As the political debate on the economic competitiveness of the United States heats up, the investment in the nation's children will become a top priority. How successfully is the United States reducing poverty among children through public income transfers of all types? And how does its effectiveness in doing so compare with its effectiveness in eliminating poverty among the elderly? Which demographic categories of children fare better in escaping poverty as a result of receiving public income transfers? This article presents the findings from a study, based on governmental data, on the distributive effects of non-means-tested cash and noncash public transfer programs, as well as of means-tested cash and noncash public transfer programs in reducing poverty among children. Furthermore, data are analyzed for white, black, and Hispanic children, separately, as well as for the elderly. The major findings are that to escape from poverty, the children heavily depend on means-tested noncash transfers in preventing poverty, whereas the elderly depend heavily on non-means-tested cash transfers. The implications for policy are discussed.
