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Imagine yourself as an elderly American in the early 1930s. You live with your daughter’s family on her farm but then the normally abundant crops begin to die due to drought conditions. Your daughter is struggling to take care of her own children and fears she cannot care for you any longer. The support system you thought you had—your family—crumbles. Where do you look for help?

The U.S. Social Security Act of 1935 was created during the Great Depression to be a safety net for older people in such situations. In this Discussion, you examine the Social Security Act and the populations it assisted in the 1930s and today.


  • Identify two reasons why the U.S. Social Security Act (1935) was developed.
  • Explain the requirements for older adults receiving social security benefits (e.g., age requirements, marital status).
  • Compare the needs of the populations served in 1935 and older adults today.



Ideas and Institutional Change in Social
Security: Conversion, Layering, and
Policy Driftn

Daniel Béland, University of Calgary

Objectives. In recent years, social scientists such as Kathleen Thelen and Jacob
Hacker have introduced new concepts to assist in the understanding of institutional
change. Fostering some of these concepts, this article proceeds to augment the
theoretical debate on institutional change in social science and policy research. A
discussion of Social Security development in the United States advances the article’s
main objective: to uncover the relationship between ideational processes and policy
development. Methods. Qualitative and historical analysis is offered to examine
three major policy episodes: the enactment of the 1939 amendments, the first
mandate of the Nixon Administration (1969–1972), and the push for Social Se-
curity privatization that emerged in the 1990s. Results. First, the analysis suggests
that, through the process of institutional conversion, the 1939 amendments and the
Nixon-era reforms altered the nature of Social Security. Second, the discussion on
Social Security privatization stresses the impact of layering and policy drift on
public and private pensions. Conclusions. The concepts of conversion, layering,
and policy drift receive further empirical support through the presented analysis.
Moreover, this article suggests that, for a full understanding of institutional change,
a systematic analysis of ideational processes is necessary.

Scholars have long debated the nature of institutional change in policy
processes. Although there is no consensus about what the main sources of
policy change are, recent scholarship by researchers such as Kathleen Thelen
and Jacob Hacker has provided social scientists working on public policy
with useful analytical models to explore ‘‘how institutions evolve’’ (Thelen,
2004; Streeck and Thelen, 2005; Hacker, 2004). Yet, because the empirical
evidence backing these models remains limited, there is ample room for
empirical studies that could provide more ground to (or challenge) these
models. Similarly, but back at the primary theoretical level, more scholarship
is required on the effect that the relationship between institutional change
and powerful economic, political, and ideological forces have on policy

nDirect correspondence to Daniel Béland, Department of Sociology, University of Cal-
gary, 2500 University Dr. NW, Calgary, Alberta, Canada, T2N 1N4 [email protected]
cai. The author is willing to share all data with those wishing to replicate the study. The
author thanks Shauna Kadyschuk, Angela Kempf, Robert L. Lineberry, and three anonymous
reviewers for their comments.

SOCIAL SCIENCE QUARTERLY, Volume 88, Number 1, March 2007
r2007 Southwestern Social Science Association

Contributing to the theoretical debate on institutional change, the
following analysis will underline the relationship between ideational
processes and policy development through a discussion of the political
history of Social Security in the United States, with a specific focus on the
1939 amendments, the reforms enacted during the first mandate of the
Nixon Administration, and the push for Social Security privatization
that emerged in the 1990s. First, the analysis will suggest that the 1939
amendments and the Nixon-era reforms altered the nature of Social
Security in what are two cases of institutional conversion. Second, looking
at the debate over Social Security privatization, the discussion will
underline the impact of layering and policy drift on pension institutions.
Overall, this analysis will show how a systematic attention to ideational
processes can shed more light on institutional change and, more precisely,
on conversion, layering, and policy drift. Specifically, the analysis will ex-
plain why one type of institutional change takes place rather than another,
and discuss how ideas help in understanding the direction that such change
may take.

The article is divided into four sections. The first will explore the concepts
of conversion, layering, and policy drift at the center of the new theories of
institutional change before showing how ideas can impact policy develop-
ment. The last three sections will respectively explore the 1939 amendments,
the Nixon-era reforms, and the debate over Social Security privatization.
Because these episodes have already been documented in the existing his-
torical literature, the analysis will remain concise, focusing mainly on the-
oretically significant issues and processes. The conclusion will return to the
literature on institutional change and underline the theoretical contribution
of the article.

Institutional Change and Ideational Processes

Historical institutionalism is grounded in the assumption that a histor-
ically constructed set of institutional constraints and opportunities affects
the behavior of political actors and interest groups involved in the policy
process (Immergut, 1998; Lecours, 2005; Orloff, 1993; Orren and Skowro-
nek, 2004; Pierson, 1994; Steinmo, Thelen, and Longstreth, 1992; Weaver
and Rockman, 1993). In contrast to sociological and rational choice insti-
tutionalisms, historical institutionalism focuses on asymmetrical power re-
lations as well as the impact of long-term institutional legacies on policy
making (Hall and Taylor, 1996). Until recently, historical institutionalism
had not paid much attention to institutional change (Clemens and Cook,
1999). This is especially true in the field of policy analysis, where the
concept of path dependence has informed much of the historical institu-
tionalist research (e.g., Pierson, 1994). In recent years, however, institu-
tionalist scholars have begun to offer comprehensive theoretical accounts of

Ideas and Institutional Change in Social Security 21

how institutions change over time (Hacker, 2004; Orren and Skowronek,
2004; Streeck and Thelen, 2005; Thelen, 2003, 2004).1

As the title of her book suggests, Kathleen Thelen’s How Institutions
Evolve sketches a systematic theory of institutional change (Thelen, 2004).
One of the most powerful aspects of that book is the critique of the punc-
tuated equilibrium model of institutional change. Punctuated equilibrium
rests on the assumption that long episodes of institutional inertia follow rare
critical junctures during which exogenous shocks provoke swift path-de-
parting institutional transformations. Thelen does not reject the concepts of
critical junctures and path dependence; rather, she convincingly argues that
most forms of institutional change occur beyond such critical junctures and
that in many contexts, endogenous mechanisms of change are more influ-
ential than exogenous ones. This means that, in order to understand policy
change better, social scientists should pay greater attention to incremental
change occurring during long episodes of—relative—political stability.

