The Evolution of Income Support Policy in Recent Decades
Explores the development of 1990s US antipoverty programs. A quick look at the contextual factors of economic performance, public opinion, & population subgroup poverty trends is followed by a discussion of the impact of (pre)taxes & (pre)transfers on poverty. Against this backdrop, the safety net, comprising social insurance & means-tested transfers, is detailed. Focus turns to the degree to which tax & transfer programs alleviate poverty, updating Daniel Weinberg (eg, 1991) & addressing four questions: the size of the poverty gap & its change since 1979; the effectiveness of programs to fill that gap; shifts in tax & transfer program effectiveness over time; & differential policy effects across the elderly, one- & two-parent families, & childless families. Program impact on labor supply, saving, & family formation is also considered. It is found that the tax & transfer system has measurable effects on low-income family behavior; a positive relationship between post-tax wage rates & labor force participation is revealed. It is argued that policy developments hinge on welfare reform lessons: (1) Benefits will continue to be connected to responsibility. (2) A diminution of support for social insurance & the disabled is unlikely. (3) Fiscal climate (ie, deficits) drives antipoverty spending. Opinions on the direction of the policy debate are offered. 3 Tables, 8 Figures, 1 Appendix. J. Zendejas