[Background Material and Data on Programs within the Jurisdiction of the Committee on Ways and Means (Green Book)]
[Appendices]
[Appendix H. Data on Poverty]
[From the U.S. Government Printing Office, www.gpo.gov]


[1998 Green Book] APPENDIX H. DATA ON POVERTY

                                CONTENTS

Measuring Poverty
Trends in the Overall Poverty Rate
Poverty Rates for Individuals in Selected Subgroups of the 
        Population
  Poverty Rates for Families
  Poverty Under Alternative Measures of Income and Price 
            Inflation
  Poverty by Metro Area and State
Trends in Family Incomes, 1967-94
  Definitions and Methods
  Income Measure
  Adjusting for Noncash Income and Taxes
  Income Shares
Trends in Pretax Cash Incomes by Type of Family
  Pretax AFI
  Average Family Cash Income
  Income Trends Year by Year
Antipoverty Effectiveness of Various Cash and Noncash Transfers
References

                           MEASURING POVERTY

    When the Federal Government began measuring poverty in the 
early 1960s, the continued existence of poor people in a time 
of the ``Affluent Society'' seemed anomalous. Official concern 
soon translated into efforts to measure the size of the poverty 
population, and the search began for programmatic ways to 
alleviate poverty. The first rough estimates of the incidence 
of poverty were based on survey data indicating that families 
generally spent about one-third of their income on food. A 
poverty level income was then calculated by using as a 
yardstick the amount of money necessary to purchase the lowest 
cost ``nutritionally adequate'' diet calculated by the 
Department of Agriculture (roughly equivalent to the current 
Thrifty Food Plan). This price tag was multiplied by three to 
produce a poverty threshold. This procedure assumed, then, that 
if a family did not have enough income to buy the lowest cost 
nutritionally adequate diet, and twice that amount to buy other 
goods and services, it was ``poor.'' Adjustments were made for 
the size of the family, the sex of the family head, and for 
whether the family lived on a farm. Farm families were assumed 
to need less cash income because their needs could be met 
partially by farm products, particularly food. The adjustments 
for sex of the family head and for farm-nonfarm residence were 
abolished in 1981. Policy officials made one change to the 
basic approach for calculating the poverty threshold in 1969. 
The current poverty threshold is established each year simply 
by increasing the previous year's threshold by the change in 
the Consumer Price Index (CPI), rather than multiplying the 
cost of the Thrifty Food Plan by three.
    Note that the tables in this subsection provide poverty 
data calculated using the official Census definition of 
poverty. The Census definition of poverty has remained fairly 
standard over time and is useful for measuring progress against 
poverty. Under this definition, poverty is determined by 
comparing pretax cash income with the poverty threshold.
    It should be noted that the Census Bureau revised its 
method of estimating the poverty threshold four times--in 1966, 
1974, 1979, and 1981. These revisions changed the estimate of 
the poverty rate. The first two revisions slightly reduced the 
estimated number of poor, while the more recent revisions 
slightly increased the number. In 1984, the Census Bureau also 
revised its method of imputing missing values for interest 
income, which slightly lowered the estimated poverty rate.
    Data on income and poverty after 1987 may not be comparable 
to data in earlier years because of changes in the methods used 
by the Census Bureau to process survey results. This new 
processing system was applied to 1987 data so that 1988 and 
1987 data are comparable. Revised 1987 data are denoted as 
1987R. The new processing system increased aggregate income by 
0.9 percent and lowered the poverty rate for 1987 by 0.1 
percent.
    Table H-1 shows the population, number of persons in 
poverty and the poverty rate in 1996 by age, race, region and 
family type. In 1996, 13.7 percent (36.5 million persons) of 
the total U.S. population lived in poverty. Of all demographic 
groups shown, poverty was highest among female-headed families 
with children (44.3 percent). Among children under age 18, 
nearly 20.5 percent, or 14.5 million children, lived in poverty 
in 1994.
    The weighted average poverty thresholds for families of 
various sizes for selected years between 1959 and 1996 are 
presented in table H-2.

                 TRENDS IN THE OVERALL POVERTY RATE \1\
---------------------------------------------------------------------------

    \1\ All poverty trend information is based upon published Census 
Bureau data contained in Current Population Reports, Series P-60, Nos. 
124, 140, 145, 149, 154, 157, 161, 166, 168, 174, 180, and 185. These 
figures may differ with other parts of this report which provide a more 
refined breakdown of this age category. Data for blacks, the aged, and 
nonaged population were not available for the years 1961-65.
---------------------------------------------------------------------------
    In the late 1950s, the overall poverty rate for individuals 
in the United States was 22 percent, representing 39.5 million 
poor persons (tables H-3 and H-4). Between 1959 and 1969, the 
poverty rate declined dramatically and steadily to 12.1 
percent. As a result of a sluggish economy, the rate increased 
slightly to 12.5 percent by 1971. In 1972 and 1973, however, it 
began to decrease again. The lowest rate over the entire 24-
year period occurred in 1973, when the poverty rate was 11.1 
percent. At that time roughly 23 million people were poor, 42 
percent less than were poor in 1959.

                                 TABLE H-1.--POVERTY STATUS OF PERSONS BY AGE, ETHNICITY, REGION, AND FAMILY TYPE, 1996                                 
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                  Poverty                Percent of   Number of   Percent of      Poverty               
                            Category                                rate     Population     total        poor       poverty     difference    Percent of
                                                                 (percent)  (thousands)  population  (thousands)  population      1996-95     difference
--------------------------------------------------------------------------------------------------------------------------------------------------------
Age:                                                                                                                                                    
    Under 18...................................................       20.5      70,650         26.5      14,463         39.6            -202      -194.2
    18-64......................................................       11.4     163,691         61.5      18,638         51.0             196       188.5
    65 and over................................................       10.8      31,877         12.0       3,428          9.4             110       105.8
                                                                ----------------------------------------------------------------------------------------
        Total..................................................       13.7     266,218        100.0      36,529        100.0             104       100.0
                                                                ========================================================================================
Race/ethnicity:                                                                                                                                         
    White......................................................       11.2     219,656         82.5      24,650         67.5             227       218.3
    Black......................................................       28.4      34,110         12.8       9,694         26.5            -178      -171.2
    Hispanic \1\...............................................       29.4      29,614         11.1       8,697         23.8             123       118.3
                                                                ----------------------------------------------------------------------------------------
        Total..................................................       13.7     266,218        100.0      36,529        100.0             104       100.0
                                                                ========================================================================================
Region:                                                                                                                                                 
    Northeast..................................................       10.9      51,455         19.3       6,558         18.0             113       108.7
    Midwest....................................................       10.7      61,940         23.3       6,654         18.2            -131      -126.0
    South......................................................       15.1      93,123         35.0      14,098         38.6            -360      -346.2
    West.......................................................       15.4      59,700         22.4       9,219         25.2             483       464.4
                                                                ----------------------------------------------------------------------------------------
        Total..................................................       13.7     266,218        100.0      36,529        100.0             104       100.0
                                                                ========================================================================================
Family type:                                                                                                                                            
    Unrelated individuals......................................       20.8      40,727         15.3       8,452         23.1             205       197.1
    Female-headed families with children.......................       44.3      26,798         10.1      12,750         34.9            -346      -332.7
    Married-couple families....................................        8.7     110,179         41.4       9,617         26.3              61        58.7
    Other families with children...............................       15.6       8,326          3.1       1,297          3.6              98        94.2
    All other families.........................................        5.5      80,188         30.1       4,413         12.1              86        82.7
                                                                ----------------------------------------------------------------------------------------
        Total..................................................       13.7     266,218        100.0      36,529        100.0             104      100.0 
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Persons of Hispanic origin may be of any race.                                                                                                      
                                                                                                                                                        
Source: U.S. Bureau of the Census (1996).                                                                                                               


                     TABLE H-2.--WEIGHTED AVERAGE POVERTY THRESHOLDS FOR NONFARM FAMILIES OF SPECIFIED SIZE, SELECTED YEARS 1959-96                     
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                Unrelated individuals                                  Families of two persons or more                  
                                           ------------------------------          ---------------------------------------------------------------------
               Calendar year                                              All ages    Head      Head                                              Seven 
                                               All      Under    Aged 65              under    aged 65    Three     Four      Five       Six     persons
                                              ages     age 65   or older             age 65   or older   persons   persons   persons   persons   or more
--------------------------------------------------------------------------------------------------------------------------------------------------------
1959......................................    $1,467    $1,503    $1,397    $1,894    $1,952    $1,761    $2,324    $2,973    $3,506    $3,944    $4,849
1960......................................     1,490     1,526     1,418     1,924     1,982     1,788     2,359     3,022     3,560     4,002     4,921
1965......................................     1,582     1,626     1,512     2,048     2,114     1,906     2,514     3,223     3,797     4,264     5,248
1970......................................     1,954     2,010     1,861     2,525     2,604     2,348     3,099     3,968     4,680     5,260     6,468
1975......................................     2,724     2,797     2,581     3,506     3,617     3,257     4,293     5,500     6,499     7,316     9,022
1980......................................     4,190     4,290     3,949     5,363     5,537     4,983     6,565     8,414     9,966    11,269  \1\ 12,7
                                                                                                                                                      61
1981......................................     4,620     4,729     4,359     5,917     6,111     5,498     7,250     9,287    11,007    12,449  \1\ 14,1
                                                                                                                                                      10
1982......................................     4,901     5,019     4,626     6,281     6,487     5,836     7,693     9,862    11,684    13,207  \1\ 15,0
                                                                                                                                                      36
1983......................................     5,061     5,180     4,775     6,483     6,697     6,023     7,938    10,178    12,049    13,630  \1\ 15,5
                                                                                                                                                      00
1984......................................     5,278     5,400     4,979     6,762     6,983     6,282     8,277    10,609    12,566    14,207  \1\ 16,0
                                                                                                                                                      96
1985......................................     5,469     5,593     5,156     6,998     7,231     6,503     8,573    10,989    13,007    14,696  \1\ 16,6
                                                                                                                                                      56
1986......................................     5,572     5,701     5,255     7,138     7,372     6,630     8,737    11,203    13,259    14,986  \1\ 17,0
                                                                                                                                                      49
1987......................................     5,778     5,909     5,447     7,397     7,641     6,872     9,056    11,611    13,737    15,509  \1\ 17,6
                                                                                                                                                      49
1988......................................     6,022     6,155     5,674     7,704     7,958     7,157     9,435    12,092    14,304    16,146  \1\ 18,2
                                                                                                                                                      32
1989......................................     6,310     6,451     5,947     8,076     8,343     7,501     9,885    12,674    14,990    16,921  \1\ 19,1
                                                                                                                                                      62
1990......................................     6,652     6,800     6,268     8,509     8,794     7,905    10,419    13,359    15,792    17,839  \1\ 20,2
                                                                                                                                                      41
1991......................................     6,932     7,086     6,532     8,865     9,165     8,241    10,860    13,924    16,456    18,587  \1\ 21,0
                                                                                                                                                      58
1992......................................     7,143     7,299     6,729     9,137     9,443     8,487    11,186    14,335    16,952    19,137  \1\ 21,5
                                                                                                                                                      94
1993......................................     7,363     7,518     6,930     9,414     9,728     8,740    11,522    14,763    17,449    19,718  \1\ 22,3
                                                                                                                                                      83
1994......................................     7,547     7,710     7,108     9,661     9,976     8,967    11,821    15,141    17,900    20,235  \1\ 22,9
                                                                                                                                                      23
1995......................................     7,763     7,929     7,309     9,933    10,259     9,219    12,158    15,569    18,408    20,804  \1\ 23,5
                                                                                                                                                      52
1996......................................     7,995     8,163     7,525    10,145    10,507     9,484    12,273    16,183    19,516    22,447  \1\ 25,8
                                                                                                                                                      28
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Poverty threshold for seven persons, not seven persons or more.                                                                                     
                                                                                                                                                        
Source: U.S. Bureau of the Census, technical papers.                                                                                                    


        TABLE H-3.--NUMBER OF PERSONS IN POVERTY FOR INDIVIDUALS IN SELECTED DEMOGRAPHIC GROUPS, 1959-96        
----------------------------------------------------------------------------------------------------------------
                                                                     Individuals                                
                                                                     in female-              Hispanic           
               Year                 Overall    Aged   Children \1\     headed       Black   origin \3\    White 
                                                                    families \2\                                
----------------------------------------------------------------------------------------------------------------
1959..............................   39,490    5,481      17,552         7,014       9,927         NA     28,484
1960..............................   39,851       NA      17,634         7,247          NA         NA     28,309
1961..............................   39,628       NA      16,909         7,252          NA         NA     27,890
1962..............................   38,625       NA      16,963         7,781          NA         NA     26,672
1963..............................   36,436       NA      16,005         7,646          NA         NA     25,238
1964..............................   36,055       NA      16,051         7,297          NA         NA     24,957
1965..............................   33,185       NA      14,676         7,524          NA         NA     22,496
1966..............................   28,510    5,114      12,389         6,861       8,867         NA     19,290
1967..............................   27,769    5,388      11,656         6,898       8,486         NA     18,983
1968..............................   25,389    4,632      10,954         6,990       7,616         NA     17,395
1969..............................   24,147    4,787       9,691         6,879       7,095         NA     16,659
1970..............................   25,420    4,793      10,440         7,503       7,548         NA     17,484
1971..............................   25,559    4,273      10,551         7,797       7,396         NA     17,780
1972..............................   24,460    3,738      10,284         8,114       7,710      2,414     16,203
1973..............................   22,973    3,354       9,642         8,178       7,388      2,366     15,142
1974..............................   23,370    3,085      10,156         8,462       7,182      2,575     15,736
1975..............................   25,877    3,317      11,104         8,846       7,545      2,991     17,770
1976..............................   24,975    3,313      10,273         9,029       7,595      2,783     16,713
1977..............................   24,720    3,177      10,288         9,205       7,726      2,700     16,416
1978..............................   24,497    3,233       9,931         9,269       7,625      2,607     16,259
1979..............................   26,072    3,682      10,377         9,400       8,050      2,921     17,214
1980..............................   29,272    3,871      11,543        10,120       8,579      3,491     19,699
1981..............................   31,822    3,853      12,505        11,051       9,173      3,713     21,553
1982..............................   34,398    3,751      13,647        11,701       9,697      4,301     23,517
1983..............................   35,303    3,625      13,911        12,072       9,882      4,633     23,984
1984..............................   33,700    3,330      13,420        11,831       9,490      4,806     22,955
1985..............................   33,064    3,456      13,010        11,600       8,926      5,236     22,860
1986..............................   32,370    3,477      12,876        11,944       8,983      5,117     22,183
1987..............................   32,221    3,563      12,843        12,148       9,520      5,422     21,195
1988..............................   31,745    3,481      12,455        11,972       9,356      5,357     20,715
1989..............................   31,528    3,363      12,590        11,668       9,302      5,430     20,785
1990..............................   33,585    3,658      13,431        12,578       9,837      6,006     22,326
1991..............................   35,708    3,781      14,341        13,824      10,242      6,339     23,747
1992 \4\..........................   38,014    3,928      15,294        14,205      10,827      7,592     25,259
1993..............................   39,265    3,755      15,727        14,636      10,877      8,126     26,226
1994..............................   38,059    3,663      15,289        14,380      10,196      8,416     25,379
1995..............................   36,425    3,318      14,665        14,205       9,872      8,574     24,423
1996..............................   36,529    3,428      14,463        13,796       9,694      8,697     24,650
----------------------------------------------------------------------------------------------------------------
\1\ All children including unrelated children.                                                                  
\2\ Does not include females living alone.                                                                      
\3\ Hispanic origin may be of any race; it is an overlapping category.                                          
\4\ For 1992, figures are based on 1990 Census population controls.                                             
                                                                                                                
NA--Not available.                                                                                              
                                                                                                                
Source: U.S. Bureau of the Census (1996).                                                                       


