what are the main causes of poverty essay

Poverty: The Main Causes and Factors Essay

At the moment, there is a great deal of debate in the scientific community as to what exactly should be considered poverty. Because of the constant process of societal development, the concept of poverty changes rapidly, adapting to the new standards of modern human life. Thus, it is impossible to determine the causes of poverty with absolute precision. Still, a range of empirical knowledge about humanity allows identifying three groups of causes most likely to lead people and entire societies to poverty. Thus, this paper’s central thesis is that a person’s poverty can be influenced not only by the characteristics of his behavior but also by the circumstances in which he was born. These may include political and economic factors, which often cause poverty for the individual and the whole society.

There are various theories that summarize the causes of poverty. Brady (2019) writes that all theories about the emergence of poverty can be divided into three conditional groups: structural, behavioral, and political. The behavioral factor refers to the set of qualities of an individual that impede his financial well-being. These may include various addictions, insufficient level of education, a person’s worldview, and other reasons. Structural factors include labor market conditions, demographic context, and other socio-economic circumstances. An example is the increase in poverty associated with the development of the COVID-19 pandemic. According to the World Bank (2022), declining incomes, job losses and work stoppages during the pandemic have significantly reduced household incomes. Finally, political causes refer to the policies pursued by the government and its institutions, which hinder the economic well-being of the citizen and society.

Observing the behavioral causes of poverty, it is worth noting several vital factors highlighted by scholars. Brown (2018) writes that given the same circumstances, some people may become more prosperous than others, which may be due to a number of their behavioral characteristics. Various studies have tested the correlation between different measures of human character and one’s financial situation. Still, one can assume the deductive argument that greater diligence, striving for growth and development, ambition, and other personality traits can affect whether or not one will be poor. According to behavioral theory, if people become poor, then they themselves are responsible for this, since their individual shortcomings, laziness or lack of qualifications necessary for society lead to the impossibility of finding a job. Mavroudeas et al. (2019) note that the character traits of the unemployed can vary widely, from a lack of hard work or good morals to a low level of education or competitive market skills. Moreover, it is worth considering that some illnesses prevent a person from reaching their goals. Such illnesses include disabilities, congenital problems, and other factors affecting a person’s future expenses and employment.

The next group of reasons is related to the demographic characteristics of the region and the conditions of the labor market there. Fewer children are born in countries where the second demographic transition has occurred. It allows parents to concentrate all their efforts on upbringing, education, and health. In less developed countries or countries with higher fertility rates, parents have to rely on the number of their children. High infant mortality forces parents to have more children than their financial situation can afford, which is also a significant cause of poverty in the developing world.

Several political, social, historical, and economic factors prevent certain societies, and therefore most of their members, from crossing the poverty threshold. Being in a prolonged military conflict, a severe financial crisis, and insufficient valuable resources for economic development are important causes of poverty for many African and Asian countries (Wijekoon, 2021). All these factors harm the region’s economic development, creating several behavioral and structural problems. For example, higher levels of unemployment often lead to problems with alcohol addiction in society. It is also worth noting that Greve (2019) identifies certain categories of citizens who, due to demographic, social and economic reasons, find themselves in a state of poverty. These include the disabled, pensioners, people with a high incidence of disease, and those with a large number of dependents. Thus, the cause of poverty is a person’s belonging to these groups.

The political reasons also include a high level of state corruption, leading to an unfair allocation of resources. In situations where a limited number of people own most of the country’s natural reserves, resources, and finances, essential to discuss unnatural causes of regional poverty caused by the incompetent work of the state apparatus. Correct distribution of resources in the economy, which promotes competition between businesses and individuals, can lead a country to develop and reduce the number of poor people.

Thus, many causes of poverty affect individuals and society in different ways. Although the definition of poverty is constantly changing and varies from country to country, there are several universal reasons for the poverty of some and the wealth of others. These reasons are historical, political, demographic, and others, as many factors, influence a person’s financial situation. Each of these causes can be a consequence of the previous one, just as alcohol addiction can follow a wage fall or an increase in unemployment.

Brady, D. (2019). Theories of the Causes of Poverty. Annual Review of Sociology , 45 , 155-175.

Brown, U., & Long, G. (2018). Poverty and welfare. In Social Welfare (pp. 19-34). Routledge.

Greve, B. (2019). Poverty: The Basics (1 st ed.). Routledge.

Mavroudeas, S., Akar, S., & Dobreva, J. (2019). Globalization, poverty, inequality, & sustainability. IJOPEC.

The World Bank. (2022). Poverty. The World Bank. Web.

Wijekoon, R., Sabri, M. F., & Paim, L. (2021). Poverty: A literature review of the concept, measurements, causes and the way forward. International Journal of Academic Research in Business and Social Sciences , 11 (15), 93-111.

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• The Opportunity for All Program: Poverty Reduction

Why Poverty Persists in America

A Pulitzer Prize-winning sociologist offers a new explanation for an intractable problem.

A mother and son living in a Walmart parking lot in North Dakota in 2012. Credit... Eugene Richards

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By Matthew Desmond

• Published March 9, 2023 Updated April 3, 2023

In the past 50 years, scientists have mapped the entire human genome and eradicated smallpox. Here in the United States, infant-mortality rates and deaths from heart disease have fallen by roughly 70 percent, and the average American has gained almost a decade of life. Climate change was recognized as an existential threat. The internet was invented.

On the problem of poverty, though, there has been no real improvement — just a long stasis. As estimated by the federal government’s poverty line, 12.6 percent of the U.S. population was poor in 1970; two decades later, it was 13.5 percent; in 2010, it was 15.1 percent; and in 2019, it was 10.5 percent. To graph the share of Americans living in poverty over the past half-century amounts to drawing a line that resembles gently rolling hills. The line curves slightly up, then slightly down, then back up again over the years, staying steady through Democratic and Republican administrations, rising in recessions and falling in boom years.

What accounts for this lack of progress? It cannot be chalked up to how the poor are counted: Different measures spit out the same embarrassing result. When the government began reporting the Supplemental Poverty Measure in 2011, designed to overcome many of the flaws of the Official Poverty Measure, including not accounting for regional differences in costs of living and government benefits, the United States officially gained three million more poor people. Possible reductions in poverty from counting aid like food stamps and tax benefits were more than offset by recognizing how low-income people were burdened by rising housing and health care costs.

The American poor have access to cheap, mass-produced goods, as every American does. But that doesn’t mean they can access what matters most.

Any fair assessment of poverty must confront the breathtaking march of material progress. But the fact that standards of living have risen across the board doesn’t mean that poverty itself has fallen. Forty years ago, only the rich could afford cellphones. But cellphones have become more affordable over the past few decades, and now most Americans have one, including many poor people. This has led observers like Ron Haskins and Isabel Sawhill, senior fellows at the Brookings Institution, to assert that “access to certain consumer goods,” like TVs, microwave ovens and cellphones, shows that “the poor are not quite so poor after all.”

No, it doesn’t. You can’t eat a cellphone. A cellphone doesn’t grant you stable housing, affordable medical and dental care or adequate child care. In fact, as things like cellphones have become cheaper, the cost of the most necessary of life’s necessities, like health care and rent, has increased. From 2000 to 2022 in the average American city, the cost of fuel and utilities increased by 115 percent. The American poor, living as they do in the center of global capitalism, have access to cheap, mass-produced goods, as every American does. But that doesn’t mean they can access what matters most. As Michael Harrington put it 60 years ago: “It is much easier in the United States to be decently dressed than it is to be decently housed, fed or doctored.”

Why, then, when it comes to poverty reduction, have we had 50 years of nothing? When I first started looking into this depressing state of affairs, I assumed America’s efforts to reduce poverty had stalled because we stopped trying to solve the problem. I bought into the idea, popular among progressives, that the election of President Ronald Reagan (as well as that of Prime Minister Margaret Thatcher in the United Kingdom) marked the ascendancy of market fundamentalism, or “neoliberalism,” a time when governments cut aid to the poor, lowered taxes and slashed regulations. If American poverty persisted, I thought, it was because we had reduced our spending on the poor. But I was wrong.

Reagan expanded corporate power, deeply cut taxes on the rich and rolled back spending on some antipoverty initiatives, especially in housing. But he was unable to make large-scale, long-term cuts to many of the programs that make up the American welfare state. Throughout Reagan’s eight years as president, antipoverty spending grew, and it continued to grow after he left office. Spending on the nation’s 13 largest means-tested programs — aid reserved for Americans who fall below a certain income level — went from $1,015 a person the year Reagan was elected president to $3,419 a person one year into Donald Trump’s administration, a 237 percent increase.

Most of this increase was due to health care spending, and Medicaid in particular. But even if we exclude Medicaid from the calculation, we find that federal investments in means-tested programs increased by 130 percent from 1980 to 2018, from $630 to $1,448 per person.

“Neoliberalism” is now part of the left’s lexicon, but I looked in vain to find it in the plain print of federal budgets, at least as far as aid to the poor was concerned. There is no evidence that the United States has become stingier over time. The opposite is true.

This makes the country’s stalled progress on poverty even more baffling. Decade after decade, the poverty rate has remained flat even as federal relief has surged.

If we have more than doubled government spending on poverty and achieved so little, one reason is that the American welfare state is a leaky bucket. Take welfare, for example: When it was administered through the Aid to Families With Dependent Children program, almost all of its funds were used to provide single-parent families with cash assistance. But when President Bill Clinton reformed welfare in 1996, replacing the old model with Temporary Assistance for Needy Families (TANF), he transformed the program into a block grant that gives states considerable leeway in deciding how to distribute the money. As a result, states have come up with rather creative ways to spend TANF dollars. Arizona has used welfare money to pay for abstinence-only sex education. Pennsylvania diverted TANF funds to anti-abortion crisis-pregnancy centers. Maine used the money to support a Christian summer camp. Nationwide, for every dollar budgeted for TANF in 2020, poor families directly received just 22 cents.

We’ve approached the poverty question by pointing to poor people themselves, when we should have been focusing on exploitation.

A fair amount of government aid earmarked for the poor never reaches them. But this does not fully solve the puzzle of why poverty has been so stubbornly persistent, because many of the country’s largest social-welfare programs distribute funds directly to people. Roughly 85 percent of the Supplemental Nutrition Assistance Program budget is dedicated to funding food stamps themselves, and almost 93 percent of Medicaid dollars flow directly to beneficiaries.

There are, it would seem, deeper structural forces at play, ones that have to do with the way the American poor are routinely taken advantage of. The primary reason for our stalled progress on poverty reduction has to do with the fact that we have not confronted the unrelenting exploitation of the poor in the labor, housing and financial markets.

As a theory of poverty, “exploitation” elicits a muddled response, causing us to think of course and but, no in the same instant. The word carries a moral charge, but social scientists have a fairly coolheaded way to measure exploitation: When we are underpaid relative to the value of what we produce, we experience labor exploitation; when we are overcharged relative to the value of something we purchase, we experience consumer exploitation. For example, if a family paid $1,000 a month to rent an apartment with a market value of $20,000, that family would experience a higher level of renter exploitation than a family who paid the same amount for an apartment with a market valuation of $100,000. When we don’t own property or can’t access credit, we become dependent on people who do and can, which in turn invites exploitation, because a bad deal for you is a good deal for me.

Our vulnerability to exploitation grows as our liberty shrinks. Because labor laws often fail to protect undocumented workers in practice, more than a third are paid below minimum wage, and nearly 85 percent are not paid overtime. Many of us who are U.S. citizens, or who crossed borders through official checkpoints, would not work for these wages. We don’t have to. If they migrate here as adults, those undocumented workers choose the terms of their arrangement. But just because desperate people accept and even seek out exploitative conditions doesn’t make those conditions any less exploitative. Sometimes exploitation is simply the best bad option.

Consider how many employers now get one over on American workers. The United States offers some of the lowest wages in the industrialized world. A larger share of workers in the United States make “low pay” — earning less than two-thirds of median wages — than in any other country belonging to the Organization for Economic Cooperation and Development. According to the group, nearly 23 percent of American workers labor in low-paying jobs, compared with roughly 17 percent in Britain, 11 percent in Japan and 5 percent in Italy. Poverty wages have swollen the ranks of the American working poor, most of whom are 35 or older.

One popular theory for the loss of good jobs is deindustrialization, which caused the shuttering of factories and the hollowing out of communities that had sprung up around them. Such a passive word, “deindustrialization” — leaving the impression that it just happened somehow, as if the country got deindustrialization the way a forest gets infested by bark beetles. But economic forces framed as inexorable, like deindustrialization and the acceleration of global trade, are often helped along by policy decisions like the 1994 North American Free Trade Agreement, which made it easier for companies to move their factories to Mexico and contributed to the loss of hundreds of thousands of American jobs. The world has changed, but it has changed for other economies as well. Yet Belgium and Canada and many other countries haven’t experienced the kind of wage stagnation and surge in income inequality that the United States has.

Those countries managed to keep their unions. We didn’t. Throughout the 1950s and 1960s, nearly a third of all U.S. workers carried union cards. These were the days of the United Automobile Workers, led by Walter Reuther, once savagely beaten by Ford’s brass-knuckle boys, and of the mighty American Federation of Labor and Congress of Industrial Organizations that together represented around 15 million workers, more than the population of California at the time.

In their heyday, unions put up a fight. In 1970 alone, 2.4 million union members participated in work stoppages, wildcat strikes and tense standoffs with company heads. The labor movement fought for better pay and safer working conditions and supported antipoverty policies. Their efforts paid off for both unionized and nonunionized workers, as companies like Eastman Kodak were compelled to provide generous compensation and benefits to their workers to prevent them from organizing. By one estimate, the wages of nonunionized men without a college degree would be 8 percent higher today if union strength remained what it was in the late 1970s, a time when worker pay climbed, chief-executive compensation was reined in and the country experienced the most economically equitable period in modern history.

It is important to note that Old Labor was often a white man’s refuge. In the 1930s, many unions outwardly discriminated against Black workers or segregated them into Jim Crow local chapters. In the 1960s, unions like the Brotherhood of Railway and Steamship Clerks and the United Brotherhood of Carpenters and Joiners of America enforced segregation within their ranks. Unions harmed themselves through their self-defeating racism and were further weakened by a changing economy. But organized labor was also attacked by political adversaries. As unions flagged, business interests sensed an opportunity. Corporate lobbyists made deep inroads in both political parties, beginning a public-relations campaign that pressured policymakers to roll back worker protections.

A national litmus test arrived in 1981, when 13,000 unionized air traffic controllers left their posts after contract negotiations with the Federal Aviation Administration broke down. When the workers refused to return, Reagan fired all of them. The public’s response was muted, and corporate America learned that it could crush unions with minimal blowback. And so it went, in one industry after another.

Today almost all private-sector employees (94 percent) are without a union, though roughly half of nonunion workers say they would organize if given the chance. They rarely are. Employers have at their disposal an arsenal of tactics designed to prevent collective bargaining, from hiring union-busting firms to telling employees that they could lose their jobs if they vote yes. Those strategies are legal, but companies also make illegal moves to block unions, like disciplining workers for trying to organize or threatening to close facilities. In 2016 and 2017, the National Labor Relations Board charged 42 percent of employers with violating federal law during union campaigns. In nearly a third of cases, this involved illegally firing workers for organizing.

