We compare trends in absolute poverty before (1939–1963) and after (1963–2023) the War on Poverty was declared. Our primary methodological contribution is to create a post-tax post-transfer income measure using the 1940, 1950 and 1960 Decennial Censuses through imputations of taxes and transfers as well as certain forms of market income including perquisites (Collins and Wanamaker 2022), consistent with the full income measures developed by Burkhauser et al. (2024) for subsequent years. From 1939–1963, poverty fell by 29 percentage points, with even larger declines for Black people and all children. While absolute poverty continued to fall following the War on Poverty’s declaration, the pace was no faster, even when evaluating the trends relative to a consistent initial poverty rate. Furthermore, the pre-1964 decline in poverty among working age adults and children was achieved almost completely through increases in market income, during which time only 2–3 percent of working age adults were dependent on the government for at least half of their income, compared to dependency rates of 7–15 percent from 1972–2023. In contrast to progress on absolute poverty, reductions in relative poverty were more modest from 1939–1963 and even less so since then.

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V. Conclusion

We create a post-tax post-transfer income measure using the Decennial Censuses that allows us to consistently evaluate poverty trends back to 1939, a quarter century before the War on Poverty was declared in 1964. We find that post-tax post-transfer poverty was falling well before the War on Poverty began and at no slower a rate than afterwards. Even more important from a policy standpoint, this pre-War on Poverty decline was driven almost completely by increases in market income. Dependency on government transfers remained low before the War on Poverty but grew to higher levels thereafter. Our results provide historical context to the widely recognized declining poverty trend after the War on Poverty was declared. At least from 1939–1963, a greatly expanded safety net was not necessary to achieve a major reduction in poverty. This outcome is consistent with the claims of Thomas Sowell, who argued that Black people in particular made economic strides before the War on Poverty was declared that were at least as great as afterward, and did so without major increases in dependency on government transfers. The most prominent exception to rising dependency during the War on Poverty came in the 1990s when tax and transfer programs were reformed to more strongly encourage work. During the welfare reform period, reductions in poverty were achieved largely via increases in market income, with the largest reductions in poverty experienced by Black children who were disproportionately affected by work-based welfare reform. As a whole, the evidence from our newly constructed data series over the past 84 years is consistent with Sowell’s descriptive claims regarding trends in poverty and dependence in the United States: Poverty fell without substantially increasing dependence, especially for Black Americans, both in the period predating the War on Poverty and when programs were reformed to mitigate or reverse their work disincentives.

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