10 Poverty in the United States

This chapter will review core concepts of poverty, examine some of the history of poverty in the United States, and discuss how poverty is a social justice issue. It will also discuss legislation and policy around poverty, and how legislation, policy, and funding impact marginalized populations.

Defining Poverty

Living in poverty often means that essential resources are scarce or unobtainable, and the intersection of resources and living standards is stark and surprising in the United States. One in four Americans needs help to obtain essential resources such as food, water, and shelter. Other resources low-income Americans lack include money, mental and physical healthcare, childcare, and employment (Goldblum & Shaddox, 2021).

Many people in the United States see each other through value-laden lenses that focus on personal attributes such as values, personal decisions, and personality traits. However, poverty is much more than a personal attribute. Poverty is a systemic issue that stems from a history of racism, sexism, ableism, xenophobia, slavery, and an economic system that takes economic inequity for granted. Examples of these systems include criminal justice systems, housing systems, employment systems, healthcare systems, and safety net programs, which are often difficult to access (Assari, 2017; Desmond, 2023; Goldblum & Shaddox, 2021). In this chapter, we will frame poverty through this systemic lens, examining the factors that have influenced the United States to become a society that does not do enough to meet the income needs of its population.

Historical Aspects of Poverty

Elizabethan poor laws began in England in the 1600s to assist the poor. For the first time in Europe, these laws declared that the government was responsible for aiding poor citizens. These citizens were divided into three categories: able-bodied, impotent (not able-bodied), and children. Poor people were expected to work, and begging was prohibited. Local church leaders oversaw services, and a tax was levied on the population to fund the assistance (Kennedy, 2023).

As the colonists established themselves in the United States, they turned to Elizabethan laws to manage the poverty that inevitably followed them to the colonies. They also broke the poor into categories of “worthy” or “unworthy” (Kennedy, 2023, para. 7). Local leaders decided who was worthy of assistance and who was not. Early in colonial times, the poor were often contracted out for manual labor by farmers or homeowners, who agreed to take them in exchange for their labor and a fixed price. Geography mattered during this time, and people who sought assistance had to prove where they were from and were punished when they attempted to move from one geographic area to another to try and receive services (Kennedy, 2023).

In the early nineteenth century, the experience of the poor shifted as poorhouses came into favor. Poorhouses, also called workhouses or almshouses, were “designed to punish people for their poverty and, hypothetically, make being poor so horrible that people would continue to work at all costs” (Blakemore, 2023, para 8). Poorhouses were often kept out of public view as the plight of being poor carried a negative social stigma. Residents had to swear an oath that they were poor and were subjected to strict rules, harsh labor, pests, violence, poor housing, and inadequate food. Poorhouses later gave way to poor farms to move poor people further from public view. By the time the Great Depression began, poorhouses and poor farms were shut down as the federal government began implementing social safety net programs (Blakemore, 2023).

The Great Depression began with the stock market crash in 1929 and lasted until 1939 when World War II began. A combination of slowing of consumer demand, increased consumer credit, decreased industrial production, and the sudden stock market expansion triggered the Great Depression. Banks failed in large numbers. At the same time, industrial production plummeted. This led to unprecedented unemployment, with millions losing their jobs, homes, and savings. The agricultural sector was also severely impacted in the United States. The Dust Bowl, a period of severe drought and dust storms that struck the central United States during this time, exacerbated the suffering of farmers by destroying crops, degrading soil, and forcing many to abandon their land.

President Franklin D. Roosevelt implemented the New Deal in 1933 as a series of programs and reforms designed to revive the economy of the United States. However, it took the United States entering World War II and the need for manufacturing production due to war to end the Great Depression (History.com, 2023).

The War on Poverty

In January 1964, President Lyndon B. Johnson declared a “War on Poverty” (Matthews, 2014, para. 1) during his State of the Union address. He introduced multiple legislative acts to impact the state of poverty in the United States. This legislation included the creation of Medicare and Medicaid, made food stamps permanent, and included the Economic Opportunity Act and the Elementary and Secondary Education Act. Programs like Head Start, Job Corps, VISTA, and Title 1 also come from this legislation set (Matthews, 2014).

