The problem of poverty in America looms large even in the best of times. The most recent economic boom got the share of those officially deemed poor down to 11.7 percent, or about 33 million persons, but poverty rates are much higher for economically vulnerable groups such as single mothers, African Americans and Hispanics. Advocates of savings incentives and other asset-building programs for the poor convincingly and passionately make the case that while low incomes are the proximate cause of poverty at any point in time, the inability to accumulate wealth is what keeps people and their families stuck in poverty for generations.

In 2002 Congress will revisit Temporary Assistance for Needy Families (TANF), often known as welfare reform. Many progressives, ourselves included, fought hard against the program that passed in 1996. We judged it too punitive and too far from the spirit of progressive reform, which would have focused less on reducing caseloads and more on both promoting employment and improving the well-being of low-income families with children. We worried that the low-wage labor market, which had been deteriorating for decades, provided little opportunity for families forced to leave public assistance.