Families in Poverty in the 1990s: Trends, Causes, Consequences, and Lessons Learned

During the 1990s, poverty rates in the United States remained relatively stable despite a robust economy in which unemployment and inflation were at their lowest points in many years. Approximately 13% of individuals, 11% of families, and 19% of children lived below the poverty line in 1998, a decline of only 1% or less for each of these categories since 1990. These high rates of poverty result in many severe consequences. This essay reviews the research and theoretical and conceptual developments during the past decade, including: (a) a background on how the poverty line was developed; (b) general research themes in the 1990s; (c) the causes of the virtually unchanged poverty rate; (d) the consequences of poverty, particularly for children; and (e) the lessons we have learned from research over the past decade, with some directions for the future. Key Words: inequality, poverty, welfare, working poor. When President John Kennedy was elected to office in 1960, more than 22% of the U.S. population lived below the poverty level. Perhaps even more alarming, nearly 27% of children under the age of 18 lived in poverty (U.S. Bureau of the Census, 1999, tables 2, 3). The dire circumstances of the poor were brought to light in Michael Harrington's book, The Other America (1963), which described the vicelike impoverishment that was common in specific geographic regions of the country. President Kennedy considered this cause for great concern and began a series of programs and policies designed to combat poverty in the United States. President Johnson continued and expanded these after Kennedy's assassination in 1963. Collectively known as The War on Poverty, these programs and policies, such as Medicaid, Medicare, Head Start, Job Corps, and Food Stamps (along with a strong economy), helped reduce the overall poverty rate to 12.6%, and the child poverty rate to 14.9% by 1970 (U.S. Bureau of the Census, 1999, tables 2, 3). Since this period, however, there has been an increase in the percentage of people who live in poverty, particularly among children, as shown in Table 1. By 1990, 13.5% of the general population, 12.0% of families, and 19.9% of children in the United States, or nearly one child in five, lived in impoverished households (U.S. Bureau of the Census, 1999, tables B1, B2). That figure has remained remarkably consistent throughout this decade, rising slightly in the early 1990s, leveling off by the middle of the decade, then dipping slightly. The most recent data available as this essay goes to press indicates that in 1998, 12.7% of the overall population, 11.2% of families, and 18.9% of children under the age of 18 lived below the poverty line (U.S. Bureau of the Census, 1999, tables BI, B2). Thus, we end the 1990s with poverty rates that are only slightly less than those in which we began. This is ironic, given the unusually robust economy during the decade. Unemployment and inflation were at their lowest rates in decades (Auerbach & Belous, 1998; U.S. Bureau of the Census, 1998, tables 679, 772). These data contrast sharply with other industrialized nations, many of which have poverty rates of one half or even one quarter of those found in the United States (Bergmann, 1996; Casper, McLanahan, & Garfinkel, 1994; Rainwater, 1995; Rainwater & Smeeding, 1995). Moreover, the full impact of welfare reforms implemented in the late 1990s has not yet been fully assessed (see the General Accounting Office, 1999, for a list of recent tracking efforts). Welfare caseloads declined dramatically between March 1994 and March 1999, from 5 million to 2.6 million (U.S. Department of Health and Human Services, 1999). But early evaluations of welfare reforms (General Accounting Office, 1999; Loprest, 1999) and the anecdotal evidence of a dramatic increase in the use of food banks and homeless shelters (Associated Press, 1999; Bernstein, 1997) suggest that many people are worse off than they were before welfare reform. …