                TABLE H-4.--POVERTY RATES FOR INDIVIDUALS IN SELECTED DEMOGRAPHIC GROUPS, 1959-96               
----------------------------------------------------------------------------------------------------------------
                                                                       Individuals                              
                                                                       in female-             Hispanic          
                Year                  Overall    Aged   Children \1\     headed      Black   origin \3\   White 
                                                                      families \2\                              
----------------------------------------------------------------------------------------------------------------
1959................................     22.4     35.2        27.3           49.4      55.1         NA      18.1
1960................................     22.2       NA        26.9           48.9        NA         NA      17.8
1961................................     21.9       NA        25.6           48.1        NA         NA      17.4
1962................................     21.0       NA        25.0           50.3        NA         NA      16.4
1963................................     19.5       NA        23.1           47.7        NA         NA      15.3
1964................................     19.0       NA        23.0           44.4        NA         NA      14.9
1965................................     17.3       NA        21.0           46.0        NA         NA      13.3
1966................................     14.7     28.5        17.6           39.8      41.8         NA      11.3
1967................................     14.2     29.5        16.6           38.8      39.3         NA      11.0
1968................................     12.8     25.0        15.6           38.7      34.7         NA      10.0
1969................................     12.1     25.3        14.0           38.2      32.2         NA       9.5
1970................................     12.6     24.6        15.1           38.1      33.5         NA       9.9
1971................................     12.5     21.6        15.3           38.7      32.5         NA       9.9
1972................................     11.9     18.6        15.1           38.2      33.3       22.8       9.0
1973................................     11.1     16.3        14.4           37.5      31.4       21.9       8.4
1974................................     11.2     14.6        15.4           36.5      30.3       23.0       8.6
1975................................     12.3     15.3        17.1           37.5      31.3       26.9       9.7
1976................................     11.8     15.0        16.0           37.3      31.1       24.7       9.1
1977................................     11.6     14.1        16.2           36.2      31.3       22.4       8.9
1978................................     11.4     14.0        15.9           35.6      30.6       21.6       8.7
1979................................     11.7     15.2        16.4           34.9      31.0       21.8       9.0
1980................................     13.0     15.7        18.3           36.7      32.5       25.7      10.2
1981................................     14.0     15.3        20.0           38.7      34.2       26.5      11.1
1982................................     15.0     14.6        21.9           40.6      35.6       29.9      12.0
1983................................     15.2     13.8        22.3           40.2      35.7       28.0      12.1
1984................................     14.4     12.4        21.5           38.4      33.8       28.4      11.5
1985................................     14.0     12.6        20.7           37.6      31.3       29.0      11.4
1986................................     13.6     12.4        20.5           38.3      31.1       27.3      11.0
1987................................     13.4     12.5        20.3           38.1      32.4       28.1      10.4
1988................................     13.0     12.0        19.5           37.2      31.3       26.7      10.1
1989................................     12.8     11.4        19.6           35.9      30.7       26.2      10.0
1990................................     13.5     12.2        20.6           37.2      31.9       28.1      10.7
1991................................     14.2     12.4        21.8           39.7      32.7       28.7      11.3
1992 \4\............................     14.8     12.9        22.3           39.0      33.4       29.6      11.9
1993................................     15.1     12.2        22.7           38.7      33.1       30.6      12.2
1994................................     14.5     11.7        21.8           38.6      30.6       30.7      11.7
1995................................     13.8     10.5        20.8           36.5      29.3       30.3      11.2
1996................................     13.7     10.8        20.5           35.8      28.4       29.4      11.2
----------------------------------------------------------------------------------------------------------------
\1\ All children including unrelated children.                                                                  
\2\ Does not include females living alone.                                                                      
\3\ Hispanic origin may be of any race; it is an overlapping category.                                          
\4\ For 1992, figures are based on 1990 Census population controls.                                             
                                                                                                                
NA--Not available.                                                                                              
                                                                                                                
Source: U.S. Bureau of the Census (1996).                                                                       

    The poverty rate increased by 1975 to 12.3 percent, and 
then oscillated around 11.5 percent through 1979. After 1978, 
however, the poverty rate rose steadily reaching 15.2 percent 
in 1983. In 1996, the last year for which data are available, 
the poverty rate was 13.7 percent and 36.5 million people were 
poor.

 POVERTY RATES FOR INDIVIDUALS IN SELECTED SUBGROUPS OF THE POPULATION

    As table H-4 illustrates, there are substantial differences 
between the overall poverty rate and the poverty rates of 
individuals in certain demographic subgroups. Most notably, 
blacks, individuals in female-headed households, and Hispanics 
have poverty rates that greatly exceed the average. The poverty 
rates for individuals in female-headed households remained 
above 35 percent over the 1959-96 period. The poverty rate for 
all blacks and Hispanics has remained near 30 percent during 
the 1980s and mid 1990s. The poverty rate for the aged, which 
exceeded the overall poverty rate in 1959, fell below the 
overall poverty rate beginning in 1982. It was 10.8 percent in 
1996. The poverty rate for whites was below the overall poverty 
rate throughout the entire 1959-96 period. It was 11.2 percent 
in 1996. The poverty rate for children exceeds the average 
rate; it was 20.5 percent in 1996 (see chart H-1).

                CHART H-1. POVERTY RATES BY AGE: 1959-96





    Source: U.S. Bureau of the Census.

                     Poverty Rates for Families \2\
---------------------------------------------------------------------------

    \2\ Income figures reported in this subsection were from the March 
Current Population Survey (CPS) computer data tapes. There is a 
tendency in surveys, such as the CPS, for respondents to underreport 
their incomes by both source and amount. Reporting of income from 
earnings is usually more accurate than reporting of income from other 
sources. In general, CPS estimates of amounts or numbers of recipients 
of various cash and noncash transfer programs tend to be lower than 
administrative program totals. As a result, the data are a better 
reflection of general trends and patterns than of absolute numbers with 
income from a particular source, or the amount received. Unrelated 
subfamilies are included as families in this analysis. The Census 
Bureau excludes such families from its poverty counts.
---------------------------------------------------------------------------
    Table H-5 shows the composition of the poverty population 
for various demographic groups for selected years between 1959 
and 1996. Table H-6 presents poverty data for families and 
unrelated individuals (individuals living alone). Female-headed 
families with children and unrelated individuals are more 
likely to be poor than other families with children or families 
with aged members. In 1996, 42.3 percent of female-headed 
families with children were poor, compared with 8.5 percent of 
male-present families. Although only 6.4 percent of all 
families with an aged member were poor, 20.9 percent of all 
aged unrelated individuals were poor. About 20.7 percent of 
nonaged unrelated individuals were poor.

    Poverty Under Alternative Measures of Income and Price Inflation

    The Census Bureau publishes data that reflect two 
adjustments in the official definition of poverty. The first of 
these is an alternative inflation adjustment. The official 
poverty line is based on a procedure developed in 1965 with 
yearly adjustments for inflation using the Consumer Price Index 
(CPI). The Consumer Price Index, in turn, is based on the 
yearly change in prices of goods used by most Americans. Prior 
to 1983, the CPI measured housing prices using a procedure that 
included changes in the asset value of owned homes. Because the 
asset value of houses was growing so much faster than the 
consumption value, the inflation rate that included asset 
values was excessive.
    In 1983 the Bureau of Labor Statistics began using a rental 
equivalence approach to measure the value of housing. The 
official CPI-U inflation rate is based on the asset value of 
housing prior to 1983 and rental equivalence in 1983 and later. 
To provide a consistent time series, the Bureau constructed an 
experimental series, the CPI-U-X1, for 1967-82 based on rental 
equivalence.
    The general effect of using the CPI-U-X1 is to lower 
inflation in past years which in turn has the effect of 
lowering poverty thresholds for those years. A lower threshold 
means that fewer people are poor. As can be seen by comparing 
the first two columns in table H-7, adjusting the poverty 
threshold using the CPI-U-X1 reduced the official poverty rate 
by about 1.5 percentage points (11 percent or 4.0 million 
persons) in 1996.
    The second adjustment in the official poverty rate made by 
the Census Bureau is to expand the definition of income to take 
into account some noncash income, including government 
benefits. Under the procedures by which the official poverty 
rate is calculated, only cash, including government benefits, 
is counted in determining whether a family is poor; income from 
cash welfare programs counts, but benefits from food programs, 
medical care, social 

                       TABLE H-5.--COMPOSITION OF POVERTY POPULATION FOR SELECTED DEMOGRAPHIC GROUPS,\1\ SELECTED YEARS 1959-1996                       
                                                             [Percent of poverty population]                                                            
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                   Year                                                 
                Demographic group                -------------------------------------------------------------------------------------------------------
                                                   1959    1966    1975    1985    1987    1988    1989    1990    1991    1992    1993    1994    1996 
--------------------------------------------------------------------------------------------------------------------------------------------------------
Aged............................................    13.9    17.9    12.8    10.5    10.9    11.0    10.7    10.9    10.6    10.3     9.6     9.6     9.4
Children........................................    43.6    42.6    42.1    38.8    39.4    38.7    39.4    39.5    39.5    39.7    39.5    39.6    38.8
Nonaged adults..................................    42.5    39.5    45.1    50.7    49.7    50.3    49.9    49.7    49.9    49.9    50.9    50.8    51.8
Individuals in female-headed families \2\.......    26.3    36.0    47.4    49.5    52.6    52.9    52.4    53.4    54.0    52.6    52.4    52.8    53.5
Individuals in all other families \2\...........    73.7    64.0    52.6    50.5    47.4    47.1    47.6    46.6    46.0    47.4    47.6    47.2    46.5
Blacks..........................................    25.1    31.1    29.2    27.0    29.8    29.5    29.5    29.3    28.7    28.5    27.7    26.8    26.5
Whites..........................................    72.1    67.7    68.7    69.1    65.6    65.3    65.9    66.5    66.5    66.4    66.8    66.7    67.5
Other races.....................................     2.8     1.2     2.1     3.9     4.7     5.3     4.6     4.2     4.8     5.1     5.5     6.5     6.0
Hispanic origin \3\.............................      NA      NA    11.6    15.8    16.9    16.9    17.2    17.9    17.8    20.0    20.7    22.1    23.8
Individuals in families with children \4\.......      NA      NA      NA      NA      NA      NA    67.9    68.0    68.4    68.4    68.7    68.0    66.7
    Male present................................      NA      NA      NA      NA      NA      NA    31.3    30.7    30.3    31.4    32.0    31.2    30.1
    Female head.................................      NA      NA      NA      NA      NA      NA    36.6    37.2    38.1    37.0    36.7    36.9    36.5
Individuals in all other families...............      NA      NA      NA      NA      NA      NA    32.1    32.0    31.6    31.6    31.3    32.0    33.3
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Demographic data are for March of the following year.                                                                                               
\2\ Includes unrelated or single individuals.                                                                                                           
\3\ Hispanic origin may be of any race; therefore numbers add to more than 100 percent.                                                                 
\4\ Family includes related children under 18.                                                                                                          
                                                                                                                                                        
NA--Not available.                                                                                                                                      
                                                                                                                                                        
Note.--Estimates for 1987-94 are not comparable to prior years due to processing changes in the Current Population Survey.                              
                                                                                                                                                        
Source: Prepared by Congressional Research Service based on data from March Current Population Survey and U.S. Bureau of the Census (1996 and various   
  years).                                                                                                                                               


       TABLE H-6.--POVERTY RATES BY FAMILY TYPE, SELECTED YEARS 1987-96, AND PERCENTAGE OF FAMILIES AND UNRELATED INDIVIDUALS BY RATIO OF TOTAL INCOME TO POVERTY THRESHOLD, 1996 \1\ \2\       
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Poverty rate, 1987-96                             Ratio of total income to poverty threshold, 1996                       
                                                     -------------------------------------------------------------------------------------------------------------------------------- 1996 total
                     Family type                                                                                                                                               3.00       (in   
                                                       1987R   1988    1990    1991    1993    1994    1996    Under  0.50-0.99  1.00-1.24  1.25-1.49  1.50-1.99  2.00-2.99    and    thousands)
                                                                                                               0.50                                                            over             
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Total:                                                                                                                                                                                          
    Families........................................    11.0    10.8    11.1    11.8    12.7    12.0    11.3     4.5       6.8        4.0        4.3        9.2       17.8      53.4     70,855 
    Unrelated individuals...........................    20.4    20.6    20.7    21.1    22.1    21.5    20.8     8.3      12.4        7.5        6.5       12.1       17.3      35.9     40,727 
No members age 65 or over:                                                                                                                                                                      
    Families........................................    11.9    11.6    12.2    13.0    14.0    13.1    12.4     5.2       7.2        3.9        4.1        8.3       16.9      54.4     57,470 
    Unrelated individuals...........................    19.1    19.3    19.1    19.6    21.3    20.9    20.7    10.0      10.7        5.1        5.2       10.0       17.2      41.8     30,017 
Any member age 65 or over:                                                                                                                                                                      
    Families........................................     7.2     6.9     6.4     6.7     7.0     6.9     6.4     1.4       5.0        4.4        5.1       13.1       22.0      49.1     13,385 
    Unrelated individuals...........................    23.9    24.1    24.7    24.9    24.1    23.1    20.9     3.7      17.2       14.4       10.2       17.8       17.6      19.2     10,709 
Families with children:                                                                                                                                                                         
    Female headed family, no husband present........    46.3    45.5    45.3    47.6    46.7    44.6    42.3    20.8      21.5        8.6        7.5       12.6       15.7      13.3      9,444 
    Male present families...........................     8.1     7.7     8.5     9.0     9.9     9.3     8.5     2.5       6.0        3.9        4.5        9.9       20.8      52.5     28,354 
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Based on Census poverty levels.                                                                                                                                                             
\2\ Unrelated subfamilies are treated as separate families. Related subfamilies are not treated as separate families but as members of the family with whom they reside.                        
                                                                                                                                                                                                
Source: Prepared by Congressional Research Service based on March Current Population Survey for selected years.                                                                                 


              TABLE H-7.--POVERTY UNDER ALTERNATIVE MEASURES OF INCOME AND PRICE INFLATION, 1979-96             
----------------------------------------------------------------------------------------------------------------
                                                                Poverty rate             Percentage reduction in
                                                    ------------------------------------     official poverty   
                                                                                             associated with:   
                        Year                                                CPI-U-X1 w/ ------------------------
                                                      Official  Using CPI-    noncash                CPI-U-X1 w/
                                                      (CPI-U)      U-X1    benefits \1\   CPI-U-X1     noncash  
                                                                                                    benefits \1\
----------------------------------------------------------------------------------------------------------------
1979...............................................       11.7       10.6          7.9         9.4         32.5 
1980...............................................       13.0       11.5          8.6        11.5         33.8 
1981...............................................       14.0       12.2          9.8        12.9         30.0 
1982...............................................       15.0       13.2         10.6        12.0         29.3 
1983...............................................       15.2       13.7         11.0         9.9         27.6 
1984...............................................       14.4       12.8         10.4        11.1         27.8 
1985...............................................       14.0       12.5         10.1        10.7         27.9 
1986...............................................       13.6       12.2          9.8        10.3         27.9 
1987...............................................       13.4       12.0          9.5        10.4         29.1 
1988...............................................       13.0       11.7          9.5        10.0         26.9 
1989...............................................       12.8       11.4          8.9        10.9         30.5 
1990...............................................       13.5       12.1          9.5        10.4         29.6 
1991...............................................       14.2       12.7          9.9        10.6         30.3 
1992...............................................       14.8       13.4         10.5         9.5         29.1 
1993...............................................       15.1       13.7         10.7         9.3         29.1 
1994...............................................       14.5       13.2          9.8         9.0         29.7 
1995...............................................       13.8       12.3          9.0        10.9         34.8 
1996...............................................       13.7       12.2          8.9        10.9         35.0 
Percent change:                                                                                                 
    1979-89........................................        9.4        7.5         12.7          NA           NA 
    1979-96........................................       17.1       15.1         12.7          NA          NA  
----------------------------------------------------------------------------------------------------------------
\1\ Including income from capital gains, health insurance supplements to wage or salary income, non-means-tested
  and means-tested government cash transfers, other means-tested government noncash transfers, the value of     
  Medicare, the value of regular-price school lunches, the value of Medicaid, the earned income credit (EIC),   
  less Social Security payroll taxes, less Federal income taxes (excluding the EIC), less State income taxes.   
                                                                                                                
NA--Not available.                                                                                              
                                                                                                                
Source: U.S. Bureau of the Census (1996 and various years).                                                     

services, education and training, and housing are not included 
in the calculation. Moreover, because government spending on 
means-tested noncash benefits has increased more rapidly than 
spending on means-tested cash benefits over the years, ignoring 
noncash benefits may be an increasingly serious omission if we 
want a broad picture of the impact of government programs on 
poverty.
    The question of how to value noncash benefits raises a 
variety of substantive and technical issues. The Census Bureau 
has been working on these issues, consulting with academic 
experts, sponsoring conferences, and issuing technical reports. 
In 1992, the Bureau published a consistent historical data 
series, covering the years 1979-91, to trace the impact of 
variety of taxes and noncash benefits on poverty and income. 
The measurement of noncash benefits extended beyond government 
spending for the poor to include government spending programs 
such as Medicare that are not means tested as well as to 
employer contributions to employee health plans.
    To examine the impact on income and poverty of various 
State and Federal taxes, government noncash programs, employer-
provided benefits, and so forth, the Bureau has adopted a 
framework that includes 15 definitions of income. By comparing 
income under these multiple definitions, it is possible to 
estimate the impact of the various income sources on the 
average income and the poverty rates of individuals and 
families.
    Income definition 14 is of interest to those concerned with 
the impact of government means-tested, noncash benefits on 
poverty rates. Unlike the official poverty rate, which includes 
only cash government benefits, definition 14 includes the 
effects of State and Federal taxes, employer-provided benefits, 
non-means-tested government benefits, and means-tested noncash 
benefits including food stamps, housing, school lunch, and the 
fungible value of Medicaid.
    By comparing the official poverty rate with the definition 
14 poverty rate, we can determine the impact on poverty of 
noncash benefits and government taxes. The third column in 
table H-7 is the poverty rate for years 1979-96 based on 
definition 14 and using the CPI-U-X1 deflator. Compared with 
the rate based on CPI-U-X1 (column 2), including taxes and 
noncash benefits (and a few other types of income that have 
little impact on poverty) in the poverty calculation reduces 
the poverty rate in 1996 by 3.3 percentage points.
    The combined impact of using the CPI-U-X1 and including 
noncash benefits can be determined by comparing the poverty 
rate in column 3 with the official rate in column 1. On 
average, the two Census Bureau adjustments reduced the poverty 
rate by 4.8 percentage points or nearly 35 percent (12.8 
million persons) in 1996.
    The question of whether to include medical benefits when 
measuring poverty has great implications on poverty rates. The 
valuation of medical benefits is particularly difficult. 
Medical coverage should not by itself raise poor individuals 
above the poverty line or constitute a major portion of the 
poverty threshold. The development of the poverty thresholds 
did not take into account medical costs. Although poor persons 
are clearly better off with medical coverage, such benefits 
cannot be used by recipients to meet other needs of daily 
living. Also, since health insurance costs are not imputed to 
the incomes of those above poverty, it seems inappropriate to 
count health benefits as income for those below the poverty 
line.
    Table H-7 illustrates that regardless of what measure of 
income or which price inflator is used, the trend is the same: 
poverty has increased substantially over the last 15 years. 
Using the official CPI-U definition, the poverty rate increased 
by 17.1 percent between 1979 and 1996. Using the CPI-U-X1 
inflator and factoring in all noncash benefits (including 
health benefits), poverty has increased by 12.7 percent but at 
a lesser rate than the official measure.

