‘War on Poverty’ May Have Created a Permanent Underclass, Economists Say
By Kevin Stocklin
Published on March 13, 2026.
Economists have suggested that America's "War on Poverty" may have created a permanent underclass due to the expansion of federal social welfare programs. The programs, launched by President Lyndon Johnson in 1964, have significantly reduced the share of private income for America’s poorest, locking them into long-term dependency and limiting their ability to move up into the middle class. Economists Kevin Corinth and Richard Burkhauser concluded that while poverty decreased significantly since 1964, this was largely due to welfare supplanting “market” income such as wages, investments, and profits. While some claim that government spending has reduced poverty by up to 90% since 1964 has also built a barrier to upward mobility for America's poorest. However, recent studies indicate that income mobility is declining in America and that expansive welfare programs are trapping more people in government dependence.
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