In her book, Thelen identifies two main mechanisms of change: layering
and conversion. On the one hand, layering involves ‘‘the grafting of new
elements onto an otherwise stable institutional framework. Such amend-
ments . . . can alter the overall trajectory of an institution’s development’’
(Thelen, 2004:35). The integration of private savings accounts into a tra-
ditional pay-as-you-go pension system is a classic example of layering in the
field of social policy (Thelen, 2003:277). On the other hand, conversion is
about adopting new goals or bringing in new actors that alter the institu-
tional role or the core objectives of an institution. The 1960s transformation
of American social assistance programs into tools of racial equality is an
example of social policy conversion (Thelen, 2003:229; see also Weir,

In a recent contribution on institutional change and social policy, Jacob
Hacker borrows several concepts from Thelen in order to reinforce the
argument that significant path-departing reforms may occur outside critical
junctures and exogenous shocks (Hacker, 2004). Writing about social policy
development in the United States, he argues that a series of low-profile
processes have slowly transformed the nature of that country’s welfare re-
gime. This argument contradicts the common wisdom that enduring policy
legacies have favored strong institutional inertia in spite of powerful con-
servative attacks (Pierson, 1994). Hacker argues that, in addition to layering
and conversion, there is another crucial mechanism of change that can
gradually transform the meaning and the role of existing institutional ar-
rangements. Labeled policy drift, this third mechanism refers to the slow
alteration of such arrangements due to changing socioeconomic circum-
stances. For Hacker, new economic and social trends can make existing
institutions become less and less adequate in the absence of significant

1To this list, one could add Paul Pierson’s Politics in Times (2004). Yet, this book focuses
more on continuity than change, and only the fifth chapter is devoted to institutional change.

22 Social Science Quarterly

legislative reforms designed to adapt them to these changing circumstances.
From this point of view, the inaction of policymakers who could take the
necessary measures to sustain and enhance policy legacies in changing times
constitutes a form of political behavior that can ironically lead to significant
institutional transformations in a context of a rapid economic and social
change. A major example of policy drift analyzed below is the current shift
from pay-as-you-go to defined-contribution occupational pensions in the
United States.

Thelen and Hacker have done much to improve our understanding of the
politics of institutional change. Yet, they leave several questions unanswered.
First, why does one type of institutional change take place rather than
another? For example, although Hacker assumes that policy drift is likely to
occur when obstacles to institutional revision are strong, his discussion about
this crucial issue remains limited (Hacker, 2004). Second, authors such as
Hacker and Thelen do not systematically address the following question:
What factors explain the direction that policy drift and incremental change
take? In his article on policy drift, Hacker essentially depicts policy drift as a
conservative device that reinforces social inequality and increases economic
insecurity. Yet, incremental change is not always conservative in nature,
which means that one must explain the direction it takes. This article sug-
gests that in order to answer these questions and understand institutional
change fully, one must recognize the central role of ideational processes in
politics and policy making. Because institutional change is generally related
to the strategies of concrete social and political actors, understanding the
effect of their ideas and assumptions on the social and economic world is
essential for explaining the way in which these actors can bring about in-
stitutional change in a particular policy area, and the form and orientation
this change will take. As the analysis below suggests, the study of institu-
tional change must take into account these actors’ beliefs and assumptions,
which often take the form of a specific policy paradigm (Hall, 1993). For
Peter Hall, a policy paradigm is ‘‘a framework of ideas and standards that
specifies not only the goals of policy and kind of instruments that can be
used to attain them, but also the very nature of the problems they are meant
to be addressing’’ (Hall, 1993:279). Although policy paradigms are generally
technical and low profile in nature, some of them can become known
outside narrow expert and policy circles through the elaboration of widely
mediated policy blueprints (Blyth, 2002).

Related to concrete economic and political conditions, paradigm shifts
and more limited changes in social and economic assumptions can help
explain the nature and the overall direction of policy change. Arguing that
paying close attention to the ideas of those involved in institutional change is
crucial, the following historical analysis provides more ground to the in-
creasingly influential claim that ideas can shape the content of policy pro-
posals and the perception of interests at the heart of political struggles (e.g.,
Blyth, 2002; Hansen and King, 2001; Lieberman, 2002; Weir, 1992). Yet,

Ideas and Institutional Change in Social Security 23

such a claim does not mean that ideational processes explain everything, and
that traditional factors like electoral competition are irrelevant to the analysis
of policy change. In fact, the analysis below will take electoral competition
into account when exploring the sources of institutional change in American
Social Security development. As evidenced below, the 1939 amendments and
Nixon-era reforms were largely the product of the interaction between elect-
oral competition and paradigm shifts affecting the socioeconomic or actuarial
assumptions forming the background of policy debates and processes. As for
the recent debate on Social Security privatization and related forms of layering
and policy drift, they are unintelligible without a systematic understanding of
the now mainstream conservative economic assumptions that shape the per-
ception of interests at the center of the current struggles over public and
private pension reforms in the United States. Overall, paying such close at-
tention to changing policy ideas is necessary to explain the nature and the
direction of institutional change across the three policy episodes.