                    Poverty by Metro Area and State

    Tables H-8 and H-9 present poverty rates for nonmetro and 
metro areas and by race in nonmetro and metro areas 
respectively. Table H-8 shows that poverty rates have increased 
in metro than in nonmetro areas (27.3 percent compared to 17.8 
percent, respectively, between 1978 and 1996). Table H-9 shows 
that poverty among blacks and Hispanics is much higher than 
rates among whites in metro areas, nonmetro areas, and inner 
cities. Table H-10 presents poverty rates by State for 1988-96, 
based on 3-year averages. The data are shown as 3-year averages 
due to poor statistical reliability of State poverty rates in a 
single year, resulting from small sample sizes.

     TABLE H-8.--POVERTY RATES IN NONMETRO AND METRO AREAS, 1978-96     
                          [Persons in percent]                          
------------------------------------------------------------------------
                                                             Metro      
                                                     -------------------
                   Year                     Nonmetro             Central
                                                        Total    cities 
                                                                  only  
------------------------------------------------------------------------
1978......................................      13.5      10.4      15.4
1979......................................      13.8      10.7      15.7
1980......................................      15.4      11.9      17.2
1981......................................      17.0      12.6      18.0
1982......................................      17.8      13.7      19.9
1983......................................      18.3      13.8      19.8
1984......................................        NA        NA        NA
1985......................................      18.3      12.7      19.0
1986......................................      18.1      12.3      18.0
1987......................................      17.0      12.3      18.3
1988......................................      16.0      12.2      18.1
1989......................................      15.7      12.0      18.1
1990......................................      16.3      12.7      19.0
1991......................................      16.1      13.7      20.2
1992 \1\..................................      16.9      14.2      20.9
1993......................................      17.2      14.6      21.5
1994......................................      16.0      14.2      20.9
1995......................................      15.6      13.4      20.6
1996......................................      15.9      13.2      19.6
Percent increase, 1978-96.................      17.8      26.9      27.3
------------------------------------------------------------------------
\1\ For 1992, figures are based on 1990 Census population controls.     
                                                                        
NA--Not available.                                                      
                                                                        
Source: U.S. Bureau of the Census (1996 and various years).             


   TABLE H-9.--PERCENTAGE OF PERSONS IN POVERTY BY RACE, BY METRO AND   
                        NONMETRO RESIDENCE, 1996                        
------------------------------------------------------------------------
                                                             Metro      
                                                     -------------------
                   Race                     Nonmetro             Central
                                                        Total    cities 
                                                                  only  
------------------------------------------------------------------------
All races.................................      15.9      13.2      19.6
White.....................................      13.5      10.6      15.7
Black.....................................      35.2      27.3      31.0
Hispanic \1\..............................      33.6      28.9      32.9
------------------------------------------------------------------------
\1\ Persons of Hispanic origin may be of any race.                      
                                                                        
Source: U.S. Bureau of the Census (1996).                               


                   TABLE H-10.--STATE POVERTY RATES: 3-YEAR AVERAGES, 1988-90 THROUGH 1994-96                   
----------------------------------------------------------------------------------------------------------------
                      State                        1988-90  1989-91  1990-92  1991-93  1992-94  1993-95  1994-96
----------------------------------------------------------------------------------------------------------------
Alabama..........................................     19.1     19.0     18.4     17.9     17.0     18.0     16.8
Alaska...........................................     11.0     11.2     11.1     10.4      9.8      8.8      8.5
Arizona..........................................     14.0     14.2     14.5     15.6     15.7     15.8     17.5
Arkansas.........................................     19.8     18.4     18.1     18.3     17.6     16.7     15.8
California.......................................     13.3     14.2     15.1     17.0     17.5     17.6     17.2
Colorado.........................................     12.8     12.1     11.6     10.4      9.9      9.2      9.5
Connecticut......................................      4.3      5.8      8.0      9.1      9.7      9.7     10.7
 Delaware........................................      8.5      8.1      7.3      8.6      8.8      9.6      9.1
 District of Columbia............................     18.1     19.2     20.0     21.8     22.6     23.3     22.5
Florida..........................................     13.5     14.1     15.0     16.4     16.1     16.3     15.1
Georgia..........................................     14.9     16.0     16.9     16.1     15.1     13.2     13.6
Hawaii...........................................     11.1     10.0      9.9      9.0      9.3      9.0     10.4
Idaho............................................     13.3     13.7     14.6     14.1     13.4     13.2     12.8
Illinois.........................................     13.0     13.3     14.2     14.3     13.9     12.8     12.3
Indiana..........................................     12.3     14.1     13.5     13.3     12.6     11.8     10.3
Iowa.............................................     10.0     10.1     10.4     10.5     10.8     11.1     10.8
Kansas...........................................      9.7     11.1     11.2     12.2     13.0     12.9     12.3
Kentucky.........................................     17.0     17.4     18.6     19.6     19.5     17.9     16.7
Louisiana........................................     23.2     22.0     22.3     23.4     25.5     23.9     22.0
Maine............................................     12.2     12.5     13.5     14.4     12.8     12.0     10.6
Maryland.........................................      9.6      9.3     10.2     10.3     10.7     10.2     10.4
Massachusetts....................................      9.3     10.2     10.6     10.8     10.2     10.5     10.3
Michigan.........................................     13.2     13.9     14.0     14.4     14.4     13.9     12.5
Minnesota........................................     11.6     12.0     12.6     12.6     12.1     10.8     10.2
Mississippi......................................     25.0     23.8     24.6     24.4     23.1     22.7     21.3
Missouri.........................................     12.9     13.6     14.6     15.6     15.8     13.7     11.5
Montana..........................................     15.5     15.8     15.1     14.7     13.4     13.9     14.6
Nebraska.........................................     11.1     10.9     10.0     10.2      9.9      9.6      9.5
Nevada...........................................      9.7     10.7     11.9     12.0     11.9     10.7     10.1
New Hampshire....................................      6.9      7.1      7.4      8.7      8.8      7.6      6.5
New Jersey.......................................      7.9      9.0      9.6     10.4     10.1      9.3      8.7
New Mexico.......................................     21.1     20.9     21.4     20.7     20.0     21.3     24.0
New York.........................................     13.4     14.1     15.0     15.9     16.4     16.6     16.7
North Carolina...................................     12.6     13.2     14.4     14.9     14.8     13.7     13.0
North Dakota.....................................     12.5     13.5     13.4     12.7     11.2     11.2     11.1
Ohio.............................................     11.5     11.8     12.4     13.0     13.2     12.9     12.8
Oklahoma.........................................     15.9     15.8     17.0     18.6     18.5     17.9     16.8
Oregon...........................................     10.3     11.3     11.3     12.3     11.7     11.6     11.6
Pennsylvania.....................................     10.6     10.8     11.2     12.1     12.5     12.6     12.1
Rhode Island.....................................      8.0      8.2     10.0     11.4     11.3     10.7     10.6
South Carolina...................................     16.2     16.5     17.2     18.1     17.2     17.5     15.6
South Dakota.....................................     13.6     13.5     14.0     14.5     14.6     14.4     13.6
Tennessee........................................     17.8     16.9     16.5     17.4     17.1     16.6     15.3
Texas............................................     17.0     16.8     17.1     17.9     18.3     18.0     17.7
Utah.............................................      8.7      9.8     10.1     11.0      9.4      9.0      8.0
Vermont..........................................      9.0     10.5     11.3     11.1      9.4      9.3     10.2
Virginia.........................................     10.9     10.6     10.1      9.7     10.0     10.2     11.1
Washington.......................................      9.1      9.3      9.8     11.0     11.7     12.1     12.0
West Virginia....................................     17.2     17.2     19.4     20.8     21.0     19.2     17.9
Wisconsin........................................      8.5      9.2     10.0     11.2     10.8     10.0      8.8
Wyoming..........................................     10.5     10.6     10.4     11.2     11.0     11.6     11.1
                                                  --------------------------------------------------------------
    U.S. total...................................     13.1     13.5     14.1     14.8     14.5     14.5    14.0 
----------------------------------------------------------------------------------------------------------------
Source: U.S. Bureau of the Census (1996).                                                                       

                   TRENDS IN FAMILY INCOMES, 1967-94

    In the past 25 years, the level of and inequality among 
family incomes has changed significantly according to all 
income measures. Between 1967 and 1973, income increased for 
all quintiles, and income inequality went down. As measured by 
the Congressional Budget Office, over this time period, the 
lowest quintile experienced an increase in mean adjusted family 
income (family income divided by the poverty threshold for the 
appropriate family size) of 30 percent, while income for the 
highest quintile grew by 21 percent. Since, 1973, however, the 
trend has been markedly different. Income of the bottom 
quintile has declined, while the income for the highest 
quintile has risen.
    While the general trends in families' economic well-being 
are similar regardless of how measured, varying results for the 
distribution of family incomes are obtained depending on which 
income measure is used. Three commonly used income measures 
(all adjusted for inflation) are family cash income, family 
cash income per capita, and adjusted family income. While no 
measure perfectly captures the economic well-being of families, 
adjusted family income most accurately accounts for differences 
in family size by incorporating the scale implicit in the 
official Federal poverty thresholds.
    Family composition in the United States has undergone 
pronounced changes over the past two decades, as the number of 
families grew almost twice as fast as the population between 
1973 and 1994. \3\ The growth in families reflects very 
different trends among particular types of families (see table 
H-11). The number of married couples with children, for 
example, fell almost 2 percent between 1973 and 1989 before 
rising by 3 percent between 1989 and 1994. In contrast, the 
number of families headed by a single mother grew by 102 
percent over the entire 1973-94 period.
---------------------------------------------------------------------------
    \3\ In contrast to some measures of income from the Bureau of the 
Census, this analysis treats unrelated individuals as one-person 
families. Family types are defined in detail below.
---------------------------------------------------------------------------
    Changes in family composition are also reflected in the 
number of persons and earners per family. The average family 
has become smaller, reflecting in part relatively fewer 
families with children (and fewer children in those families). 
The average family also had fewer earners in 1994 than in 1973.
    Total family cash income grew over 50 percent in real terms 
between 1973 and 1989, before falling slightly as the recession 
that began in 1990 took hold. The real income of the average 
family rose during this period as well, but the magnitude and 
timing of the increase depends on the income measure used. For 
example, family cash income rose about 9 percent between 1973 
and 1989, on average, with virtually all of the increase taking 
place between 1979 and 1989. In contrast, average pretax 
adjusted family income (AFI)--which takes into account changes 
in family size--rose about 20 percent, with the annual increase 
about equally divided between the two time periods shown. The 
larger increase in AFI reflects in part a decrease in average 
family size.

                        Definitions and Methods

    Analyzing trends in the distribution of family incomes over 
time requires making decisions about a number of variables: How 
should variation in incomes be measured? What is the 
appropriate timeframe over which to look at changes? How should 
inflation be taken into account? And, finally, what is the 
appropriate measure of income to use?

Measuring variation

    Most of the data in this section are presented for income 
quintiles, each of which represents one-fifth of the income 
distribution (either families or persons, as indicated). 
Quintiles are calculated by ordering all relevant family units 
from that with the lowest income to that with the highest. For 
the analysis of changes in incomes among different types of 
families, quintiles are defined separately for each family 
type.
    The analysis of changes in the distribution of family 
incomes over time is done by looking at average incomes, 
adjusted for inflation, by income quintile for specific types 
of families.

Timeframe

    Most of the analysis focuses on data for 4 years: 1967, 
1973, 1979, and 1989. Those years reflect peaks in the business 
cycle, and allow comparisons to be made across time periods in 
which general economic conditions were similar. Information is 
also presented for 1994.

           TABLE H-11.--CHANGES IN POPULATION, FAMILY COMPOSITION, AND INCOME, SELECTED YEARS 1973-94           
----------------------------------------------------------------------------------------------------------------
                                                           Year                            Percent change       
             Family group              -------------------------------------------------------------------------
                                           1973       1979       1989       1994     1973-89   1979-89   1989-94
----------------------------------------------------------------------------------------------------------------
    A. Distribution of families and                                                                             
        persons by family type                                                                                  
                                                                                                                
Number of families (in thousands).....     73,166     84,229    101,663    108,522      38.9      20.7       6.7
                                       -------------------------------------------------------------------------
    Families with children............     31,098     32,166     34,768     37,413      11.8       8.1       7.6
        Married couples with children.     24,798     24,166     24,378     25,079      -1.7       0.9       2.9
        Single mothers with children..      4,126      5,650      7,123      8,351      72.6      26.1      17.2
    Nonelderly childless units \1\....     28,183     35,730     46,467     49,580      64.9      30.1       6.7
    Elderly childless units \2\.......     13,884     16,331     20,428     21,530      47.1      25.1       5.4
                                       =========================================================================
Number of persons in different family                                                                           
 types (in thousands).................    207,525    217,718    245,846    261,614      18.5      12.9       6.4
                                       -------------------------------------------------------------------------
    Families with children............    134,248    130,426    135,381    145,814       0.8       3.8       7.7
        Married couples with children.    108,976    101,318     99,471    103,043      -8.7      -1.8       3.6
        Single mothers with children..     14,240     18,132     21,504     25,372      51.0      18.6      18.0
    Nonelderly childless units \1\....     50,148     60,514     77,025     80,323      53.6      27.3       4.3
    Elderly childless units \2\.......     23,129     26,778     33,440     35,477      44.6      24.9       6.1
                                       =========================================================================
 B. Size, age composition, and number                                                                           
      of earners for all families                                                                               
                                                                                                                
Average number of persons per family:                                                                           
      Total...........................       2.87       2.59       2.42       2.41     -16.4      -6.6      -0.3
                                       -------------------------------------------------------------------------
    Under 18..........................       0.94       0.75       0.63       0.65     -31.9     -16.1       2.5
    18 to 64..........................       1.64       1.55       1.50       1.48     -10.1      -3.4      -1.4
    65 and older......................       0.30       0.28       0.29       0.29      -1.9       3.9      -0.9
                                       =========================================================================
Average number of earners per family:                                                                           
      Total...........................       1.39       1.34       1.27       1.24      -6.9      -5.2      -2.0
                                       -------------------------------------------------------------------------
    Male earners......................       0.81       0.75       0.69       0.67     -15.3      -8.5      -3.0
    Female earners....................       0.57       0.59       0.58       0.58       5.2      -1.1      -0.7
                                       =========================================================================
 C. Income trends for all families, by                                                                          
            income measure                                                                                      
                                                                                                                
Income measure (in 1989 dollars):                                                                               
    Total family cash income                                                                                    
     (billions).......................      2,220      2,591      3,353      3,402      51.0      29.4       1.5
    Mean family cash income...........     30,341     30,764     32,978     31,346       8.7       7.2      -5.0
    Mean family cash income per capita                                                                          
     \3\..............................     10,718     11,922     13,743     13,003      28.2      15.3      -4.7
    Adjusted pretax income \4\........     19,096     20,592     23,025     22,004      20.6      11.8      -4.3
    Adjusted posttax income \5\.......         NA     17,404     19,424     18,707        NA      11.6      -3.5
        High adult male earner........         NA     12,044     12,189     11,253        NA       1.2      -7.6
        High adult female earner......         NA      4,111      5,633      5,896        NA      37.0       4.8
        Other earners in family.......         NA        923        894        710        NA      -3.1     -19.2
        Other private income..........         NA      2,021      2,700      2,388        NA      33.6     -13.0
        Cash transfer income (non-                                                                              
         means tested)................         NA      1,190      1,429      1,548        NA      20.0      12.5
        Cash transfer income (means                                                                             
         tested)......................         NA        302        180        208        NA     -40.4      15.4
        Noncash transfer income.......         NA        145        139        179        NA      -4.0      26.2
        Taxes.........................         NA     -3,333     -3,740     -3,475        NA      12.2      -7.0
----------------------------------------------------------------------------------------------------------------
\1\ Families in which both the head and spouse are under age 65 and there are no children under 18, and         
  unrelated individuals under age 65.                                                                           
\2\ Families in which either the head or spouse of head is 65 or older and there are no children under 18, and  
  unrelated individuals 65 and older.                                                                           
\3\ Family cash income divided by the number of persons in the family.                                          
\4\ Pretax AFl (adjusted family income) is pretax family income divided by the poverty threshold. Thresholds are
  based on the 1989 distribution of family sizes, with no adjustment for the age of the head of household or the
  number of children. In this table only, pretax AFl is expressed in dollars by multiplying adjusted family     
  income by the one-person poverty threshold.                                                                   
\5\ Posttax AFl (adjusted family income) is posttax family income, plus the cash value of noncash food and      
  housing benefits, divided by the poverty threshold. Thresholds are based on the 1989 distribution of family   
  sizes, with no adjustment for the age of the head of household or the number of children. In this table only, 
  posttax AFl is expressed is expressed in dollars by multiplying adjusted family income by the one-person      
  poverty threshold.                                                                                            
                                                                                                                
NA--Not available.                                                                                              
                                                                                                                
Source: Congressional Budget Office based on Current Population Survey data.                                    

