Point of View

The War on Poverty’s fundamental flaw: not enough jobs

January 23, 2014 

However you evaluate its impact, the 50-year-old War on Poverty raises the puzzling question of why the world’s most prosperous economy continues to harbor the largest percentage of persons in poverty of any developed nation. For North Carolina, the Community Action Agencies are the War on Poverty’s most significant legacy.

Eliminating poverty by creating economic opportunity was based on the belief that through education, training and other supportive services, the poor would find their way into jobs and begin to climb the ladder to economic self-sufficiency. While the War on Poverty focused serious national concern on poverty and committed funds to confront it, the war offered a battery of innovative service programs designed to prepare the poor for work rather than provide cash support.

The prospects of an “unconditional” War on Poverty led to intense competition among federal agencies to administer it. The Department of Labor wanted to be the lead agency, but it had not demonstrated an ability to work effectively with the poor. Secretary of Labor Willard Wirtz wanted to create jobs for the poor while President Johnson wanted to get the poor into existing jobs.

The Department of Health, Education and Welfare had become too “categorical,” and the War on Poverty working group feared that new initiatives would simply end up in old program forms.

In the end, the working group rejected both agencies and created a separate unit, the Office of Economic Opportunity.

This decision to administer the War on Poverty outside established social welfare structures undoubtedly contributed to the gradual erosion of support for its innovative programs. Yet the War on Poverty’s ineffectiveness resulted more from the failure of America’s economic system to produce economically adequate jobs than from an unprepared labor force.

This has been one lesson taught by the recent Great Recession, which not only exposed basic weaknesses in America’s economic system but also revealed a fundamental flaw in our social welfare structure. It rests entirely on work, not work in the sense of financial resources necessary to support social welfare initiatives, but work as the underlying reason for social welfare in the first place.

Americans are not eligible for Social Security if they have not worked. They cannot collect Unemployment Insurance if they have not worked enough in “covered employment.” There are no Earned Income Tax credits for those who are not working. Temporary Assistance to Needy Families requires mothers of needy children to work, even though there is little or no jobs even at shameful wages. Supplemental Security Income benefit payments, for those presumably unable to work, are kept below the poverty level for fear that higher benefits will discourage persons from working.

For those unable to work, only cash supplements will lift them out of poverty. This is the lesson learned in the early 1970s when Social Security benefits were liberalized, reducing poverty among the aged by one-half and subsequently reducing the overall poverty rate – the only significant drop in poverty during the past 50 years.

The shortcomings in the War on Poverty must be seen in the context of an economic system that ties its economic prosperity to a full-employment economy but is unable to produce enough jobs at above-poverty income levels. We must take into account America’s economic failures along with individuals who make bad decisions. After all, there are many persons who make bad decisions who do not end up in poverty and many poor persons who make good decisions who remain poor.

Perhaps the continued existence of Community Action Agencies remains the most unappreciated legacy of the War on Poverty. An afterthought in planning, Title II of the Economic Opportunity Act established the principle of “maximum feasible participation of the poor” in the decisions of implementing programs affecting them. Across the nation and in North Carolina in particular, these organizations, now incorporated as 501(c)3 nonprofits, have become the sole voice of (not for) the poor.

North Carolina has 36 CAAs that serve the needs of the poor in every county. They weatherize substandard homes, provide shuttles to free health clinics and stitch together diminishing social resources as simple as gloves for children in Western North Carolina and seeds for poor people in Eastern North Carolina to grow vegetables. They are funded by donations, used clothing sales, homemade baked goods, raffles and ever-diminishing administrative funds from the state’s Community Services Block Grant.

Community Action Agencies are the soapboxes of the poor. If we would listen, the poor will tell us how to reduce poverty.

Andrew Dobelstein, Ph. D., is professor emeritus of Social Welfare at the University of North Carolina at Chapel Hill.

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