Confronting Poverty: Measuring Its Causes, Costs, and Consequences

In 2023, the United States Federal government spent $545 billion on programs to combat poverty, but the Official Poverty Measure (OPM) in place since the 1960s fails to account for many of these resources. As a result, the OPM has shown little sustained reduction in poverty over time—consistent with President Ronald Reagan’s old quip that the “federal government fought the war on poverty, and poverty won.” The innovative Supplemental Poverty Measure (SPM) better accounts for the totality of resources families have available to spend and the demands on those resources, and uses an improved, empirically based poverty threshold level. The result is that the SPM changes both the number and composition of who is considered poor. As shown in the figure below, SPM poverty started off higher in the late 1960s and fell sharply prior to 1979. Over the next several decades, the SPM has been higher than the OPM but has moved largely—though not perfectly—in parallel to it, with much of the fluctuation in both measures  driven by economic booms and busts. The measures diverge starkly in 2020–2021, because the SPM reflects the historic relief payments made during that time while the OPM does not incorporate many of them. In recent decades, the design of the safety net also has shifted to providing increased incentives and rewards for work.

The volume is a tribute to Becky’s remarkable contributions in academia, government, and scholarship.

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