    Data for more recent years are not presented here because 
they are not fully comparable with those for earlier years. 
Income data provided by the Census Bureau to researchers 
outside that agency frequently are limited in certain areas 
both to protect confidentiality and to reduce the impact of 
reporting and coding errors on statistical calculations. 
Beginning with information for 1995, the Census Bureau 
substantially increased the maximum earnings it reports for 
individuals on public-use computer files. As a result, for some 
survey respondents, changes in income between 1995 or 1996 and 
earlier years can be due to actual changes in economic 
resources, to changes in the way their income is coded, or 
both. While alternative ways of presenting data for various 
years are explored, this section limits the comparisons to 
1994, the last year for which the former coding technique was 
used.

Adjustment for inflation

    To examine changes in family income over time, the dollar 
amounts must be adjusted for inflation to compare actual buying 
power. Adjustment for inflation is done here using the CPI-U-
X1, \4\ a revised version of the official Consumer Price Index 
that provides a consistent treatment of the costs of home 
ownership over the years examined. The CPI-U-X1 is an index of 
the cost of a market basket of goods and services representing 
the average consumption of the urban population.
---------------------------------------------------------------------------
    \4\ The official CPI is viewed by many analysts as having 
overstated the growth in housing costs during the late 1970s. Prior to 
1983, the housing component of the CPI reflected both the flow of 
services and the investment aspects of home ownership; only the former 
is appropriate in an index measuring consumption costs. Since 1983, the 
Bureau of Labor Statistics (BLS) has used a rental-equivalence measure 
incorporating the consumption aspects of owning a home, not the 
investment aspects. The CPI-U-X1 series is used to calculate what the 
CPI would be had the rental-equivalence measure been in place since 
1967. The BLS recommends using the CPI-U-X1 when a consistent treatment 
of homeowner costs is desired. See U.S. Bureau of the Census (1993, 
Appendixes A and B).
---------------------------------------------------------------------------

                             Income Measure

    The purpose of looking at the distribution of family 
incomes over time is to analyze changes in family economic 
well-being. Two important issues in choosing an appropriate 
income measure are how to adjust for differences in family size 
and what to include as income.
    One measure is real family cash income, which is the sum of 
wage, salary, and self-employment earnings, private pension and 
retirement income, interest and dividends, and government cash 
transfers received by each family member. By this measure, 
which takes inflation into account but not changes in family 
size, noncash transfers, or taxes, the average income of 
families increased 8.7 percent between 1973 and 1989, with most 
of the growth occurring between 1979 and 1989 (see panel A of 
table H-12). Family cash income also shows different trends 
among income quintiles: the average income of the lowest 
quintile fell 3.2 percent between 1973 and 1989, whereas the 
average income of the highest quintile rose 17.1 percent. 
Similarly, the decline in family income after 1989 was greater 
for families in the bottom quintiles.

TABLE H-12.--ALTERNATIVE MEASURES OF FAMILY INCOME BY INCOME QUINTILE AND CHANGE OVER TIME, SELECTED YEARS 1967-
                                               94 FOR ALL FAMILIES                                              
                                                [In 1989 dollars]                                               
----------------------------------------------------------------------------------------------------------------
                                                              Year                           Percent change     
       Income measure and quintile        ----------------------------------------------------------------------
                                            1967     1973     1979     1989     1994   1973-89  1979-89  1989-94
----------------------------------------------------------------------------------------------------------------
          I. Pretax cash income                                                                                 
                                                                                                                
A. Mean family cash income (family                                                                              
 weighted):                                                                                                     
    Lowest...............................      NA   $6,061   $5,994   $5,866   $5,194     -3.2     -2.1    -11.5
    Second...............................      NA   15,416   15,306   15,107   13,729     -2.0     -1.3     -9.1
    Middle...............................      NA   25,909   25,609   25,823   23,886     -0.3      0.8     -7.5
    Fourth...............................      NA   37,946   38,680   40,374   38,493      6.4      4.4     -4.7
    Highest..............................      NA   66,364   68,230   77,716   75,434     17.1     13.9     -2.9
                                          ----------------------------------------------------------------------
      Total..............................      NA   30,341   30,764   32,978   31,347      8.7      7.2     -4.9
                                          ======================================================================
B. Mean adjusted family income (person                                                                          
 weighted): \1\                                                                                                 
    Lowest...............................   $0.69     0.90     0.90     0.86     0.77     -4.3     -4.3    -11.0
    Second...............................    1.54     1.94     2.06     2.09     1.93      7.7      1.3     -7.3
    Middle...............................    2.26     2.82     3.07     3.27     3.10     16.0      6.7     -5.4
    Fourth...............................    3.16     3.94     4.32     4.77     4.61     20.9     10.5     -3.3
    Highest..............................    5.67     6.87     7.39     8.84     8.57     28.7     19.6     -3.0
                                          ----------------------------------------------------------------------
      Total..............................    2.66     3.29     3.55     3.97     3.80     20.4     11.8     -4.3
                                          ======================================================================
C. Mean family income per capita (person                                                                        
 weighted): \2\                                                                                                 
    Lowest...............................      NA    2,795    2,912    2,822    2,443      1.0     -3.1    -12.7
    Second...............................      NA    5,906    6,535    6,872    6,319     16.4      5.2     -7.3
    Middle...............................      NA    8,628    9,713   10,723   10,083     24.3     10.4     -5.1
    Fourth...............................      NA   12,386   14,046   16,058   15,262     29.6     14.3     -4.1
    Highest..............................      NA   23,875   26,405   32,237   30,907     35.0     22.1     -3.5
                                          ----------------------------------------------------------------------
      Total..............................      NA   10,718   11,922   13,743   13,003     28.2     15.3     -4.7
                                          ======================================================================
 II. Posttax income plus food and housing                                                                       
                 benefits                                                                                       
                                                                                                                
D. Mean adjusted family income \3\                                                                              
 (person weighted): \1\                                                                                         
    Lowest...............................      NA       NA     0.96     0.93     0.89       NA     -2.1     -4.7
    Second...............................      NA       NA     1.89     1.90     1.81       NA      0.5     -4.8
    Middle...............................      NA       NA     2.67     2.84     2.72       NA      6.4     -4.5
    Fourth...............................      NA       NA     3.63     4.01     3.90       NA     10.6     -2.8
    Highest..............................      NA       NA     5.85     7.04     6.82       NA     20.4     -3.1
                                          ----------------------------------------------------------------------
      Total..............................      NA       NA     3.00     3.35     3.23       NA     11.6     -3.5
----------------------------------------------------------------------------------------------------------------
\1\ Family income divided by the poverty threshold. Thresholds are based on the 1989 distribution of family     
  sizes, with no adjustment for the age of the head of household or the number of children.                     
\2\ Total family income divided by the number of persons in the family.                                         
\3\ Posttax income plus food and housing benefits.                                                              
                                                                                                                
NA--Not available.                                                                                              
                                                                                                                
Source: Congressional Budget Office tabulations of data from the March Current Population Survey, 1968, 1974,   
  1980, 1990, and 1995.                                                                                         

    Family cash income has several shortcomings as a measure of 
changes in economic well-being. Most notably, it fails to take 
into account changes in family size and composition: a family 
of one; i.e., a person living alone, with $30,000 in income is 
treated as being as well off as a family of four with $30,000 
in income. This assumption is inappropriate, however, as a 
family of four requires more income to attain the same standard 
of living as a single person.
    An alternative approach is to measure income on a per 
capita basis, by dividing total family income by the number of 
persons in the family. Using family cash income per capita 
yields quite different results (see panel C of table H-12). The 
growth in average per capita income between 1973 and 1989 is 
much larger than the growth in average family cash income: 28.2 
percent, compared with 8.7 percent. Moreover, average cash 
income per capita rose for each quintile between 1973 and 1989, 
whereas average family cash income rose only for the top two 
quintiles. Both measures, however, show a decline in family 
income between 1989 and 1994.
    In contrast to family cash income, which completely ignores 
differences in family size, using per capita family income as a 
measure of well-being assumes that a family of four requires 
exactly four times as much as a single person to attain the 
same standard of living. But four persons living together would 
generally require less than four times as much income because 
of the economies of scale reaped from increased family size. 
(For example, families with more children might require more 
bedrooms, but not more kitchens.) A measure that reflects such 
economies of scale would therefore provide a better method of 
taking family size into account.
    Analysts disagree over the best method of making incomes 
comparable for families of different size, but one readily 
available candidate is the scale implicit in the official 
Federal poverty thresholds. This scale assumes, for example, 
that a family of four needs about twice as much income as a 
single person to attain an equivalent standard of living (see 
table H-13). The equivalence scale implicit in the poverty 
thresholds may not perfectly capture the disparate needs of 
families of different sizes, but it probably yields a better 
assessment of relative economic well-being than making no 
adjustment (mean family cash income) or assuming no economies 
of scale (mean family cash income per capita).
    The adjusted family income (AFI) measure shown in panel B 
of table H-12 incorporates the equivalence scale underlying the 
poverty thresholds. Each family's pretax cash income is divided 
by its poverty threshold, yielding family income as a multiple 
of poverty. Thus, for example, the average family in the middle 
quintile in 1994 had an income of 3.10 times its poverty 
threshold. \5\
---------------------------------------------------------------------------
    \5\ Poverty thresholds for one- and two-person families in this 
section do not vary by the age of the family head. The 1989 weighted 
averages are adjusted for inflation using the CPI-U-X1.
---------------------------------------------------------------------------
    Adjusting for family size yields results that are generally 
intermediate to those obtained for the family cash income and 
family cash income per capita measures. Between 1967 and 1973, 
income increased significantly for all quintiles, by 23 percent 
for the lowest quintile. On average, pretax AFI increased 20.4 
percent between 1973 and 1989, with a 4.3 percent decline for 
the lowest quintile and a 28.7-percent increase for the highest 
quintile. AFI decreased for all quintiles between 1989 and 1994 
(see chart H-2).

  TABLE H-13.--POVERTY THRESHOLDS AND EQUIVALENCE VALUES FOR DIFFERENT  
                           FAMILY SIZES, 1994                           
------------------------------------------------------------------------
                                                             Equivalence
                                        Official   Adjusted   value (one
        Family size (persons)           poverty    poverty     person = 
                                       threshold  threshold     1.00)   
------------------------------------------------------------------------
1....................................     $7,547     $6,928        1.00 
2....................................      9,661      8,867        1.28 
3....................................     11,812     10,853        1.57 
4....................................     15,141     13,916        2.01 
5....................................     17,900     16,457        2.37 
6....................................     20,235     18,587        2.68 
7....................................     22,923     21,038        3.04 
8....................................     25,427     23,416        3.37 
9 or more............................     30,300     27,975        4.01 
------------------------------------------------------------------------
Note.--Poverty thresholds shown for one- and two-person families are a  
  weighted average of the separate official thresholds for elderly and  
  nonelderly individuals and families. Adjusted poverty thresholds are  
  computed using the CPI-U-X1 to adjust for inflation. The official     
  poverty threshold is adjusted for inflation using the CPI.            
                                                                        
                                                                        
Source: Congressional Budget Office.                                    

CHART H-2. RATIO OF AVERAGE ADJUSTED FAMILY INCOME OF HIGHEST QUINTILE 
             TO AVERAGE INCOME OF LOWEST QUINTILE, 1967-94





    Source: Congressional Budget Office.
    It must be remembered that there is no adjustment in these 
analyses for labor inputs. For example, if mean income 
increases by 10 percent over a given time period while family 
work hours also increase by 10 percent, the family's overall 
economic well-being may be qualitatively different than a 10-
percent increase in income would suggest. Work expenses may 
have increased by an even larger amount, particularly if more 
family members are working, and leisure time would have 
decreased.

                 Adjusting for Noncash Income and Taxes

    A family's economic well-being is determined not only by 
its pretax cash income, but also by the amount of any noncash 
income it receives. Analyses that ignore noncash benefits--
whether received from employers in the form of fringe benefits 
or through social welfare transfer programs--understate how 
well-off families are. The understatement has grown over time, 
moreover, because in-kind income has increased as a share of 
personal income. Employer-provided benefits increased from 
about 7 percent of wages and salaries in 1973 to 10 percent in 
1989. Adjusted for inflation and population growth, spending on 
the major government noncash transfer programs--food stamps, 
public housing, Medicare, and Medicaid--almost tripled over the 
same period.
    Whereas the omission of noncash income understates economic 
well-being for most families, pretax measures of income 
overstate it. Both income and payroll taxes reduce disposable 
income, so that posttax income provides a better measure of the 
resources available to families at any point in time. Taking 
taxes into account is especially important for assessing income 
trends over time because Social Security tax rates increased by 
almost 30 percent, and the amount of annual earnings subject to 
the tax increased by nearly 70 percent in real terms between 
1973 and 1989. And although individual income taxes as a share 
of income have been relatively constant, the share varies 
widely across income quintiles.
    The income measure shown in panel D of table H-12 shows 
posttax AFI, plus the estimated cash value of food and housing 
benefits, for 1979, 1989, and 1994. \6\ Food benefits reflect 
the value of food stamps and school lunches; housing benefits 
reflect subsidized public housing; and taxes include Federal 
income and payroll taxes, but not State income taxes. Being 
more comprehensive, posttax AFI is a better indicator of 
economic well-being than pretax AFI, and is used extensively in 
this study. \7\
---------------------------------------------------------------------------
    \6\ Data on noncash transfers are available only for 1979 and later 
years, as the Bureau of the Census did not collect this information 
until then. Similar information about the value of Medicaid and 
Medicare is also available, but the family-level data needed to 
allocate employer-provided health insurance benefits are not. The value 
of Medicaid and Medicare benefits is therefore excluded to avoid 
skewing the distribution of income toward low-income families.
    \7\ Unless stated otherwise, posttax AFI always includes the cash 
value of noncash food and housing benefits.
---------------------------------------------------------------------------
    There are interesting differences in the measurement of 
family income provided by pretax AFI (panel B) as compared with 
posttax AFI (panel D). The most notable difference between the 
two measures is in their levels: average posttax AFI (0.89) was 
about 16 percent higher than average pretax AFI (0.77) for the 
lowest quintile in 1994, but about 20 percent lower for the 
highest quintile (6.82 versus 8.57). The difference in the two 
measures reflects the addition of food and housing benefits to 
the incomes of families in the lowest quintile and the 
subtraction of taxes from incomes of families in the highest 
quintile.

                             Income Shares

    Another way of tracking income trends is to look at changes 
in the percentage share of income received by families in each 
quintile. Income shares measure whether families have gained or 
lost in relative terms. That is, a given quintile may receive a 
smaller share of real income even as its average income has 
increased.
    All four income measures show broadly similar trends in the 
share of income received by each quintile (see table H-14). In 
general, between 1973 and 1994, the shares of the lowest three 
quintiles fell, and the share of the top quintile rose. 
However, pretax family cash income (family weighted) of the 
fourth quintile declined slightly over the period, and the 
posttax adjusted family income of the fourth quintile remained 
constant over the 1979-94 period for which data is available. 
The measures show different patterns of shares at any point in 
time, however. In 1994, for example, the share of the top 
quintile was 48.1 percent when measured as family cash income, 
compared with 42.3 percent when measured as posttax AFI.

            TRENDS IN PRETAX CASH INCOMES BY TYPE OF FAMILY

    The composition of the typical family has changed over 
time. Compared with 1973 and 1979, there were fewer persons in 
each family in 1994, on average, and married couples with 
children made up a smaller fraction of all families (see table 
H-15). Additional insights can therefore be gained by looking 
at changes in incomes for specific family types. This analysis 
distinguishes six types of family units:
 1. Married couples with children, which are families composed 
        of a married couple living only with their own or 
        related children, at least one of whom is under age 18;
 2. Single mothers with children, which are families composed 
        of unmarried, divorced, separated, or widowed mothers 
        living only with their own or related children, at 
        least one of whom is under age 18;
 3. Nonelderly childless families, which are families composed 
        of two or more related people living together, in which 
        the family head and the spouse of the head are both 
        under age 65 and there are no children under age 18;
 4. Nonelderly unrelated individuals, which are people over age 
        17 and under age 65 who are not living with relatives;
 5. Elderly childless families, which are families composed of 
        two or more related people living together, in which 
        either the family head or the spouse of the head is 65 
        or older and there are no children under age 18; and
 6. Elderly unrelated individuals, which are people 65 or older 
        who are not living with relatives.

