to
our unemployment system to make it more of a re-employment
system, and community college initiatives to reform our
higher education system and support training partnerships
with business in high-demand industries.
Other achievements include making college more affordable
by reforming student loan programs, raising the maximum Pell
Grant, and establishing the American Opportunity Tax Credit
which is the first partially refundable tax credit for
college; placing 372,000 low-income youth into summer and
year-round employment in 2009 and 2010; improving access to
school meal programs that help children learn and thrive; and
extending minimum wage and overtime protections to nearly all
home care workers to help make their jobs more financially
rewarding.
The fundamental lesson of the past 50 years is that we have
made progress in the War on Poverty largely through
bipartisan efforts to strengthen economic security and
increase opportunity. As our economy moves forward, rather
than cut these programs and risk leaving hardworking
Americans behind, we need to build on the progress we have
made to strengthen and reform them. Going forward, we can't
lose sight of the positive part government can continue to
play in reducing economic hardship and ensuring access to
economic opportunity for all citizens. At the same time,
sustainable improvements are only possible if we create jobs
and speed the economic recovery in the short run, raise
economic growth in the long run, and work to ensure that the
benefits of a growing economy reach all Americans.