Government programs can effectively reduce poverty in the United States. Using the Supplemental Poverty Measure (SPM)—a more comprehensive measure of economic security than traditional poverty thresholds—the figure below illustrates the strength of the government to mitigate the incidence of poverty.
Social Security is, by far, the most effective anti-poverty program in the United States. Without Social Security, an additional 8.6 percent of Americans, or nearly 27 million, would fall below the SPM poverty threshold. Refundable tax credits, such as the Earned Income Tax Credit, kept 2.9 percent of Americans, or 9 million, above the SPM poverty threshold. Other programs, such as SNAP (food stamps), Supplemental Security Income, housing subsidies, and unemployment insurance, also have a significant impact on the ability of families to stay afloat.
Government programs reduce poverty: Supplemental Poverty Rate, with and without targeted government programs (2013)
|Refundable tax credits||18.4%|
|Child support received||16.0%|
Notes: The red bar shows the actual SPM poverty rate for 2013. The blue bars show what the SPM poverty rate would have been in the absence of the specified program.
Source: Author's analysis of Short, Kathleen. 2014. "The Research Supplemental Poverty Measure: 2013." U.S. Census Bureau.