Reasons for Measuring Poverty in the United States in the Context of Public Policy — A Historical Review, 1916-1995. The Early Post-World-War-II Period

06/01/2000

In July 1949, the chairman of the Congressional Joint Committee on the Economic Report [JCER — subsequently renamed the Joint Economic Committee] appointed a subcommittee to do a study of low-income families.16 The appointment of this Subcommittee on Low-Income Families [SLIF] grew out of the post-World-War-II inflationary spiral. In 1947-1948, Senator Ralph Flanders [R-Vermont] had headed an earlier subcommittee of the JCER to investigate rising prices; that subcommittee had found that food price increases had severely impacted low-income and fixed-income groups, making it difficult for them to purchase nutritious diets and also to buy other necessities. Senator Flanders also became concerned about the large number of low-income persons unable to afford market rents for housing, and suggested that the JCER do a study of low-income groups; he was one of the senators appointed to the SLIF.17 In November 1949, the SLIF issued a staff report containing material on low-income families to serve as background for the subcommittee's hearings and deliberations.18 The introduction to the report noted that the JCER was studying low-income families and their effect on the national economy because "the low purchasing power of these groups retards the future rate of economic progress of the Nation.... If there are to be ample employment opportunities....[o]ld markets must be expanded and new markets developed. The unfilled wants of American families now living on inadequate incomes constitute a great underdeveloped economic frontier — a new and expansible market for the products of American industry. In an economic system geared to mass production, there must be mass consumption if severe economic dislocations are to be avoided."19 The report presented data on the number and characteristics of nonfarm families with annual money incomes below $2,000 (in 1948 dollars), farm families with money incomes below $1,000, and unrelated individuals with incomes below $1,000.20 The final report of the subcommittee, issued in March 1950, recommended "that local communities, private business and professional groups, and Federal, State, and local governments take all appropriate action to provide opportunities for low-income families to become full partners in prosperous American communities," and that government agencies "continue to study the relationship between the distribution of income and the stability and progress of the economy as a whole." Specific recommendations included a study of Federal farm price-support programs to see how they might be modified to be of greater benefit to low-income farmers; consideration by states of establishing minimum wages in industries not covered by the federal minimum wage; federal financial assistance to states for elementary and secondary education "to help equalize educational opportunity throughout the Nation"; establishment of a national scholarship fund for the higher education of able but needy students; revision and liberalization of the Aid to Dependent Children program; expansion of the National School Lunch Program; enactment of a social insurance program for the permanently and totally disabled; and "the development of a comprehensive program, based upon the voluntary cooperation of public and private agencies, which will permit all persons who so desire to participate in a system of health insurance."21

Early in 1955, the Congressional Joint Committee on the Economic Report reconstituted its Subcommittee on Low-Income Families to do further studies of the problems of low-income families. In discussing the work to be done by the Subcommittee, one of its members put the problem of low-income families in the context of recession-related unemployment, technological unemployment, and the problems of depressed areas.22 In October 1955, the SLIF issued a staff report containing material on low-income families to serve as background for the subcommittee's hearings.23 After referring to the Employment Act of 1946 and its goals of "maximum employment, production, and purchasing power," the introduction to the staff report commented that "the existence of a significant number of Americans adjudged to be poor is a matter of serious concern." It differentiated between low-income families and individuals who were "technically unemployable" and those who could achieve higher earnings "if given adequate opportunity.... Economic growth is everywhere retarded by the burden placed on society by its dependent members and by those who, although in the labor force, display low levels of productivity. Continued development of our national economic strength and levels of output is dependent in part upon more efficient utilization of available manpower. Greater utilization of our labor resources in turn is partially dependent upon raising the level of economic activity in depressed rural and industrial areas. Many of the low-income population are located in such areas.... A paradox of modern economic society is the continuing existence, during periods of full employment, of geographic pockets in which chronic unemployment and underemployment are excessively high.... The materials presented in this report indicate that the problems of low income are complex and many-faceted...."24 The report included data on the number and characteristics of nonfarm families with annual money incomes below $2,000 (in 1948 dollars), farm families with money incomes below $1,000, and unrelated individuals with incomes below $1,000.25 The final report of the subcommittee, issued in January 1956, expressed the conviction "that with national income at peak levels and with relatively full employment, now is the time for a renewed and vigorous attack on the remaining problems of low-income groups," with action involving "the concerted efforts of all segments of our national life — all levels of government working with labor and management and private community groups and organizations." Specific recommendations (focusing primarily on federal programs) included consideration of legislation to establish social insurance programs covering temporary and permanent disability; measures to make adequate health care more widely available and affordable; establishment of a single federally-aided program of general public assistance in place of existing categorical programs; direct federal grants to states for education, "initially for construction of school plant and equipment"; establishment of a national scholarship fund to aid needy persons who could benefit from further education; expansion of adult education programs and encouragement of nongovernment vocational training and retraining programs; various measures to aid economically depressed rural and industrial areas and low-income families living in them; "[i]ntensive studies to identify the population at substandard levels of living [the long-term poor] and the causes of their low economic status"; and submission to Congress of periodic reports "on the current status and size of the low-income population and the progress made in the alleviation of poverty and elimination of its causes...."26


16.  "Congress to Study Low-Income Group," New York Times, July 3, 1949, p. 21. 

