Depressing Graphic for the Day

Ben Eisen, Blog, Uncategorized

This graphic compares growth in explicit anti-poverty spending in the United States to progress in actually reducing poverty.

From the CATO Institute study this is drawn from:

“The poverty rate declined significantly between 1959 and 1964 as the overall economy grew, but this was before the launch of President Lyndon Johnson’s War on Poverty (and therefore before the enactment of Medicaid and Medicare, two of the largest anti-poverty programs in existence today). Between 1966 and 2009, the poverty rate fluctuated with the business cycle but showed little downward trend, even as antipoverty spending grew by a factor of six in real terms. In other words, our anti-poverty programs have been implemented at enormous and ever-increasing cost — and it is not clear that they have done much to actually reduce the rate of poverty.”

The lesson here is clear –just because a government spends more in a particular area is no guarantee that it will make progress towards stated objectives. Policymakers need to keep asking themselves not only whether a priority is worth pursuing (poverty reduction is), but whether the strategies currently being employed are actually working.  More spending does not necessarily guarantee better results.

To be clear, I don’t mean to suggest that explicit anti-poverty spending is futile or that the USA should start doing less of it – just that they may not be spending what they do spend as effectively as we would like.