Conversion, Phase 1: From Fiscal Conservatism to Family Protection

As enacted in 1935, Social Security constituted a federal social insurance
scheme grounded in conservative actuarial assumptions. The policy para-
digm that guided the elaboration of this program encouraged the emergence
of a distinct set of principles regarding both general revenue financing and
the contributory method. For President Franklin Delano Roosevelt, Social
Security could exist only as a self-supporting program (Altmeyer, 1965; Leff,
1983; Witte, 1963). Rejecting general revenue financing, Roosevelt backed
the idea of a strict actuarial relationship between the contributions of work-
ers and employers, on the one hand, and the level of social benefits, on the
other hand. For him, the contractual model tied to the contributory method
would grant ‘‘the contributors a legal, moral, and political right to collect
their pensions.’’ Because of those ‘‘earned rights,’’ he argued, ‘‘no damn
politician can ever scrap my social security program’’ (Schlesinger,
1959:308–09; see also Perkins, 1946:281–83). Overall, the domination of
the president’s conservative fiscal paradigm meant that benefits would re-
main relatively modest.

A significant episode underlines the central role of President Roosevelt’s
fiscal conservatism in the months preceding the enactment of the Social
Security Act. Unsatisfied with the first draft of the bill, President Roosevelt
ordered his Secretary of the Treasury, Henry Morgenthau Jr., to request that
the Committee on Ways and Means modify the program’s tax schedule in
order to avoid the possible use of general revenue financing after 1965
(Morgenthau, 1935:901–02). Following Morgenthau’s recommendations,
the committee increased the initial tax rate and altered the tax schedule so
that the rate would increase faster than anticipated, reaching a maximum of
6 percent in 1949 instead of 5 percent in 1957. As a result, the anticipated

24 Social Science Quarterly

size of the trust fund would increase by more than 300 percent (Béland,

Interestingly, a major political debate about the future size of this trust
fund would only emerge more than a year after the signing of the Social
Security Act in August 1935. This debate came about during the 1936
presidential campaign, as Republican candidate Alf Landon publicly at-
tacked Social Security, which he labeled a ‘‘cruel hoax.’’ For Landon, the
accumulation of a large reserve fund would lead to governmental mis-
spending on the part of Democrats. ‘‘We have good spenders in Washington
. . . . With this social security money alone running into billions of dollars,
all restraint on Congress will be off’’ (Landon, 1936). As a result of this
misspending, Landon claimed, money from the new federal payroll tax
would not be used to pay Social Security benefits. Despite the defeat of
Landon and the reelection of President Roosevelt in November 1936, the
debate over Social Security funding did not dissipate.

Escalating the ongoing debate over Social Security funding was the August
1937 recession, which some economists argued was caused by the payroll tax
that had taken effect in January of the same year (Berkowitz, 1983). To
assess and contend with this controversial issue, the administration finally
launched the Advisory Council on Social Security (1937). For the Chairman
of the Social Security Board, Arthur Altmeyer, what became the 1937–1938
Advisory Council represented a major political opportunity for the presi-
dent. ‘‘As a matter of fact, I think it is possible not only to offset these
attacks on the Social Security Act, but really to utilize them to advance a
socially desirable program, fully in accord with present fundamental prin-
ciples underlying the Social Security Act and within our financial capacity’’
(Altmeyer, cited in McKinley and Frase, 1970:358).

In its 1938 report, the Advisory Council recommended a major reduction
in the size of the trust fund through a change in the tax schedule and, more
importantly, a major expansion of Social Security benefits (U.S. Advisory
Council on Social Security, 1938). Shifting the focus of the program from
fiscal conservatism to social adequacy and the protection of the family unit
as a whole, the 1937–1938 Advisory Council advocated a more redistribu-
tive vision of social insurance that implicitly contradicted the individualistic
actuarial model adopted in 1935. J. Douglas Brown, who served as Chair of
the Advisory Council, later summarized the nature of the paradigm shift that
shaped the content of the 1939 amendments: ‘‘The Advisory Council of
1937–1938 shifted the whole concept of what became the OASDI program
from a hybrid compromise between private savings and social insurance to a
clear-cut concept of social insurance. The new focus became adequacy and
the protection of the family unit’’ (Brown, 1972:136).2 The enactment of a

2The 1935 version of the program had a redistributive element in the form of a weighted
benefit formula. According to this formula, federal old age insurance would offer higher
replacement rates to lower-income workers.

Ideas and Institutional Change in Social Security 25

legislation grounded in this more redistributive yet low-profile policy
paradigm became possible because the Roosevelt Administration accepted
repudiating the strict social insurance model enacted in 1935—a
decision that reflected the growing social and political opposition in the
aftermath of the 1937 recession and the 1938 congressional elections
(Polenberg, 1975).

To save his Social Security program, Roosevelt succumbed to pressures
demanding the abandonment of fiscal conservatism. Reflecting this com-
promise, Roosevelt finally asked Congress for reform in January 1939
(Roosevelt, 1939). Because the main political actors had already agreed to
reduce the anticipated size of the trust fund in exchange for the increase in
‘‘family protection,’’ the legislative process proved to be unproblematic
(Berkowitz, 1983). Against the financial imperatives imposed by the ad-
ministration less than five years earlier, Social Security emerged as a much
more redistributive program than the one established in 1935. No longer
centered on actuarial equity and advance funding, the new version of the
program included spousal and survivor benefits, two measures rooted in
traditional gender roles (Berkowitz, 2001; Kessler-Harris, 1995; Mettler,
1998). These two measures favored income redistribution from singles to
married couples (Berkowitz, 2001). From this perspective, it is not an ex-
aggeration to talk about institutional conversion in the case of the
1939 amendments. Although the main actors involved in that ‘‘deal’’
remained quiet about the true scope of the reform they supported (Berko-
witz, 1983), it represented a genuine paradigm shift in Social Security.
This fact challenges the punctuated equilibrium model of policy
development as the reform occurred well after the expansionist phase of
the New Deal had ended. Furthermore, the 1939 reform underlines the
role of ideas in institutional change, as there is clear evidence that
the dominance of the family protection paradigm helped reshape some of
the program’s core objectives. Finally, the intensification of electoral com-
petition during President Roosevelt’s second mandate made the 1939 com-
promise possible in the first place, as the weakened Democratic
administration had little choice but to bargain with its opponents in order
to preserve Social Security.