Corporate lobbyists told us that organized labor was a drag on the economy — that once the companies had cleared out all these fusty, lumbering unions, the economy would rev up, raising everyone’s fortunes. But that didn’t come to pass. The negative effects of unions have been wildly overstated, and there is now evidence that unions play a role in increasing company productivity, for example by reducing turnover. The U.S. Bureau of Labor Statistics measures productivity as how efficiently companies turn inputs (like materials and labor) into outputs (like goods and services). Historically, productivity, wages and profits rise and fall in lock step. But the American economy is less productive today than it was in the post-World War II period, when unions were at peak strength. The economies of other rich countries have slowed as well, including those with more highly unionized work forces, but it is clear that diluting labor power in America did not unleash economic growth or deliver prosperity to more people. “We were promised economic dynamism in exchange for inequality,” Eric Posner and Glen Weyl write in their book “Radical Markets.” “We got the inequality, but dynamism is actually declining.”

As workers lost power, their jobs got worse. For several decades after World War II, ordinary workers’ inflation-adjusted wages (known as “real wages”) increased by 2 percent each year. But since 1979, real wages have grown by only 0.3 percent a year. Astonishingly, workers with a high school diploma made 2.7 percent less in 2017 than they would have in 1979, adjusting for inflation. Workers without a diploma made nearly 10 percent less.

Lousy, underpaid work is not an indispensable, if regrettable, byproduct of capitalism, as some business defenders claim today. (This notion would have scandalized capitalism’s earliest defenders. John Stuart Mill, arch advocate of free people and free markets, once said that if widespread scarcity was a hallmark of capitalism, he would become a communist.) But capitalism is inherently about owners trying to give as little, and workers trying to get as much, as possible. With unions largely out of the picture, corporations have chipped away at the conventional midcentury work arrangement, which involved steady employment, opportunities for advancement and raises and decent pay with some benefits.

As the sociologist Gerald Davis has put it: Our grandparents had careers. Our parents had jobs. We complete tasks. Or at least that has been the story of the American working class and working poor.

Poor Americans aren’t just exploited in the labor market. They face consumer exploitation in the housing and financial markets as well.

There is a long history of slum exploitation in America. Money made slums because slums made money. Rent has more than doubled over the past two decades, rising much faster than renters’ incomes. Median rent rose from $483 in 2000 to $1,216 in 2021. Why have rents shot up so fast? Experts tend to offer the same rote answers to this question. There’s not enough housing supply, they say, and too much demand. Landlords must charge more just to earn a decent rate of return. Must they? How do we know?

We need more housing; no one can deny that. But rents have jumped even in cities with plenty of apartments to go around. At the end of 2021, almost 19 percent of rental units in Birmingham, Ala., sat vacant, as did 12 percent of those in Syracuse, N.Y. Yet rent in those areas increased by roughly 14 percent and 8 percent, respectively, over the previous two years. National data also show that rental revenues have far outpaced property owners’ expenses in recent years, especially for multifamily properties in poor neighborhoods. Rising rents are not simply a reflection of rising operating costs. There’s another dynamic at work, one that has to do with the fact that poor people — and particularly poor Black families — don’t have much choice when it comes to where they can live. Because of that, landlords can overcharge them, and they do.

A study I published with Nathan Wilmers found that after accounting for all costs, landlords operating in poor neighborhoods typically take in profits that are double those of landlords operating in affluent communities. If down-market landlords make more, it’s because their regular expenses (especially their mortgages and property-tax bills) are considerably lower than those in upscale neighborhoods. But in many cities with average or below-average housing costs — think Buffalo, not Boston — rents in the poorest neighborhoods are not drastically lower than rents in the middle-class sections of town. From 2015 to 2019, median monthly rent for a two-bedroom apartment in the Indianapolis metropolitan area was $991; it was $816 in neighborhoods with poverty rates above 40 percent, just around 17 percent less. Rents are lower in extremely poor neighborhoods, but not by as much as you would think.

Yet where else can poor families live? They are shut out of homeownership because banks are disinclined to issue small-dollar mortgages, and they are also shut out of public housing, which now has waiting lists that stretch on for years and even decades. Struggling families looking for a safe, affordable place to live in America usually have but one choice: to rent from private landlords and fork over at least half their income to rent and utilities. If millions of poor renters accept this state of affairs, it’s not because they can’t afford better alternatives; it’s because they often aren’t offered any.

You can read injunctions against usury in the Vedic texts of ancient India, in the sutras of Buddhism and in the Torah. Aristotle and Aquinas both rebuked it. Dante sent moneylenders to the seventh circle of hell. None of these efforts did much to stem the practice, but they do reveal that the unprincipled act of trapping the poor in a cycle of debt has existed at least as long as the written word. It might be the oldest form of exploitation after slavery. Many writers have depicted America’s poor as unseen, shadowed and forgotten people: as “other” or “invisible.” But markets have never failed to notice the poor, and this has been particularly true of the market for money itself.

The deregulation of the banking system in the 1980s heightened competition among banks. Many responded by raising fees and requiring customers to carry minimum balances. In 1977, over a third of banks offered accounts with no service charge. By the early 1990s, only 5 percent did. Big banks grew bigger as community banks shuttered, and in 2021, the largest banks in America charged customers almost $11 billion in overdraft fees. Previous research showed that just 9 percent of account holders paid 84 percent of these fees. Who were the unlucky 9 percent? Customers who carried an average balance of less than $350. The poor were made to pay for their poverty.

In 2021, the average fee for overdrawing your account was $33.58. Because banks often issue multiple charges a day, it’s not uncommon to overdraw your account by $20 and end up paying $200 for it. Banks could (and do) deny accounts to people who have a history of overextending their money, but those customers also provide a steady revenue stream for some of the most powerful financial institutions in the world.

Every year: almost $11 billion in overdraft fees, $1.6 billion in check-cashing fees and up to $8.2 billion in payday-loan fees.

According to the F.D.I.C., one in 19 U.S. households had no bank account in 2019, amounting to more than seven million families. Compared with white families, Black and Hispanic families were nearly five times as likely to lack a bank account. Where there is exclusion, there is exploitation. Unbanked Americans have created a market, and thousands of check-cashing outlets now serve that market. Check-cashing stores generally charge from 1 to 10 percent of the total, depending on the type of check. That means that a worker who is paid $10 an hour and takes a $1,000 check to a check-cashing outlet will pay $10 to $100 just to receive the money he has earned, effectively losing one to 10 hours of work. (For many, this is preferable to the less-predictable exploitation by traditional banks, with their automatic overdraft fees. It’s the devil you know.) In 2020, Americans spent $1.6 billion just to cash checks. If the poor had a costless way to access their own money, over a billion dollars would have remained in their pockets during the pandemic-induced recession.

Poverty can mean missed payments, which can ruin your credit. But just as troublesome as bad credit is having no credit score at all, which is the case for 26 million adults in the United States. Another 19 million possess a credit history too thin or outdated to be scored. Having no credit (or bad credit) can prevent you from securing an apartment, buying insurance and even landing a job, as employers are increasingly relying on credit checks during the hiring process. And when the inevitable happens — when you lose hours at work or when the car refuses to start — the payday-loan industry steps in.

For most of American history, regulators prohibited lending institutions from charging exorbitant interest on loans. Because of these limits, banks kept interest rates between 6 and 12 percent and didn’t do much business with the poor, who in a pinch took their valuables to the pawnbroker or the loan shark. But the deregulation of the banking sector in the 1980s ushered the money changers back into the temple by removing strict usury limits. Interest rates soon reached 300 percent, then 500 percent, then 700 percent. Suddenly, some people were very interested in starting businesses that lent to the poor. In recent years, 17 states have brought back strong usury limits, capping interest rates and effectively prohibiting payday lending. But the trade thrives in most places. The annual percentage rate for a two-week $300 loan can reach 460 percent in California, 516 percent in Wisconsin and 664 percent in Texas.

Roughly a third of all payday loans are now issued online, and almost half of borrowers who have taken out online loans have had lenders overdraw their bank accounts. The average borrower stays indebted for five months, paying $520 in fees to borrow $375. Keeping people indebted is, of course, the ideal outcome for the payday lender. It’s how they turn a $15 profit into a $150 one. Payday lenders do not charge high fees because lending to the poor is risky — even after multiple extensions, most borrowers pay up. Lenders extort because they can.

Every year: almost $11 billion in overdraft fees, $1.6 billion in check-cashing fees and up to $8.2 billion in payday-loan fees. That’s more than $55 million in fees collected predominantly from low-income Americans each day — not even counting the annual revenue collected by pawnshops and title loan services and rent-to-own schemes. When James Baldwin remarked in 1961 how “extremely expensive it is to be poor,” he couldn’t have imagined these receipts.

“Predatory inclusion” is what the historian Keeanga-Yamahtta Taylor calls it in her book “Race for Profit,” describing the longstanding American tradition of incorporating marginalized people into housing and financial schemes through bad deals when they are denied good ones. The exclusion of poor people from traditional banking and credit systems has forced them to find alternative ways to cash checks and secure loans, which has led to a normalization of their exploitation. This is all perfectly legal, after all, and subsidized by the nation’s richest commercial banks. The fringe banking sector would not exist without lines of credit extended by the conventional one. Wells Fargo and JPMorgan Chase bankroll payday lenders like Advance America and Cash America. Everybody gets a cut.

Poverty isn’t simply the condition of not having enough money. It’s the condition of not having enough choice and being taken advantage of because of that. When we ignore the role that exploitation plays in trapping people in poverty, we end up designing policy that is weak at best and ineffective at worst. For example, when legislation lifts incomes at the bottom without addressing the housing crisis, those gains are often realized instead by landlords, not wholly by the families the legislation was intended to help. A 2019 study conducted by the Federal Reserve Bank of Philadelphia found that when states raised minimum wages, families initially found it easier to pay rent. But landlords quickly responded to the wage bumps by increasing rents, which diluted the effect of the policy. This happened after the pandemic rescue packages, too: When wages began to rise in 2021 after worker shortages, rents rose as well, and soon people found themselves back where they started or worse.

Antipoverty programs work. Each year, millions of families are spared the indignities and hardships of severe deprivation because of these government investments. But our current antipoverty programs cannot abolish poverty by themselves. The Johnson administration started the War on Poverty and the Great Society in 1964. These initiatives constituted a bundle of domestic programs that included the Food Stamp Act, which made food aid permanent; the Economic Opportunity Act, which created Job Corps and Head Start; and the Social Security Amendments of 1965, which founded Medicare and Medicaid and expanded Social Security benefits. Nearly 200 pieces of legislation were signed into law in President Lyndon B. Johnson’s first five years in office, a breathtaking level of activity. And the result? Ten years after the first of these programs were rolled out in 1964, the share of Americans living in poverty was half what it was in 1960.

But the War on Poverty and the Great Society were started during a time when organized labor was strong, incomes were climbing, rents were modest and the fringe banking industry as we know it today didn’t exist. Today multiple forms of exploitation have turned antipoverty programs into something like dialysis, a treatment designed to make poverty less lethal, not to make it disappear.

This means we don’t just need deeper antipoverty investments. We need different ones, policies that refuse to partner with poverty, policies that threaten its very survival. We need to ensure that aid directed at poor people stays in their pockets, instead of being captured by companies whose low wages are subsidized by government benefits, or by landlords who raise the rents as their tenants’ wages rise, or by banks and payday-loan outlets who issue exorbitant fines and fees. Unless we confront the many forms of exploitation that poor families face, we risk increasing government spending only to experience another 50 years of sclerosis in the fight against poverty.

The best way to address labor exploitation is to empower workers. A renewed contract with American workers should make organizing easy. As things currently stand, unionizing a workplace is incredibly difficult. Under current labor law, workers who want to organize must do so one Amazon warehouse or one Starbucks location at a time. We have little chance of empowering the nation’s warehouse workers and baristas this way. This is why many new labor movements are trying to organize entire sectors. The Fight for $15 campaign, led by the Service Employees International Union, doesn’t focus on a single franchise (a specific McDonald’s store) or even a single company (McDonald’s) but brings together workers from several fast-food chains. It’s a new kind of labor power, and one that could be expanded: If enough workers in a specific economic sector — retail, hotel services, nursing — voted for the measure, the secretary of labor could establish a bargaining panel made up of representatives elected by the workers. The panel could negotiate with companies to secure the best terms for workers across the industry. This is a way to organize all Amazon warehouses and all Starbucks locations in a single go.

Sectoral bargaining, as it’s called, would affect tens of millions of Americans who have never benefited from a union of their own, just as it has improved the lives of workers in Europe and Latin America. The idea has been criticized by members of the business community, like the U.S. Chamber of Commerce, which has raised concerns about the inflexibility and even the constitutionality of sectoral bargaining, as well as by labor advocates, who fear that industrywide policies could nullify gains that existing unions have made or could be achieved only if workers make other sacrifices. Proponents of the idea counter that sectoral bargaining could even the playing field, not only between workers and bosses, but also between companies in the same sector that would no longer be locked into a race to the bottom, with an incentive to shortchange their work force to gain a competitive edge. Instead, the companies would be forced to compete over the quality of the goods and services they offer. Maybe we would finally reap the benefits of all that economic productivity we were promised.

We must also expand the housing options for low-income families. There isn’t a single right way to do this, but there is clearly a wrong way: the way we’re doing it now. One straightforward approach is to strengthen our commitment to the housing programs we already have. Public housing provides affordable homes to millions of Americans, but it’s drastically underfunded relative to the need. When the wealthy township of Cherry Hill, N.J., opened applications for 29 affordable apartments in 2021, 9,309 people applied. The sky-high demand should tell us something, though: that affordable housing is a life changer, and families are desperate for it.

We could also pave the way for more Americans to become homeowners, an initiative that could benefit poor, working-class and middle-class families alike — as well as scores of young people. Banks generally avoid issuing small-dollar mortgages, not because they’re riskier — these mortgages have the same delinquency rates as larger mortgages — but because they’re less profitable. Over the life of a mortgage, interest on $1 million brings in a lot more money than interest on $75,000. This is where the federal government could step in, providing extra financing to build on-ramps to first-time homeownership. In fact, it already does so in rural America through the 502 Direct Loan Program, which has moved more than two million families into their own homes. These loans, fully guaranteed and serviced by the Department of Agriculture, come with low interest rates and, for very poor families, cover the entire cost of the mortgage, nullifying the need for a down payment. Last year, the average 502 Direct Loan was for $222,300 but cost the government only $10,370 per loan, chump change for such a durable intervention. Expanding a program like this into urban communities would provide even more low- and moderate-income families with homes of their own.

We should also ensure fair access to capital. Banks should stop robbing the poor and near-poor of billions of dollars each year, immediately ending exorbitant overdraft fees. As the legal scholar Mehrsa Baradaran has pointed out, when someone overdraws an account, banks could simply freeze the transaction or could clear a check with insufficient funds, providing customers a kind of short-term loan with a low interest rate of, say, 1 percent a day.

States should rein in payday-lending institutions and insist that lenders make it clear to potential borrowers what a loan is ultimately likely to cost them. Just as fast-food restaurants must now publish calorie counts next to their burgers and shakes, payday-loan stores should publish the average overall cost of different loans. When Texas adopted disclosure rules, residents took out considerably fewer bad loans. If Texas can do this, why not California or Wisconsin? Yet to stop financial exploitation, we need to expand, not limit, low-income Americans’ access to credit. Some have suggested that the government get involved by having the U.S. Postal Service or the Federal Reserve issue small-dollar loans. Others have argued that we should revise government regulations to entice commercial banks to pitch in. Whatever our approach, solutions should offer low-income Americans more choice, a way to end their reliance on predatory lending institutions that can get away with robbery because they are the only option available.