  TABLE H-14.--SHARES OF FAMILY INCOME BY INCOME QUINTILE FOR SELECTED  
                     YEARS 1967-94 FOR ALL FAMILIES                     
                              [In percent]                              
------------------------------------------------------------------------
                                                   Year                 
   Income measure and quintile   ---------------------------------------
                                   1967    1973    1979    1989    1994 
------------------------------------------------------------------------
      I. Pretax cash income                                             
                                                                        
A. Family cash income (family                                           
 weighted):                                                             
    Lowest......................      NA     4.0     3.9     3.6     3.3
    Second......................      NA    10.2    10.0     9.2     8.8
    Middle......................      NA    17.1    16.6    15.7    15.2
    Fourth......................      NA    25.0    25.1    24.5    24.6
    Highest.....................      NA    43.7    44.4    47.1    48.1
B. Adjusted family income (AFI)                                         
 (person weighted): \1\                                                 
    Lowest......................     5.2     5.5     5.1     4.3     4.0
    Second......................    11.6    11.8    11.6    10.5    10.2
    Middle......................    16.9    17.1    17.3    16.5    16.3
    Fourth......................    23.7    23.9    24.3    24.0    24.3
    Highest.....................    42.6    41.7    41.7    44.6    45.2
C. Family cash income per capita                                        
 (person weighted): \2\                                                 
    Lowest......................      NA     5.2     4.9     4.1     3.8
    Second......................      NA    11.0    11.0    10.0     9.7
    Middle......................      NA    16.1    16.3    15.6    15.5
    Fourth......................      NA    23.1    23.6    23.4    23.5
    Highest.....................      NA    44.6    44.3    46.9    47.5
                                                                        
II. Posttax income plus food and                                        
        housing benefits                                                
                                                                        
D. Adjusted family income (AFI)                                         
 (person weighted): \1\                                                 
    Lowest......................      NA      NA     6.4     5.6     5.5
    Second......................      NA      NA    12.6    11.4    11.2
    Middle......................      NA      NA    17.8    17.0    16.8
    Fourth......................      NA      NA    24.2    24.0    24.2
    Highest.....................      NA      NA    39.0    42.1    42.3
------------------------------------------------------------------------
\1\ Family income divided by the poverty threshold. Thresholds are based
  on the 1989 distribution of family sizes, with no adjustment for the  
  age of the head of household or the number of children.               
\2\ Total family income divided by the number of persons in the family. 
                                                                        
Source: Congressional Budget Office tabulations of data from the March  
  Current Population Survey, 1968, 1974, 1980, 1990, and 1995.          

    In addition, results are also presented for four 
aggregates:
 1. All families with children, which comprises married 
        couples, single mothers, and other families with 
        children;
 2. Nonelderly childless units, which comprises nonelderly 
        childlessfamilies and nonelderly unrelated individuals;
 3. Elderly childless units, which comprises elderly childless 
        families and elderly unrelated individuals; and
 4. All families, which comprises all families and unrelated 
        individuals (i.e., the noninstitutional U.S. 
        population).

 TABLE H-15.--AVERAGE FAMILY SIZE AND NUMBER OF FAMILIES, \1\ BY FAMILY 
           TYPE, WEIGHTED BY FAMILIES, SELECTED YEARS 1973-94           
------------------------------------------------------------------------
                                                 Number of              
       Family type and year        Persons per    families    Percent of
                                      family    (thousands)    families 
------------------------------------------------------------------------
All families: \1\                                                       
    1973.........................         2.84       73,166        100.0
    1979.........................         2.59       84,229        100.0
    1989.........................         2.42      101,663        100.0
    1994.........................         2.41      108,522        100.0
                                                                        
All families with children:                                             
    1973.........................         4.35       31,098         42.5
    1979.........................         4.09       32,166         38.2
    1989.........................         3.89       34,768         34.2
    1994.........................         3.90       37,413         34.5
                                                                        
Married couples with children                                           
    1973.........................         4.42       24,798         33.9
    1979.........................         4.23       24,166         28.7
    1989.........................         4.08       24,378         24.0
    1994.........................         4.11       25,079         23.1
                                                                        
Single mothers with children:                                           
    1973.........................         3.50        4,126          5.6
    1979.........................         3.24        5,650          6.7
    1989.........................         3.02        7,123          7.0
    1994.........................         3.04        8,351          7.7
                                                                        
Nonelderly childless units:                                             
    1973.........................         1.76       28,183         38.5
    1979.........................         1.68       35,730         42.4
    1989.........................         1.66       46,467         45.7
    1994.........................         1.62       49,580         45.7
                                                                        
Nonelderly childless families:                                          
    1973.........................         2.32       16,363         22.4
    1979.........................         2.35       17,931         21.3
    1989.........................         2.44       21,257         20.9
    1994.........................         2.43       21,473         19.8
                                                                        
Nonelderly unrelated individuals:                                       
    1973.........................         1.00       11,820         16.2
    1979.........................         1.00       17,799         21.1
    1989.........................         1.00       25,210         24.8
    1994.........................         1.00       28,106         25.9
                                                                        
Elderly childless units:                                                
    1973.........................         1.64       13,884         19.0
    1979.........................         1.62       16,331         19.4
    1989.........................         1.64       20,428         20.1
    1994.........................         1.65       21,530         19.8
                                                                        
Elderly childless families:                                             
    1973.........................         2.17        7,590         10.4
    1979.........................         2.16        8,676         10.3
    1989.........................         2.23       10,600         10.4
    1994.........................         2.26       11,100         10.2
                                                                        
Elderly unrelated individuals:                                          
    1973.........................         1.00        6,294          8.6
    1979.........................         1.00        7,655          9.1
    1989.........................         1.00        9,828          9.7
    1994.........................         1.00       10,430          9.6
------------------------------------------------------------------------
\1\ Corresponds more closely to Census definition of household. Includes
  families of one person.                                               
                                                                        
Source: Congressional Budget Office tabulations of data from the March  
  Current Population Survey, 1974, 1980, 1990 and 1995.                 

    Unless otherwise noted, the analysis of changes in income 
for each family type listed above is based on quintiles 
computed for that family type. This procedure permits 
comparisons within, but not across, family types; the quintile 
in which a particular family is found says nothing about its 
place among all families, but measures its position in relation 
to families of the same type. For example, individuals in the 
middle quintile of single mothers with children may be in the 
lowest quintile of the all-families grouping.
    Comparisons over time show how the incomes of families of a 
given type compare with similar families at another time, not 
how incomes have changed for a particular type of family. 
Families may move among income quintiles as their incomes--or 
the incomes of other families--rise or fall; they may also 
change types as their members grow older, have children, marry, 
or divorce. In addition, the average number of members and 
earners within a given type of family may change over time, as 
may the characteristics of those persons.

                               Pretax AFI

    Trends in incomes for different family types show more 
variation than trends for families overall. Between 1973 and 
1989, adjusted family income grew 14.9 percent, on average, for 
families with children (see table H-16). This compares with an 
income gain of 20.4 percent for all families. For families with 
children, average AFI fell 16.1 percent during this period for 
the lowest quintile, from 88 percent of poverty to 74 percent 
of poverty. For the highest quintile, average AFI rose 25.6 
percent, compared with 28.7 percent for all families. With few 
exceptions, the 1989-94 period saw declines in income across 
family types and income quintiles. The exceptions were married 
couples with children in the higher income quintiles and single 
mothers with children in the lowest income quintile.

 TABLE H-16.--AVERAGE PRETAX AFI (INCOME AS A MULTIPLE OF POVERTY) BY FAMILY TYPE AND INCOME QUINTILE, WEIGHTED 
                                       BY PERSONS, SELECTED YEARS 1967-94                                       
----------------------------------------------------------------------------------------------------------------
                                                     Year                               Percent change          
    Family type and quintile    --------------------------------------------------------------------------------
                                   1967     1973     1979     1989     1994   1967-89  1973-89  1979-89  1989-94
----------------------------------------------------------------------------------------------------------------
All families:                                                                                                   
    Lowest.....................     0.69     0.90     0.90     0.85     0.77     25.1     -4.3     -4.3    -11.0
    Second.....................     1.54     1.94     2.06     2.09     1.93     35.5      7.7      1.3     -7.3
    Middle.....................     2.26     2.82     3.07     3.27     3.10     45.2     16.0      6.7     -5.4
    Fourth.....................     3.16     3.94     4.32     4.77     4.61     50.8     20.9     10.5     -3.3
    Highest....................     5.67     6.87     7.39     8.84     8.57     56.0     28.7     19.6     -3.0
                                --------------------------------------------------------------------------------
      Total....................     2.66     3.29     3.55     3.97     3.80     49.0     20.4     11.8     -4.3
                                ================================================================================
All families with children:                                                                                     
    Lowest.....................     0.74     0.88     0.84     0.74     0.66      0.1    -16.1    -11.9    -11.1
    Second.....................     1.54     1.88     1.95     1.87     1.73     21.6     -0.7     -4.2     -7.5
    Middle.....................     2.13     2.65     2.84     2.93     2.79     37.4     10.8      3.3     -5.0
    Fourth.....................     2.84     3.54     3.85     4.14     4.09     45.5     16.9      7.6     -1.3
    Highest....................     4.77     5.73     6.15     7.20     7.14     50.9     25.6     17.1     -0.9
                                --------------------------------------------------------------------------------
      Total....................     2.40     2.94      3.3     3.38     3.28     40.4     14.9      8.0     -2.9
                                ================================================================================
Married couples with children:                                                                                  
    Lowest.....................     0.89     1.16     1.18     1.14     1.06     27.9     -1.1     -2.9     -7.3
    Second.....................     1.66     2.12     2.29     2.34     2.26     40.9     10.1      2.2     -3.4
    Middle.....................     2.23     2.84     3.12     3.34     3.31     49.9     17.8      7.1     -0.9
    Fourth.....................     2.93     3.71     4.11     4.52     4.58     54.2     21.9     10.2      1.2
    Highest....................     4.88     5.94     6.41     7.67     7.68     57.3     29.2     19.8      0.1
                                --------------------------------------------------------------------------------
      Total....................     2.52     3.15     3.42     3.80     3.78     51.1     20.6     11.2     -0.7
                                ================================================================================
Single mothers with children:                                                                                   
    Lowest.....................     0.21     0.33     0.32     0.25     0.25     18.6    -23.4    -22.9      1.0
    Second.....................     0.59     0.71     0.75     0.64     0.62      9.3     -9.2    -13.8     -3.7
    Middle.....................     0.91     1.03     1.22     1.14     1.11     26.0     10.7     -6.1     -2.7
    Fourth.....................     1.45     1.67     2.01     2.03     1.94     39.9     21.5      0.6     -4.3
    Highest....................     2.78     3.29     3.65     4.14     4.02     49.2     26.0     13.5     -2.9
                                --------------------------------------------------------------------------------
      Total....................     1.19     1.41     1.59     1.64     1.59     38.5     16.9      3.2     -3.2
                                ================================================================================
Nonelderly childless units:                                                                                     
    Lowest.....................     0.80     1.22     1.24     1.19     1.00     49.3     -1.8     -3.9    -16.2
    Second.....................     2.19     2.81     2.91     2.94     2.68     34.0      4.5      0.9     -8.8
    Middle.....................     3.28     4.09     4.27     4.45     4.20     35.6      8.9      4.2     -5.7
    Fourth.....................     4.47     5.49     5.78     6.29     6.04     40.8     14.5      8.8     -3.9
    Highest....................     7.42     8.95     9.35    10.94    10.66     47.4     22.3     17.1     -2.6
                                --------------------------------------------------------------------------------
      Total....................     3.63     4.51     4.71     5.16     4.92     42.1     14.4      9.6     -4.8
                                ================================================================================
Nonelderly childless families:                                                                                  
    Lowest.....................     1.03     1.74     1.85     1.80     1.68     74.2      3.5     -2.8     -6.8
    Second.....................     2.47     3.31     3.59     3.68     3.52     49.1     11.1      2.5     -4.2
    Middle.....................     3.52     4.53     4.89     5.20     5.05     48.0     15.0      6.3     -2.9
    Fourth.....................     4.70     5.88     6.33     7.03     6.90     49.6     19.5     11.1     -1.9
    Highest....................     7.65     9.33     9.94    11.72    11.53     53.3     25.7     17.9     -1.7
                                --------------------------------------------------------------------------------
      Total....................     3.87     4.96     5.32     5.89     5.74     52.0     18.8     10.7     -2.6
                                ================================================================================
Nonelderly unrelated                                                                                            
 individuals:                                                                                                   
    Lowest.....................     0.32     0.51     0.61     0.61     0.47     90.4     19.4     -0.4    -23.1
    Second.....................     1.14     1.49     1.72     1.83     1.57     61.1     23.1      6.4    -14.2
    Middle.....................     2.12     2.53     2.78     3.00     2.70     41.5     18.8      8.0    -10.0
    Fourth.....................     3.23     3.82     4.03     4.46     4.14     37.9     16.9     10.6     -7.2
    Highest....................     5.88     7.00     7.11     8.48     8.08     44.3     21.2     19.3     -4.8
                                --------------------------------------------------------------------------------
      Total....................     2.54     3.07     3.25     3.68     3.39     44.9     19.9     13.1     -7.8
                                ================================================================================
Elderly childless units:                                                                                        
    Lowest.....................     0.48     0.76     0.84     0.95     0.93     96.8     24.7     13.4     -2.5
    Second.....................     0.95     1.34     1.50     1.73     1.73     82.6     28.6     14.8      0.3
    Middle.....................     1.48     1.97     2.26     2.64     2.52     78.1     34.1     16.9     -4.6
    Fourth.....................     2.40     3.02     3.38     4.02     3.74     67.3     33.2     19.1     -7.1
    Highest....................     5.32     6.54     6.85     8.63     8.00     62.1     32.0     26.0     -7.3
                                --------------------------------------------------------------------------------
      Total....................     2.13     2.73     2.97     3.59     3.38     68.9     31.8     21.2     -5.9
                                ================================================================================
Elderly childless families:                                                                                     
    Lowest.....................     0.60     0.96     1.06     1.20     1.20    100.2     25.3     13.5      0.5
    Second.....................     1.16     1.63     1.86     2.15     2.11     85.9     31.5     15.2     -1.7
    Middle.....................     1.77     2.34     2.67     3.14     2.97     77.6     34.0     17.4     -5.5
    Fourth.....................     2.76     3.50     3.83     4.61     4.26     67.2     31.8     20.3     -7.8
    Highest....................     5.73     7.12     7.37     9.54     8.69     66.7     34.0     29.4     -8.9
                                --------------------------------------------------------------------------------
      Total....................     2.40     3.11     3.36     4.13     3.85     72.0     32.7     22.9     -6.8
                                ================================================================================
Elderly unrelated individuals:                                                                                  
    Lowest.....................     0.35     0.54     0.64     0.73     0.67    109.0     35.7     13.6     -7.4
    Second.....................     0.63     0.93     1.02     1.17     1.17     86.1     26.1     14.7     -0.8
    Middle.....................     0.86     1.23     1.37     1.62     1.62     88.9     32.2     18.2      0.0
    Fourth.....................     1.29     1.73     2.05     2.46     2.34     91.2     42.1     20.2     -5.3
    Highest....................     3.44     4.08     4.83     5.58     5.57     62.3     36.8     15.5     -0.2
                                --------------------------------------------------------------------------------
      Total....................     1.31     1.70     1.98     2.31     2.27     76.3     36.0     16.7    -1.8 
----------------------------------------------------------------------------------------------------------------
Note.--Poverty thresholds are based on the 1989 distribution of family sizes, with no adjustment for the age of 
  the head of household or the number of children. Quintiles are based the number of persons.                   
                                                                                                                
Source: Congressional Budget Office tabulations of data from the March Current Population Survey, 1968, 1974,   
  1980, 1990, and 1995.                                                                                         

    Most of the divergence in incomes among families with 
children reflects compositional change, as families of single 
mothers with children became increasingly common. The lowest 
quintile of married couples with children has a 1.1-percent 
decline in average AFI between 1973 and 1989; the lowest 
quintile of single mothers with children fared much worse, with 
a 23.4-percent decline during the same period. These two family 
types as a whole, however, showed income gains over the period: 
20.6 percent for married couples with children and 16.9 percent 
for single mothers with children.
    Elderly persons experienced income gains across the board 
between 1973 and 1989. For elderly childless units, which 
include both single persons and married couples, average AFI 
rose 24.7 percent for the lowest quintile and 32.0 percent for 
the highest quintile. Despite their gains, the elderly 
generally had much lower incomes than the nonelderly. In 1989, 
for example, the average income of elderly childless units was 
about 3.6 times poverty; the average income of nonelderly 
childless units, by comparison, was about 5.2 times poverty. 
Like the other family types, the income of most elderly units 
fell between 1989 and 1994.
    The effects of differences in rates of growth in incomes by 
quintile show up directly in data on income shares. The share 
of total family income received by families in the lowest 
quintile declined, while the share received by the highest 
quintile increased between 1973 and 1994 (see table H-17).