All in all, the emergence of a low-profile paradigm promoting economic
redistribution and grounded in traditional gender roles paved the way to the
1939 amendments. In other words, a particular set of ideas largely explains
the redistributive orientation of the institutional conversion that took place
in 1939. Furthermore, these ideas, coupled with a changing electoral
context and Republican pressures to shrink the trust fund, help explain
why institutional conversion—and not layering or policy drift—occurred
in that particular situation. Ultimately, new policy ideas enabled by a
changing political environment made legislative action not only possible
but unavoidable. This resulted in reform through formal institutional

26 Social Science Quarterly

Conversion, Phase 2: Social Security as a ‘‘Retirement Wage’’

In the United States, World War II favored a return to economic pros-
perity and a strengthening of conservative forces in Congress. This situation
resulted in a decade of relative legislative inaction in the field of Social
Security reform, subsequently ushering in a gradual decline in the real value
of benefits. Eventually, however, to offset the negative effects of inflation,
the 1950s witnessed the enactment of several pieces of Social Security le-
gislation that increased benefits (Achenbaum, 1986; Altmeyer, 1965;
Béland, 2005; Tynes, 1996). Furthermore, the 1950s saw the enactment
of a disability insurance scheme as part of Social Security (Berkowitz,
1987). Less than a decade later, in 1965, the enactment of Medicare, a
program directly related to Social Security, represented another major
step in the incremental expansion of the federal social insurance system
(Corning, 1969; Marmor, 1973). Yet, as far as the old-age pension com-
ponent of Social Security was concerned, the first mandate of the Nixon
Administration constituted a major turning point that brought about a series
of legislative actions gradually altering the very meaning of the program
(Myles, 1988).

Similar to the context of reform in the late 1930s, intensified electoral
competition in the 1970s also helped create conditions conducive to in-
stitutional conversion. Seeking to reduce the capacity of Democrats in
Congress to make electoral gains through ad hoc benefit increases, President
Nixon pushed for the automatic indexation of Social Security (e.g., Nixon,
1971). In this context, Wilbur Mills (D-Arkansas) and other influential
Democratic congressmen opposed this measure in order to maintain their
capacity to claim credit for the ad hoc benefit increases (Weaver, 1988;
Zelizer, 1998:312–46).3 To fight the apparent generosity of President Nix-
on’s indexation proposal, Mills and his allies promoted the enactment of
unprecedented benefit hikes that would significantly increase the real value
of Social Security benefits. Three factors facilitated the adoption of these
increases in the late 1960s and early 1970s. First, in the context of the
Vietnam War, the Democratic leadership in Congress could include benefit
hikes in major war-related bills, which President Nixon could not always
afford to veto (e.g., Weaver, 1988:166). Second, the declining confidence in
big business (Edsall, 1984:113) and occupational pensions (Hacker,
2002:145–53) increased support for more generous Social Security bene-
fits while undermining possible conservative opposition to the expansion of
a popular federal program that now included the middle class (Quadagno,

3Another factor undoubtedly motivating Wilbur Cohen to promote such potentially
popular benefit increases was his plan to run for the presidency in 1972.

Ideas and Institutional Change in Social Security 27

1991).4 Third, a new ‘‘optimistic’’ actuarial paradigm repudiated the ac-
tuarial conservatism that had prevailed since the New Deal.

Rather than assuming that wages would not increase in the future, deci-
sionmakers embraced a ‘‘dynamic’’ actuarial paradigm that produced consid-
erable projected windfalls instead of the after-the-fact windfalls traditionally
generated by conservative assumptions (Derthick, 1979:349–57). What made
the actuarial situation of the early 1970s unique was that ‘‘policymakers could
use these projected windfalls in addition to the after-the-fact windfalls still
available at the time’’ (Béland, 2005:134). Supported by economists from the
Brookings Institution and Social Security Commissioner Robert Ball, these
new assumptions made room for major benefit hikes without the enactment
of potentially unpopular short-term tax increases. Consequently, the emer-
gence of this low-profile actuarial paradigm facilitated the enactment of mas-
sive benefit increases by reducing their perceived fiscal and political cost
(Derthick, 1979; Weaver, 1988). This is true because the new actuarial as-
sumptions helped Democratic members of Congress provide a rationale for
their ambitious benefit increases, which appeared more reasonable in the
mirror of such assumptions. All in all, the new actuarial paradigm largely
explains the progressive direction of the institutional conversion that reshaped
Social Security during President Nixon’s first mandate.

Considering these factors and the Democratic push for major benefit
increases before the enactment of automatic indexation, Congress approved
a series of benefit hikes that extended far beyond the inflation rate: 13
percent in 1967, 15 percent in 1969, 10 percent in 1971, and 20 percent in
1972 (Weaver, 1988). These ad hoc increases boosted the average replace-
ment rate for Social Security before Congress finally enacted automatic
indexation in 1972.5 According to John Myles, the changes adopted be-
tween 1969 and 1974 transformed Social Security into a ‘‘retirement wage’’
program similar to the social insurance schemes adopted in western Europe
during the postwar era (Myles, 1988).

As in 1939, intense electoral competition and a low-profile paradigm shift
led to a genuine form of institutional conversion in Social Security, thus
favoring a rapid expansion of the program. During President Nixon’s first
mandate, optimistic actuarial ideas facilitated the triumph of the liberal
expansionist agenda, thereby affecting the direction of change. The conver-
gence of ideational and electoral factors created a unique opportunity for
significant legislative revision, leading to a genuine form of institutional
conversion, rather than a more indirect form of change such as policy drift.