In Tommy Orange’s novel, “There There,” a man trying to describe the problem of suicides on Native American reservations says: “Kids are jumping out the windows of burning buildings, falling to their deaths. And we think the problem is that they’re jumping.” The poverty debate has suffered from a similar kind of myopia. For the past half-century, we’ve approached the poverty question by pointing to poor people themselves — posing questions about their work ethic, say, or their welfare benefits — when we should have been focusing on the fire. The question that should serve as a looping incantation, the one we should ask every time we drive past a tent encampment, those tarped American slums smelling of asphalt and bodies, or every time we see someone asleep on the bus, slumped over in work clothes, is simply: Who benefits? Not: Why don’t you find a better job? Or: Why don’t you move? Or: Why don’t you stop taking out payday loans? But: Who is feeding off this?

Those who have amassed the most power and capital bear the most responsibility for America’s vast poverty: political elites who have utterly failed low-income Americans over the past half-century; corporate bosses who have spent and schemed to prioritize profits over families; lobbyists blocking the will of the American people with their self-serving interests; property owners who have exiled the poor from entire cities and fueled the affordable-housing crisis. Acknowledging this is both crucial and deliciously absolving; it directs our attention upward and distracts us from all the ways (many unintentional) that we — we the secure, the insured, the housed, the college-educated, the protected, the lucky — also contribute to the problem.

Corporations benefit from worker exploitation, sure, but so do consumers, who buy the cheap goods and services the working poor produce, and so do those of us directly or indirectly invested in the stock market. Landlords are not the only ones who benefit from housing exploitation; many homeowners do, too, their property values propped up by the collective effort to make housing scarce and expensive. The banking and payday-lending industries profit from the financial exploitation of the poor, but so do those of us with free checking accounts, as those accounts are subsidized by billions of dollars in overdraft fees.

Living our daily lives in ways that express solidarity with the poor could mean we pay more; anti-exploitative investing could dampen our stock portfolios. By acknowledging those costs, we acknowledge our complicity. Unwinding ourselves from our neighbors’ deprivation and refusing to live as enemies of the poor will require us to pay a price. It’s the price of our restored humanity and renewed country.

Matthew Desmond is a professor of sociology at Princeton University and a contributing writer for the magazine. His latest book, “Poverty, by America,” from which this article is adapted, is being published on March 21 by Crown.

An earlier version of this article referred incorrectly to the legal protections for undocumented workers. They are afforded rights under U.S. labor laws, though in practice those laws often fail to protect them.

An earlier version of this article implied an incorrect date for a statistic about overdraft fees. The research was conducted between 2005 and 2012, not in 2021.

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7 Essays About Poverty: Example Essays and Prompts

Essays about poverty give valuable insight into the economic situation that we share globally. Read our guide with poverty essay examples and prompts for your paper.

In the US, the official poverty rate in 2022 was 11.5 percent, with 37.9 million people living below the poverty line. With a global pandemic, cost of living crisis, and climate change on the rise, we’ve seen poverty increase due to various factors. As many of us face adversity daily, we can look to essays about poverty from some of the world’s greatest speakers for inspiration and guidance.

There is nothing but a lack of social vision to prevent us from paying an adequate wage to every American citizen whether he be a hospital worker, laundry worker, maid or day laborer. There is nothing except shortsightedness to prevent us from guaranteeing an annual minimum—and livable—income for every American family. Martin Luther King Jr., Where Do We Go from Here: Chaos or Community?

Writing a poverty essay can be challenging due to the many factors contributing to poverty and the knock-on effects of living below the poverty line . For example, homelessness among low-income individuals stems from many different causes.

It’s important to note that poverty exists beyond the US, with many developing countries living in extreme poverty without access to essentials like clean water and housing. For help with your essays, check out our round-up of the best essay checkers .

Essays About Poverty: Top Examples

1. pensioner poverty: fear of rise over decades as uk under-40s wealth falls, 2. the surprising poverty levels across the u.s., 3. why poverty persists in america, 4. post-pandemic poverty is rising in america’s suburbs.

• 5. The Basic Facts About Children in Poverty
• 6. The State of America’s Children 
• 7. COVID-19: This is how many Americans now live below the poverty line

10 Poverty Essay Topics

1. the causes of poverty, 2. the negative effects of poverty, 3. how countries can reduce poverty rates, 4. the basic necessities and poverty, 5. how disabilities can lead to poverty, 6. how the cycle of poverty unfolds , 7. universal basic income and its relationship to poverty, 8. interview someone who has experience living in poverty, 9. the impact of the criminal justice system on poverty, 10. the different ways to create affordable housing.

There is growing concern about increasing pensioner poverty in the UK in the coming decades. Due to financial challenges like the cost of living crisis, rent increases, and the COVID-19 pandemic, under 40s have seen their finances shrink.

Osborne discusses the housing wealth gap in this article, where many under the 40s currently pay less in a pension due to rent prices. While this means they will have less pension available, they will also retire without owning a home, resulting in less personal wealth than previous generations. Osborne delves into the causes and gaps in wealth between generations in this in-depth essay.

“Those under-40s have already been identified as  facing the biggest hit from rising mortgage rates , and last week a study by the financial advice firm Hargreaves Lansdown found that almost a third of 18- to 34-year-olds had stopped or cut back on their pension contributions in order to save money.” Hilary Osborne,  The Guardian

In this 2023 essay, Jeremy Ney looks at the poverty levels across the US, stating that poverty has had the largest one-year increase in history. According to the most recent census, child poverty has more than doubled from 2021 to 2022.

Ney states that the expiration of government support and inflation has created new financial challenges for US families. With the increased cost of living and essential items like food and housing sharply increasing, more and more families have fallen below the poverty line. Throughout this essay, Ney displays statistics and data showing the wealth changes across states, ethnic groups, and households.

“Poverty in America reflects the inequality that plagues U.S. households. While certain regions have endured this pain much more than others, this new rising trend may spell ongoing challenges for even more communities.” Jeremy Ney,  TIME

In this New York Times article, a Pulitzer Prize-winning sociologist explores why poverty exists in North America.

The American poor have access to cheap, mass-produced goods, as every American does. But that doesn’t mean they can access what matters most. Matthew Desmond,  The New York Times

The U.S. Census Bureau recently released its annual data on poverty, revealing contrasting trends for 2022. While one set of findings indicated that the overall number of Americans living in poverty remained stable compared to the previous two years, another survey highlighted a concerning increase in child poverty. The rate of child poverty in the U.S. doubled from 2021 to 2022, a spike attributed mainly to the cessation of the expanded child tax credit following the pandemic. These varied outcomes underscore the Census Bureau’s multifaceted methods to measure poverty.

“The nation’s suburbs accounted for the majority of increases in the poor population following the onset of the pandemic” Elizabeth Kneebone and Alan Berube,  Brookings

5.  The Basic Facts About Children in Poverty

Nearly 11 million children are living in poverty in America. This essay explores ow the crisis reached this point—and what steps must be taken to solve it.

“In America, nearly 11 million children are poor. That’s 1 in 7 kids, who make up almost one-third of all people living in poverty in this country.” Areeba Haider,  Center for American Progress

6.  The State of America’s Children  

This essay articles how, despite advancements, children continue to be the most impoverished demographic in the U.S., with particular subgroups — such as children of color, those under five, offspring of single mothers, and children residing in the South — facing the most severe poverty levels.

“Growing up in poverty has wide-ranging, sometimes lifelong, effects on children, putting them at a much higher risk of experiencing behavioral, social, emotional, and health challenges. Childhood poverty also plays an instrumental role in impairing a child’s ability and capacity to learn, build skills, and succeed academically.” Children’s Defense Fund

7.  COVID-19: This is how many Americans now live below the poverty line

This essay explores how the economic repercussions of the coronavirus pandemic 2020 led to a surge in U.S. poverty rates, with unemployment figures reaching unprecedented heights. The writer provides data confirming that individuals at the lowest economic strata bore the brunt of these challenges, indicating that the recession might have exacerbated income disparities, further widening the chasm between the affluent and the underprivileged.

“Poverty in the U.S. increased in 2020 as the coronavirus pandemic hammered the economy and unemployment soared. Those at the bottom of the economic ladder were hit hardest, new figures confirm, suggesting that the recession may have widened the gap between the rich and the poor.” Elena Delavega,  World Econmic Forum

If you’re tasked with writing an essay about poverty, consider using the below topics. They offer pointers for outlining and planning an essay about this challenging topic.

One of the most specific poverty essay topics to address involves the causes of poverty. You can craft an essay to examine the most common causes of extreme poverty. Here are a few topics you might want to include:

• Racial discrimination, particularly among African Americans, has been a common cause of poverty throughout American history. Discrimination and racism can make it hard for people to get the education they need, making it nearly impossible to get a job.
• A lack of access to adequate health care can also lead to poverty. When people do not have access to healthcare, they are more likely to get sick. This could make it hard for them to go to work while also leading to major medical bills.
• Inadequate food and water can lead to poverty as well. If people’s basic needs aren’t met, they focus on finding food and water instead of getting an education they can use to find a better job.

These are just a few of the most common causes of poverty you might want to highlight in your essay. These topics could help people see why some people are more likely to become impoverished than others. You might also be interested in these essays about poverty .

Poverty affects everyone, and the impacts of an impoverished lifestyle are very real. Furthermore, the disparities when comparing adult poverty to child poverty are also significant. This opens the doors to multiple possible essay topics. Here are a few points to include:

• When children live in poverty, their development is stunted. For example, they might not be able to get to school on time due to a lack of transportation, making it hard for them to keep up with their peers. Child poverty also leads to malnutrition, which can stunt their development.
• Poverty can impact familial relationships as well. For example, members of the same family could fight for limited resources, making it hard for family members to bond. In addition, malnutrition can stunt the growth of children.
• As a side effect of poverty, people have difficulty finding a safe place to live. This creates a challenging environment for everyone involved, and it is even harder for children to grow and develop.
• When poverty leads to homelessness, it is hard for someone to get a job. They don’t have an address to use for physical communication, which leads to employment concerns.

These are just a few of the many side effects of poverty. Of course, these impacts are felt by people across the board, but it is not unusual for children to feel the effects of poverty that much more. You might also be interested in these essays about unemployment .

Different countries take different approaches to reduce the number of people living in poverty

The issue of poverty is a major human rights concern, and many countries explore poverty reduction strategies to improve people’s quality of life. You might want to examine different strategies that different countries are taking while also suggesting how some countries can do more. A few ways to write this essay include:

• Explore the poverty level in America, comparing it to the poverty level of a European country. Then, explore why different countries take different strategies.
• Compare the minimum wage in one state, such as New York, to the minimum wage in another state, such as Alabama. Why is it higher in one state? What does raising the minimum wage do to the cost of living?
• Highlight a few advocacy groups and nonprofit organizations actively lobbying their governments to do more for low-income families. Then, talk about why some efforts are more successful than others.

Different countries take different approaches to reduce the number of people living in poverty. Poverty within each country is such a broad topic that you could write a different essay on how poverty could be decreased within the country. For more, check out our list of simple essays topics for intermediate writers .

You could also write an essay on the necessities people need to survive. You could take a look at information published by the United Nations , which focuses on getting people out of the cycle of poverty across the globe. The social problem of poverty can be addressed by giving people the necessities they need to survive, particularly in rural areas. Here are some of the areas you might want to include:

• Affordable housing
• Fresh, healthy food and clean water
• Access to an affordable education
• Access to affordable healthcare

Giving everyone these necessities could significantly improve their well-being and get people out of absolute poverty. You might even want to talk about whether these necessities vary depending on where someone is living.

There are a lot of medical and social issues that contribute to poverty, and you could write about how disabilities contribute to poverty. This is one of the most important essay topics because people could be disabled through no fault of their own. Some of the issues you might want to address in this essay include:

• Talk about the road someone faces if they become disabled while serving overseas. What is it like for people to apply for benefits through the Veterans’ Administration?
• Discuss what happens if someone becomes disabled while at work. What is it like for someone to pursue disability benefits if they are hurt doing a blue-collar job instead of a desk job?
• Research and discuss the experiences of disabled people and how their disability impacts their financial situation.

People who are disabled need to have money to survive for many reasons, such as the inability to work, limitations at home, and medical expenses. A lack of money, in this situation, can lead to a dangerous cycle that can make it hard for someone to be financially stable and live a comfortable lifestyle.

Many people talk about the cycle of poverty, yet many aren’t entirely sure what this means or what it entails. A few key points you should address in this essay include:

• When someone is born into poverty, income inequality can make it hard to get an education.
• A lack of education makes it hard for someone to get into a good school, which gives them the foundation they need to compete for a good job. 
• A lack of money can make it hard for someone to afford college, even if they get into a good school.
• Without attending a good college, it can be hard for someone to get a good job. This makes it hard for someone to support themselves or their families. 
• Without a good paycheck, it is nearly impossible for someone to keep their children out of poverty, limiting upward mobility into the middle class.

The problem of poverty is a positive feedback loop. It can be nearly impossible for those who live this every day to escape. Therefore, you might want to explore a few initiatives that could break the cycle of world poverty and explore other measures that could break this feedback loop.

Many business people and politicians have floated the idea of a universal basic income to give people the basic resources they need to survive. While this hasn’t gotten a lot of serious traction, you could write an essay to shed light on this idea. A few points to hit on include:

• What does a universal basic income mean, and how is it distributed?
• Some people are concerned about the impact this would have on taxes. How would this be paid for?
• What is the minimum amount of money someone would need to stay out of poverty? Is it different in different areas?
• What are a few of the biggest reasons major world governments haven’t passed this?

This is one of the best essay examples because it gives you a lot of room to be creative. However, there hasn’t been a concrete structure for implementing this plan, so you might want to afford one.

Another interesting topic you might want to explore is interviewing someone living in poverty or who has been impoverished. While you can talk about statistics all day, they won’t be as powerful as interviewing someone who has lived that life. A few questions you might want to ask during your interview include:

• What was it like growing up?
• How has living in poverty made it hard for you to get a job?
• What do you feel people misunderstand about those who live in poverty?
• When you need to find a meal, do you have a place you go to? Or is it somewhere different every day?
• What do you think is the main contributor to people living in poverty?

Remember that you can also craft different questions depending on your responses. You might want to let the interviewee read the essay when you are done to ensure all the information is accurate and correct.

The criminal justice system and poverty tend to go hand in hand. People with criminal records are more likely to be impoverished for several reasons. You might want to write an essay that hits on some of these points:

• Discuss the discriminatory practices of the criminal justice system both as they relate to socioeconomic status and as they relate to race.
• Explore just how hard it is for someone to get a job if they have a criminal record. Discuss how this might contribute to a life of poverty.
• Dive into how this creates a positive feedback loop. For example, when someone cannot get a job due to a criminal record, they might have to steal to survive, which worsens the issue.
• Review what the criminal justice system might be like for someone with resources when compared to someone who cannot afford to hire expert witnesses or pay for a good attorney.

You might want to include a few examples of disparate sentences for people in different socioeconomic situations to back up your points. 

