In the 20s and 30s immigration accounted for a much larger proportion of the population than it does today. There were movements to teach what amounts to ESL, but even this level of demand didn't give rise to a sustainable cadre of professional adult educators. It did not generate a demand from the public for adult education. To get the public to pay for a social commodity, you must convince them that there is a need.
Most people consider illiterates to be losers.
After all, the taxpayer is already paying for them to go through 12 years of education - including special education, reading specialists, speech pathologists, etc. Now, we want to establish a second secondary education program for those who failed in the first one. To most people, this is throwing good money after bad, and ABE educators are nothing more than a second set of mouths to feed from the public teat. I don't think the winning strategy will be to have literacy instructors ask to have their budget doubled or tripled, or whatever it will take to pay for the desired services. In the short term, I think you need to serve fewer people.