  TABLE H-17.--SHARES OF PRETAX ADJUSTED FAMILY INCOME (AFI) BY FAMILY  
            TYPE AND INCOME QUINTILE, SELECTED YEARS 1967-94            
------------------------------------------------------------------------
                                                   Year                 
    Family type and quintile     ---------------------------------------
                                   1967    1973    1979    1989    1994 
------------------------------------------------------------------------
All families:                                                           
    Lowest......................     5.2     5.5     5.1     4.3     4.0
    Second......................    11.6    11.8    11.6    10.5    10.2
    Middle......................    16.9    17.1    17.3    16.5    16.3
    Fourth......................    23.7    23.9    24.3    24.0    24.3
    Highest.....................    42.6    41.7    41.7    44.6    45.2
All families with children:                                             
    Lowest......................     6.2     6.0     5.4     4.4     4.0
    Second......................    12.8    12.8    12.5    11.1    10.5
    Middle......................    17.8    18.0    18.2    17.4    17.0
    Fourth......................    23.7    24.1    24.6    24.5    24.9
    Highest.....................    39.7    39.0    39.3    42.6    43.5
Married couples with children:                                          
    Lowest......................     7.1     7.3     6.9     6.0     5.6
    Second......................    13.2    13.5    13.4    12.3    12.0
    Middle......................    17.7    18.0    18.2    17.6    17.5
    Fourth......................    23.3    23.5    24.0    23.8    24.2
    Highest.....................    38.7    37.7    37.5    40.3    40.7
Single mothers with children:                                           
    Lowest......................     3.5     4.6     4.1     3.0     3.2
    Second......................     9.9    10.1     9.4     7.9     7.8
    Middle......................    15.3    14.7    15.3    13.9    14.0
    Fourth......................    24.4    23.7    25.3    24.7    24.4
    Highest.....................    46.8    46.8    45.9    50.5    50.6
Nonelderly childless units:                                             
    Lowest......................     4.4     5.4     5.3     4.6     4.1
    Second......................    12.1    12.5    12.4    11.4    10.9
    Middle......................    18.1    18.1    18.1    17.2    17.1
    Fourth......................    24.6    24.4    24.5    24.4    24.6
    Highest.....................    40.9    39.7    39.7    42.4    43.4
Nonelderly childless families:                                          
    Lowest......................     5.3     7.0     7.0     6.1     5.8
    Second......................    12.7    13.4    13.5    12.5    12.3
    Middle......................    18.2    18.3    18.4    17.7    17.6
    Fourth......................    24.3    23.7    23.8    23.9    24.1
    Highest.....................    39.5    37.6    37.4    39.8    40.2
Nonelderly unrelated                                                    
 individuals:                                                           
    Lowest......................     2.5     3.3     3.8     3.3     2.8
    Second......................     9.0     9.7    10.6    10.0     9.3
    Middle......................    16.7    16.5    17.1    16.3    15.9
    Fourth......................    25.5    24.9    24.8    24.3    24.4
    Highest.....................    46.3    45.6    43.8    46.1    47.6
Elderly childless units:                                                
    Lowest......................     4.6     5.6     5.7     5.3     5.5
    Second......................     8.9     9.9    10.1     9.6    10.2
    Middle......................    13.9    14.4    15.2    14.7    14.9
    Fourth......................    22.6    22.1    22.8    22.4    22.1
    Highest.....................    50.0    48.0    46.2    48.0    47.3
Elderly childless families:                                             
    Lowest......................     5.0     6.1     6.3     5.8     6.3
    Second......................     9.6    10.5    11.1    10.4    11.0
    Middle......................    14.7    15.1    15.9    15.2    15.4
    Fourth......................    23.0    22.5    22.8    22.4    22.1
    Highest.....................    47.7    45.8    43.9    46.2    45.2
Elderly unrelated individuals:                                          
    Lowest......................     5.3     6.3     6.5     6.3     5.9
    Second......................     9.6    10.9    10.3    10.1    10.3
    Middle......................    13.1    14.4    13.8    14.0    14.3
    Fourth......................    19.6    20.4    20.7    21.3    20.5
    Highest.....................    52.4    47.9    48.7    48.2    49.0
------------------------------------------------------------------------
Note.--Poverty thresholds are based on the distribution of family sizes,
  with no adjustment for the age of the head of household or the number 
  of children. Quintiles are based on the number of persons.            
                                                                        
Source: Congressional Budget Office tabulations of data from the March  
  Current Population Survey, 1968, 1974, 1980, 1990, and 1995.          

                       Average Family Cash Income

    For all families, average cash income grew more slowly than 
average pretax AFI between 1973 and 1989. This was also 
generally true for specific family types. At the same time, 
those groups of families whose average cash incomes declined 
had more pronounced decreases than occurred in pretax AFI.
    Average family cash income grew 5.8 percent for families 
with children between 1973 and 1989, with most of the growth 
taking place between 1979 and 1989 (see table H-18). The 
average for the lowest quintile fell 26.7 percent during the 
1973-89 period, while the average for the highest quintile rose 
16.4 percent. As with pretax AFI, compositional change is 
important for interpreting changes in incomes among families 
with children. The 5.5 percent decrease in average family cash 
income for the lowest quintile of married couples with children 
was much smaller than the 26.9-percent decline for single 
mothers with children. Similarly, although most family types 
experienced cash income declines over the 1989 to 1994 period, 
the declines were either smaller or nonexistent for upper-
income married couples with children but were generally greater 
among upper-income single mothers with children.
    Because the change in family size among elderly persons was 
almost negligible over the period, their trend in average 
family cash incomes is almost identical to the trend in average 
pretax AFI. Elderly childless units, which comprise married 
couples and unrelated individuals, experienced income gains in 
every quintile between 1973 and 1989 and income declines in 
almost every quintile between 1989 and 1994.
    Table H-19 shows family cash income limits (the income 
cutoffs between quintiles) by quintile and family type. Between 
1973 and 1994, income limits among families with children have 
declined or grown slowly while those for the elderly have 
increased, in some cases significantly. Across all family types 
except elderly childless units and families, income limits 
among the higher quintiles have increased more than among the 
lower quintiles. In fact, income limits for the lower quintiles 
have decreased for several family types.
    For most family types, the share of family income going to 
the bottom quintiles declined over the 1973-94 period while the 
share of income going to top quintiles increased (table H-20). 
Again, this generalization is less true for elderly units.

                       Income Trends Year By Year

    Tables H-21 and H-22 show average pretax AFI and average 
family cash income by type of family and income quintile for 
selected years between 1973 and 1994.

       TABLE H-18.--AVERAGE FAMILY CASH INCOME BY FAMILY TYPE AND INCOME QUINTILE, SELECTED YEARS 1973-94       
                                                [In 1989 dollars]                                               
----------------------------------------------------------------------------------------------------------------
                                                                  Year                       Percent change     
         Family type and income quintile          --------------------------------------------------------------
                                                     1973     1979     1989     1994   1973-89  1979-89  1989-94
----------------------------------------------------------------------------------------------------------------
All families:                                                                                                   
    Lowest.......................................   $6,061   $5,994   $5,886   $5,194     -3.2     -2.1    -11.5
    Second.......................................   15,416   15,306   15,107   13,729     -2.0     -1.3     -9.1
    Middle.......................................   25,909   25,609   25,823   23,886     -0.3      0.8     -7.5
    Fourth.......................................   37,946   38,680   40,374   38,493      6.4      4.4     -4.7
    Highest......................................   66,364   68,230   77,716   75.434     17.1     13.9     -2.9
                                                  --------------------------------------------------------------
      Total......................................   30,341   30,764   32,978   31,347      8.7      7.2     -4.9
                                                  ==============================================================
All families with children:                                                                                     
    Lowest.......................................   10,529    9,369    7,714    6,843    -26.7    -17.7    -11.3
    Second.......................................   23,176   22,365   20,664   18,790    -10.8     -7.6     -9.1
    Middle.......................................   32,616   33,317   33,067   31,315      1.4     -0.8     -5.3
    Fourth.......................................   43,426   44,940   47,217   46,412      8.7      5.1     -1.7
    Highest......................................   70,420   72,971   81,966   81,430     16.4     12.3     -0.7
                                                  --------------------------------------------------------------
      Total......................................   36,034   36,592   38,127   36,958      5.8      4.2     -3.1
                                                  ==============================================================
Married couples with children:                                                                                  
    Lowest.......................................   15,450   15,148   14,606   13,564     -5.5     -3.6     -7.2
    Second.......................................   27,170   28,294   28,660   27,732      5.5      1.3     -3.3
    Middle.......................................   35,513   37,693   39,683   39,425     11.7      5.3     -0.7
    Fourth.......................................   45,783   48,616   53,106   53,798     16.0      9.2      1.3
    Highest......................................   72,842   76,547   88,168   88,576     21.0     15.2      0.5
                                                  --------------------------------------------------------------
      Total......................................   39,352   41,260   44,846   44,619     14.0      8.7     -0.5
                                                  ==============================================================
Single mothers with children:                                                                                   
    Lowest.......................................    3,505    3,338    2,563    2,738    -26.9    -23.2      6.7
    Second.......................................    7,931    8,122    6,737    6,626    -15.1    -17.1     -1.7
    Middle.......................................   11,922   13,136   11,803   11,349     -1.0    -10.1     -3.9
    Fourth.......................................   17,867   19,904   19,427   18,905      8.7     -2.4     -2.8
    Highest......................................   33,430   35,714   38,394   37,227     14.8      7.5     -3.1
                                                  --------------------------------------------------------------
      Total......................................   14,930   16,043   15,792   15,369      5.8     -1.6     -2.7
                                                  ==============================================================
Nonelderly childless units:                                                                                     
    Lowest.......................................    5,809    5,863    5,727    4,584     -1.4     -2.3    -20.0
    Second.......................................   15,886   15,808   15,840   13,926     -0.3      0.2    -12.1
    Middle.......................................   25,562   25,397   26,154   23,930      2.3      3.0     -8.5
    Fourth.......................................   37,670   38,217   40,549   38,140      7.6      6.1     -5.9
    Highest......................................   67,136   69,142   79,550   76,026     18.5     15.1     -4.4
                                                  --------------------------------------------------------------
      Total......................................   30,412   30,886   33,565   31,321     10.4      8.7     -6.7
                                                  ==============================================================
Nonelderly childless families:                                                                                  
    Lowest.......................................   13,044   13,881   13,712   12,860      5.1     -1.2     -6.2
    Second.......................................   25,352   27,773   28,880   27,670     13.9      4.0     -4.2
    Middle.......................................   35,256   38,599   41,716   40,477     18.3      8.1     -3.0
    Fourth.......................................   47,199   51,058   57,713   56,304     22.3     13.0     -2.5
    Highest......................................   76,867   83,026   98,413   95,606     28.0     18.5     -2.9
                                                  --------------------------------------------------------------
      Total......................................   39,543   42,867   48,093   46,583     21.6     12.2     -3.1
                                                  ==============================================================
Nonelderly unrelated individuals:                                                                               
    Lowest.......................................    2,948    3,504    3,522    2,710     19.5      0.5    -23.1
    Second.......................................    8,620    9,957   10,621    9,114     23.2      6.7    -14.2
    Middle.......................................   14,628   16,065   17,389   15,653     18.5      8.2    -10.0
    Fourth.......................................   22,105   23,330   25,849   23,985     16.9     10.8     -7.2
    Highest......................................   40,555   41,215   49,182   46,855     21.3     19.3     -4.7
                                                  --------------------------------------------------------------
      Total......................................   17,770   18,814   21,315   19,663     20.0     13.3     -7.8
                                                  ==============================================================
Elderly childless units:                                                                                        
    Lowest.......................................    4,148    4,632    5,221    5,003     25.9     12.7     -4.2
    Second.......................................    7,556    8,367    9,665    9,674     27.9     15.5      0.1
    Middle.......................................   11,628   13,325   15,446   14,964     32.8     15.9     -3.1
    Fourth.......................................   18,576   21,202   25,021   23,524     34.7     18.0     -6.0
    Highest......................................   45,276   47,577   59,036   55,109     30.4     24.1     -6.7
                                                  --------------------------------------------------------------
      Total......................................   17,436   19,021   22,880   21,655     31.2     20.3     -5.4
                                                  ==============================================================
Elderly childless families:                                                                                     
    Lowest.......................................    7,083    7,864    8,940    9,084     26.2     13.7      1.6
    Second.......................................   12,074   13,841   15,967   15,841     32.2     15.4     -0.8
    Middle.......................................   17,200   19,750   23,381   22,346     35.9     18.4     -4.5
    Fourth.......................................   26,124   28,889   34,869   32,259     33.5     20.7     -7.5
    Highest......................................   56,136   57,963   75,091   68,613     33.8     29.5     -8.7
                                                  --------------------------------------------------------------
      Total......................................   23,723   25,661   31,657   29,629     33.4     23.4     -6.4
                                                  ==============================================================
Elderly unrelated individuals:                                                                                  
    Lowest.......................................    3,108    3,717    4,221    3,908     35.8     13.6     -7.4
    Second.......................................    5,393    5,932    6,806    6,755     26.2     14.7     -0.8
    Middle.......................................    7,114    7,963    9,414    9,417     32.3     18.2      0.0
    Fourth.......................................   10,046   11,881   14,286   13,538     42.2     20.2     -5.3
    Highest......................................   23,626   27,984   32,331   32,275     36.8     15.5     -0.2
                                                  --------------------------------------------------------------
      Total......................................    9,857   11,495   13,414   13,179     36.1     16.7    -1.8 
----------------------------------------------------------------------------------------------------------------
Note.--Quintiles are based on the number of families.                                                           
                                                                                                                
Source: Congressional Budget Office tabulations of data from the March Current Population Survey, 1974, 1980,   
  1990, and 1995.                                                                                               


                     TABLE H-19.--FAMILY CASH INCOME LIMITS BY QUINTILE AND FAMILY TYPE \1\                     
----------------------------------------------------------------------------------------------------------------
                                                                  Year                       Percent change     
                   Family type                    --------------------------------------------------------------
                                                     1973     1979     1989     1994   1973-79  1979-89  1973-94
----------------------------------------------------------------------------------------------------------------
All families:                                                                                                   
    Lowest.......................................   10,561   10,604   10,452    9,458        0       -1    -10.4
    Second.......................................   20,595   20,099   20,005   18,408       -2        0    -10.6
    Middle.......................................   31,540   31,679   32,050   30,067        0        1     -4.7
    Fourth.......................................   45,759   46,951   50,319   49,186        3        7      7.5
All families with children:                                                                                     
    Lowest.......................................   17,778   16,749   14,472   12,634       -6      -14    -28.9
    Second.......................................   28,049   28,063   26,944   25,101        0       -4    -10.5
    Middle.......................................   37,353   38,583   39,400   37,931        3        2      1.5
    Fourth.......................................   50,745   52,386   56,415   56,352        3        8     11.0
Married couples with children:                                                                                  
    Lowest.......................................   22,606   22,946   22,678   21,504        2       -1     -4.9
    Second.......................................   31,540   33,230   34,110   33,555        5        3      6.4
    Middle.......................................   39,934   42,350   45,524   45,601        6        7     14.2
    Fourth.......................................   52,937   56,109   62,200   63,352        6       11     19.7
Single mothers with children:                                                                                   
    Lowest.......................................    6,150    6,080    4,770    4,769       -1      -22    -22.5
    Second.......................................    9,909   10,391    9,000    8,715        5      -13    -12.0
    Middle.......................................   14,456   16,317   15,000   14,312       13       -8     -1.0
    Fourth.......................................   21,933   24,286   24,935   24,032       11        3      9.6
Nonelderly childless unit:                                                                                      
    Lowest.......................................   11,039   11,222   11,053    9,371        2       -2    -15.1
    Second.......................................   20,737   20,137   20,551   18,583       -3        2    -10.4
    Middle.......................................   31,182   31,011   32,100   29,778       -1        4     -4.5
    Fourth.......................................   45,982   46,911   50,681   48,835        2        8      6.2
Nonelderly childless families:                                                                                  
    Lowest.......................................   20,209   22,058   22,500   21,338        9        2      5.6
    Second.......................................   30,257   33,377   35,010   33,887       10        5     12.0
    Middle.......................................   40,665   44,217   48,900   47,692        9       11     17.3
    Fourth.......................................   55,194   59,638   68,739   67,029        8       15     21.4
Nonelderly unrelated individuals:                                                                               
    Lowest.......................................    5,677    6,782    7,200    6,091       19        6      7.3
    Second.......................................   11,617   13,064   14,000   12,300       12        7      5.9
    Middle.......................................   18,348   19,285   21,020   19,453        5        9      6.0
    Fourth.......................................   26,591   28,390   31,635   29,517        7       11     11.0
Elderly childless units:                                                                                        
    Lowest.......................................    6,069    6,579    7,466    7,441        8       13     22.6
    Second.......................................    9,330   10,562   12,215   12,042       13       16     29.1
    Middle.......................................   14,230   16,473   19,249   18,176       16       17     27.7
    Fourth.......................................   24,443   27,246   32,371   30,320       11       19     24.0
Elderly childless families:                                                                                     
    Lowest.......................................    9,967   11,284   12,767   13,034       13       13     30.8
    Second.......................................   14,301   16,600   19,454   18,649       16       17     30.4
    Middle.......................................   20,711   23,147   28,000   26,365       12       21     27.3
    Fourth.......................................   33,353   36,412   43,400   40,876        9       19     22.6
Elderly unrelated individuals:                                                                                  
    Lowest.......................................    4,452    5,001    5,688    5,564       12       14     25.0
    Second.......................................    6,274    6,860    7,904    7,933        9       15     26.4
    Middle.......................................    8,129    9,493   11,368   11,084       17       20     36.3
    Fourth.......................................   12,490   15,074   18,061   16,908       21       20     35.4
----------------------------------------------------------------------------------------------------------------
\1\ In 1989 dollars.                                                                                            
                                                                                                                
