This report provides a statistical portrait of progress in the reduction of poverty and economic hardship over the past five decades among America’s most vulnerable citizens. The poverty measures presented in this volume show that the federal safety net has advanced the economic circumstances of low-income children and families since 1964. Three key metrics assess whether families were able to secure resources to meet their basic human needs and avoid severe material deprivation:
1) Official poverty measure. Developed by Mollie Orshansky in 1963-1964 and designated as the federal government’s official statistical definition of poverty in 1969.i The initial measure determined levels of basic need, which have been updated only for inflation. The measure accounts for the cash resources available to meet needs, but does not include non-cash benefits. In the 1960s, the federal social safety net was much smaller than today and consisted largely of cash benefit programs, most notably the Aid to Families with Dependent Children (AFDC) program.
2) Supplemental poverty measure. First released by the Census Bureau for 2009, it offers a modern measurement of family needs and includes tax credits and noncash benefits as available resources.ii Unlike the official poverty measure which is updated only for inflation, the supplemental measure is updated as spending on basic necessities among lower income families changes. The supplemental poverty measure allows for an analysis of the current impact of the full array of government policies and programs on poverty rates in recent years.
3) Alternative poverty measure. Recently developed by researchers at Columbia University, it extends the supplemental poverty measure back decades and fills the critical gap in knowledge necessary to evaluate the impact of the full federal safety net prior to 2009.1 Drawing on the supplemental poverty measure, the alternative poverty measure in this report takes the cost of basic necessities at 2012 spending levels, and applies these spending levels to each year between 1967 and 2012, adjusting only for inflation. By anchoring or fixing at 2012 spending levels, the alternative poverty measure sets a fixed assessment of what constitutes basic needs. These needs are then compared to a broader, more comprehensive set of income and in-kind resources over time.
By employing the official poverty, the supplemental poverty, and the alternative poverty measures, this report highlights shifts and changes not only in overall poverty rates and trends, but demonstrates the clear positive impact of the evolving social safety net on the economic well-being of individuals and families during the past 50 years.