America’s (Flawed) War on Poverty: The Doomed Current Approach

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I like Banksy

America’s current approach will never end real poverty.

The current approach is too flawed to completely eliminate poverty.  A failure to address educational issues, family concerns, disabilities, and racial disparities demonstrates that the absolute, pre-transfer, income approach is doomed.  The Council of Economic Advisers indicates that the income approach has not enabled these originally poor populations to escape poverty. “About half of the poorest individuals remain in the lowest fifth of the income distribution after 10 and 20 years, and no more than one-fourth make it to one of the top three income quintiles” *.  Those who are born poor die poor.  Alternatives must be investigated.

*Council of Economic Advisers. The War on Poverty 50 Year Later: A Progress Report. Washington, DC: United States Government, 2014. 33. Print.1


America’s (Flawed) War on Poverty: Financial Problems

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How poverty solutions are enacted is a big issue as well

Financial problems also plague the current poverty measurements as well.  Issues measuring the Consumer Price Index, the index of variation in prices paid by the average consumer on goods and services, understates the real fall in poverty by three percentage points over the last sixty years*.  Additionally, individuals deliberately under report incomes so they can accrue more benefits, hampers administrators allocations*.  This encourages them to become criminals or lazy, rather than working hard to ascend from poverty.  Such a singular emphasis on income results in recipients being able to easily manipulate the system to their own advantage.

*Council of Economic Advisers. The War on Poverty 50 Year Later: A Progress Report. Washington, DC: United States Government, 2014. 2,8,11, 26,27,33. Print.1

America’s (Flawed) War on Poverty : Logistical Issues

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Systemic oversights have led to failings throughout America’s War on Poverty

This problem is that poverty is based on pre-tax income and cash transfers but not on taxes, tax credits, or non-cash transfers*.  Many programs benefiting the less educated, families headed by single mothers, minorities, and the disabled such as SNAP, EITC, and WIC are not calculated in the current poverty index, unlike Social Security*.  This distinction makes it politically difficult to increase funding for these forgotten programs because increasing funding would not have a measureable impact on poverty.  Therefore, it is politically untenable.

*Council of Economic Advisors. The War on Poverty 50 Year Later: A Progress Report. Washington, DC: United States Government, 2014. 8,27 Print.1. 

America’s (Flawed) War on Poverty : Victory Amongst the Elderly

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Social Security and Medicare have insured the elderly are largely shielded from poverty.  Certain racial and socioeconomic demographics have not done as well.

Social Security and Medicare have insured the elderly are shielded from poverty.

The elderly are the only segment of the population whose poverty proportion has been dramatically reduced over the last sixty years.  For those over 65, their poverty rate has fallen from 36.9 percent to just 9.1 percent.  This is less than a fourth of 1959 levels.  Social Security is included in poverty measure for these individuals, buffering them above the poverty line.  It is the main reason why their poverty rate has fallen; if it were not the elderly poverty rate would be 54.7 percent.  By itself, Social Security raises 8.56 percent of all American’s out of poverty*.  Since social security is included as income it is measured in the current poverty index and officials are able to properly evaluate its benefit to the elderly.  This solution has not been applied to the other impoverished demographics, leaving them with higher poverty rates.

*Council of Economic Advisers. The War on Poverty 50 Year Later: A Progress Report. Washington, DC: United States Government, 2014. 26,27. Print. 

America’s (Flawed) War on Poverty: Systemic Racial and Socioeconomic Failings

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It falls along racial lines, mainly.

Sections of the population have not benefited from America’s War on Poverty

America’s War on Poverty has greatly reduced poverty in the United States; however, some demographics are remaining destitute.  This good news is the official poverty measure has fallen 7.3 percent over the last sixty years; only 15.1 percent of all Americans remain in poverty.  Disturbing trends amongst those remaining in poverty indicate segments of the population are not benefiting proportionally.  One third of all those impoverished have less than a high school education.   Twenty-nine percent of single, female headed households are included in the official poverty measure.  African Americans, Hispanics, and Native Americans all have a third of their respective population below the poverty line.  Meanwhile, Whites and Asians each have only a tenth of their total population below the poverty line.  Finally, while those with disabilities were not originally indexed almost thirty percent of them are below the poverty line today*.  Due to the inadequacies of the absolute, income approach we do not have national data to fully examine those below the poverty line.  They are all lumped together so we cannot infer any solutions from the poverty data.  All we know is those of lower education, families headed by single mothers, native minorities, and the disabled are disproportionally likely to be poor, indicating that the current anti-poverty program is not ubiquitous successful.

*Council of Economic Advisers. The War on Poverty 50 Year Later: A Progress Report. Washington, DC: United States Government, 2014. 11. Print.