Source: Congressional Budget Office tabulations of data from the March Current Population Survey, 1974, 1980,   
  1990, and 1995.                                                                                               


TABLE H-20.--SHARES OF FAMILY CASH INCOME, BY INCOME QUINTILE AND FAMILY
                      TYPE, SELECTED YEARS 1973-94                      
                              [In percent]                              
------------------------------------------------------------------------
                                                       Year             
        Family type and quintile         -------------------------------
                                           1973    1979    1989    1994 
------------------------------------------------------------------------
All families:                                                           
    Lowest..............................     4.0     3.9     3.6     3.3
    Second..............................    10.2    10.0     9.2     8.8
    Middle..............................    17.1    16.6    15.7    15.2
    Fourth..............................    25.0    25.1    24.5    24.6
    Highest.............................    43.7    44.4    47.1    48.1
All families with children:                                             
    Lowest..............................     5.8     5.1     4.0     3.7
    Second..............................    12.9    12.2    10.8    10.2
    Middle..............................    18.1    18.2    17.3    16.9
    Fourth..............................    24.1    24.6    24.8    25.1
    Highest.............................    39.1    39.9    43.0    44.1
Married couples with children:                                          
    Lowest..............................     7.9     7.3     6.5     6.1
    Second..............................    13.8    13.7    12.8    12.4
    Middle..............................    18.0    18.3    17.7    17.7
    Fourth..............................    23.3    23.6    23.7    24.1
    Highest.............................    37.0    37.1    39.3    39.7
Single mothers with children:                                           
    Lowest..............................     4.7     4.2     3.2     3.6
    Second..............................    10.6    10.1     8.5     8.6
    Middle..............................    16.0    16.4    14.9    14.8
    Fourth..............................    23.9    24.8    24.6    24.6
    Highest.............................    44.8    44.5    48.6    48.4
Nonelderly childless units:                                             
    Lowest..............................     3.8     3.8     3.4     2.9
    Second..............................    10.4    10.2     9.4     8.9
    Middle..............................    16.8    16.4    15.6    15.3
    Fourth..............................    24.8    24.7    24.2    24.4
    Highest.............................    44.2    44.8    47.4    48.5
Nonelderly childless families:                                          
    Lowest..............................     6.6     6.5     5.7     5.5
    Second..............................    12.8    13.0    12.0    11.9
    Middle..............................    17.8    18.0    17.3    17.4
    Fourth..............................    23.9    23.8    24.0    24.2
    Highest.............................    38.9    38.7    40.9    41.0
Nonelderly unrelated individuals:                                       
    Lowest..............................     3.3     3.7     3.3     2.8
    Second..............................     9.7    10.6    10.0     9.3
    Middle..............................    16.5    17.1    16.3    15.9
    Fourth..............................    24.9    24.8    24.3    24.4
    Highest.............................    45.6    43.8    46.1    47.7
Elderly childless units:                                                
    Lowest..............................     4.8     4.9     4.6     4.6
    Second..............................     8.7     8.8     8.4     8.9
    Middle..............................    13.3    14.0    13.5    13.8
    Fourth..............................    21.3    22.3    21.9    21.7
    Highest.............................    51.9    50.0    51.6    50.9
Elderly childless families:                                             
    Lowest..............................     6.0     6.1     5.6     6.1
    Second..............................    10.2    10.8    10.1    10.7
    Middle..............................    14.5    15.4    14.8    15.1
    Fourth..............................    22.0    22.5    22.0    21.8
    Highest.............................    47.3    45.2    47.4    46.3
Elderly unrelated individuals:                                          
    Lowest..............................     6.3     6.5     6.3     5.9
    Second..............................    10.9    10.3    10.1    10.3
    Middle..............................    14.4    13.9    14.0    14.3
    Fourth..............................    20.4    20.7    21.3    20.5
    Highest.............................    47.9    48.7    48.2    49.0
------------------------------------------------------------------------
Note.--Quintiles are based on the number of families.                   
                                                                        
Source: Congressional Budget Office tabulations of data from the March  
  Current Population Survey, 1974, 1980, 1990, and 1995.                

     ANTIPOVERTY EFFECTIVENESS OF VARIOUS CASH AND NONCASH TRANSFERS

    Tables H-23 through H-25 provide estimates of the number 
and percentage of individuals removed from poverty by different 
social insurance programs (Social Security, unemployment 
compensation, and workers' compensation), means-tested cash 
programs (Aid to Families with Dependent Children, Supplemental 
Security Income, and General Assistance), means-tested noncash 
programs (food stamps, housing benefits, and school lunch), and 
Federal payroll and income taxes and the earned income credit. 
Tables are provided separately for all persons, for elderly 
persons, and for children for selected years between 1979 and 
1996.
    The tables present alternative measures of poverty to the 
official measure. They include counts of the number of people 
below the poverty line before any government benefits are taken 
into account, after each type of benefit is added to income, 
and after the government cash and noncash benefits and Federal 
taxes and the EIC are added to (or subtracted from) income.
    The tables also measure the effect of these government 
programs on the ``poverty gap''--the gap between a poor 
family's income and the poverty line. The poverty gap 
represents the degree of poverty by showing the amount of money 
that would be needed to lift every poor person exactly to the 
poverty line.

 TABLE H-21.--AVERAGE PRETAX AFI (INCOME AS A MULTIPLE OF POVERTY) BY FAMILY TYPE AND INCOME QUINTILE, SELECTED 
                                                  YEARS 1973-94                                                 
----------------------------------------------------------------------------------------------------------------
                                                                                       Year                     
                          Family group                           -----------------------------------------------
                                                                   1973    1979    1989    1990    1993    1994 
----------------------------------------------------------------------------------------------------------------
All families:                                                                                                   
    Lowest......................................................    0.93    0.92    0.86    0.83    0.74    0.77
    Second......................................................    1.97    2.09    2.09    2.03    1.89    1.93
    Middle......................................................    2.85    3.09    3.27    3.18    3.03    3.10
    Fourth......................................................    3.94    4.31    4.77    4.64    4.53    4.61
    Highest.....................................................    6.86    7.36    8.84    8.55    8.38    8.57
                                                                 -----------------------------------------------
      Total.....................................................    3.31    3.55    3.97    3.85    3.72    3.80
                                                                 ===============================================
All families with children:                                                                                     
    Lowest......................................................    0.91    0.85    0.74    0.71    0.63    0.66
    Second......................................................    1.91    1.96    1.87    1.80    1.67    1.73
    Middle......................................................    2.67    2.85    2.93    2.80    2.71    2.79
    Fourth......................................................    3.55    3.84    4.14    4.00    4.00    4.09
    Highest.....................................................    5.72    6.11    7.20    6.94    7.03    7.14
                                                                 -----------------------------------------------
      Total.....................................................    2.95    3.12    3.38    3.25    3.21    3.28
                                                                 ===============================================
Married couples with children:                                                                                  
    Lowest......................................................    1.19    1.20    1.14    1.11    1.03    1.06
    Second......................................................    2.15    2.30    2.34    2.26    2.20    2.26
    Middle......................................................    2.86    3.13    3.34    3.22    3.24    3.31
    Fourth......................................................    3.72    4.11    4.52    4.42    4.51    4.58
    Highest.....................................................    5.93    6.38    7.67    7.43    7.57    7.68
                                                                 -----------------------------------------------
      Total.....................................................    3.17    3.42    3.80    3.69    3.71    3.78
                                                                 ===============================================
Single mothers with children:                                                                                   
    Lowest......................................................    0.33    0.33    0.25    0.25    0.25    0.25
    Second......................................................    0.72    0.75    0.64    0.61    0.58    0.62
    Middle......................................................    1.05    1.22    1.15    1.09    1.04    1.11
    Fourth......................................................    1.67    2.01    2.03    1.95    1.88    1.94
    Highest.....................................................    3.32    3.67    4.15    3.90    3.99    4.02
                                                                 -----------------------------------------------
      Total.....................................................    1.42    1.60    1.64    1.56    1.55    1.59
                                                                 ===============================================
Nonelderly childless units:                                                                                     
    Lowest......................................................    1.21    1.23    1.19    1.16    0.99    1.00
    Second......................................................    2.79    2.88    2.94    2.89    2.63    2.68
    Middle......................................................    4.04    4.22    4.45    4.37    4.10    4.20
    Fourth......................................................    5.42    5.70    6.29    6.12    5.91    6.04
    Highest.....................................................    8.83    9.23   10.94   10.61   10.35   10.66
                                                                 -----------------------------------------------
      Total.....................................................    4.46    4.65    5.16    5.03    4.80    4.92
                                                                 ===============================================
Nonelderly childless families:                                                                                  
    Lowest......................................................    1.73    1.84    1.80    1.81    1.61    1.68
    Second......................................................    3.28    3.56    3.68    3.66    3.41    3.52
    Middle......................................................    4.48    4.85    5.20    5.13    4.92    5.05
    Fourth......................................................    5.82    6.26    7.03    6.86    6.71    6.90
    Highest.....................................................    9.22    9.84   11.72   11.42   11.23   11.53
                                                                 -----------------------------------------------
      Total.....................................................    4.91    5.27    5.89    5.78    5.58    5.74
                                                                 ===============================================
Nonelderly unrelated individuals:                                                                               
    Lowest......................................................    0.50    0.60    0.61    0.58    0.46    0.47
    Second......................................................    1.47    1.69    1.83    1.74    1.59    1.57
    Middle......................................................    2.49    2.73    3.00    2.92    2.74    2.70
    Fourth......................................................    3.74    3.93    4.46    4.34    4.13    4.14
    Highest.....................................................    6.78    6.88    8.49    8.12    7.89    8.08
                                                                 -----------------------------------------------
      Total.....................................................    3.00    3.17    3.68    3.54    3.36    3.39
                                                                 ===============================================
Elderly childless units:                                                                                        
    Lowest......................................................    0.82    0.90    0.95    0.94    0.92    0.93
    Second......................................................    1.44    1.61    1.73    1.76    1.70    1.73
    Middle......................................................    2.11    2.42    2.64    2.67    2.51    2.52
    Fourth......................................................    3.22    3.60    4.02    3.98    3.72    3.74
    Highest.....................................................    6.95    7.28    8.63    8.44    7.89    8.00
                                                                 -----------------------------------------------
      Total.....................................................    2.91    3.16    3.59    3.56    3.35    3.38
                                                                 ===============================================
Elderly childless families:                                                                                     
    Lowest......................................................    1.03    1.13    1.20    1.22    1.19    1.20
    Second......................................................    1.76    2.00    2.15    2.19    2.08    2.11
    Middle......................................................    2.51    2.85    3.14    3.18    2.94    2.97
    Fourth......................................................    3.71    4.08    4.61    4.52    4.23    4.26
    Highest.....................................................    7.58    7.83    9.54    9.29    8.59    8.69
                                                                 -----------------------------------------------
      Total.....................................................    3.32    3.58    4.13    4.08    3.81    3.85
                                                                 ===============================================
Elderly unrelated individuals:                                                                                  
    Lowest......................................................    0.57    0.68    0.73    0.70    0.65    0.67
    Second......................................................    0.99    1.09    1.17    1.14    1.12    1.11
    Middle......................................................    1.31    1.46    1.62    1.63    1.57    1.62
    Fourth......................................................    1.85    2.19    2.47    2.47    2.32    2.34
    Highest.....................................................    4.35    5.15    5.58    5.58    5.35    5.57
                                                                 -----------------------------------------------
      Total.....................................................    1.81    2.12    2.31    2.30    2.20    2.27
----------------------------------------------------------------------------------------------------------------
Source: Congressional Budget Office tabulations of data for the March Current Population Survey, 1974, 1980,    
  1990, 1991, 1994, and 1995.                                                                                   


          TABLE H-22.--AVERAGE FAMILY INCOME BY INCOME QUINTILE AND FAMILY TYPE, SELECTED YEARS 1973-94         
                                                [In 1989 dollars]                                               
----------------------------------------------------------------------------------------------------------------
                                                                                    Year                        
                       Family group                        -----------------------------------------------------
                                                              1973     1979     1989     1990     1993     1994 
----------------------------------------------------------------------------------------------------------------
All families:                                                                                                   
    Lowest................................................    6,061    5,994    5,866    5,649    5,033    5,194
    Second................................................   15,416   15,306   15,107   14,781   13,623   13,729
    Middle................................................   25,909   25,609   25,823   25,191   23,572   23,886
    Fourth................................................   37,946   38,680   40,374   39,269   37,870   38,493
    Highest...............................................   66,364   68,230   77,716   75,429   73,908   75,434
                                                           -----------------------------------------------------
      Total...............................................   30,341   30,764   32,978   32,063   30,801   31,347
                                                           =====================================================
All families with children:                                                                                     
    Lowest................................................   10,529    9,369    7,714    7,317    6,342    6,843
    Second................................................   23,176   22,365   20,664   19,834   18,108   18,790
    Middle................................................   32,616   33,317   33,067   31,916   30,465   31,315
    Fourth................................................   43,426   44,940   47,217   45,964   45,501   46,412
    Highest...............................................   70,420   72,971   81,966   79,427   80,319   81,430
                                                           -----------------------------------------------------
      Total...............................................   36,034   36,592   38,127   36,890   36,147   36,958
                                                           =====================================================
Married couples with children:                                                                                  
    Lowest................................................   15,450   15,148   14,606   14,186   13,260   13,564
    Second................................................   27,170   28,294   28,660   27,960   27,105   27,732
    Middle................................................   35,513   37,693   39,683   38,810   38,927   39,425
    Fourth................................................   45,783   48,616   53,106   52,275   53,084   53,798
    Highest...............................................   72,842   76,547   88,168   85,483   87,429   88,576
                                                           -----------------------------------------------------
      Total...............................................   39,352   41,260   44,846   43,741   43,961   44,619
                                                           =====================================================
Single mothers with children:                                                                                   
    Lowest................................................    3,505    3,338    2,563    2,529    2,449    2,738
    Second................................................    7,931    8,122    6,737    6,499    6,074    6,626
    Middle................................................   11,922   13,136   11,803   11,238   10,382   11,349
    Fourth................................................   17,867   19,904   19,427   18,703   17,816   18,905
    Highest...............................................   33,430   35,714   38,394   36,228   36,770   37,227
                                                           -----------------------------------------------------
      Total...............................................   14,930   16,043   15,792   15,036   14,698   15,369
                                                           =====================================================
Nonelderly childless units:                                                                                     
    Lowest................................................    5,809    5,863    5,727    5,425    4,555    4,584
    Second................................................   15,886   15,808   15,840   15,448   13,986   13,926
    Middle................................................   25,562   25,397   26,154   25,518   23,627   23,930
    Fourth................................................   37,670   38,217   40,549   39,503   37,492   38,140
    Highest...............................................   67,136   69,142   79,550   77,006   73,968   76,026
                                                           -----------------------------------------------------
      Total...............................................   30,412   30,886   33,565   32,578   30,726   31,321
                                                           =====================================================
Nonelderly childless families:                                                                                  
    Lowest................................................   13,044   13,881   13,712   13,969   12,582   12,860
    Second................................................   25,352   27,773   28,880   28,802   26,988   27,670
    Middle................................................   35,256   38,599   41,716   41,203   39,872   40,477
    Fourth................................................   47,199   51,058   57,713   56,552   55,464   56,304
    Highest...............................................   76,867   83,026   98,413   96,054   93,144   95,606
                                                           -----------------------------------------------------
      Total...............................................   39,543   42,867   48,093   47,311   45,610   46,583
                                                           =====================================================
Nonelderly unrelated individuals:                                                                               
    Lowest................................................    2,948    3,504    3,522    3,362    2,659    2,710
    Second................................................    8,620    9,957   10,621   10,077    9,259    9,114
    Middle................................................   14,628   16,065   17,389   16,950   15,899   15,653
    Fourth................................................   22,105   23,330   25,849   25,189   23,988   23,985
    Highest...............................................   40,555   41,215   49,182   47,167   45,801   46,855
                                                           -----------------------------------------------------
      Total...............................................   17,770   18,814   21,315   20,546   19,521   19,663
                                                           =====================================================
Elderly childless units:                                                                                        
    Lowest................................................    4,148    4,632    5,221    5,060    4,917    5,003
    Second................................................    7,556    8,367    9,665    9,724    9,523    9,674
    Middle................................................   11,628   13,325   15,446   15,702   15,021   14,964
    Fourth................................................   18,576   21,202   25,021   25,097   23,779   23,524
    Highest...............................................   45,276   47,577   59,036   58,134   54,366   55,109
                                                           -----------------------------------------------------
      Total...............................................   17,436   19,021   22,880   22,741   21,521   21,655
                                                           =====================================================
Elderly childless families:                                                                                     
    Lowest................................................    7,083    7,864    8,940    9,138    9,052    9,084
    Second................................................   12,074   13,841   15,967   16,468   15,717   15,841
    Middle................................................   17,200   19,750   23,381   23,917   22,422   22,346
    Fourth................................................   26,124   28,889   34,869   34,665   32,363   32,259
    Highest...............................................   56,136   57,963   75,091   73,345   67,748   68,613
                                                           -----------------------------------------------------
      Total...............................................   23,723   25,661   31,657   31,503   29,460   29,629
                                                           =====================================================
Elderly unrelated individuals:                                                                                  
    Lowest................................................    3,108    3,717    4,221    4,038    3,751    3,908
    Second................................................    5,393    5,932    6,806    6,616    6,508    6,755
    Middle................................................    7,114    7,963    9,414    9,468    9,139    9,417
    Fourth................................................   10,046   11,881   13,973   14,286   13,474   13,538
    Highest...............................................   23,626   27,984   32,331   32,398   31,056   32,275
                                                           -----------------------------------------------------
      Total...............................................    9,857   11,495   13,414   13,367  12,786,   13,179
----------------------------------------------------------------------------------------------------------------
Note.--Quintiles are based on the number of families. In 1989, the Bureau of the Census revised its methods of  
  processing data from the Current Population Survey, which made the incomes of some families higher than what  
  they would have been using the old method. For further discussion, see U.S. Bureau of the Census, ``Money     
  Income and Poverty Status in the United States: 1988,'' Current Population Reports, Series, P-60, No. 166,    
  October 1989.                                                                                                 
                                                                                                                
