Americans believe strongly that people should take personal responsibility for themselves. Debates about social policy are debates about social responsibility. Social policies are often called "social insurance," however, because they are intended to "insure" people against life's crises and catastrophes-serious sickness, disability, the ravages of aging or job loss.

Social welfare policies attempt to provide assistance and support to specific groups in society. Many Americans equate social welfare exclusively with government monies given to the poor. Yet the government gives far more money to the nonpoor than to people below the "poverty line"; only 17 percent of social spending goes to the poor. Social welfare policies consist of two kinds of programs. First are the entitlement programs. An entitlement is any benefit provided by law and regardless of need. The two biggest entitlement programs are Social Security and Medicare. Second are the means-tested programs, which provide benefits selectively only to people with specific needs. To be eligible for these programs, people must be able to prove that they qualify for them. These programs generate powerful political controversy.

INCOME, POVERTY, AND PUBLIC POLICY

The concept of income distribution describes the share of national income earned by various groups in the United States. The distribution of income across segments of the American population is quite uneven. Income is the amount of money collected between any two points in time (such as a week or a year); wealth is the amount already owned (such as stocks, bonds, bank accounts, cars, and houses). Studies of wealth display even more inequality than those of income.

The census lists Americans' median family income in 2003 as $43,300. However, there is also a great deal of poverty. For 2003, the Census Bureau defined a family of three as falling below the poverty level if it had an annual income below $14,824; that year 12.5 percent of all Americans were living in poverty.

Poverty in America is concentrated among a few groups. Large percentages of some groups are poor, including African Americans, Hispanics, unmarried women, and inner-city residents. Because of the high incidence of poverty among unmarried mothers and their children, experts on poverty often describe the problem today as the feminization of poverty.

The government spends one out of every three dollars in the American economy, and thus has a major impact on its citizens' wealth and income. In particular, there are two principal ways in which government can affect a person's income: government can manipulate incomes through its taxing powers, and government can affect income through its expenditure policies.

There are three general types of taxes, and each can affect citizens' incomes in a different way. A progressive tax takes a bigger bite from the incomes of the rich than from those of the poor. A proportional tax takes the same percentage from everyone, rich and poor alike. A regressive tax takes a higher percentage from those at the lower income levels than from the well-to-do. In general, federal taxes are progressive. The EITC is a special tax benefit for working people who earn low incomes.

Government spending policies can also affect a person's income. Benefits from government are called transfer payments because they transfer money from the general treasury to those in specific need. Government can also give an "in-kind payment," something with cash value that is not cash itself (such as food stamps or a low-interest loan for college education or healthcare subsidies for poor families with children).

HELPING THE POOR? SOCIAL POLICY AND POVERTY

For centuries, societies considered family welfare to be a private concern. With the growth of large, depersonalized cities and the requirements of the urban workforce, government was impelled to take a more active role in social welfare support.

A major change in how Americans viewed government's role in providing social welfare came during the Great Depression. After the onset of the Depression in 1929, many Americans began to think that governments must do more to protect their citizens against economic downturns. The federal government responded to this change by passing the Social Security Act of 1935, one of the most significant pieces of social welfare legislation of all time. Other programs such as Medicare were added later.

The 1960s brought an outpouring of federal programs to help the poor and the elderly, to create economic opportunities for those at the lower rungs of the economic ladder, and to reduce discrimination against minorities. Many of these programs were established during the presidency of Lyndon B. Johnson (1963-1969), whose administration coined the term the "Great Society" for these policy initiatives.

By the 1980s, many had come to believe that welfare programs of the Great Society had been a failure. President Ronald Reagan chose to target poverty programs as one major way to cut government spending. This action served his own ideological beliefs of less government and more self-sufficiency.

In August 1996, President Clinton signed a welfare reform bill that was supported by congressional Republicans but was opposed by half of congressional Democrats. The major provisions of the bill included giving each state a fixed amount of money to run its own welfare program; requiring people on welfare to find jobs within two years or lose their benefits; and setting a lifetime maximum of five years on welfare. After welfare reform, they were known as Temporary Assistance to Needy Families (TANF), today's name for the means-tested aid for the poorest of the poor. TANF benefits like AFDC are small and declining.

From the Welfare Reform Act's signing in 1996 until September 2002, the number of welfare recipients declined from 12.2 million to five million. Welfare reform coincided with major economic growth in the 1990s. As the twenty-first century dawned, economic recession and then terrorism strained national and state budgets. No state put the poor at the top of its spending agenda.

LIVING ON BORROWED TIME: SOCIAL SECURITY

As it stands now, the Social Security program is living on borrowed time. By the turn of the twenty-first century, Social Security and Medicare had become the most expensive public policies in the history of the world. Social Security grew over the years, in large part because it worked. More than 90 percent of people polled, year after year, support Social Security. In 1965, Congress tacked onto Social Security a new program, Medicare, to assist the elderly with medical costs.

SOCIAL WELFARE POLICY ELSEWHERE

Other national governments and their citizens often take quite a different approach to the problems of poverty and social welfare. Most Americans would be amazed at the range of social benefits in the average European country. Europeans pay a high price for generous benefits. Taxes in Western European nations far exceed those in the United States. There, taxes approach (or even exceed) 50 percent of income. Every problem the United States faces in funding Social Security is even bigger in Europe.

UNDERSTANDING SOCIAL WELFARE POLICY

In the social welfare policy arena, the competing groups are often quite unequal in terms of political resources. For example, the elderly are relatively well organized and often have the resources needed to wield significant influence in support of programs they desire. As a result, they are usually successful in protecting and expanding their programs. For the poor, however, influencing political decisions is more difficult. They vote less frequently and lack strong, focused organizations and money.

Although government benefits are difficult to enact, the nature of democratic politics makes it difficult to withdraw them once they are established. Tremendous pressures come from these supporters to keep or expand programs and to preserve them from elimination. These pressures persist even when the size and costs of programs seem to have grown beyond anything anyone might have originally envisioned.