17.  Will Lissner, "New Rise in Grains Clouds Retail Food Price Outlook," New York Times, September 28, 1947, pp. 1 and 5; Senator Ralph E. Flanders, "Allocation of Meat" (January 19, 1948), pp. 292-293 in Congressional Record [annual bound version], Vol. 94, Part 1, Washington, D.C., United States Government Printing Office, 1948; United States Congress, Joint Committee on the Economic Report, High Prices of Consumer Goods[:] Report...Pursuant to S. Con. Res. 19[,] a Concurrent Resolution Establishing a Joint Committee to Investigate High Prices of Consumer Goods, Washington, D.C., United States Government Printing Office, 1948, pp. 5-9; United States Senate, General Housing Legislation[:] Hearings Before a Subcommittee of the Committee on Banking and Currency...on...Bills Pertaining to General Housing Legislation, Washington, D.C., United States Government Printing Office, 1949, pp. 104-105 (February 3); and C. Hartley Grattan, "Senator Flanders: Intelligent Conservative," Harper's Magazine, Vol. 200, No. 1196, January 1950, pp. 85-86. 

18.  "8,000,000 Incomes Under $1,000 in '48," New York Times, November 13, 1949, pp. 1 and 68; and J.A. O'Leary, "Senators Study $2,000 Income Families' Plight," Washington Star, November 13, 1949. For a brief discussion of this report and its $2,000 low-income line, see Fisher, "From Hunter to Orshansky..." (1997 revision), pp. 41-42. 

19.  United States Congress, Joint Committee on the Economic Report, Low-Income Families and Economic Stability[ — ]Materials on the Problem of Low-Income Families Assembled by the Staff of the Subcommittee on Low-Income Families..., Washington, D.C., United States Government Printing Office, 1949, p. 1.

20.  Low-Income Families and Economic Stability[ — ]Materials..., pp. 2, 9-10, 35, and 52-55.

21.  United States Congress, Joint Committee on the Economic Report, Low-Income Families and Economic Stability[:] Report of the Subcommittee on Low-Income Families...Pursuant to S. Con. Res. 26, Washington, D.C., United States Government Printing Office, 1950, pp. 1, 4-5, 9-12, and 16. See also Harold B. Hinton, "Low-Income Group Held a Vital Field," New York Times, February 26, 1950, p. 49; and "Subcommittee Charts Broad Program to Aid Low-Income Families," Washington Star, February 26, 1950.

22.  "Subcommittee on Low-Income Families," p. 7 in U.S. Congress, Joint Committee on the Economic Report, Joint Economic Report[ — ]Report of the Joint Committee on the Economic Report on the January 1955 Economic Report of the President... (84th Congress, 1st Session, Senate Report No. 60), Washington, D.C., U.S. Government Printing Office, 1955; and Rep. Augustine B. Kelley (Pennsylvania), "Chronic Low Income and Its Effect on Unemployment" (May 18, 1955), pp. 6540-6541 in Congressional Record [annual bound version], Vol. 101, Part 5, Washington, D.C., U.S. Government Printing Office, 1955.

23.  Joseph A. Loftus, "Number of Poor in Slight Drop," New York Times, October 30, 1955, p. 65; and J.A. O'Leary, "Chronically Poor Are Still With Us Despite Seven Years of Prosperity," Washington Star, October 30, 1955. For a brief discussion of this report and its low-income line, see Fisher, "From Hunter to Orshansky..." (1997 revision), p. 44.

24.  U.S. Congress, Joint Committee on the Economic Report, Characteristics of the Low-Income Population and Related Federal Programs[ — ]Selected Materials Assembled by the Staff of the Subcommittee on Low-Income Families..., Washington, D.C., United States Government Printing Office, 1955, pp. 1-4.

25.  Characteristics of the Low-Income Population..., pp. 1-2, 5-7, and 12-13. 

26.  United States Congress, Joint Committee on the Economic Report, A Program for the Low-Income Population at Substandard Levels of Living[:] Report...to the Congress... (84th Congress, 2d Session, Senate Report No. 1311), Washington, D.C., United States Government Printing Office, 1956, pp. 2, 4-6, and 8-14. See also "Aid to Poor Asked by Congress Unit," New York Times, January 2, 1956, p. 10.