On a cool night in January 1964, America would begin the longest war of its history.
No, it's not Afghanistan. This war is still ongoing today, and America is losing.
Since 1968 we have not won a single battle. We have not managed to push back the enemy lines even an inch. In fact, we have lost ground.
On Jan 8th, 1964, America launched it's longest war — The War on Poverty.
It's been a colossal failure.
A Military History of Poverty: Where did we come from, where are we today?
Here's an uninteresting fact: the poverty rate in 1968 was 13%.
That means based on official poverty measures, 13 in every one hundred American adults were poor. Neat, I guess.
If you keep that definition of poverty the same while adjusting for inflation and still using official measures of poverty, then you can compare poverty across time.
So here's a more interesting fact: 12 years later, in 1980, after more than quadrupling the budget on anti-poverty welfare programs the poverty rate was — 13.
A lot had changed, but no results.
Still, maybe 12 years isn't enough time for welfare programs to really have an impact? We can't say for certain that they aren't having an effect in the long-run.
Fair enough.
Now, here's a very interesting fact, the poverty rate today is 12%. If you look at the volatility in the long run average of that rate, it is essentially unchanged from 1980.
(There is a notable exception to the long-run average of the poverty rate, which occurred in 2019, right at the end of the Trump Presidency. It was the lowest poverty rate since 1959 — 10.5%).
So in the 40+ years we have been fighting the war on poverty, nothing has changed.
Oh wait, something has changed — the amount of spending on anti-poverty programs has increased by many hundreds of times over.
In fact, on virtually every poverty measure we have been using since 1964, we are actually worse off (but that's for another time).
So maybe there's just a "natural rate" of poverty, right? Economists generally accept the concept of a natural rate for other things: unemployment, interest rates, pollution, etc.
Maybe 13% is just the poverty rate for a healthy, productive, economy.
Could be. But I'm not convinced.
Here's an extremely interesting fact: in 1950, the poverty rate was 30%.
And another: In 1960, it was 22%. So in the decade leading up to 1960, the poverty rate had dropped by nearly ten percentage points.
You probably also noticed that means the poverty rate dropped almost another ten percentage points from 1960 to 1968.
Then, quite suddenly, the rate stays constant for the next four decades. Why is that, what is going on?
This is exactly the question at the heart of Charles Murray's aptly-named book about the War on Poverty — Losing Ground.
Murray draws on all the available data from the period starting in 1950 through 1980. His book highlights many of the concerning failures of the anti-poverty welfare system.
So what happened in 1968 that halted our decades-long progress on poverty? The answer is we began the War on Poverty.
Drawing Up The Battle Lines: 1960-1964
Before the "war on poverty" really got going, there began a shift in American culture during the fifties.
Charles Murray, describing the period of the fifties, writes:
Poverty? Poverty was so far from being a topic of concern that the lack of poverty was said to be creating, if not exactly a problem, at least a challenge. Philanthropists would have to start being more creative in finding useful things to do with their money, wrote the head of one large foundation, "now that most of the crushing burden of relieving destitution has been removed from the shoulders of the individual giver to those of society, where it belongs."
In 1950, American society did not view poverty as a very serious issue. Most Americans felt that poverty would simply work itself out.
By 1980, something had changed.
The U.S. began spending more on anti-poverty welfare programs. Poverty had become a central issue for Americans.
Consider just a few statistics, all in constant dollars:
Health and medical costs in 1980 were six times their 1950 cost.
Public assistance costs in 1980 were thirteen times their 1950 cost.
Education costs in 1980 were twenty-four times their 1950 cost.
Social insurance costs in 1980 were twenty-seven times their 1950 cost.
Housing costs in 1980 were 129 times their 1950 cost.
Murray concludes:
Overall, civilian social welfare costs increased by twenty times from 1950 to 1980, in constant dollars... We altered a longstanding national consensus about what it means to be poor, who the poor are, and what they are owed by the rest of society.
What changed the "national consensus" around poverty? In short, it was Kennedy and Johnson.
Beginning in 1962, Kennedy began welfare programs aimed at the working poor. They were meagre in initial cost, but represented a marked shift in America policy.
Up until that time, there was no notion that the government had a role in training the working poor for jobs, or paying benefits to the working poor, or even of improving urban neighborhoods.
That all changed with Kennedy, who saw oversaw the first anti-poverty programs, but the real progress began when Johnson came to power.
The Great Battle Of Our Time: Johnson Launches America's Greatest War (1964-1968)
Johnson was keen to piggyback off the popularity of Kennedy's rhetoric. Almost before Kennedy was even in the ground, Johnson got to work.
As Murray details:
Johnson lost no time in implementing the Kennedy rhetoric. The initial antipoverty bill was written, debated, passed, and signed-in August 1964 -within Johnson's first nine months in office.
On Jan 8th, 1964, Johnson famously declared:
This administration here and now declares unconditional war on poverty.
And it was off to the races:
The antipoverty bills, Food Stamps, Medicare, Medicaid, public housing programs, manpower training, expansions of entitlements, all followed pell-mell. It was a legislative blitzkrieg, not the implementation of a master plan.
By 1968, it looked like the anti-poverty bills were working, but why didn't poverty continuing going down after '68?
And if there was something "wrong" with the welfare system, why did the poverty rate go down at all between '64-'68?
Conclusion: Escalation and Continuation
If you want a deep-dive into those questions, then you should read Losing Ground By Charles Murray.
He is a Harvard scientist whose work on social policy is still considered the gold standard even by his political enemies.
The short answer is this — rhetoric and spending are not the same.
In 1964, the rhetoric was large, but not the spending. It took about four years for real spending to catch up with the policy changes.
This is true for the whole period of 1960-1980. It generally takes about two to four years for policy changes to make a measurable difference in poverty measures. This is probably still true today.
(Gee, I wonder what that would mean for that 2019 statistic I cited above...)
In other words, the War on Poverty really didn't kick off until 1968, when the poverty rate suddenly stopped moving.
What about the drop in poverty during those four years? It was just a continuation of the decades long trend in poverty reduction in the US.
A trend which sadly halted, almost certainly due to government welfare programs.
Over the decades which succeeded the 1960s, the spending on welfare programs would balloon. Current spending on welfare absolutely eclipses that of 1980.
The reason is exactly what you would expect, because it is so familiar to us:
"Our programs are not having the effect we intended, it must mean the problem is even bigger than we thought. We will need more money to combat poverty."
This has continued up to the present day on an annual basis. Yet no moves in the poverty rate have occurred save for a small dip in 2019.
Could the real problem be a dependency on social welfare and insurance? If we suddenly removed social welfare, would the historical trend in poverty return? The answer to all of these questions is — perhaps.
But answering those questions is not the scope of this article.
One thing is clear though, there is no evidence that increasing or continuing anti-poverty welfare programs will have any positive effects on poverty.
Further Reading
Losing Ground by Charles Murray
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