Affordable housing can make a major difference when someone is trying to escape poverty

Many poverty-related problems could be reduced if people had access to affordable housing. While the cost of housing has increased dramatically in the United States , some initiatives exist to create affordable housing. Here are a few points to include:

• Talk about public programs that offer affordable housing to people from disadvantaged backgrounds.
• Discuss private programs, such as Habitat for Humanity , doing similar things.
• Review the positive impacts that stable housing has on both adults and children.
• Dive into other measures local and federal governments could take to provide more affordable housing for people.

There are a lot of political and social angles to address with this essay, so you might want to consider spreading this out across multiple papers. Affordable housing can make a major difference when trying to escape poverty. If you want to learn more, check out our essay writing tips !

Meet Rachael, the editor at Become a Writer Today. With years of experience in the field, she is passionate about language and dedicated to producing high-quality content that engages and informs readers. When she's not editing or writing, you can find her exploring the great outdoors, finding inspiration for her next project.

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10 Common Root Causes of Poverty

Poverty is a global problem. According to the World Bank in 2015 , over 700 million people were living on less than $1.90 a day. While that represents a milestone (in 1990, it was over one billion ) that’s still way too many people. That number also includes extreme poverty that is defined by the UN as “a condition characterized by severe deprivation of basic human needs, including food, safe drinking water, sanitation facilities, health, shelter, education and information. It depends not only on income but also on access to services.”

What causes poverty in the first place? Here are ten root causes:

#1. Lack of good jobs/job growth

This is the first reason a lot of people think about. When you don’t have a good job, you aren’t getting a good income. In many countries, traditional jobs like farming are disappearing. The Democratic Republic of Congo is a good example, where most of the population live in rural areas stripped of natural resources from years of colonialism. Half of the DRC live below the poverty line. Even in nations like the United States where many people do have jobs, those jobs aren’t paying enough. According to the Economic Policy Institute , large groups of workers with full-time, year-round employment are still below federal poverty guidelines.

#2: Lack of good education

The second root cause of poverty is a lack of education. Poverty is a cycle and without education, people aren’t able to better their situations. According to UNESCO , over 170 million people could be free of extreme poverty if they only had basic reading skills. However, in many areas of the world, people aren’t getting educated. The reasons vary. Often times, families need kids to work, there aren’t schools close by, or girls aren’t being educated because of sexism and discrimination.

#3: Warfare/conflict

Conflict has a huge impact on poverty. In times of war, everything stops. Productivity suffers as well as a country’s GDP. It’s very difficult to get things going again as foreign businesses and countries won’t want to invest. For families and individuals, war and conflict can make it impossible to stay in one place. It’s also very common for women to become the primary breadwinners, and they deal with many barriers like sexual violence and discrimination.

#4: Weather/climate change

According to the World Bank , climate change has the power to impoverish 100 million people in the next decade or so. We know climate change causes drought, floods, and severe storms, and that can take down successful countries while pulling poor ones down even further. Recovering is extremely difficult, as well, especially for agricultural communities where they barely have enough to feed themselves, let alone prepare for the next harvest year.

#5: Social injustice

Whether it’s gender discrimination, racism, or other forms of social injustice, poverty follows. People who are victims of social injustice struggle with getting a good education, the right job opportunities, and access to resources that can lift them out of poverty. The United Nations Social Policy and Development Division identifies “inequalities in income distribution and access to productive resources, basic social services, opportunities” and more as a cause for poverty. Groups like women, religious minorities, and racial minorities are the most vulnerable.

#6: Lack of food and water

Without access to basic essentials like food and water, it’s impossible to get out of poverty’s cycle. Everything a person does will be about getting food and water. They can’t save any money because it all goes towards their daily needs. When there isn’t enough sustenance, they won’t have the energy to work. They are also way more likely to get sick, which makes their financial situation even worse.

#7: Lack of infrastructure

Infrastructure includes roads, bridges, the internet, public transport, and more. When a community or families are isolated, they have to spend a lot of money, time, and energy getting to places. Without good roads, traveling takes forever. Without public transport, it may be next to impossible to get a good job or even to the store. Infrastructure connects people to the services and resources they need to better their financial and life situation, and without it, things don’t get better.

#8: Lack of government support

To combat many of the issues we’ve described, the government needs to be involved. However, many governments are either unable or unwilling to serve the poor. This might mean failing to provide (or cutting) social welfare programs, redirecting funds away from those who need it, failing to build good infrastructure, or actively persecuting the population. If a government fails to meet the needs of the poor, the poor will most likely stay that way.

#9: Lack of good healthcare

People who are poor are more likely to suffer from bad health, and those with bad health are more likely to be poor. This is because healthcare is often too expensive or inaccessible to those who need it. Without money for medicine and treatment, the poor have to make really tough decisions, and usually essentials like food take priority. People who are sick get sicker, and then they can’t work, which makes the situation even more dire. If people do seek treatment, the cost often ruins their finances. It’s a vicious cycle.

#10: High costs

The last root of poverty is simple: stuff costs too much. Even the basics can be too expensive. According to stats from the World Food Programme, the poorest households in the world are spending 60-80% of their incomes on food. Food prices are also very unpredictable in certain areas, so when they rise, the poor have to keep cutting out other essentials. Housing is another essential that is rising. Global house markets have been climbing, according to the International Monetary Fund. Income growth, however, has not.

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About the author, emmaline soken-huberty.

Emmaline Soken-Huberty is a freelance writer based in Portland, Oregon. She started to become interested in human rights while attending college, eventually getting a concentration in human rights and humanitarianism. LGBTQ+ rights, women’s rights, and climate change are of special concern to her. In her spare time, she can be found reading or enjoying Oregon’s natural beauty with her husband and dog.

The World Bank Group is committed to fighting poverty in all its dimensions. We use the latest data, evidence and analysis to help countries develop policies to improve people's lives, with a focus on the poorest and most vulnerable.

Around 700 million people live on less than $2.15 per day, the extreme poverty line. Extreme poverty remains concentrated in parts of Sub-Saharan Africa, fragile and conflict-affected areas, and rural areas.

After decades of progress, the pace of global poverty reduction began to slow by 2015, in tandem with subdued economic growth. The Sustainable Development Goal of ending extreme poverty by 2030 remains out of reach.

Global poverty reduction was dealt a severe blow by the COVID-19 pandemic and a series of major shocks during 2020-22, causing three years of lost progress. Low-income countries were most impacted and have yet to recover. In 2022, a total of 712 million people globally were living in extreme poverty, an increase of 23 million people compared to 2019. 

We cannot reduce poverty and inequality without also addressing intertwined global challenges, including slow economic growth, fragility and conflict, and climate change.

Climate change is hindering poverty reduction and is a major threat going forward. The lives and livelihoods of poor people are the most vulnerable to climate-related risks.

Millions of households are pushed into, or trapped in, poverty by natural disasters every year. Higher temperatures are already reducing productivity in Africa and Latin America, and will further depress economic growth, especially in the world’s poorest regions.

Eradicating poverty requires tackling its many dimensions. Countries cannot adequately address poverty without also improving people’s well-being in a comprehensive way, including through more equitable access to health, education, and basic infrastructure and services, including digital.

Policymakers must intensify efforts to grow their economies in a way that creates high quality jobs and employment, while protecting the most vulnerable.

Jobs and employment are the surest way to reduce poverty and inequality. Impact is further multiplied in communities and across generations by empowering women and girls, and young people.

Last Updated: Apr 02, 2024

Closing the gaps between policy aspiration and attainment

Too often, there is a wide gap between policies as articulated and their attainment in practice—between what citizens rightfully expect, and what they experience daily. Policy aspirations can be laudable, but there is likely to be considerable variation in the extent to which they can be realized, and in which groups benefit from them. For example, at the local level, those who have the least influence in a community might not be able to access basic services. It is critical to forge implementation strategies that can rapidly and flexibly respond to close the gaps.

Enhancing learning, improving data

From information gathered in household surveys to pixels captured by satellite images, data can inform policies and spur economic activity, serving as a powerful weapon in the fight against poverty. More data is available today than ever before, yet its value is largely untapped. Data is also a double-edged sword, requiring a social contract that builds trust by protecting people against misuse and harm, and works toward equal access and representation.

Investing in preparedness and prevention

The COVID-19 pandemic demonstrated that years of progress in reducing poverty can quickly disappear when a crisis strikes. Prevention measures often have low political payoff, with little credit given for disasters averted. Over time, populations with no lived experience of calamity can become complacent, presuming that such risks have been eliminated or can readily be addressed if they happen. COVID-19, together with climate change and enduring conflicts, reminds us of the importance of investing in preparedness and prevention measures comprehensively and proactively.

Expanding cooperation and coordination

Contributing to and maintaining public goods require extensive cooperation and coordination. This is crucial for promoting widespread learning and improving the data-driven foundations of policymaking. It is also important for forming a sense of shared solidarity during crises and ensuring that the difficult policy choices by officials are both trusted and trustworthy.

Overall, with more than 60 percent of the world’s extreme poor living in middle-income countries, we cannot focus solely on low-income countries if we want to end extreme poverty. We need to focus on the poorest people, regardless of where they live, and work with countries at all income levels to invest in their well-being and their future.

The goal to end extreme poverty works hand in hand with the World Bank Group’s goal to promote shared prosperity. Boosting shared prosperity broadly translates into improving the welfare of the least well-off in each country and includes a strong emphasis on tackling persistent inequalities that keep people in poverty from generation to generation.

Our work at the World Bank Group is based on strong country-led programs to improve living conditions—to drive growth, raise median incomes, create jobs, fully incorporate women and young people into economies, address environmental and climate challenges, and support stronger, more stable economies for everyone.

We continue to work closely with countries to help them find the best ways to improve the lives of their least advantaged citizens.

Last Updated: Oct 17, 2023

How the Pandemic Drove Increases in Poverty | Poverty & Shared Prosperity 2022

Around the bank group.

Find out what the World Bank Group's branches are doing to reduce poverty.

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COVID-19 Dealt a Historic Blow to Poverty Reduction

The 2022 Poverty and Prosperity Report provides the first comprehensive analysis of the pandemic’s toll on poverty in developing countries and of the role of fiscal policy in protecting vulnerable groups.

Umbrella Facility for Poverty and Equity

The Umbrella Facility for Poverty and Equity (UFPE) is the first global trust fund to support the cross-cutting poverty and equity agenda.

IDA: Our Fund for the Poorest

The International Development Association (IDA) aims to reduce poverty by providing funding for programs that boost economic growth.

As the World Bank’s behavioral sciences team within the Poverty and Equity Global Practice, eMBeD uses behavioral sciences to fight global poverty and reduce inequality.

High-Frequency Monitoring Systems to Track the Impacts of COVID-19

The World Bank and partners are monitoring the crisis and the socioeconomic impacts of COVID-19 through a series of high-frequency phone surveys.

An Adjustment to Global Poverty Lines

The World Bank uses purchasing power parities (PPPs) to estimate global poverty. With the release of 2017 PPPs, we’ll start using in Fall 2022 new poverty lines to determine the share of the world population in poverty.

Systematic Country Diagnostics

The SCD looks at issues in countries and seeks to identify barriers and opportunities for sustainable poverty reduction.

Poverty Podcast

Join us and poverty specialists as we explore the latest data and research on poverty reduction, shared prosperity, and equity around the globe in this new World Bank Group podcast series.

Correcting Course to Accelerate Poverty Reduction

Mari Pangestu, World Bank Managing Director of Development Policy and Partnerships, speaks about how we must respond to current challenges in ways that do not further impoverish the poor today and focus on creating ...

Stepping Up the Fight Against Extreme Poverty

To avert the risk of more backsliding, policymakers must put everything they can into the effort to end extreme poverty.

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Understanding Poverty

Professor of Economics

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This volume presents 28 essays on poverty by some of the leading experts in the field of economics. The book is divided into three sections, beginning with an essay about how poverty is measured. The first section is about the causes of poverty and its persistence, and the ideas range from the impact of colonialism and globalization to the problems of “excessive” population growth, corruption, and ethnic conflict. The second section is about policy: how should we fight poverty? The essays discuss issues such as how to get drug companies to produce more vaccines for the diseases of the poor, what we should and should not expect from micro-credit, what we should do about child labor, and how to design welfare policies that work better. The third section presents new ways of thinking about poverty such as the integration of psychology and economics, nonmarket institutions, and interconnections between race and economic inequality.

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The top 11 causes of poverty around the world

Feb 3, 2022

Approximately 10% of the world’s population lives in extreme poverty. But why? Updated for 2022, we look at 11 of the top causes of poverty around the world.

For most of us, living on less than $2 a day seems far removed from reality. But it  is  the reality for roughly 800 million people around the globe. Approximately 10% of the global population lives in extreme poverty, meaning that they're living below the poverty line of $1.90 per day.

There is some good news: In 1990, that figure was 1.8 billion people. We've made progress. But in the last few years we've also begun to move backwards — in 2019, estimates were closer to 600 million people living in extreme poverty. Climate change and conflict have both hindered progress. The global economic impact of the COVID-19 pandemic only made matters worse.

There’s no one single solution to poverty . There isn't a single cause of poverty, either. In fact, most cases of poverty in 2022 are the result of a combination of factors. Understanding what these factors are and how they work together is a critical step to sustainably ending poverty.

Learn more about the causes of poverty — and how we're solving them

1. inequality.

Let's start with something both simple and complex: Inequality is easy enough to understand as a concept. When one group has fewer rights and resources based on an aspect of their identity compared to others in a community, that's inequality. This marginalization could be based on caste, ability, age, health, social status or — most common and most pervasive — gender.

How inequality functions as a cause of poverty, however, is a bit more multifaceted. When people are given fewer rights or assets based on their ethnicity or tribal affiliation, that means they have fewer opportunities to move ahead in life. We see this often in gender inequality , especially when women have fewer rights around their health and economic power. In this case, equality isn't even relative. It doesn't matter that someone has more.  What matters is that someone else doesn't have enough.

This is especially harmful when inequality is combined with risk — which is the basic formula we use at Concern to understand the cycle of poverty . A widow raising a family of five won't have the same resources available to her husband. If she lives in an area vulnerable to the effects of climate change, that puts pressure on what few  resources she has. In some countries, this is the rule rather than the exception.

To address inequality, we must consider all groups in a community. What's more, to build equality we have to consider equality of results, as opposed to equality of resources.

2. Conflict

If poverty is caused by inequality multiplied by risk, let's talk about risks. At the top of the list of risks for poverty is conflict . Large-scale, protracted crises, such as the decade of civil war in Syria , can grind an otherwise thriving economy to a halt. As fighting continues in Syria, for example, millions have fled their homes (often with nothing but the clothes on their backs). Public infrastructure has been destroyed. Prior to 2011, as few as 10% of Syrians lived below the poverty line. Ten years later, more than 80% of Syrians now live below the poverty line.

But the nature of conflict has changed in the last few decades, and violence has become more localized. This also has a huge impact on communities, especially those that were already struggling. In some ways, it's even harder to cope as these crises go ignored in headlines and primetime news. Fighting can stretch out for years, if not decades, and leave families in a permanent state of alert. This makes it hard to plan for the long-term around family businesses, farms, or education.