Statistics show that despite continued poverty in the United States, this legislation significantly impacted poverty levels and continues to do so today. Matthews (2014) states that “In 2012, food stamps (since renamed Supplemental Nutrition Assistance Program, or SNAP) alone kept 4 million people out of poverty” (para. 12).

Myths of Poverty

One of the biggest myths of poverty is that poverty is an individual problem and not a systemic issue. As a country that values hard work and individualism, many in the United States see those who remain in poverty as lazy, unmotivated, and uneducated (Assari, 2017). Thus, individuals struggling with poverty find themselves the victims of stereotyping and judgment. Often, it is suggested that poor people should try harder, work harder, go back to school, etc., without thinking through the barriers inherent in those suggestions (Goldblum & Shaddox, 2021).

Another poverty myth is that poor people do not work. In actuality, the working poor make up much of the service industry, agricultural work, and factory work in the United States today. However, structural issues such as the cost of food, housing, daycare, and medical expenses make it impossible to get ahead on a minimum wage job (Goldblum & Shaddox, 2021). For example, a single mother of young children cannot just leave her children at home to return to work. If she does, then she could lose her children to Child Protective Services (CPS). Thus, if she does go back to work, she must make enough to cover daycare costs and living expenses, which many low-paying jobs do not do. Desmond (2023) describes this well, noting that “poverty is about money, of course, but it is also a relentless piling on of problems” (p. 13). Desmond highlights that financial hardship rarely exists in isolation, but is compounded by overlapping challenges such as housing instability, poor health, and limited access to services. Recognizing this complexity is essential for developing effective policies and interventions that address the root causes of poverty.

The Welfare Queen

One of the most persistent myths about poverty is that of the welfare queen. Ronald Reagan coined this phrase when running for president in the late 1970s/early 1980s to reinforce his policies of cutting funding for welfare programs. The stereotypical welfare queen is a Black woman who hustles the welfare system and becomes wealthy from it. The welfare queen is flashy, promiscuous, well-dressed, and drives a nice car (Covert, 2019; Levin, 2021).

The welfare case that Reagan turned into the stereotype of the welfare queen was Linda Taylor, a woman who used multiple aliases to receive excessive welfare benefits fraudulently. Taylor was a complicated woman who also perpetuated multiple other crimes. Despite her criminal activity, including suspicion of murder, Taylor was only prosecuted for her fraudulent welfare claims. While Reagan claimed she made six figures a year as a welfare queen, court records show that she received a total of $8,865.67 in welfare payments. In addition to her criminal activity, it was also asserted that Taylor had significant mental health issues (Covert, 2019; Levin, 2021).

Following the prosecution of Linda Taylor for welfare fraud, the myth of the welfare queen became deeply ingrained in the national consciousness. In response, policies were implemented nationwide to combat perceived welfare system abuse. These crackdowns reinforced stereotypes that portrayed poor individuals as lazy and unmotivated, further stigmatizing those in need. In Chicago, the welfare department teamed up with the police to pursue welfare fraud cases. Those accused of welfare fraud then had exorbitant bail thrust upon them, and many were pushed into prison time. Fueled by the Taylor case, Reagan continued his crusade against welfare. Consequently, welfare eligibility and benefits saw cuts on both the state and national levels (Covert, 2019).

The Linda Taylor case generated a stereotype that continues to this day. Because she was a Black woman, the intersection of racism, sexism, and poverty combined with the political climate of the time to reinforce the public perception of who is poor. There are a variety of other poverty myths that continue today. These include the idea that those who live in poverty make poor financial decisions, do not care for their children, do not value education, and do not work hard. In addition, many believe that people choose to live on welfare and have more children because it is easier than working. This is far from true as access to safety net programs is often challenging and dehumanizing. One of the biggest of these myths is that poverty is inextricably intertwined with race. Statistics do not bear this out, and in 2015, 42 percent of those in poverty were White (Just Harvest, 2015).

