The "war on poverty" turns 50 this week. Judging by the official rate, which has only edged down from 19 percent to 15 percent in that time, poverty is winning the war.
Why?
In Annie Lowrey's excellent overview, the experts blame low wages. The University of Kentucky's James P. Ziliak and the Obama administration's Jason Furman agree that "the biggest potential gains that could be made on poverty would be in raising market incomes."
There's no question that lower-income wages have fallen behind inflation and productivity growth. But poverty isn't entirely a crisis of McJobs and minimum-wage workers. In fact, the vast majority of people who earn the minimum wage or work cheap jobs on a full-time basis aren't in poverty. In households with at least one fully employed person, the poverty rate just 4.6 percent—two-thirds below the national average. The poverty rate among all full-time workers is even lower, at 2.9 percent—scarcely a fifth of the national figure.
Low wages should be a national concern, as globalization and technology have tag-teamed to devastate the buying power of families who struggle annually to pay the bills and raise their children. But the pesky poverty rate isn't just a measure of low wages. It's sticky high partly because the government's best efforts to get cash to working families have been offset by the fact that Americans are—for a variety of reasons—working less.*
The first reason we're working less is that we just suffered a huge recession, and Washington all but abandoned its efforts to heal the labor market. Even with jobless benefits, unemployment stresses poverty in a straightforward way. The poverty rate for full-time workers is very low: 3 percent. For those who don't work, it's very high: 33 percent...