3. Hunger, malnutrition, and stunting

You might think that poverty causes hunger (and you would be right!). But hunger is also a cause — and maintainer — of poverty . If a person doesn’t get enough food, they’ll lack the strength and energy needed to work. Or their immune system will weaken from malnutrition and leave them more susceptible to illness that prevents them from getting to work.

In Ethiopia, stunting contributes to GDP losses as high as 16%.

This can lead to a vicious cycle, especially for children. From womb to world, the first 1,000 days of a child’s life are key to ensuring their future health. For children born into low-income families, health is also a key asset to their breaking the cycle of poverty. However, if a mother is malnourished during pregnancy, that can be passed on to her children. The costs of malnutrition may be felt over a lifetime: Adults who were stunted as children earn, on average, 22% less than those who weren't stunted. In Ethiopia, stunting contributes to GDP losses as high as 16%.

4. Poor healthcare systems — especially for mothers and children

As we saw above with the effects of hunger, extreme poverty and poor health go hand-in-hand. In countries with weakened health systems, easily-preventable and treatable illnesses like malaria , diarrhea, and respiratory infections can be fatal. Especially for young children.

When people must travel far distances to clinics or pay for medicine, it drains already vulnerable households of money and assets. This can tip a family from poverty into extreme poverty. For women in particular, pregnancy and childbirth can be a death sentence.  Maternal health is often one of the most overlooked areas of healthcare in countries that are still built around patriarchal structures. New mothers and mothers-to-be are often barred from seeking care without their father's or husband's permission. Adolescent girls who are pregnant (especially out of wedlock) face even greater inequities and discrimination.

5. Little (or zero) access to clean water, sanitation, and hygiene

Currently, more than 2 billion people don’t have access to clean water at home. This means that people collectively spend 200 million hours every day walking long distances to fetch water. That’s precious time that could be used working, or getting an education to help secure a job later in life. And if you guessed that most of these 200 million hours are shouldered by women and girls… you're correct. Water is a women's issue as well as a cause of poverty.

Contaminated water can also lead to a host of waterborne diseases, ranging from the chronic to the life-threatening. Poor water infrastructure — such as sanitation and hygiene facilities — can compound this. It can also create other barriers to escaping poverty, such as preventing girls from going to school during their cycles.

6. Climate change

Climate change causes poverty , working as an interdependent link between not only extreme poverty but also many of the other causes on this list — including hunger , conflict, inequality, and a lack of education (see below). One report from the World Bank estimates that the climate crisis has the power to push more than 100 million people into poverty over the next decade.

Many of the world’s poorest populations rely on farming or hunting and gathering to eat and earn a living. Malawi, as an example, is 80% agrarian. They often have only just enough food and assets to last through the next season, and not enough reserves to fall back on in the event of a poor harvest. So when climate change or natural disasters (including the widespread droughts caused by El Niño ) leave millions of people without food, it pushes them further into poverty, and can make recovery even more difficult.

How climate change keeps people in poverty

By 2030, climate change could force more than 100 million people into extreme poverty.

7. Lack of education

Not every person without an education is living in extreme poverty. But most adults living in extreme poverty did not receive a quality education. And, if they have children, they're likely passing that on to them. There are many barriers to education around the world , including a lack of money for uniforms and books or a cultural bias against girls’ education .

But education is often referred to as the great equalizer. That's because it can open the door to jobs and other resources and skills that a family needs to not just survive, but thrive. UNESCO estimates that 171 million people could be lifted out of extreme poverty if they left school with basic reading skills. Poverty threatens education, but education can also help end poverty .

8. Poor public works and infrastructure

What if you have to go to work, but there are no roads to get you there? Or what if heavy rains have flooded your route and made it impossible to travel? We're used to similar roadblocks (so to speak) in the United States. But usually we can rely on our local governments to step in.

A lack of infrastructure — from roads, bridges, and wells, to cables for light, cell phones, and internet — can isolate communities living in rural areas. Living off the grid often means living without the ability to go to school, work, or the market to buy and sell goods. Traveling further distances to access basic services not only takes time, it costs money, keeping families in poverty.

As we've found in the last two years, isolation limits opportunity. Without opportunity, many find it difficult, if not impossible, to escape extreme poverty.

9. Global health crises including epidemics and pandemics

Speaking of things we've learned over the last two years… A poor healthcare system that affects individuals, or even whole communities, is one cause of poverty. But a large-scale epidemic or pandemic merits its own spot on this list. COVID-19 isn't the first time a public health crisis has fueled the cycle of poverty. More localized epidemics like Ebola in West Africa (and, later, in the DRC ), cholera in Haiti or the DRC, or malaria in Sierra Leone have demonstrated how local and national governments can grind to a halt while working to stop the spread of a disease, provide resources to frontline workers and centers, and come up with contingency plans as day-to-day life is disrupted.

All of this comes, naturally, at a cost. In Guinea, Liberia , and Sierra Leone — the three countries hit hardest by the 2014-16 West African Ebola epidemic — an estimated $2.2 billion was lost across all three countries' GDPs in 2015 as a direct result of the epidemic. This included losses in the private sector, agricultural production, and international trade.

The crisis in Kenya: Climate, COVID, and hunger

The worst drought in four decades, the worst locust invasion in seven, plus the domino effects of a global pandemic have northern Kenyans living out an underreported crisis and facing an uncertain future.

10. Lack of social support systems

In the United States, we're familiar with social welfare programs that people can access if they need healthcare or food assistance. We also pay into insurances against unemployment and fund social security through our paychecks. Theses systems ensure that we have a safety net to fall back on if we lose our job or retire.

But not every government can provide this type of help to its citizens. Without that safety net, there’s nothing to stop vulnerable families from backsliding further into extreme poverty. Especially in the face of the unexpected.

11. Lack of personal safety nets

If a family or community has reserves in place, they can weather some risk. They can fall back on savings accounts or even a low-interest loan in the case of a health scare or an unexpected layoff, even if the government doesn't have support systems to cover them. Proper food storage systems can help stretch a previous harvest if a drought or natural disaster ruins the next one.

At its core, poverty is a lack of basic assets or a lack on return from what assets a person has.

People living in extreme poverty can't rely on these safety nets, however. At its core, poverty is a lack of basic assets or a lack on return from what assets a person has. This leads to negative coping mechanisms, including pulling children out of school to work (or even marry ), and selling off assets to buy food. That can help a family make it through one bad season, but not another. For communities constantly facing climate extremes or prolonged conflict, the repeated shocks can send a family reeling into extreme poverty and prevent them from ever recovering.

Solutions to Poverty to Get Us To 2030

What would Zero Poverty look like for the world in 2030? Here are a few starting points.

How can you help?

At Concern, we believe that zero poverty is possible, especially when we work with communities to address both inequalities and risks. Last year, we reached 36.9 million people with programs designed to address the specific causes of extreme poverty in countries, communities, and families.

Pictured in the banner image for this story is one of those people, Adrenise Lusa. Born 60 years ago in the DRC's Manono Territory, Adrenise joined Concern's Graduation program in 2019 and participated in trainings on income generation and entrepreneurship, which gave her ideas on how to increase her production and income. With monthly cash transfers as part of Graduation and a loan from her community Village Savings and Loans Association, she invested in a few income-generating activities including goat rearing and trading oil, maize, and cassava. Prior to joining Graduation, she had the ideas. But, as she explains, "I didn’t start these businesses because I just didn’t have enough money."

Since launching her new ventures, Adrenise has increased her income from approximately 30,000 francs per month to anywhere between 100–400,000 francs per month, depending on the season. She's used her additional income to buy a plot of land and build a new house, feed her family with more nutritious food, and send her son and daughter to university.

You can make your own impact by supporting our efforts working with the world’s poorest communities. Learn more about the other ways you can help the fight against poverty.

More about the causes of poverty

Extreme Poverty and Hunger: A Vicious Cycle

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Combating Poverty: Understanding New Challenges for Families

Subscribe to the center for economic security and opportunity newsletter, ron haskins ron haskins senior fellow emeritus - economic studies.

June 5, 2012

• 43 min read

My name is Ron Haskins and I’m pleased and privileged to have the opportunity to testify before the Finance Committee about poverty. Few topics have enjoyed as much attention from federal policymakers over the past half century as poverty and what can be done to reduce it. After a brief review of our success, such as it is, in reducing poverty, I examine the major causes of poverty, trends in spending to help poor and low-income Americans, and strategies Congress has adopted to fight poverty. Poverty has shown great if unfortunate staying power, but we have learned useful lessons about how to fight it.

Poverty Trends

Figure 1 shows poverty trends since the 1960s for the elderly, children, and all people. After some initial progress in the 1960s, and continuing progress for the elderly, the nation has made surprisingly little progress against poverty. The nation’s inability to reduce children’s poverty is especially troublesome. A review of the leading causes of poverty shows why trends in the economy, demography, and education make progress against poverty so difficult to achieve.

Causes of Poverty

In the United States, with the important exception of those on Social Security, the only way for most adults and families to avoid poverty is to work. Yet between 1980 and 2009, work rates for men declined from 74.2 percent to 67.6 percent, a fall of around 9 percent. The trend for young black men (ages 20-24) is even worse. Starting from the very low base of 60.9 percent, their ratio declined to the startling level of 46.9 percent, a decline of nearly 23 percent. Work among young black males is a national crisis. [2]

The work rate of women stands in sharp contrast to that of men. In 2007 before the Great Recession set in, 58.1 percent of women were working, a 25 percent increase since 1980. These figures reflect the post-World War II trend of the relentlessly increasing participation by women – including mothers of young children – in the nation’s economy. Equally impressive is the 20 percent rise in work by lone mothers over the same period, a trend that bears directly on child poverty rates because children in female-headed families are four or five times (depending on the year) more likely to be in poverty than children in married-couple families. [3] Even more important for the nation’s poverty rate, work by never-married mothers rose more sharply than that of any other group during the 1990s. These mothers and their children have always been the group most likely to be in poverty, including long-term poverty, in large part because their work rates have been so low. [4] In 1983, for example, only about only 35 percent of never-married mothers worked. After the welfare reform legislation of 1996, their work rate exploded, increasing from 46.5 percent in 1995 to 66.0 percent in 1999, an increase of more than 40 percent in just four years. Equally surprising, after a lengthy period of employment stagnation and decline associated with the mild recession of 2001 and the deep recession of 2007-2009, in 2010 their work rate was still more than 25 percent higher than it had been before welfare reform in the mid-1990s.

The fact that in 2007 – before the Great Recession – the work rates of males and females were 72 percent and 58 percent respectively, combined with the fact that the poverty rate for individuals in families in which no one works is nearly eight times as high as the poverty rate for individuals in families with at least one full-time, year-round worker, shows that there is plenty of room for improvement. [5] This uneven record of maintaining high levels of work is a leading cause of poverty in America. Without high work levels, it will be difficult to mount an effective fight against poverty.

Wage rates are a second work-associated factor that has a major impact on poverty. Based on data from the U.S. Census Bureau, trends in wages since 1979 can be succinctly summarized. Wages at the 10th percentile fell and then recovered and ended the nearly three decade period almost exactly where they were in 1979. The general trend of wages at the 50th percentile was a slow increase amounting to about a 10 percent rise over the entire period. At the top, by contrast, wages did very well, increasing 32 percent over the period at the 90th percentile. If we were to plot wages higher up in the distribution, they would rise even higher. [6]

In 2007, wages at the 10th percentile were about $8 per hour, more or less where they were in 1979 if inflation is taken into account. Working at this wage for 35 hours a week year round, a person would earn $14,560, $2,145 under the poverty level for a family of three. It is an amazing mathematical fact that 10 percent of all workers will always be at the 10th percentile of earnings or below. Thus, if wages do not improve at the bottom, all single parents with two or more children at or below the 10th percentile – and even many above the 10th percentile – will always be in poverty if earnings are their only income.

Family Composition

In 2009, the poverty rate for children in married-couple families was 11.0 percent. By contrast, the poverty rate for children in female-headed families was 44.3 percent. [7] The difference between these two poverty rates is a specter haunting American social policy because the percentage of American children who live in female-headed families has been increasing relentlessly for over five decades. In 1950, 6.3 percent of families with children were headed by a single mother. By 2010, 23.9 percent of families with children had single-mother heads. [8] That a higher and higher fraction of children live in the family type in which they are about four times as likely to be poor exerts strong upward pressure on the poverty rate. One way to think of the shift to female-headed families is that even if government policy were successful in moving people out of poverty, the large changes in family composition serve to offset at least part of the progress that otherwise would be made. In fact, a Brookings analysis shows that if we had the marriage rate we had in 1970, the poverty rate would fall by more than 25 percent. [9]

There now appears to be universal agreement that the combination of technological advances and globalization have resulted in education being a major factor in determining the employment and earnings of many American workers. [10] Census Bureau data on the relationship between education and family income since the 1960s show that families headed by adults with more education make more money. Some of the differences are huge. In 2009, the difference in median family income between families headed by an individual who dropped out of high school and families headed by an individual with a bachelor’s degree or higher was about $68,600 ($31,100 compared with $99,700). [11] Even more pertinent for examining the causes of poverty, family income for those with less than a college degree has been stagnant or declining for three decades. Without a college degree, 45 percent of the children from families in the bottom fifth of income will themselves be mired in the bottom fifth as adults. By contrast, with a college degree, adult children cut their odds of staying in the bottom fifth all the way down to 16 percent from 45 percent. The odds of making it to the top quintiles indicate similar abrupt changes if youngsters from poor families manage to achieve a college degree. [12]

Despite the great advantages of having a college degree, James Heckman has demonstrated that the high school graduation rate reached its highest level at about 80 percent in the late 1960s and has since decreased by 4 to 5 percentage points. A high school degree is usually required for college admission. Moreover, a significant gap remains between the graduation rate of white students (above 80 percent) and black and Hispanic students (both about 65 percent). [13] Ethnic gaps such as these are a continuing plague on the nation’s social policy.

The four-year college enrollment and graduation rates of students from families with varying levels of income renders the education picture discouraging. Youngsters from higher-income families are more likely both to enroll in and graduate from college than youngsters from poorer families. For example, 79 percent of children whose parents were in the top income fifth enrolled in college and 53 percent earned a four-year degree. But only 34 percent of children whose parents were in the bottom income quintile enrolled in college and only 11 percent received a four-year degree. If education is one of the routes out of poverty, the American educational system seems to be perpetuating poverty and income distinctions as much as it facilitates movement up the income scale.

The effectiveness of the nation’s K-12 education system is cast into serious doubt by comparing the performance of U.S. students with students from other OECD nations. In the most recent version of the Program for International Student Assessment (PISA), the U.S. was tied with two other countries for 27th in math, was 17th in science, and tied for 12th in reading. [14] A recent volume by Claudia Golden and Lawrence Katz of Harvard presents a strong case that past U.S. achievements in international competitiveness were due in large part to the superiority of the nation’s system of universal education and excellent colleges and universities. [15] The U.S. now seems to be mired in a situation in which the nation’s young people are at a level of educational achievement that is inferior to that of young people from many other nations. Thus, not only will the modest educational achievement of many Americans continue to make progress against poverty difficult, but American competitiveness in the global economy seems threatened.

