In a brief blog post, economist Lawrence McQuillan comments on the chart above:
The poverty rate in the United States fell by half from 1950 to the start of the “War on Poverty.” And it was on track to continue falling. But after the “War on Poverty” programs kicked in, the poverty rate has been stuck in a narrow corridor.
The lesson: Despite good intentions, statist redistribution programs to “help the poor” lead to multigenerational dependency and shrinking opportunities and incentives for low-skill individuals to enter the workforce, increase their skills, and move up the income ladder.
In the comments, McQuillan says, “Note in the chart above that the poverty rate fell dramatically after the Clinton overhaul [in 1996].” This drop in poverty was also corroborated in a 2000 study referenced by McQuillan.
But does this faithfully capture the condition of the poor in the U.S.? I’ll explore this in Part 2.