4On the growing popularity of Social Security in the postwar era, see Brain (1991).
5For example, between only 1969 and 1971, the real value of benefits (i.e., net of inflation)

increased by 23 percent. After indexation became effective in 1974, however, high inflation
rates coupled with cost-of-living adjustments (COLAs) further augmented the real value of
benefits. As an illustration, in 1975 the average replacement rate for Social Security reached
55.9 percent. This figure was up from 33.5 percent in 1965 and 40.3 percent in 1967
(Myers, 1993:363).

28 Social Science Quarterly

Therefore, like the genesis of the 1939 amendments, this episode underlines
the relationship between ideational processes, electoral competition, and
institutional change in Social Security development.

Layering, Policy Drift, and Social Security Privatization

By the mid-1970s, the combined effects of inflation, high unemployment,
and a flawed indexation system favored the emergence of a fiscal crisis in
Social Security (Light, 1995; Snee and Ross, 1978). Considering the pop-
ularity of this program and the powerful constituencies it created (Campbell,
2003; Pierson, 1994), major direct cutbacks were excluded from the legis-
lative agenda and, in 1977, Congress enacted payroll tax hikes coupled with
indirect benefit cuts such as the alteration of the indexation formula (‘‘de-
coupling’’), which only affected future retirees—later known as the ‘‘notch
babies’’ (Pierson and Weaver, 1993:117). Several years later, new legislative
actions became necessary as enduringly high inflation and unemployment
rates created a second fiscal crisis in Social Security (Kingson, 1984). After
making several strategic mistakes (Stockman, 1986), President Reagan fi-
nally put together the Greenspan Commission, which reached a last-minute
agreement over the measures necessary to ‘‘save’’ Social Security (National
Commission on Social Security Reform, 1983). A combination of modest
tax hikes and benefit cuts, the 1983 amendments to the Social Security Act
also included a gradual increase in retirement age that would take place
between 2000 and 2022 (Light, 1995). Overall, the amendments did not
alter the nature and the institutional goals of Social Security.

In the aftermath of the 1983 amendments, conservative actors rejecting
the redistributive nature of Social Security began sketching a long-term
political strategy that could undermine support for the program, leading to
Social Security privatization, which refers to the shift from defined benefits
and pay-as-you-go financing to defined contributions and advanced funding
taking the shape of personal savings accounts (Quadagno, 1999; Teles,
1998). It is impossible to understand the core objectives of this strategy and
the direction that the Social Security debate would take after 1990 without
analyzing the financial paradigm that guides conservative efforts to privatize
that federal program. Related to the old liberal support for individualism
and market forces against economic redistribution, this financial paradigm
seeks to increase personal responsibility and financial investment at the
expense of ‘‘big government’’ security. More concretely, this policy para-
digm states that investing payroll money in equity is beneficial to the econ-
omy as well as to future retirees. This is true because privatization would
create higher ‘‘return rates’’ than the current pay-as-you-go program (e.g.,
Ferrara and Tanner, 1998). Rejecting the redistributive logic of Social Se-
curity, conservatives argue that this new federal savings scheme would
stimulate economic growth by increasing national savings rates. As opposed

Ideas and Institutional Change in Social Security 29

to the family protection and the actuarial paradigms leading, respectively, to
the 1939 and the early 1970s reforms, the new financial paradigm is as-
sociated with a high-profile public discourse that is ever present in con-
temporary media reports and political debates. More recently, the ideas at
the center of this paradigm have been featured prominently in George W.
Bush’s Ownership Society blueprint (Béland, 2005).

To transform Social Security in the sense of this individualistic and mar-
ket-oriented financial paradigm, a number of conservative experts and pol-
iticians argued that only incremental changes in private benefits coupled
with a relentless ideological campaign against Social Security could lead to
its partial or full privatization. Ironically described as a ‘‘Leninist Strategy’’
(Butler and Germanis, 1984), this long-term approach to Social Security
reform includes institutional layering, as conservatives support the multi-
plication of defined-contribution schemes like 401(k)s, which constitutes
the explicit model for Social Security privatization (Teles, 1998).6 By pro-
moting the expansion of these schemes through new tax provisions, con-
servatives and their allies in Congress have helped create a massive
retirement savings system at odds with the pay-as-you-go and the defined-
benefit logics inherent to Social Security (Hacker, 2002).7

The development of tax-deferred 401(k) voluntary savings schemes began
in the late 1970s, intensifying during the 1980s and 1990s. Conservatives
hold the development of these schemes as proof that the existing Social
Security program is obsolete and that privatization would bring efficiency to
the program, as well as higher returns to the vast majority of workers (Teles,
1998). From this perspective, layering is an instrument of conservative pol-
icy change that favors the promotion of specific policy ideas aimed at con-
vincing citizens and interest groups that it is in their interest to support
Social Security privatization and the related financial paradigm.8 The dom-
ination of this paradigm coupled with the exceptional financial perform-
ances of the mid-1990s contributed to the construction of the economic
interests of the financial industry, which generally supported privatization.9

6Personal savings have had a long-standing presence as a major component of the Amer-
ican pension system. Recent conservative efforts have only aimed at encouraging their growth
in order to reduce the reliance on Social Security and defined-benefit pensions.

7The following quote underlines the rapid growth of 401(k)s during the 1980s and 1990s:
‘‘Although enabled by legislation in 1978, 401(k) plans effectively were not adopted until the
Internal Revenue Service issued clarifying rules in 1981. Since then, they have grown re-
markably and become the primary vehicle for retirement saving. In 1996, 33 percent of all
private pension assets, 33 percent of all pension plans, and 45 percent of all active pension
participants were in 401(k)s. The $104 billion in 401(k) contributions represented 61 per-
cent of all pension contributions and 38 percent of National Income and Product Account
(NIPA) personal saving that year. Benefits paid from 401(k)s represented 38 percent of total
pension benefits disbursed’’ (Engelhardt, 2001:1).