Immigration

Until the recent recession, America had been experiencing one of the greatest waves of immigration in its history. For the past two decades, an average of about one million immigrants has obtained legal permanent resident status in the U.S. each year. [16] In addition, according to the Pew Hispanic Center, in the seven years before the Great Recession, the population of undocumented immigrants grew by an average of a little over 500,000 per year. [17] In a nation that prides itself on being built by immigrants, these large numbers alone are not particularly daunting. However, as George Borjas of Harvard shows, about 20 percent of immigrants have less than a 9th grade education as compared with a little less than 3 percent of non-immigrants. [18] Consistent with the relatively large number of immigrants who lack even minimally adequate education, Borjas also finds a long-term trend toward lower wages among immigrants. In 1940, the age-adjusted average wage of first-generation male immigrants was 5.8 percent above the average wage of non-immigrant males. This figure fell to 1.4 percent above the average wage of non-immigrant males in 1970 and then dropped dramatically to 20 percent below the non-immigrant male wage in 2000. [19]

It comes as little surprise, then, that the poverty rate among immigrants is higher than the poverty rate among native-born Americans. In 2009, the immigrant poverty rate was 19.0 percent as compared with 13.7 percent for native-born Americans. Given that the overall poverty rate for the nation was 14.3 percent, the poverty rate would be lower by about 0.6 percentage points (or around 1.9 million people) if the immigrant poverty rate were the same as the poverty rate for native-born citizens. [20]

Reflecting on these five major causes of poverty leads one to understand why it has been so hard for the U.S. to make much progress against poverty despite the proliferation of social programs and the substantial increases in spending (see below) since President Johnson first declared war on poverty in the mid-1960s. Declining work rates, stagnant wages, the rise of female-headed families, inferior education, and the arrival of millions of immigrants with poor education and low skills are little engines pushing up the poverty rate. Conditions in the U.S. virtually ensure high poverty rates because the underlying factors that cause poverty have remained very strong. Even so, the nation has done a lot to reduce poverty and has even achieved a few victories as we shall now see.

Trends in Spending on Means-Tested Programs

Many analysts think that the nation could greatly reduce poverty by spending more money on programs for the poor. Figure 2, based on a Brookings analysis of federal budget data published by the Office of Management and Budget, shows that federal spending since 1962 in the ten biggest means-tested federal programs has increased dramatically. Since 1980, by which time all but two of the ten programs that spent the most money in 2011 were in place, spending has increased by about $500 billion, from $126 billion to $626 billion after adjusting for inflation. Similarly, spending per person in poverty between 1980 and 2011 increased from about $4,300 to $13,000 or more than $3 spent per person in poverty in 2011 for every dollar spent in 1980. [21]More recently, means-tested spending increased from about $477 billion to $626 billion in the first three years of the Obama administration, an increase of about 31 percent.

The Congressional Research Service has conducted a study that divides means-tested spending into eight categories (health, cash, nutrition, employment and training, etc.). Health is by far the biggest category of means-tested spending at $319 billion in 2009, around 2.5 times as much as cash programs, the second biggest category. Employment and training at $9 billion is the smallest of the eight categories.

These spending data are for only the ten largest means-tested programs. The Congressional Research Service estimates that in 2009, spending on these ten programs represented about 75 percent of total federal means-tested spending. [22] If that percentage remained roughly the same for 2011, total federal means-tested spending in that year was closer to $835 billion than the $626 billion spent on the ten biggest programs. Even $835 billion is an underestimate of total means-tested spending because state and local governments also spend money on many of these programs. The Congressional Research Service has estimated that state and local governments supplemented federal spending on means-tested programs by around 27 percent in 2004. [23] If we assume that the 27 percent has remained roughly constant, we can estimate that total federal, state, and local government spending on means-tested programs was probably more than $1 trillion in 2011.

On a per-person in poverty basis, that figure represents about $23,700 in spending by federal, state, and local governments. But this estimate should be considered in light of several caveats. The first is that not all of the spending on means-tested programs goes directly to individuals and families. Some of the money is spent on programs, such as the $14.5 billion spent on Title I of the No Child Left Behind Act and the $9 billion in spending on employment and training programs, that provide services rather than direct cash or in-kind benefits to individuals and families. Second, some of the money in programs that provide cash or in-kind benefits directly to households goes to individuals and families that are not below the poverty level. Children in families of up to 200 percent of the poverty level, for example, are eligible for Medicaid or the Child Health Insurance Program (CHIP) in almost every state. [24] Similarly, people in households with incomes up to 130 percent of poverty are eligible for SNAP benefits (Supplemental Nutrition Assistance Program, previously food stamps). In the case of the Earned Income Tax Credit (EITC), in 2010 a single mother with two children could receive benefits if the mother’s income was below $40,964, about 225 percent of the poverty level for this family.

Thus, means-tested spending has increased enormously no matter how it is measured. Although there have been some periods of comparatively rapid growth, such as during the recession of 2007 to 2009, Figure 2 shows that spending has grown almost every year for the last five decades. The increase in spending has been the most rapid in health programs, but cash, nutrition, and several other types of spending have also increased rapidly. Spending per person in poverty has also increased substantially, although not quite as rapidly as total spending. Unfortunately, as we have seen, the high level and remarkable increases in means-tested spending have not led to consistent declines in poverty, although we have learned a lot about what works and what doesn’t, a topic to which we now turn our attention.

Strategies to Reduce Poverty

Although the dramatic increase in federal spending has not led to an overall reduction in the nation’s poverty rate, at least two strategies have been successful in reducing poverty within specific demographic groups. Both should be considered major successes of the nation’s social policy and both could be extended. The first is to give money to people who are not expected to work and the second is to use welfare policy to strongly encourage work and then to subsidize earnings because so many of the poor have low skills and often cannot earn enough to escape poverty.

Before reviewing these and other strategies for reducing poverty, I want to emphasize the importance of individual initiative in reducing poverty and promoting economic success. My Brookings colleague Isabel Sawhill and I have spent years emphasizing the importance of individual responsibility in reducing poverty and increasing opportunity. One of our arguments, based in part on a Brookings analysis of Census Bureau data, is that young people can virtually assure that they and their families will avoid poverty if they follow three elementary rules for success – complete at least a high school education, work full time, and wait until age 21 and get married before having a baby. Based on an analysis of Census data, people who followed all three of these rules had only a 2 percent chance of being in poverty and a 72 percent chance of joining the middle class (defined as above $55,000 in 2010). These numbers were almost precisely reversed for people who violated all three rules, elevating their chance of being poor to 77 percent and reducing their chance of making the middle class to 4 percent. [25] Individual effort and good decisions about the big events in life are more important than government programs. Call it blaming the victim if you like, but decisions made by individuals are paramount in the fight to reduce poverty and increase opportunity in America. The nation’s struggle to expand opportunity will continue to be an uphill battle if young people do not learn to make better decisions about their future.

Strategy 1: Give Them Money

The most straightforward way to help people escape poverty, primarily when they belong to a group, such as the elderly or disabled, who are not expected to work is to give them cash and in-kind benefits that will bring their income above the poverty threshold. The Social Security program, for example, is designed specifically to help the elderly avoid destitution. Although in its early decades it provided benefits that were quite modest by today’s standards, in the early 1970s Congress enacted laws that increased the Social Security cash benefit. [26] These reforms had an immediate impact in driving down the poverty rate among the elderly. Indeed, research shows that virtually the entire decline in poverty among the elderly is accounted for by the rise in Social Security benefits. [27] In addition, nearly all the elderly are covered by the Medicare health program and the poor and low-income elderly are qualified for many other programs including housing and nutrition. If the value of taxes, in-kind benefits (except health insurance), and the imputed return on home equity are taken into account, poverty among the elderly drops even further, from the official rate of 8.9 percent to as low as 5.3 percent. [28]

The strategy of reducing poverty by providing government benefits touches on one of the major fault lines in American politics. As polls consistently show, Americans think able-bodied, non-elderly people should earn their own way. Americans simply don’t like welfare, even when someone calls it by a different name (e.g., “food stamps” or more recently “SNAP”). [29] In 1995 and 1996 during the welfare reform debate, when Republicans were proposing that the cash welfare benefit of lone mothers who didn’t meet work requirements be reduced or terminated and that the benefit be time limited, polls showed that the American public supported these tough policies. [30] Giving money and other goods to the poor might work with the elderly or the disabled, because Americans do not expect either group to work. But it seems likely that simply giving welfare to the able-bodied poor, even if they are single mothers, will never be an effective strategy for reducing poverty in the U.S. because it will be difficult to enact legislation authorizing the necessary spending. [31]

Strategy 2: Increase Work Rates and Work Supports

At the other end of the continuum from policies that give money and other benefits to the poor are policies that encourage work. Well over 75 percent of families with children that lack a full-time, year-round worker are in poverty. [32] An individual or family in the U.S. whose only source of income is welfare benefits cannot escape poverty. [33] It follows that an effective anti-poverty strategy would be to increase work rates. This was precisely the goal of the welfare reform legislation enacted in 1996, which replaced the Aid to Families with Dependent Children program with the Temporary Assistance for Needy Families (TANF) program. Passed on a strong bipartisan basis, and signed by Democratic President Bill Clinton, the new law required individuals to meet work requirements in order to qualify for welfare benefits. Mothers on welfare had to participate in state-designed welfare-to-work programs that provided training, job search assistance, or actual work experience. If the mothers did not participate, states were required by federal law to impose financial sanctions on them in the form of reduced or even terminated cash welfare (although they remained eligible for non-cash benefits). In addition to work requirements and sanctions, the reform law imposed a 5-year time limit on benefit receipt for most mothers who accepted welfare.

After passage of the 1996 reforms, poor mothers entered the workforce in unprecedented numbers. Between 1995 and 1999, for example, there was an increase of more than 40 percent in the number of never-married mothers, the poorest of the poor, who found employment. [34] In large part due to this increased employment of never-married mothers, poverty among all single mothers and their children fell by 30 percent, from a 1991 peak of 47.1 percent to 33.0 percent in 2000, its lowest level ever. Similarly, poverty among black children, who live disproportionately in female-headed families, reached its lowest level ever in 2001. This example demonstrates what is possible if government policy encourages and even pressures adults to go to work and then subsidizes the incomes of those who earn low wages. The combination of work requirements and earned public benefits has the appearance of an approach to reducing poverty that has strong bipartisan overtones.

It is notable that even during and after the recessions of 2001 and 2007 to 2009, work rates among never-married mothers did not return to their pre-welfare reform level. Although their work rates fell from the 1999 peak (and highest ever) of 66.0 percent to 58.7 percent in 2010, the 2010 level is still about 25 percent higher than the pre-welfare reform level of 46.5 percent in 1995. [35] On its face, the strategy of emphasizing work, even by mothers whose education and experience usually limit them to low-wage jobs, results in more mothers working and lower poverty levels than the low employment levels that prevailed during the pre-welfare reform years in which millions of mothers spent many years on the welfare rolls. [36] Further, giving benefits to mothers who work full time in order to help them and their children escape poverty is more politically popular – and therefore sustainable – than giving welfare to mothers who don’t work.

The predominance of low-wage work for poorly educated workers is the reason encouraging work is only half the federal strategy for increasing work rates to attack poverty. Millions of Americans have low-wage and part-time jobs that do not provide them with enough money to support a family at or above the poverty level. If a lone mother worked year-round, full-time at the minimum wage ($7.25 per hour), with no vacations and no time off for illness or to care for sick children, she would earn $15,080, about $2,500 below the poverty level for a mother and two children. Realizing the problem of low wages, and hoping to increase work incentives at the bottom of the wage scale, Congress and three presidents, beginning roughly in the mid-1980s, passed a series of laws that created, modified, or expanded programs that provide cash and in-kind benefits to poor and low-income working families. [37] These programs, often referred to as the nation’s work support system, are structured in such a way that they provide benefits to families that have low earnings. Some of the programs, like the Child Tax Credit and the Earned Income Tax Credit (EITC), provide their benefits only to families with earnings. All of the programs allow at least some of their benefits to flow to families that avoid or leave welfare for work.

Federal policymakers developed the work support system over a period of roughly two decades. [38] If the laws on child care, medical assistance, the child tax credit, and the Earned Income Tax Credit (EITC) had not changed after 1984, a study by the Congressional Budget Office shows that in 1999 working families would have received a mere $5.6 billion in benefits. But because Congress expanded, modified, or created all these work support programs after 1984, in 1999 working families qualified for $51.7 billion in benefits. A more recent estimate of benefits from these programs for working families by Sheila Zedlewski of the Urban Institute shows that between 1996 and 2002, work support benefits grew by 27 percent in real dollars. [39] Since 2002, the EITC has been expanded twice, Medicaid coverage has expanded, food stamps benefits have been reformed to make it easier for working families to get them, and day care funding has been expanded. Federal policy does a lot to increase income and reduce poverty among low-income working families.

The increase in work by single mothers following enactment of welfare reform in 1996 activated the work support system for millions of these families, both those leaving welfare and those who never went on welfare. Work and work support, in short, functioned together to reduce poverty and welfare dependency. Figure 3 provides a clear view of the impact of government programs on children’s poverty rates in families headed by never-married mothers in 1989, before welfare reform, and in 2006, after welfare reform. The raw poverty rate (before any government transfers or taxes) in 2006 was nearly 20 percent lower than in 1989 (39.6 percent vs. 48.3 percent). Undoubtedly, this decline in raw poverty before any government assistance was due to increased work and earnings by these never-married mothers. As shown by the second bar graph in each set, social insurance and non-cash benefits reduced poverty by between 20 and 25 percent in both years. But in 2006, cash benefits provided through the EITC and Child Tax Credit (CTC) sent the poverty rate down another 13 percent while in 1989 the mothers’ work rate was not high enough to attract substantial support from the EITC and CTC. In short, both more work by the mothers and more work support benefits from government contributed to the final poverty rate being almost 40 percent lower in 2006 (26.1 percent) than in 1989 (39.1 percent). [40]

Although controversial, a reasonable implication of these results is that federal policy should encourage work. One way to achieve this end would be to strengthen work requirements in both the SNAP program and the means-tested housing programs. This recommendation is controversial because the 1996 reforms showed that some mothers either do not find jobs or have difficulty holding down a job for an extended period. As often happens in these situations, an argument has broken out among researchers and pundits about whether the finding that many mothers do not retain employment is a major problem. There are two primary facts that are accepted by both sides.

First, the percentage of single mothers who are “disconnected” from both cash welfare and employment has more than doubled since welfare reform was enacted in 1996. Second, the percentage of poor single mothers and children who receive cash welfare from the TANF program is the lowest ever; in 1979, about 82 families were receiving cash from the old Aid to Families with Dependent Children program for every 100 families with children in poverty; by 2010 that number had fallen to 27 families receiving TANF for every 100 families in poverty. [41] One side argues that these data show that these mothers and their children are on the edge of destitution and that policy should be changed so that they can qualify for cash welfare benefits. [42] The other side argues that these mothers are choosing not to work, that they get other means-tested benefits (especially food stamps), and that they usually live with other adults who have income. [43] At the very least, the large number of mothers with very low income who are not receiving cash welfare calls for caution. Caution in this case means that strengthening work requirements in SNAP and housing programs should be done on a limited basis and studied carefully during implementation. Caution may also call for Congressional hearings and studies by Congressional agencies of how states are implementing the work requirements established by the 1996 welfare reform law and the Deficit Reduction Act.

Other Strategies

If giving money to the elderly and incentivizing work combined with supplementing earnings with work support benefits have proven to be effective in reducing poverty, at least four other strategies hold promise for reducing poverty.