Source: Congressional Budget Office tabulations of data from the March Current Population Survey, 1974, 1980,   
  1990, 1991, 1994, and 1995.                                                                                   


   TABLE H-23.--ANTIPOVERTY EFFECTIVENESS OF CASH AND NONCASH TRANSFERS (INCLUDING FEDERAL INCOME AND PAYROLL   
                   TAXES) FOR ALL PERSONS IN FAMILIES OR LIVING ALONE, SELECTED YEARS 1979-96                   
----------------------------------------------------------------------------------------------------------------
                                                                          Year                                  
               Category                -------------------------------------------------------------------------
                                           1979       1983       1987       1989      1993      1995      1996  
----------------------------------------------------------------------------------------------------------------
Total population (in thousands).......   222,893    231,140    240,982    246,492    259,278   263,733   266,218
Number of persons (in thousands):                                                                               
    Cash income before transfers......    42,783     52,700     49,679     49,052     60,429    57,350    57,228
    Plus social insurance.............    28,604     36,928     34,380     33,825     42,247    39,316    39,459
    Plus means-tested cash transfers..    25,924     35,030     32,546     31,534     39,265    36,425    36,529
    Plus food and housing benefits....    21,548     31,697     29,004     27,642     34,765    31,705    32,251
    Plus EIC and less Federal payroll                                                                           
     and income taxes.................    22,215     33,923     30,400     28,941     34,613    30,303    30,538
Number of persons (in thousands)                                                                                
 removed from poverty due to:                                                                                   
    Social insurance..................    14,179     15,772     15,299     15,227     18,182    18,034    17,769
    Means-tested cash.................     2,680      1,898      1,834      2,291      2,982     2,891     2,930
    Food and housing benefits.........     4,378      3,333      3,542      3,892      4,500     4,720     4,278
    EIC and Federal payroll and income                                                                          
     taxes............................      (669)    (2,226)    (1,396)    (1,299)       152     1,402     1,713
                                       -------------------------------------------------------------------------
        Total.........................    20,568     18,777     19,279     20,111     25,816    27,047    26,690
                                       =========================================================================
Percent of persons removed from                                                                                 
 poverty due to:                                                                                                
    Social insurance..................      33.1       29.9       30.8       31.0       30.1      31.4      31.0
    Means-tested cash.................       6.3        3.6        3.7        4.7        4.9       5.0       5.1
    Food and housing benefits.........      10.2        6.3        7.1        7.9        7.4       8.2       7.5
    EIC and Federal payroll and income                                                                          
     taxes............................      -1.6       -4.2       -2.8       -2.6        0.3       2.4       3.0
                                       -------------------------------------------------------------------------
        Total.........................      48.1       35.6       38.8       41.0       42.7      47.2      46.6
                                       =========================================================================
Poverty rate (in percent):                                                                                      
    Cash income before transfers......      19.2       22.8       20.6       19.9       23.3      21.7      21.5
    Plus social insurance.............      12.8       16.0       14.3       13.7       16.3      14.9      14.8
    Plus means-tested cash transfers..      11.6       15.2       13.5       12.8       15.1      13.8      13.7
    Plus food and housing benefits....       9.7       13.7       12.0       11.2       13.4      12.0      12.1
    Plus EIC and less Federal payroll                                                                           
     and income taxes.................      10.0       14.7       12.6       11.7       13.3      11.5      11.5
                                       -------------------------------------------------------------------------
        Total reduction in poverty                                                                              
         rate.........................       9.2        8.1        8.0        8.2       10.0      10.3      10.0
                                       =========================================================================
Poverty gap (millions of 1996                                                                                   
 dollars):                                                                                                      
    Cash income before transfers......   141,549    175,095    171,604    165,779    204,979   195,017   196,332
    Plus social insurance.............    73,293     98,699     95,879     91,064    118,141   105,824   106,575
    Plus means-tested cash transfers..    50,958     73,551     71,337     67,943     89,109    80,475    81,549
    Plus food and housing benefits....    39,893     58,598     55,846     52,565     68,088    62,311    63,292
    Plus EIC and less Federal payroll                                                                           
     and income taxes.................    40,522     60,780     57,172     53,662     67,505    60,025    60,408
Reduction in poverty gap (in millions)                                                                          
 due to:                                                                                                        
    Social insurance..................    68,256     76,396     75,725     74,715     86,838    89,193    89,757
    Means-tested cash.................    22,336     25,148     24,542     23,121     29,031    25,349    25,026
    Food and housing benefits.........    11,065     14,953     15,491     15,377     21,021    18,163    18,257
    EIC and Federal payroll and income                                                                          
     taxes............................      (629)    (2,182)    (1,326)    (1,097)       583     2,286     2,884
                                       -------------------------------------------------------------------------
        Total.........................   101,028    114,315    114,432    112,116    137,474   134,992   135,924
                                       =========================================================================
Percent reduction in the poverty gap                                                                            
 due to:                                                                                                        
    Social insurance..................      48.2       43.6       44.1       45.1       42.4      45.7      45.7
    Means-tested cash.................      15.8       14.4       14.3       13.9       14.2      13.0      12.7
    Food and housing benefits.........       7.8        8.5        9.0        9.3       10.3       9.3       9.3
    EIC and Federal payroll and income                                                                          
     taxes............................      -0.4       -1.2       -0.8       -0.7        0.3       1.2       1.5
                                       -------------------------------------------------------------------------
        Total.........................      71.4       65.3       66.7       67.6       67.1      69.2      69.2
----------------------------------------------------------------------------------------------------------------
Note.--Poverty gap dollars for each year adjusted to 1996 dollars. EIC = earned income credit.                  
                                                                                                                
Source: Congressional Budget Office calculations of Census Bureau data.                                         


   TABLE H-24.--ANTIPOVERTY EFFECTIVENESS OF CASH AND NONCASH TRANSFERS (INCLUDING FEDERAL INCOME AND PAYROLL   
                             TAXES) FOR ALL ELDERLY PERSONS, SELECTED YEARS 1979-96                             
----------------------------------------------------------------------------------------------------------------
                                                                                  Year                          
                       Category                       ----------------------------------------------------------
                                                         1979      1983      1989      1993      1995     1996  
----------------------------------------------------------------------------------------------------------------
Total population (in thousands)......................   24,194    26,313    29,094    30,779    31,658   31,877 
Number of poor persons (in thousands):                                                                          
    Cash income before transfers.....................   13,120    13,253    13,853    15,640    15,810   15,977 
    Plus social insurance............................    4,202     4,095     3,934     4,270     3,722    3,905 
    Plus means-tested cash transfers.................    3,682     3,625     3,312     3,755     3,318    3,428 
    Plus food and housing benefits...................    3,261     3,158     2,793     3,123     2,839    2,936 
    Plus EIC and less Federal payroll and income                                                                
     taxes...........................................    3,276     3,177     2,841     3,159     2,838    2,943 
Number of persons (in thousands) removed from poverty                                                           
 due to:.............................................                                                           
    Social insurance.................................    8,918     9,158     9,919    11,370    12,088   12,072 
    Means-tested cash................................      520       470       622       515       404      477 
    Food and housing benefits........................      421       467       519       632       479      492 
    EIC and Federal payroll and income taxes.........      (15)      (19)      (48)      (36)        1       (7)
                                                      ----------------------------------------------------------
        Total........................................    9,844    10,076    11,012    12,481    12,972   13,034 
                                                      ==========================================================
Percent of persons removed from poverty due to:                                                                 
    Social insurance.................................     68.0      69.1      71.6      72.7      76.5     75.6 
    Means-tested cash................................      4.0       3.5       4.5       3.3       2.6      3.0 
    Food and housing benefits........................      3.2       3.5       3.7       4.0       3.0      3.1 
    EIC and Federal payroll and income taxes.........     -0.1      -0.1      -0.3      -0.2       0.0     -0.0 
                                                      ----------------------------------------------------------
        Total........................................     75.0      76.0      79.5      79.8      82.0     81.6 
                                                      ==========================================================
Poverty rate (in percent):                                                                                      
    Cash income before transfers.....................     54.2      50.4      47.6      50.8      49.9     50.1 
    Plus social insurance............................     17.4      15.6      13.5      13.9      11.8     12.3 
    Plus means-tested cash transfers.................     15.2      13.8      11.4      12.2      10.5     10.8 
    Plus food and housing benefits...................     13.5      12.0       9.6      10.1       9.0      9.2 
    Plus EIC and less Federal payroll and income                                                                
     taxes...........................................     13.5      12.1       9.8      10.3       9.0      9.2 
                                                      ----------------------------------------------------------
        Total reduction in poverty rate..............     40.7      38.3      37.8      40.6      41.0     40.9 
                                                      ==========================================================
Poverty gap (millions of 1996 dollars):                                                                         
    Cash income before transfers.....................   56,838    58,200    60,480    67,972    70,831   71,700 
    Plus social insurance............................    9,941     9,664     9,121    10,424     9,060    9,900 
    Plus means-tested cash transfers.................    6,700     6,380     6,074     7,709     6,589    6,900 
    Plus food and housing benefits...................    5,619     5,429     4,995     6,515     5,559    6,000 
    Plus EIC and less Federal payroll and income                                                                
     taxes...........................................    5,619     5,538     4,995     6,515     5,559    6,000 
Reduction in poverty gap (in millions) due to:                                                                  
    Social insurance.................................   46,897    48,536    51,359    57,548    61,772   61,800 
    Means-tested cash................................    3,242     3,284     3,047     2,715     2,471    3,000 
    Food and housing benefits........................    1,081       951     1,079     1,194     1,030      900 
    EIC and Federal payroll and income taxes.........        0      (109)        0         0         0        0 
                                                      ----------------------------------------------------------
        Total........................................   51,219    52,662    55,485    61,457    65,272   65,700 
                                                      ==========================================================
Percent reduction in the poverty gap due to:                                                                    
    Social insurance.................................     82.5      83.4      84.9      84.7      87.2     86.2 
    Means-tested cash................................      5.7       5.6       5.0       4.0       3.5      4.2 
    Food and housing benefits........................      1.9       1.6       1.8       1.8       1.5      1.3 
    EIC and Federal payroll and income taxes.........      0.0      -0.2       0.0       0.0       0.0      0.0 
                                                      ----------------------------------------------------------
        Total........................................     90.1      90.5      91.7      90.4      92.2     91.6 
----------------------------------------------------------------------------------------------------------------
Note.--Poverty gap dollars for each year adjusted to 1996 dollars. EIC = earned income credit.                  
                                                                                                                
Source: Congressional Budget Office calculations of Census Bureau data.                                         


   TABLE H-25.--ANTIPOVERTY EFFECTIVENESS OF CASH AND NONCASH TRANSFERS (INCLUDING FEDERAL INCOME AND PAYROLL   
                                 TAXES) FOR ALL CHILDREN, SELECTED YEARS 1979-96                                
----------------------------------------------------------------------------------------------------------------
                                                                                   Year                         
                        Category                        --------------------------------------------------------
                                                           1979      1983      1989      1993     1995     1996 
----------------------------------------------------------------------------------------------------------------
Total population (in thousands)........................   63,375    62,333    65,602    69,292   70,566   70,650
Number of poor persons (in thousands):                                                                          
    Cash income before transfers.......................   12,761    16,146    14,954    18,198   17,098   16,642
    Plus social insurance..............................   11,364    14,405    13,846    16,685   15,717   15,426
    Plus means-tested cash transfers...................   10,377    13,911    13,154    15,727   14,665   14,463
    Plus food and housing benefits.....................    8,421    12,464    11,409    13,874   12,476   12,576
    Plus EIC and less Federal payroll and income taxes.    8,620    13,293    11,811    13,853   11,443   11,341
Number of persons (in thousands) removed from poverty                                                           
 due to:                                                                                                        
    Social insurance...................................    1,397     1,741     1,108     1,513    1,381    1,216
    Means-tested cash..................................      987       494       692       958    1,052      963
    Food and housing benefits..........................    1,956     1,447     1,745     1,853    2,189    1,887
    EIC and Federal payroll and income taxes...........     (199)     (829)     (402)       21    1,033    1,235
                                                        --------------------------------------------------------
        Total..........................................    4,141     2,853     3,143     4,345    5,655    5,301
                                                        ========================================================
Percent of persons removed from poverty due to:                                                                 
    Social insurance...................................     10.9      10.8       7.4       8.3      8.1      7.3
    Means-tested cash..................................      7.7       3.1       4.6       5.3      6.2      5.8
    Food and housing benefits..........................     15.3       9.0      11.7      10.2     12.8     11.3
    EIC and Federal payroll and income taxes...........     -1.6      -5.1      -2.7       0.1      6.0      7.4
                                                        --------------------------------------------------------
        Total..........................................     32.5      17.7      21.0      23.9     33.1     31.9
                                                        ========================================================
Poverty rate (in percent):                                                                                      
    Cash income before transfers.......................     20.1      25.9      22.8      26.3     24.2     23.6
    Plus social insurance..............................     17.9      23.1      21.1      24.1     22.3     21.8
    Plus means-tested cash transfers...................     16.4      22.3      20.1      22.7     20.8     20.5
    Plus food and housing benefits.....................     13.3      20.0      17.4      20.0     17.7     17.8
    Plus EIC and less Federal payroll and income taxes.     13.6      21.3      18.0      20.0     16.2     16.1
                                                        --------------------------------------------------------
        Total reduction in poverty rate................      6.5       4.6       4.8       6.3      8.0      7.5
                                                        ========================================================
Poverty gap (millions of 1996 dollars):                                                                         
    Cash income before transfers.......................   31,985    42,347    38,872    48,644   43,446   42,100
    Plus social insurance..............................   26,798    35,615    33,769    42,021   37,578   36,500
    Plus means-tested cash transfers...................   17,505    25,520    24,168    30,294   27,077   27,400
    Plus food and housing benefits.....................   12,102    17,699    16,179    20,088   18,017   18,400
    Plus EIC and less Federal payroll and income taxes.   12,102    18,242    16,179    19,545   16,164   16,100
Reduction in poverty gap (in millions) due to:                                                                  
    Social insurance...................................    5,187     6,732     5,103     6,623    5,868    5,600
    Means-tested cash..................................    9,293    10,095     9,601    11,727   10,501    9,100
    Food and housing benefits..........................    5,403     7,821     7,989    10,207    9,060    9,000
    EIC and Federal payroll and income taxes...........        0      (543)        0       543    1,853    2,300
                                                        --------------------------------------------------------
        Total..........................................   19,883    24,105    22,693    29,100   27,282   26,000
                                                        ========================================================
Percent reduction in the poverty gap due to:                                                                    
    Social insurance...................................     16.2      15.9      13.1      13.6     13.5     13.3
    Means-tested cash..................................     29.1      23.8      24.7      24.1     24.2     21.6
    Food and housing benefits..........................     16.9      18.5      20.6      21.0     20.9     21.4
    EIC and Federal payroll and income taxes...........      0.0      -1.3       0.0       1.1      4.3      5.5
                                                        --------------------------------------------------------
        Total..........................................     62.2      56.9      58.4      59.8     62.8     61.8
----------------------------------------------------------------------------------------------------------------
Note.--Poverty gap dollars for each year adjusted to 1996 dollars. EIC = earned income credit.                  
                                                                                                                
Source: Congressional Budget Office computations of Census Bureau data.                                         

                               REFERENCES

U.S. Bureau of the Census. (1993). Money income of households, 
        families, and persons in the United States: 1991. 
        Current Population Reports (Series P-60, No. 180). 
        Washington, DC: U.S. Government Printing Office.
U.S. Bureau of the Census. (1996 and various years). Income, 
        poverty, and valuation of noncash benefits, 1994. 
        Current Population Reports (Series P-60, No. 189). 
        Washington, DC: U.S. Government Printing Office. 
        [Several publications from the P-60 Series were used in 
        preparing the tables for this chapter. These include 
        numbers 124, 140, 145, 149, 154, 157, 161, 166, 168, 
        174, and 180.]