Ending America’s (Flawed War) on Poverty: Thesis

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Serious issues should be introduced with a light joke

Poverty is a serious, unanswered issue. Lets start with something fun.

Emerging from the shaky growth following the recession from 1960 to 1961,  President Carter launched America’s War on Poverty.  His strategy comprised of “initiatives designed to improve the education, health, skills, jobs, and access to economic resources of those struggling to make ends meet*”.   The primary goal of the War on Poverty was to increase the standard of living of the American people in all dimensions, growing opportunity and strengthening social mobility.  An absolute poverty line was set up and poverty was linked exclusively to income.  As the decades past it became increasingly evident that this solution was not accurately assessing or alleviating poverty.  Shifting away from an absolute, income approach will be essential for the United States to better address poverty in the twenty-first century.  A fully developed relative, post-transfer, basic needs approach, evaluating both income and tangible symptoms, is necessary to liberate America from poverty.

*Council of Economic Advisers. The War on Poverty 50 Year Later: A Progress Report. Washington, DC: United States Government, 2014. 2. Print.

“Oportunidades” for Occupy Wall Street

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The Occupiers in America have one chief concern: economic inequality.

The Mexicans have one stunning solution: Oportunidades.

Mother & Cracker-Eating Son

Impoverished Families of Mexico look to Oportunidades for financial aid and stability.

What is “Oportunidades?”

It is a conditional cash transfer anti-poverty program by the Mexican government that has revolutionized economic equality.

The Mexicans social welfare program differs from many in the developed world.  Rather than paying out blanket benefits to beneficiaries specific criteria must be met before financial aid is released.  Recipients must meet educational, health, and nutrition goals.   Already the program covers 5.8 million families or 30% of the total population.

What are the Criteria?

Education, Health, and Nutrition.

Investing in the human capital of the future generation is of primary importance for Oportunidades.  To be put in layman’s terms, the Mexican government works to make future citizens be self-sufficient and perhaps even give back to their country through employment and taxes.

Guaranteeing students attend school is vitally important.  For each student attending school families receive larger cash transfers.  In addition, for each successive year of education the cash transfers grow significantly. Rather than working in the fields engaged students are getting an education.  Some even progress to college and acquire class changing jobs.

Health and nutrition are also essential ingredients in the Oportunidades miracle.  Cash transfer payments are delivered as long as mothers keep regular medical checkups for their children and enroll themselves in classes detailing disease prevention.  Other workshops educate the mothers about dietary needs of their families and the best methods to get the most nutritional food on the table.

Has Oportunidades Been Effective?

Here is a quotation from an article by Tina Rosenberg the New York Times concerning Oportunidades.  Judge the program for yourself:

“In Mexico today, malnutrition, anemia and stunting have dropped, as have incidences of childhood and adult illnesses.  Maternal and infant deaths have been reduced.  Contraceptive use in rural areas has risen and teen pregnancy has declined.  But the most dramatic effects are visible in education.  Children in Oportunidades repeat fewer grades and stay in school longer.  Child labor has dropped.  In rural areas, the percentage of children entering middle school has risen 42 percent.  High school inscription in rural areas has risen by a whopping 85 percent. The strongest effects on education are found in families where the mothers have the lowest schooling levels.  Indigenous Mexicans have particularly benefited, staying in school longer.”

How Would Oportunidades America Help the Occupiers?

Below is one key demand from the manifesto of Occupy Wall Street : NYC.


The Occupiers exclamation amounts to the government enforcing the graduated income tax on the super-wealthy so that the middle class can return to prosperity.  Oportunidades is a physical manifestation of the Occupiers dream.  The Mexican anti-poverty program redistributes the wealth of the nation, through taxes, to help and empower the impoverished and middle class.  This is what the occupiers need.

America needs Oportunidades just as badly as Mexico did.  Currently, 15.1% of Americans live in poverty. 10.5% of Mexicans live in “extreme poverty.”  Oportunidades is one of the primary reasons why the United States has been surpassed by Mexico on taking care of its own people.  The Occupiers must add reformation in anti-poverty programs in order sustain today’s America and empower future  generations.

Are There Any Pilot Oportunidades Programs  in America?

New York, ground zero for the Occupy Wall Street, is ironically the flagship of the American anti-poverty program.  The private program was entitled Opportunity NYC–Family Rewards.  It takes Oportunidades of the rural Mexico and optimizes it for the urban setting.  Initial results were promising.  The program quantitatively decreased poverty and day-to-day hardships, increased school grades and attendance, proliferated use of health insurance, and even increased dental care.  Despite these promising beginnings, under capitalization and a short trial period doomed the program.  It is no longer funded.

Instead, Bloomberg pays riot police to prevent the impoverished  Occupiers from taking what they were once given.

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