Poverty Measures

The question of how to measure poverty is a complicated one. The first poverty estimates were published in 1967 following President Johnson’s State of the Union address (US Census Bureau, 2014). The United States government has been tracking poverty statistics ever since. Desmond (2023) states: “Technically, a person is considered ‘poor’ when they can’t afford life’s necessities like food and housing” (p. 10). While the definition posed by Desmond makes intuitive sense, this is not how the United States measures poverty. There are two ways that poverty is officially measured in the United States: the Official Poverty Measure (OPM) and the Supplemental Poverty Measure (SPM).

The OPM was developed by Mollie Oshansky in 1965 and frames poverty through the lens of food cost. Oshansky’s equation looks at food cost in a given year and then compares that cost to how much income is devoted to paying for food. If a person or family pays more than one third of their income to food costs, then they are poor. The poverty threshold in 2022 was an income of $13,590 for a single person and $27,750 a year for a family of four (Desmond, 2023). The OPM examines all sources of cash income but does not take non-cash government assistance, such as food stamps or housing assistance, into account (Institute for Research on Poverty, n.d.). The OPM also does not consider geographic location, and Desmond (2023) points out that many families and individuals are living in poverty above the official poverty line, particularly in high cost of living areas.

The Supplemental Poverty Measure (SPM) was introduced in 2010 to provide an alternate view of poverty. The SPM is not meant to replace the OPM but to supplement it with pertinent information. The SPM balances the cost of basic needs, financial resources, and other expenses against an individual or family’s resources. Resources include cash assets and non-cash assistance, such as food stamps or Medicaid (Kilduff, 2022). Cost includes food, shelter, medical expenses, work expenses, child support, and taxes. The SPM also considers unrelated people living in the home, geographic location, and whether an individual rents or owns their home (U.S. Census Bureau, 2022).

There are many critics of the way the United States government has chosen to identify and track poverty. Because it is well-known that the standard poverty measures do not accurately reflect the experience of the American population, many agencies use multipliers or adjust based on other factors when examining eligibility. For example, the US Department of Housing and Urban Development (HUD) looks at the median income of the state an applicant lives in to determine eligibility (Kilduff, 2022). One very critical voice in the debate about how to define poverty is Matthew Desmond (2023) who states that:

Poverty isn’t a line. It’s a tight knot of social maladies. It is connected to every social problem we care about-crime, health, education, housing- and its persistence in American life means that millions of families are denied safety and security and dignity in one of the richest nations in the history of the world. (p. 23)

Safety Net Programs

Safety net programs are the public benefits and systems intended to assist those in need. Some examples of safety net programs include Temporary Assistance for Needy Families (TANF), Supplemental Nutrition Assistance Program (SNAP, previously called food stamps), housing assistance, cash assistance, child support, the earned income tax credit, Medicaid, Medicare, and social security (Gaines et al., 2021). In the United States, safety net programs have cut poverty by about half (Greenstein, 2015), and research consistently shows that safety net programs help people rise out of poverty and improve quality of life (Gaines et al., 2021). Despite this data, the United States government has continued to focus on cutting safety net programs.

Much of the cuts to safety net programs reflect a societal prejudice towards poverty that focuses on the individualistic, welfare queen rhetoric (Assari, 2017; Covert, 2019). In addition to funding cuts, safety net funding is often managed through state-run Medicaid programs with federal funding (Gaines et al, 2021). Thus, safety net programs vary significantly based on what state an individual lives in as well as the political climate of that state in any given year. In addition, Desmond (2023) points out that funding does not go directly to those in need. He states that “Nationwide, for every dollar budgeted for TANF in 2020, poor families directly received just 22 cents” (p. 28). Desmond argues that the rest of the money is spent in widely varying ways, much of which has nothing to do with impacting poverty in the United States.

