Name 1
Name
Instructor
16th May 2016
American Economic History
In 1992, a thirty-month study was initiated by the National Statistics of the National
Academy of Sciences Committee as requested by the Congress. The study included a close
examination of statistical issues that are involved in the measurement and understanding of
poverty. Prior to this initiative by the Congress, a war on poverty in America was declared about
fifty years ago by President Lyndon B. Johnson. He introduced initiatives that were to improve
access to economic resources, health, jobs, and skills (Ravallion n.p).
Before the mid-1970s, the economic growth in the United States was associated with a
falling rate of poverty. This was determined and measured as the share of the American
population living below the poverty line. Had this relationship continued, poverty in the country
would have been eradicated during the 1980s (Rodgers, n.p). However, as the United States’
economy continued growing, poverty levels started rising as well (Rodgers, n.p). This was,
primarily, as a result of the 1970s oil crisis that hit America and exacerbated poverty levels,
which began rising again until in the 1990s during the new economic boom. Considering the
general wage stagnation, as well as the sluggish income growth at the top, it is not a surprise that
fewer economical improvements were experienced by the individuals at the bottom for the last
thirty years. Since then, income growth and prosperity hasn’t been shared widely and least of all
for the majority at the bottom (Carter, Michael & Christopher 180).
Name 2
Today, many Americans are employed in jobs which barely meet their needs. Compared
to several other rich countries, the United States ranks pretty high in poverty level charts. This is
primarily as a result of the elderly and children who lie disproportionately below the established
poverty line. In most of the developed economies, child poverty is often below 10 percent.
America’s child poverty stands at about 20 percent and in fact increased to 25 percent recently.
Workers earning low wages are more susceptible to the recession and flows of the economy.
Carter, Michael and Christopher state that the strong economy of the 1990s was characterized by
minimal rate of unemployment, periods of high productivity and there was a strong wage growth
and reduced poverty levels (181 & 182). The Great Recession was accompanied by a steep
increase in poverty, from 12.5 percent in 2007 to 15 percent in 2010. More than forty-six million
people in America were living in poverty in 2010.