Immigration . History shows that immigrants are often a hard working and creative group of people who move from their home country specifically because they want to get ahead. [44] In the U.S., however, legislation enacted in 1965 gave preference in admitting immigrants to relatives of those who are already in the U.S., regardless of their education or skill levels. It appears from recent debates that there is now widespread recognition that it would be wise to shift immigration policy to reduce the importance of family relationships in favor of increasing the emphasis on skills and on giving employers more flexibility in allowing valuable employees to stay in the U.S. The hope for legislation to reflect this recognition is being held up, however, primarily by continuing disagreements concerning what to do about undocumented immigrants. If we shifted immigration poverty to place a greater emphasis on education and skills, we would see a shift in the percentage of immigrants who earn higher wages and thereby avoid poverty. In addition, immigrants with higher education and skills would contribute more to the American economy which would in turn contribute to economic growth and increase both employment and tax revenues. There does not appear to be any downside to immigration reforms of this sort.

Reducing Nonmarital Births . One of the engines driving poverty in the U.S. is the fragmentation of families. Around a quarter of children are living in female-headed families at any given moment and about half experience at least some time during their childhood in a female-headed family. When children live in female-headed families, they are at least four times as likely to be poor as when they live in a married-couple family. [45] But poverty is not the only risk faced by these children. Since Sara McLanahan and Gary Sandefur publishedGrowing up with a Single Parent in 1994, [46] social science research has repeatedly shown that children reared in female-headed families are more likely to fail in school, more likely to be arrested, more likely to get pregnant as teens, more likely to have mental health problems and to commit suicide, more likely to get a divorce when they grow up, and more likely to experience other negative outcomes. [47] In addition, as Kathy Edin has shown, these parents tend to separate within a few years, whereupon both the mother and father usually go on to form new relationships. Thus, their children experience a series of changes in household composition as their mothers form new cohabiting relationships. [48] The mother might even have a baby with one or more of these new men, creating a household with complex and often difficult relationships among the adults and usually making it hard for the children to establish a close relationship with their fathers. [49] The point is that life in female-headed families imposes both a high likelihood of poverty and of household instability that can produce negative impacts on child development. [50] If the share of children born into and living in married-couple families could be increased, poverty and childhood education, health, and mental health problems would decline, increasing the human capital of the nation’s children and having a long-term impact on the nation’s poverty rate. [51]

Several programs have proven successful in reducing teen pregnancy. [52] In part because of the prevalence of these programs, the U.S. teen birthrate has declined in all but three years since 1991. [53] It is difficult, however, to be too optimistic about the declining teen birthrate because as the teen birthrate has declined, the nonmarital birthrate for young women in the twenties and early thirties has increased more than enough to offset the decline in the teen rate. [54]

Even so, investments in programs aimed at reducing nonmarital births have been shown not only to actually reduce such births among women in their 20s and 30s, but to save government money. [55] The programs are a mass media campaign that encourages men to use condoms, a program for teens that both encourages abstinence and instructs on the proper use of contraceptives, and expansion of family planning services provided by Medicaid, mostly birth control for low-income females. Similarly, the Obama administration has initiated a number of new evidence-based initiatives that could reduce the number of nonmarital births even more.  Additional investments in these programs would reduce the number of nonmarital births and in doing so reduce the nation’s poverty rate. but with 72 percent of black babies, 53 percent of Hispanic babies, and over 40 percent of all babies born outside marriage, there is a long way to go. [56] The nonmarital birth machine that expands poverty and produces children with less human capital than their peers being reared in married-couple families is disrupting and will continue to disrupt the nation’s drive to curb poverty.

Increasing Human Capital. The most basic reason rich nations need welfare programs is because a significant fraction of their populations do not earn enough money to support themselves and their families. Since the 1960s, a major goal of anti-poverty policy has been helping the poor acquire the education and skills needed to achieve earnings that will support a decent standard of living. In other words, the goal has been to create more opportunity for economic and social achievement by helping people improve their human capital, which in turn would increase their earnings and reduce their dependency on welfare. There are four major types of programs that the U.S. uses to develop human capital: preschool programs, K-12 education, post-secondary education, and employment and training programs. All have the potential to increase human capital, thereby making the economy more efficient and competitive while simultaneously providing participants with the education and skills needed to find a productive and rewarding place in the American economy. Here I focus attention only on preschool programs.

No human capital program is so widely believed to be effective as preschool education for children from poor and low-income families. [57] The Perry Preschool Program in Michigan, the Abecedarian program in North Carolina, and the Child-Parent Centers in Chicago have all produced both immediate and long-term impacts on the development of poor children. [58] Similarly, a number of state pre-K programs have shown that they boost the development of preschool children from poor families and increase their school readiness. [59] Reviewers regularly cite these and similar programs to argue that there is rigorous evidence that preschool programs can have broad and long-lasting effects that boost human capital. [60]

Between the federal government and the states, the U.S. now spends around $31 billion on preschool programs (including child care and home visiting), mostly for children from poor and low-income families. [61] At least some of this money is being spent on programs, particularly the state pre-K programs, that are of high enough quality to produce some of the impacts achieved by Perry, Abecedarian, and the Chicago Parent-Child Centers. Unfortunately, a substantial portion of the money is being spent on preschool programs that lack an educational focus or on Head Start (about $7 billion in 2010), which has been shown by a recent random-assignment evaluation to have almost no impacts by the end of first grade. Thus, until the U.S. figures out how to achieve bigger impacts in the programs supported by our current $31 billion in expenditures on preschool programs, it cannot be expected that poor children are going to receive enough of a boost from preschool programs to make a long-term difference in their school performance, employment, or earnings.

Two courses of action now seem desirable. First, the Obama administration is subjecting Head Start to the most important and far-reaching reforms in its history. Each Head Start program is being carefully evaluated; those that fail must re-compete against other willing program operators to retain their funding. This reform should be followed carefully by Congress over the next several years through hearings and assessments from the Government Accountability Office or the Congressional Budget Office. If the Obama reforms improve the average impact of Head Start on school readiness, the school performance of poor children in grades K-12 could improve, increasing the chances that they will succeed in the American economy. Second, Congress should work with states to maintain funding of both state pre-K programs and state child care programs and to help states improve the average quality of child care, much of which is woefully inadequate.

[1] In technical papers, work rates are called “employment to population ratios.” They are calculated by putting the number in the demographic group of interest in the denominator and the number of members of this group who have jobs in the numerator.

[2] Harry J. Holzer, Paul Offner, and Elaine Sorensen, “Declining employment among young black less-educated men: The role of incarceration and child support,” Journal of Policy Analysis and Management 24, no. 2 (2005): pp. 329-350.

[3] For example, in 2009, 11.0 percent of children in married-couple were in poverty compared to 44.3 percent of children in female-headed families. Similarly, in 2008 the poverty rates for children in married-couple families and female-headed families were 9.9 percent and 43.5 percent, respectively. And in 2007, these respective child poverty rates were 8.5 percent and 42.9 percent. U.S. Census Bureau, Detailed Poverty Tables, “POV03: People in Families with Related Children Under 18 by Family Structure, Age, and Sex, Iterated by Income-to-Poverty Ratio and Race: 2007” ( http://pubdb3.census.gov/macro/032008/pov/new03_100_01.htm ), “POV03: People in Families with Related Children Under 18 by Family Structure, Age, and Sex, Iterated by Income-to-Poverty Ratio and Race: 2008” ( http://www.census.gov/hhes/www/cpstables/032009/pov/new03_100_01.htm ), and “POV03: People in Families with Related Children Under 18 by Family Structure, Age, and Sex, Iterated by Income-to-Poverty Ratio and Race: 2009” ( http://www.census.gov/hhes/www/cpstables/032010/pov/new03_100_01.htm ).

[4] As Wu and Stojnic (2007, 7-8) note, during the period between 1975 and 2000, “individuals in never-married female-headed households were roughly 4 to 5 times more likely to be in poverty relative to a randomly chosen individual in the U.S. population; similarly, individuals in never-married female-headed households were, on average, about twice as likely to live below the poverty line as individuals in ever-married female-headed households…” Lawrence L. Wu and Miodrag Stojnic, “Poverty among the Poorest-Poor in the United States: Trends for Never-Married Women and Their Children,” Paper Presented at the Inaugural Conference, Center for Research on Inequalities and the Life Course, Yale University (May 2007). Available at http://www.yale.edu/ciqle/INAUGURAL%20PAPERS/pp070502.pdf .

[5] U.S. Census Bureau, Detailed Poverty Tables, “POV10: People in Families by Number of Working Family Members and Family Structure: 2009” ( http://www.census.gov/hhes/www/cpstables/032010/pov/new10_100_01.htm ).

[6] Based on Social Security income records, the top 1 percent of workers earned 12.3 percent of all income in 2004, up from 5.9 percent in 1960. See Wojciech Kopczuk, Emmanuel Saez, and Jae Song, “Earnings Inequality and Mobility in the Untied States: Evidence from Social Security Data since 1937,” Quarterly Journal of Economics 125, no. 1, 2010, pp. 91-128.

[7] U.S. Census Bureau, Detailed Poverty Tables, “POV03: People in Families with Related Children Under 18 by Family Structure, Age, and Sex, Iterated by Income-to-Poverty Ratio and Race: 2009” ( http://www.census.gov/hhes/www/cpstables/032010/pov/new03_100_01.htm ).

[8] U.S. Census Bureau, Families and Living Arrangements, “Table FM-1: Families by Presence of Own Children Under 18: 1950 to Present” ( http://www.census.gov/population/www/socdemo/hh-fam.html ).

[9] Ron Haskins and Isabel Sawhill, Creating an Opportunity Society (Washington, DC: Brookings, 2009).

[10] Claudia Golden and Lawrence F. Katz, The Race between Education and Technology (Cambridge, MA: Harvard, 2008).

[11] U.S. Census Bureau, Historical Income Tables, “Table F-18: Educational Attainment of Householder–Families with Householder 25 Years Old and Over by Median and Mean Income” and “Table F-19: Years of School Completed–Families with Householder 25 Years Old and Over by Median and Mean Income” ( http://www.census.gov/hhes/www/income/data/historical/families/index.html ).

[12] Ron Haskins, “Education and Economic Mobility,” in Julia B. Isaacs, Isabel, V. Sawhill, and Ron Haskins, editors, Getting Ahead or Losing Ground: Economic Mobility in America (Washington, DC: Brookings and Pew Charitable Trusts, 2009).

[13] James J. Heckman and Paul A. LaFontaine, “The American High School Graduation Rate: Trends and Levels,” National Bureau of Economic Research Working Paper No. 13670, December 2007 and James J. Heckman and Paul A. LaFontaine, “The Declining American High School Graduation Rate: Evidence, Sources, and Consequences,” NBER Reporter, Research Summary, 2008, No. 1.

[14] Organization of Economic Cooperation and Development, PISA 2009 Results: What Students Know and Can Do: Student Performance in Reading, Mathematics, and Science, vol. 1 (Paris: Author, 2010). Professor Daniel Koretz of Harvard recommends caution in simply comparing the average PISA scores of American students with the average scores of students from other nations in part because the scores are so variable from test occasion to test occasion. Nonetheless, the performance of U.S. students shows clearly that they are not near the top on any of the subtests. Rather, American students are closer to the average scores for OECD nations than to the top score; see Daniel Koretz, “How Do American Students Measure Up? Making Sense of International Comparisons,” The Future of Children 19, no. 1 (Spring 2009): 37-51.

[15] Golden and Katz, 2008.

[16] Department of Homeland Security, Yearbook of Immigration Statistics: 2010, Table 6 ( http://www.dhs.gov/files/statistics/publications/LPR10.shtm ).

[17] Pew Hispanic Center, “Unauthorized Immigrant Population: National and State Trends, 2010. Washington, DC: Author, February 2011.

[18] U.S. Census Bureau, “Foreign-Born Population of the United States Current Population Survey – March 2009: Detailed Tables,” Table 1.5 ( http://www.census.gov/population/www/socdemo/foreign/cps2009.html ).

[19] George J. Borjas, “Making It in America: Social Mobility in the Immigrant Population,” The Future of Children 16, no. 2 (2006): 55–71. More recently, Borjas has noted that there was an unexplained rise in entry wages during the 1990s. See George J. Borjas and Rachel M. Freidberg, “Recent Trends in the Earnings of New Immigrants to the United States” (Working Paper 15406), Cambridge: National Bureau of Economic Research, October 2009.

[20] U.S. Census Bureau, Income, Poverty and Health Insurance Coverage in the United States: 2009 (Washington, D.C.: U.S. Department of Commerce, September 2010), Table 4.

[21] The number of people in poverty in 2011 will not be published by the Census Bureau until next fall. Based on a model designed by Richard Bavier, a former senior official at OMB, that has successfully predicted the poverty level for the past several years, poverty increased by .6 percentage points in 2011, bringing the poverty rate to 15.7 percent in that year. According to the American Community Survey, the population of the United States in 2011 was 306 million. Thus, around 48,042,000 people were poor in 2011. This is the figure I used to compute means-tested spending per person in poverty for 2011.

[22] Karen Spar, “Federal Benefits and Services for People with Low Income: Programs, Policy, and Spending, FY2008-FY2009” (R41625), Washington, DC: Congressional Research Service, January 2011, p. 12. Domestic Social Policy Division, “Cash and noncash Benefits for Persons with Limited Income: Eligibility Rules, Recipient and Expenditure Data, FY2002-FY2004” (RL33340), Washington, DC: Congressional Research Service, March 2006.

[23] According to the Kaiser Family Foundation, only North Dakota, Oklahoma, Arkansas, and Idaho set the child eligibility level for Medicaid and CHIP below 200 percent of poverty; half the states are at 250 percent or above. See http://www.kff.org/medicaid/upload/7993-02.pdf

[24] The Brookings analysis is suggestive rather than definitive because of something called selection effects. People who at least complete high school, get a job, and get married and wait until age 21 to have babies may differ in other ways that could account for their ability to avoid poverty and join the middle class. There may be four rules, or five rules, or a dozen rules, most of which those who follow the three rules we specify also follow. If this were true, then attributing success to our three rules would be misleading.

[26] Social Security Administration, Social Security: A Brief History (Washington DC: Author, 2005); available at http://www.ssa.gov/history/pdf/2005pamphlet.pdf .

[27] Jonathan Gruber and Gary Engelhardt, “Social Security and the Evolution of Elderly Poverty,” in Public Policy and the Income Distribution, edited by Alan Auerbach, David Card, and John Quigley (New York: Russell Sage Foundation, 2006), pp. 259–87.

[28] U.S. Census Bureau, Definitions 1 and 15 from, “Table 2: Percent of Persons in Poverty, by Definition of Income and Selected Characteristics: 2009,” from the Current Population Survey, Annual Social and Economic Supplement; available at http://www.census.gov/hhes/www/cpstables/032010/rdcall/2_001.htm .

[29] Martin Gilens, Why American’s Hate Welfare (Chicago: University of Chicago, 2000).

[30] R. Kent Weaver, Ending Welfare as We Know It (Washington, DC: Brookings, 2000), Chapter 7; Ron Haskins, Work over Welfare: The Inside Story of the 1996 Welfare Reform Law (Washington, DC: Brookings, 2006), p. 55.