8On the argument that ideas shape the perception of economic interests, see Blyth (2002).
9By the late 1990s, however, the support for Social Security privatization within the

financial industry had already started to decline as tangible legislative proposals showed the
administrative problems related to this policy alternative (Rose and Celarier, 1999).

30 Social Science Quarterly

The push for Social Security privatization also broadly represents yet another
facet of the conservative crusade against ‘‘big government,’’ which has be-
come increasingly influential in the United States since the 1970s.

Although conservatives failed to convince members of Congress to enact
Social Security privatization legislation in the 1990s (Derthick, 2001;
Weaver, 2005), impressive stock market performances did help them push
this policy alternative onto the agenda (Teles, 1998). Yet, popular support
for Social Security remained strong, and conservatives failed to convince the
majority of citizens that privatization would serve their interests (Cook,
Barabas, and Page, 2002). In his 1999 State of the Union Address, President
Clinton openly rejected privatization; but, considering the ideological
weight of the financial paradigm, he felt compelled to propose the creation
of new tax-sponsored savings accounts alongside Social Security (Clinton,
1999). Even though this initiative went nowhere in the context of the
Lewinsky scandal (Weaver, 2005), it underlines the central role of layering
in the politics of Social Security.

Nevertheless, the politics of Social Security in the United States is also
about what Jacob Hacker calls policy drift (Hacker, 2004). As employers
increasingly support the development of defined-contribution pensions in
order to replace costly defined-benefit schemes, private pensions are drifting
away from the logic inherent to Social Security. Related to cost-saving
strategies on the part of employers, this form of policy drift is transforming
private benefits despite the absence of path-breaking legislative actions:
economic and managerial logics favor the transformation of the contract
between workers and employers in the sense of a model of protection strik-
ingly similar to policy alternatives labeled as Social Security privatization.
Although the long-term impact of this form of policy drift on Social Se-
curity is unknown, it exacerbates the growing clash between this program
and tax-sponsored private pensions (Hacker, 2002; Klein, 2003).10 This
tendency is in itself a significant form of institutional change through policy
drift, despite the absence of legislation on Social Security privatization.11

Interestingly, the financial paradigm mentioned above is promoting the
multiplication of defined-contribution pension schemes, as they implicitly
serve as models for Social Security privatization. To a certain extent, this
paradigm thus contributes to the individualistic and financial orientation of
contemporary policy drift.

All in all, one could argue that although the powerful constituencies
created by the postwar expansion of Social Security created major political

10In 2003, the Pension Benefit Guaranty Corporation (PBGC) ‘‘insured about 29,500
single-employer defined benefit plans, down from an all-time high of 112,000 plans in 1985.
This decline primarily reflects a large number of terminations among small plans’’ (PBGC,

11Furthermore, in the context of growing income inequality, more income is earned above
the Social Security earnings cap, which, in the long run, is weakening the program’s fiscal

Ideas and Institutional Change in Social Security 31

obstacles to privatization, the enduring influence of the financial paradigm
and the incremental development of personal savings accounts in the private
sector have transformed the American pension system in a profound way.
Through layering and policy drift, the private, yet government-regulated,
pension institutions have changed significantly since the 1980s. In turn,
these trends strongly affect the perception of Social Security, a program
whose postwar expansion was directly related to the development of tax-
sponsored, defined-benefit pension schemes in the private sector (Hacker,
2002; Klein, 2003). With the decline of these schemes and the multipli-
cation of defined-contribution plans and savings accounts, the defined-ben-
efit model at the foundation of Social Security seems more and more
marginal institutionally (Hacker, 2004). Only time will tell if layering,
policy drift, and the ideological campaign of the right will succeed in mak-
ing Social Security privatization appear unavoidable. As President Bush’s
doomed 2005 privatization crusade demonstrates, institutional obstacles to
privatization remain formidable (Béland, 2005). The Bush Administration’s
failure to directly reform Social Security could encourage conservative pol-
iticians and policy experts to ‘‘invest’’ even more in layering and policy drift,
two major sources of incremental change in the contemporary American
pension system. In short, the development of Social Security itself remains
path dependent. Such path dependence subsequently encourages conserva-
tives to support alternative forms of institutional change, such as layering
and policy drift.

This remark points to the reason why layering and policy drift have
dominated the contemporary pension reform scene in the United States.
Because obstacles to formal institutional revision and conversion are strong,
indirect change is the only option for political and economic actors seeking
to implement conservative ideas. From that perspective, the tension between
the conservative paradigm and blueprint on the one hand, and enduring
institutional obstacles on the other hand, explains why conservatives have
promoted layering and policy drift so extensively in order to reshape the
American pension system. As for the conservative direction of contemporary
policy change (i.e., individualizing protection and shifting economic risks
onto workers), it reflects the imperatives of the financial paradigm that has
become increasingly prominent in American policy debates since the early
1990s. High-profile conservative ideas prepare the ground for low-profile
and indirect, yet conservative, change.


This article has offered a dynamic understanding of Social Security de-
velopment in the United States. Far from maintaining the same institutional
path since its enactment in 1935, Social Security has changed over time
in major ways. In 1939, the program became far more distributive than

32 Social Science Quarterly

originally conceived. During the Nixon era, increases in benefits trans-
formed a relatively modest public pension scheme into a genuine income
maintenance program. Since the 1990s, politically meaningful changes in
government-regulated private benefits have not formally altered Social Se-
curity; rather, they have reshaped the economic and institutional environ-
ment of this federal program, thus altering its status and meaning in
American society. As evidenced above, the first two episodes of institutional
change described here correspond to what Kathleen Thelen labels institu-
tional conversion, a process by which the major objectives of a policy are
transformed. Concerning the third episode, it is clearly a case of layering, as
conservatives supported the development of private savings schemes like
401(k)s alongside Social Security in order to weaken institutional support
for that program and persuade the population that financial investment is
the best way to ‘‘save’’ Social Security. Yet, consistent with the scholarship of
Jacob Hacker, this article argues that policy drift is a core aspect of the new
politics of Social Security. Namely, the absence of formal reform, coupled
with the presence of social and economic change, combine to reshape oc-
cupational pensions closely related to Social Security.

