Effects of federal programs on children: Absolute poverty, relative poverty, and income inequality

Since the 1996 welfare reform, federal spending on means-tested programs targeting the poorest children has decreased, while programs that benefit children in low-income working families have been expanded substantially. With this background, this study examined changes in the antipoverty and anti-inequality effects of children's programs between 1995 and 2007 using data from the Annual Social and Economic (ASEC) Supplements to the Current Population Survey (CPS). The findings suggest that although the poverty-reduction effects of the federal child programs increased between 1995 and 2007, the programs' effects on the reductions of children's absolute poverty gaps, relative poverty rates, relative poverty gaps, and income inequality all decreased. More importantly, the antipoverty effects of the federal child programs were most weakened for the poorest children (i.e., those in female-headed, immigrant, and nonworking families) between 1995 and 2007.

Research Highlights► Since 1996, federal programs for the poorest children have diminished. ► However, federal spending on children in low-income working families has increased. ► Inequality-reduction effects of the federal programs decreased among children. ► Antipoverty effects of federal programs were weakened for the poorest children.