[31] R. Kent Weaver, “The Politics of Low-Income Families in the United States,” in Making the Work-Based Safety Net Work Better: Forward-Looking Policies to Help Low-Income Families, edited by Carolyn J. Heinrich and John Karl Scholz (New York: Russell Sage, 2009).

[32] U.S. Census Bureau, Poverty Division CPS ASEC, “Detailed Tables, Table POV07: Families With Related Children Under 18 by Number of Working Family Members and Family Structure: 2009,” from Income, Poverty, and Health Insurance Coverage in the United States: 2009, (Washington, DC: Author, 2010); available at http://www.census.gov/hhes/www/poverty/data/index.html .

[33] For example, according to Liz Schott and Zachary Levinson, TANF Benefits Are Low and Have Not Kept Pace with Inflation, (Washington DC: Center on Budget and Policy Priorities, 2008); available at http://www.cbpp.org/pdf/11-24-08tanf.pdf; the combined benefits of TANF and Food Stamps (SNAP) remained under 75 percent of the federal poverty line in all but three states in 2008.

[34] The percentage increase is based on our analysis of data from the Annual Social and Economic Supplement to the Current Population Survey. The percentage of never-married mothers employed in 1995 was 47; by 1999, the percentage had increased to 66.

[35] Brookings tabulations of data from the Annual Social and Economic Supplement to the Current Population Survey.

[36] Mary Jo Bane and David Ellwood, “Slipping into and out of Spells of Poverty,” Journal of Human Resources 21, no. 1 (1986): 23.

[37] Carolyn J. Heinrich and John Karl Scholz, editors, Making the Work-Based Safety Net Work Better: For ward-Looking Policies to Help Low-Income Families (New York: Russell Sage, 2009).

[38] U.S. Congressional Budget Office, Policy Changes Affecting Mandatory Spending for Low-Income Families Not Receiving Welfare (Washington, DC: 1998).

[39] Sheila Zedlewski and others, “Is there a System Supporting Low-Income Working Families,” Low Income Work Families Paper 4, The Urban Institute (2006); available at http://www.urban.org/UploadedPDF/311282_lowincome_families.pdf .

[40] Christopher Bollinger et al., Welfare Reform and the Level and Composition of Income, in Welfare Reform and its Long-Term Consequences for America’s Poor, edited by James P. Ziliak (Forthcoming); Robert F. Schoeni & Rebecca M. Blank, What Welfare Reform Accomplished? Impacts on Welfare Participation, Employment, Income, Poverty, and Family Structure, NBER Working Paper 7627, 2000; Robert A Moffitt, The Effect of Pre-PRWORA Waivers on AFDC Caseloads and Female Earnings, Income, and Labor Force Behavior, in Economic Conditions and Welfare Reform, edited by Sheldon Danziger (W.E. Upjohn 1999).

[41] Danilo Trisi and LaDonna Pavetti, “TANF Weakening as a Safety Net for Poor Families,” Washington, DC: Center on Budget and Policy Priorities, March 2012; Pamela J. Loprest, “Disconnected Families and TANF,” Washington, DC: Urban Institute, OPRE Brief #2, November 2011.

[42] Rebecca M. Blank and Brian K. Kovak, “The Growing Problem of Disconnected Single Mothers,” in Making the Work-Based Safety Net Work Better, edited by Carolyn J. Heinrich and John Karl Scholz (New York: Russell Sage, 2009).

[43] Douglas J. Besharov, “Leaving Welfare Without Working: How Do Mothers Do it? And What Are the Implications?” College Park, MD: University of Maryland, Welfare Reform Academy, February 2002.

[44] George J. Borjas, Heaven’s Door: Immigration Policy and the American Economy (Princeton, NJ: Princeton, 1999); Jacob L. Vigdor, From Immigrants to Americans: The Rise and Fall of Fitting In (New York: Rowman & Littlefield, 2009).

[45] Census Bureau, Families, “Table C2: Household Relationship and Living Arrangements of Children Under 18 Years, by Age and Sex: 2010,” available at http://www.census.gov/population/www/socdemo/hh-fam/cps2010.html ;” Katherine Magnuson and Lawrence M. Berger, “Family Structure States and Transitions: Associations with Children’s Well-Being During Middle Childhood,” Journal of Family and Marriage 71, no. 3 (2000): 575-591.

[46] Sara McLanahan and Gary Sandefur, Growing up with a Single Parent: What Hurts, What Helps (Cambridge: Harvard, 1994).

[47] Paul R. Amato, “The Impact of Family Formation Change on the Cognitive, Social, and Emotional Well-Being of the Next Generation,” The Future of Children 15, no. 2 (2005): 75-96; Mitch Pearlstein, Shortchanging Student Achievement: The Educational, Economic, and Social Costs of Family Fragmentation (Forthcoming); Haskins and Sawhill, Creating an Opportunity Society, Chapter 10.

[48] Reference Edin study of transitions in Fragile Families study

[49] Kathy Edin, personal communication, April 28, 2011; see https://crcw.princeton.edu%2fworkingpapers%2fWP11-10-FF.pdf .

[50] Sara McLanahan and others, “Strengthening Fragile Families,” Future of Children Policy Brief, Princeton-Brookings, Fall 2010.

[51] Adam Thomas and Isabel Sawhill, “For Richer or Poorer: Marriage as an Antipoverty Strategy,” Journal of Policy Analysis and Management 21, no. 4 (2002): 587-599; Ron Haskins and Isabel Sawhill, “Work and Marriage: The Way to End Poverty and Welfare,” Welfare Reform and Beyond Brief 28, The Brookings Institution (September 2003).

[52] Douglas Kirby, Emerging Answers 2007: Research Findings on Programsto Reduce Teen Pregnancy and Sexually Transmitted Diseases (Washington DC: National Campaign to Prevent Teen and Unplanned Pregnancy, 2007).

[53] The National Campaign to Prevent Teen and Unplanned Pregnancy, “National Birth Rates for Teens, aged 15-19,” (Accessed May 19, 2011); available at http://www.thenationalcampaign.org/national-data/NBR-teens-15-19.aspx .

[54] Stephanie J. Ventura, “Changing Patterns of Nonmarital Childbearing in the United States,” National Center for Health Statistics Data Brief, No. 18, May 2009.

[55] Adam Thomas, “Three Strategies to Prevent Unintended Pregnancy,” Journal of Policy Analysis and Management 31, No. 2 (2012).

[56] Brady Hamilton, Joyce Martin, and Stephanie Ventura, “Table 1: Total Births and birth, fertility, and total fertility rates and nonmarital births, by race and Hispanic origin of mother: United States, final 2008 and preliminary 2009,” from National Vital Statistics Reports: Births: Preliminary Data for 2009 59, no. 3 (2010); available at http://www.cdc.gov/nchs/products/nvsr.htm .

[57] James J. Heckman, “Catch ‘Em Young,” Wall Street Journal, January 10, 2006, p. A14.

[58] Craig Ramey, Frances Campbell, and Clancy Blair, “Enhancing the Life Course for High-Risk Children: Results from the Abecedarian Project,” in Social Programs that Work, edited by Jonathan Crane (New York: Russell Sage Foundation, 1998); Lawrence J. Schweinhart, and others, Lifetime Effects: The High/Scope Perry Preschool Study through Age 40 (Ypsilanti, MI: High/Scope Press, 2005); Arthur J. Reynolds, Success in Early Intervention: The Chicago Child-Parent Centers (Lincoln, NB: University of Nebraska Press, 2000).

[59] W. Steven Barnett and others, Effects of Five State Pre-Kindergarten Programs on Early Learning (Rutgers University, National Institute for Early Education Research, 2007); William T. Gormley, Jr. and Deborah Phillips, “The Effects of Universal Pre-K in Oklahoma: Research Highlights and Policy Implications,” The Policy Studies Journal 33, no. 1 (2005): 65-82.

[60] Haskins and Sawhill, Creating an Opportunity Society, Chapter 8; Gregory Camilli and others, “Meta-Analysis of the Effects of Early Education Interventions on Cognitive and Social Development,” Teachers College Record 112, no. 3 (2010): 579-620; Lynn A. Karoly, M. Rebecca Kilburn, and Jill Cannon, Early Childhood Interventions: Proven Results, Future Promise, RAND Corporation (MG-341), 2005

[61] Ron Haskins and W. Steven Barnett eds., Investing in Young Children: New Directions in Federal Preschool and Early Childhood Policy (Washington DC: Brookings and National Institute for Early Education Research, 2010), p. 4.

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When analyzing such a global issue, one should consider historical and cultural factors. Nations that are among the poorest in the world were once colonies, or areas from which richer countries exported slaves; also, some of these territories were drained of resources. Rare exceptions like Canada or Australia do not deny the fact that, for example, almost the entire continent of Africa is a problematic area in terms of poverty and hunger. This happened due to the fact that colonialism contributed to the establishment of conditions where people living in former colonies cannot access capital or education. In addition, there exist several hot spots in the world where wars and political instability also cause a significant decrease in the quality of life: Syria, Egypt, Ukraine, and so on ( The Borgen Project ).

Perhaps the most direct causal link exists between poverty and the balance between a country’s population density and its agricultural capabilities. Although such countries as the Netherlands or Belgium have a high density of population, their agricultural industry is based on mechanized farming and high-tech solutions, so poverty and hunger have no chance there. The same refers to other technologically-advanced countries. In contrast, Bangladesh, which has one of the world’s largest population densities (2,791 persons in a square mile) exists on the edge of extreme poverty—mostly because the majority of population is involved in low-efficient manual farming. On the other hand, there are countries in Africa with only about 80 persons per square mile, but because of low soil fertility, and the use of manual labor, these countries cannot boost their productivity and development ( povertyhci.weebly.com ).

Along with objective poverty factors, it is also important to consider social factors—in particular, psychological traits that many poor people possess. In many developed countries, poor people do not try to improve their financial conditions, relying on welfare payments provided to them by governments (CliffsNotes). Due to the lack of education and skills (also caused by the inability to pay for them), they cannot work at well-paid jobs, although they can still become maids, cleaners, postal workers, couriers, and so on. Doing so would enable such people to earn more money necessary for education and personal development, but they prefer to keep the status quo.

Reasons of poverty are numerous, and it is difficult to analyze the entire complex of causes of such a global issue. However, some of them are obvious: a colonial background, wars and political instability, dense population combined with low agricultural capabilities, and certain psychological traits of poor people. These factors help keep poverty in the world’s list of the most urgent problems.

“Top 5 Causes of Poverty.” The Borgen Project. N.p., 25 June 2013. Web. 21 May 2015.

“Poverty at Large: A Dark Spot in Humanity.”Http://povertyhci.weebly.com/. N.p., n.d. Web. 21 May 2015.

“Causes and Effects of Poverty.” CliffNotes. N.p., n.d. Web. 21 May 2015.

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Poverty Essay for Students and Children

500+ words essay on poverty essay.

“Poverty is the worst form of violence”. – Mahatma Gandhi.

How Poverty is Measured?

For measuring poverty United nations have devised two measures of poverty – Absolute & relative poverty.  Absolute poverty is used to measure poverty in developing countries like India. Relative poverty is used to measure poverty in developed countries like the USA. In absolute poverty, a line based on the minimum level of income has been created & is called a poverty line.  If per day income of a family is below this level, then it is poor or below the poverty line. If per day income of a family is above this level, then it is non-poor or above the poverty line. In India, the new poverty line is  Rs 32 in rural areas and Rs 47 in urban areas.

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Causes of Poverty

According to the Noble prize winner South African leader, Nelson Mandela – “Poverty is not natural, it is manmade”. The above statement is true as the causes of poverty are generally man-made. There are various causes of poverty but the most important is population. Rising population is putting the burden on the resources & budget of countries. Governments are finding difficult to provide food, shelter & employment to the rising population.

The other causes are- lack of education, war, natural disaster, lack of employment, lack of infrastructure, political instability, etc. For instance- lack of employment opportunities makes a person jobless & he is not able to earn enough to fulfill the basic necessities of his family & becomes poor. Lack of education compels a person for less paying jobs & it makes him poorer. Lack of infrastructure means there are no industries, banks, etc. in a country resulting in lack of employment opportunities. Natural disasters like flood, earthquake also contribute to poverty.

In some countries, especially African countries like Somalia, a long period of civil war has made poverty widespread. This is because all the resources & money is being spent in war instead of public welfare. Countries like India, Pakistan, Bangladesh, etc. are prone to natural disasters like cyclone, etc. These disasters occur every year causing poverty to rise.

Ill Effects of Poverty

Poverty affects the life of a poor family. A poor person is not able to take proper food & nutrition &his capacity to work reduces. Reduced capacity to work further reduces his income, making him poorer. Children from poor family never get proper schooling & proper nutrition. They have to work to support their family & this destroys their childhood. Some of them may also involve in crimes like theft, murder, robbery, etc. A poor person remains uneducated & is forced to live under unhygienic conditions in slums. There are no proper sanitation & drinking water facility in slums & he falls ill often &  his health deteriorates. A poor person generally dies an early death. So, all social evils are related to poverty.

Government Schemes to Remove Poverty

The government of India also took several measures to eradicate poverty from India. Some of them are – creating employment opportunities , controlling population, etc. In India, about 60% of the population is still dependent on agriculture for its livelihood. Government has taken certain measures to promote agriculture in India. The government constructed certain dams & canals in our country to provide easy availability of water for irrigation. Government has also taken steps for the cheap availability of seeds & farming equipment to promote agriculture. Government is also promoting farming of cash crops like cotton, instead of food crops. In cities, the government is promoting industrialization to create more jobs. Government has also opened  ‘Ration shops’. Other measures include providing free & compulsory education for children up to 14 years of age, scholarship to deserving students from a poor background, providing subsidized houses to poor people, etc.

Poverty is a social evil, we can also contribute to control it. For example- we can simply donate old clothes to poor people, we can also sponsor the education of a poor child or we can utilize our free time by teaching poor students. Remember before wasting food, somebody is still sleeping hungry.

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Home — Essay Samples — Social Issues — Poverty — Poverty Is The Root Of Crime

How Poverty is The Main Cause of Crime

• Categories: Criminal Behavior

About this sample

Words: 593 |

Published: Dec 16, 2021

Words: 593 | Page: 1 | 3 min read

• brooklyn eagle. (2019,October 15). New York's most desperate caught up in 'crimes of poverty'. Retrieved from https://brooklyneagle.com/articles/2019/10/15/new-yorks-most-desperate-caught-up-in-crimes-of-poverty/
• Ginni Correa. (2020,june 18). Addiction center. Retrieved from https://www.addictioncenter.com/addiction/low-income-americans/
• OSAC. (6/18/2019). Venezuela 2019 Crime & Safety Report. Retrieved from https://www.osac.gov/Country/Venezuela/Content/Detail/Report/b0933dac-4154-4dc2-89c1-160ca3b2c4c2
• Tom Mack. (3 JAN 2020). Leicestershire live . Retrieved from https://www.leicestermercury.co.uk/news/leicester-news/man-stealing-metal-feed-family-3699993

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Provides a foundational overview, outlining the historical context and introducing key information that will be further explored in the essay, setting the stage for the argument to follow.

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Should follow a right side up triangle format, meaning, specifics should be mentioned first such as restating the thesis, and then get more broad about the topic at hand. Lastly, leave the reader with something to think about and ponder once they are done reading.

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