Beyond the more dynamic view of Social Security development and the
new empirical evidence supporting the concepts of layering, conversion, and
policy drift, this article contributes to our understanding of institutional
change through a discussion about the role of ideas in public policy. What is
crucial to understand here is that ideational processes can become a major
source of institutional change, at least as far as Social Security development
is concerned. More specifically, the analysis of ideational processes helps
answer two questions raised in the theoretical section. The first question
concerns the factors that explain why one type of policy change takes place
rather than another. Regarding this issue, the discussion about the late 1930s
and the early 1970s episodes shows that the convergence between the for-
mulation of new policy ideas and the intensification of electoral competition
are conducive to institutional revision and conversion. During both epi-
sodes, intensifying electoral competition and the influence of ideas neces-
sitating legislative revision reinforced one another to create the conditions
for genuine institutional conversion. As for the more current situation, the
growing influence of the financial paradigm in the context of strong in-
stitutional obstacles to Social Security privatization this paradigm supports
have transformed layering and policy drift into the main sources of con-
servative policy change in American pension policy. Here, layering and
policy drift become the main instruments of policy change for conservatives
precisely because the legislative revision of Social Security that their financial
paradigm supports remains elusive.

The second question deals with the direction that policy change takes. In
1939, as well as in the late 1960s and early 1970s, a paradigm shift con-
cretely affected the overall direction of the institutional conversion that, on
both occasions, affected Social Security. In 1939, the ‘‘family protection’’

Ideas and Institutional Change in Social Security 33

paradigm grounded in traditional gender roles helped reconstruct Social
Security as a redistributive program. Three decades later, a change in the
actuarial paradigm (i.e., the shift from conservative to ‘‘dynamic’’ assump-
tions) made generous benefit hikes easier to implement for members of
Congress. This resulted in a major expansion of Social Security. As for the
current layering process involving the multiplication of private savings ac-
counts, the financial paradigm dominant among conservatives provides a
strong ideological rationale for this process and for the crusade against the
redistributive logic of Social Security. Consequently, the analysis of the three
episodes backs the claim that ideas play an instrumental role in determining
the overall direction of policy change. Finally, such an analysis underlines
the distinction between high- and low-profile policy ideas. As evidenced
above, the ‘‘family protection’’ and the actuarial paradigms that respectively
impacted the 1939 and the early 1970s reforms represented a set of low-
profile policy ideas hardly debated outside expert and bureaucratic circles. In
contrast, the contemporary financial paradigm has become a highly debated
set of assumptions linked to a prominent policy blueprint: George W.
Bush’s Ownership Society.

As this article suggests, recognizing the central role of ideas in processes of
institutional change identified by Kathleen Thelen and Jacob Hacker does
not mean that ideas are the only locus of policy development. In the first two
episodes analyzed above, for example, electoral competition between the two
main parties and/or between the presidency and Congress represented a
major driving force for institutional change. Furthermore, in the case of the
recent debate on Social Security privatization, the economic interests of
employers and the financial industry constitute a key aspect of the political
process. Yet, because these interests are constructed through ideational pro-
cesses related to the financial paradigm, there is a close relationship between
the politics of ideas and the politics of interests. In the future, scholars
conducting research on institutional change should recognize the enduring
weight of ideational processes in conversion, layering, and policy drift while
paying attention to electoral struggles and the perception of economic in-
terests that can weigh so heavily on policy making.


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Families in Society: The Journal of Contemporary Social Services | | Copyright 2005 Alliance for Children and Families

The passage of the Social Security Act has been heralded
as one of the United State’s greatest policy successes.
However, the current focus is less on preserving Social

Security’s social welfare benefits for all workers and more
on its long-term financing and maximizing individual ben-
efits, which reflects a difference in the fundamental values
underlying Social Security. This shift is most vividly illus-
trated by President Bush’s decision to make the privatiza-
tion of Social Security for younger workers a central focus
of his second-term domestic agenda. Yet Social Security is
indeed the safety net for many older adults, especially
women and people of color. It is credited with removing
more individuals from poverty than all other governmental
programs combined. The more than threefold decline in

poverty among the older population over a 40-year period
is due largely to Social Security. In 1959, the poverty rate
among adults age 65 and older was 35.9% compared with
10.2% today (U.S. Census Bureau, 2001, 2004a ). Yet even
with this policy success, approximately 3.6 million older
Americans still fell below the official federal poverty line in
2003, and an additional 2.2 million older adults were classi-
fied as near poor (income between the poverty level and
125% of this level; U.S. Census Bureau, 2004a). A dispro-
portionate number of these older Americans living in
poverty are women. Indeed, the stark reality is that almost
70% of poor older adults are women, in particular women
of color and those older than 85 years and living alone
(Fitzpatrick & Entmacher, 2000).

Reducing Poverty Among
Older Women: Social Security
Reform and Gender Equity
Judith G. Gonyea & Nancy R. Hooyman


The authors document the higher poverty rate of older women, especially women of color, com-

pared with older men—a pattern created and maintained by the intersection of the structural

factors of age, race, and marital status. They then review how the U.S. Social Security program

generally benefits older women and reduces their late-life economic vulnerability. A persistent

gender inequity, however, is that women are more likely to disrupt their paid employment to

meet family care responsibilities, which may increase the number of zero-earnings years and

reduce the amount paid into Social Security. Current proposals to privatize the Social Security

system are critiqued in terms of their gender inequities. Three relatively revenue-neutral propos-

als that could increase Social Security’s protection against poverty and differentially affect low-

income women are briefly discussed.