Intersectionality

Statistically, marginalized populations have been significantly impacted by poverty, particularly Black Americans. When slavery ended, many White Americans assumed that Black families were able to amass wealth in the same way that White families did. However, this is far from the truth. When slavery was abolished, other laws and policies were implemented to discriminate against former slaves and their families. While White families were amassing wealth, Black families suffered from discrimination, prejudice, and policies such as redlining, which made it impossible to accumulate wealth at the same rate. Sharecropping, forced prison labor, segregation laws, redlining, and voter discrimination continued to keep Black families poor and continue to impact the Black experience of poverty today (Jackson, 2021; PBS, n.d.; Race in America, n.d.).

Other contributing factors in Black poverty include lower employment rates, lower income, lack of access to healthcare (including racism in healthcare), poorer credit, higher levels of debt, and mass incarceration. Statistically, Black students have the highest level of student debt of any racial group and yet are disproportionately lower educated than the general population. In addition, Black children are six times more likely than White children to attend schools in high poverty areas (Bread of the World, 2017).

It is not only Black populations who experience poverty inequity. Many of the same issues that plague the Black population also affect other racial groups. While the history of racism may vary between the groups, that shared history has led to a country where marginalized people of color are more likely to be poor. As of 2021, the official poverty rate in the United States was 11.6%. This equates to 37.9 million impoverished people (Creamer et al., 2022). In 2021, the breakdown of poverty stats by race as cited by KFF (n.d.) were:

• White: 9.5%
• Black: 21.7%
• Hispanic: 17.6%
• Asian/Pacific Islander: 10.2%
• American Indian/Alaska Native: 25.9%
• Multiple races: 14.1%

Poverty affects people of all races; however, being White makes a person more likely to overcome poverty. Elliott (2016) argues that Black poverty is more persistent across generations than White poverty. In addition, Elliott (2016) states that:

Among children who spent at least one year in poverty, a black child is twice as likely as a white child to also be poor as an adult (43 versus 20 percent). Perhaps more astonishingly, though, black adults have roughly the same chance of experiencing poverty (43 versus 41 percent) regardless of whether or not they were ever poor as children. (para. 5)

This may be partly because Black unemployment rates are 50% higher than those of White individuals in the United States (Gaines et al, 2021). Huang and Taylor (2019) share this disturbing statistic:

If current trends continue, it will take the median Latino family over 2,000 years just to match the current wealth (financial and housing assets) of the median white household, and Black families will never catch up with white families’ current level. (p. 9)

Disability and Poverty

Similar to what Black people in the United States have experienced, laws and policies have also kept people with disabilities from amassing wealth. Disabled individuals are twice as likely to live in poverty than individuals without a disability (Fessler, 2015). In addition, if this statistic is based on the standard measure of poverty, this number could be much higher as current poverty measures do not include individuals living in psychiatric wards, facilities, hospitals, or other supported living type environments (Desmond, 2023).  There is an even bigger divide for an individual who is a person of color with a disability (Vallas et al., 2022).

Statistically, more people with disabilities struggle to afford to pay their rent and are more likely to have food insecurity. According to Vallas et al. (2022)

disability remains both a cause and a consequence of poverty in the United States. Many of the persistent barriers to economic security facing Americans with disabilities are the result of policy failures that become visible when we center the perspectives and experiences of the disability community—from inadequate affordable, accessible housing and transportation to a long history of disinvestment in community living supports, and more. (para. 1)

Gender and Poverty

There is still a wage gap between women and men in the United States. As of 2023, women make 83.7 percent of what men do in the workforce (U.S. Department of Labor, 2023). Goldblum and Shaddox (2021) point out that “women’s work” (p. 157) is often less profitable and has less upward mobility than more traditionally male jobs. One of these jobs is caregiving. Many nursing assistants care for the elderly and disabled and seldom get raises or move into more lucrative positions. In addition, many women who struggle with poverty provide informal caregiving for family—meaning they are unpaid. The Alzheimer’s Association estimates that in 2022, 18 billion hours of unpaid help occurred in dementia care alone. This equates to nearly $340 billion in unpaid care. Of those caregivers, 41% make $50,000 or less (Sanchez, 2023).

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