Poverty is the largest single factor that drives people to apply for governmental assistance, commonly called "welfare." Many researchers agree that the major factors that create poverty are family size, family background, low educational achievement, unemployment, underemployment (for example, part-time workers who want to work full-time), low wages, and the prevailing economic conditions in the labor market.

Since 1974 children have been the poorest group in America, a status previously held by the elderly. The major reason for the decline in poverty rates among the elderly was social insurance benefits, nearly all of which come from Social Security. In 2002, 16.7 percent of all children in the United States lived in families with incomes below the poverty level. (See Figure 3.2 in Chapter 3.) Changes in household and family composition, particularly the increase in the number of single-parent families, have contributed to high...