The war on poverty

In a 1998 report, the Census Bureau carefully studied a sample of individuals who were poor from October 1992 through 1995. During this time, the overall annual poverty rate was 12.6 percent to 12.9 percent, almost identical to the 12.7 percent annual poverty rate in 2004. In 1994, 6.9 million people who were not poor in 1993 became poor sometime during the year. During the same year, 7.6 million people who were poor at the end of 1993 rose out of poverty during 1994. The net change was 700,000 fewer people in poverty at the end of 1994 than at the end of 1993, resulting in a small reduction in the annual poverty rate.

In addition to observing that 10 times as many people actually rose out of poverty than the net change in the poverty level in 1994, the Census Bureau also measured the actual number of months each person earned less than the poverty level of income. The mean period that all individuals who were poor sometime in 1993 or 1994 actually lived below the poverty level was 4.5 months. Half of all individuals who were poor at any time in 1993 or 1994 were poor for less than 4.5 months. Yes, children were poor longer: 5.3 months at the median. And households headed by females were poor longer: 7.2 months.

About one-third of individuals who were poor in the beginning of 1993 remained poor for 24 months or more. The persistent poverty rate in 1994 was 5.3 percent versus an average poverty rate of 15.4 percent (and an annual poverty rate of 12.9 percent).

The policy implications of these dynamics, and the actual trigger events, are significant. To accelerate the transition out of poverty, government agencies need to qualify applicants and deliver services within weeks of entering poverty or the public expenditures will be largely irrelevant. Long-term support issues of housing, training, and education may be important to the one-third chronically poor, but not to the two-thirds in transit through poverty.

The war on poverty needs to be fought on at least two fronts. First is the quick response, transactional battle of month to month for those at the edge of poverty to sustain or regain employment and family stability - supporting most of the people and most cost- effective support because it leverages their own substantial family and financial momentum. The second is the chronic poor, where there is a different strategy of long-term support and gradual transition.

As the 1998 Census Bureau report concluded, "Poverty may seem to be a relatively simple picture, but, in fact, it is complex."

• George B. Weathersby is CEO of Genesys Solutions LLC, a management consulting firm.

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