National Academies Press: OpenBook

Measuring Poverty: A New Approach (1995)

Chapter: Proposals for AFDC Minimum Benefits: A Brief History

Suggested Citation:"Proposals for AFDC Minimum Benefits: A Brief History." National Research Council. 1995. Measuring Poverty: A New Approach. Washington, DC: The National Academies Press. doi: 10.17226/4759.
Page 338

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THE POVERTY MEASURE AND AFDC 338 Maximum AFDC Benefit Maximum Combined AFDC/Food Stamp Benefit State AFDC Dollar Percent of Dollar Percent of Need Value Need Value Need Standard Rhode Island 554 554 100 822 148 South Carolina 440 200 45 495 113 South Dakota 491 417 85 688 140 Tennessee 426 185 43 480 113 Texas 574 184 32 479 83 Utah 552 414 75 686 124 Vermont 1,124 638 57 843 75 Virginia 393 354 90 644 164 Washington 1,158 546 47 804 69 West Virginia 497 249 50 544 109 Wisconsin 647 517 80 758 117 Wyoming 674 360 53 648 96 Mean 655 396 66 675 115 Median 574 366 66 658 113 Range 320–1,648 120–923 24–100 415– 47–187 1,208 Coefficient of 40.7% 39.5% 39.6% 21.8% 32.5% variationc SOURCE: U.S. House of Representatives (1994:366-367). a The values apply to Wayne County. b The values apply to New York City. c The standard deviation of the distribution as a percentage of the mean value. Proposals for AFDC Minimum Benefits: A Brief History The original Aid to Dependent Children program, the predecessor to AFDC, was enacted in 1935 as part of the legislation that instituted a national Social Security system.3 It was designed to put on a sounder footing the states' programs to provide ''mothers' pensions," but there was no intent to mandate a prominent role for the federal government.4 The legislation provided that the federal government would pay 33 percent of the program's costs, with a 3 Peterson and Rom (1990:Chap. 4) is the main source for this historical review; see also U.S. Senate (1986). 4 In contrast, it was argued in the case of Social Security that national standards were needed to protect working people, given the mobility of labor across state boundaries. Similarly, for unemployment insurance, it was argued that a nationally uniform payroll tax was needed to ensure that states could not gain an unfair business advantage by choosing not to provide unemployment compensation.

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Each year's poverty figures are anxiously awaited by policymakers, analysts, and the media. Yet questions are increasing about the 30-year-old measure as social and economic conditions change.

In Measuring Poverty a distinguished panel provides policymakers with an up-to-date evaluation of:

  • Concepts and procedures for deriving the poverty threshold, including adjustments for different family circumstances.
  • Definitions of family resources.
  • Procedures for annual updates of poverty measures.

The volume explores specific issues underlying the poverty measure, analyzes the likely effects of any changes on poverty rates, and discusses the impact on eligibility for public benefits. In supporting its recommendations the panel provides insightful recognition of the political and social dimensions of this key economic indicator.

Measuring Poverty will be important to government officials, policy analysts, statisticians, economists, researchers, and others involved in virtually all poverty and social welfare issues.

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