This article is part of “The Future of Social Work With Older Adults,” a special issue
of Families in Society with guest editor Carol Austin.

Gonyea & Hooyman | Reducing Poverty Among Older Women: Social Security Reform and Gender Equity


As the nation’s older population has continued to grow,
along with a dramatically increasing federal deficit, conflict-
ing viewpoints have emerged regarding public or collective
responsibility for income security in old age. Moreover, the
level of this debate has intensified with the growing realiza-
tion that members of the baby boomer generation will soon
begin to enter the ranks of the 65-plus population. The U.S.
Census Bureau projects that by 2030, the time at which the
youngest members of the baby boomer generation will turn
65, the percentage of the older population will reach 20%
(i.e., 1 of every 5 Americans; U.S. Census Bureau, 2001).
Much of the current debate about privatizing Social Security
has, therefore, been framed around the program’s financial
solvency and returns on individual investment. Less atten-
tion has been focused on the inadequacies of Social Security
to protect low-income individuals from moving into
poverty in old age. However, both issues—the long-term fis-
cal balance and the antipoverty effectiveness of Social
Security—are critical to promoting older women’s eco-
nomic security.

We begin with an examination of the experience of
poverty among older Americans. We not only highlight
gender differences in the risk of late-life poverty but also
examine how the poverty risk varies within the female pop-
ulation based on structural characteristics such as age,
socioeconomic class, race, and marital status. The ways in
which women’s domestic and labor force roles contribute
to their late-life economic vulnerability and the salience of
Social Security to their lives are explored. Current propos-
als to privatize Social Security are critiqued in terms of their
gender inequities. In contrast, we argue for both the pro-
tection of Social Security’s core principles and expansion of
its antipoverty protection.

The Differential Risk of Poverty in Old Age

Lack of attention to the plight of older adults who are liv-
ing in poverty may reflect a growing societal view that older
adults are faring better financially relative to other age
groups in the United States, particularly children. As noted,
the poverty rate for persons 65 and older was 10.2% in
2003, which is lower than the 10.8% rate for working age
adults and the 17.6% rate for children (U.S. Census Bureau,
2004a). It is increasingly recognized, however, that the
annual cross-sectional poverty statistics produced by the
Current Population Survey (CPS) do not present a com-
plete picture of the economic status of older Americans
(Wu, 2003). Using longitudinal data from the national
Panel Study of Income Dynamics (PSID), for example, Wu
(2003) tracked the poverty status of the same individuals
from 1981 to 1992.

To explore the phenomenon of persistent poverty, Wu
asked two important questions: (a) Do older persons face a
greater risk than younger persons in falling into poverty for
a long period, and (b) Do older adults compared with

young adults experience more difficulty escaping from
poverty after they enter it? His findings reveal that the
poverty experience does, in fact, vary by life stage. During a
5-year period (1988–1992), 24.3% of the 65-plus popula-
tion experienced poverty for at least 1 year and 5.6% were
poor for all 5 years; in contrast, 20.1% of the under-65 pop-
ulation were poor for at least 1 year and only 3.6% lived in
poverty throughout the 5 years. During the 12-year period
(1981–1992), only 35.2% of the 65-plus population who
spent 1 year in poverty escaped from economic hardship
compared with 40.3% of the under-65 population. Wu
concluded that “the majority of older adults who spent
more than four consecutive years in poverty will stay in
poverty for a long time, and some of them will remain poor
until death” (2003).

The PSID longitudinal data reinforce a finding consis-
tently documented in the CPS cross-sectional data: Women
are at a much greater risk of falling into poverty in later life
than men. From 1998 to 1992, 27.8% of older women expe-
rienced at least 1 year of poverty compared with 17.6% of
men (Wu, 2003). In fact, analysis of the CPS data on the
percentage of older Americans living in poverty by age,
gender, race, and Hispanic origin dramatically underscores
the greater vulnerability of women of color.

As reflected in Table 1, approximately 25% of older
African American or Hispanic women now live below the
federal poverty level. Marriage often protects women
against experiencing poverty in old age. Whereas less than
5% of older married women face poverty, as shown in Table
2, 17% of unmarried older women are poor (Federal
Interagency Forum on Aging-Related Statistics, 2002; Older
Women’s League, 2003).

Women’s Economic Vulnerability
Across the Life Course

The difference in women’s greater economically vulnerabil-
ity in old age compared with men’s is largely a consequence

TABLE 1. Percentage of Older U.S. Adults Living in Poverty, by Age,
Gender, Race and Hispanic Origin in 2001


Sex and Age
Both Sexes

65 to 74 years 9.2 7.8 20.2 21.8

75 and older 11.2 10.2 24.2 22.0


65 to 74 years 6.8 5.7 14.3 17.5

75 and older 7.3 6.4 18.1 19.4


65 to 74 years 11.2 9.6 24.5 25.0

75 and older 13.6 12.5 28.3 23.7
aHispanic can be of any race.
Source: U.S. Bureau of Labor Statistics and Bureau of the Census. Current
Population Series, Annual Demographic Survey March 2001 Supplement.
Table 1.

FAMILIES IN SOCIETY | Volume 86, No. 3


of the domestic division of labor and women’s position in
the labor market. Exploring the linkages among the phases
of the life course, rather than their distinctiveness, reveals
how feminization of poverty occurs in old age. Although
more women have entered the labor force in the last several
decades, their wages, even for workers with the greatest
employment effort, continue to lag behind those of men
who are working full time and year-round. One important
reason for this earnings gap is gender segregation in the
labor market (i.e., the division into traditional women’s jobs
and men’s jobs). In 2003, a gender-based comparison of
fully engaged workers (e.g., continuous, full-time employ-
ment) revealed that women earn, on average 75.5 cents for
every dollar earned by men (U.S. Census Bureau, 2004b).

The measurement of an annual male–female wage gap
(similar to the annual poverty statistic) does not, however,
offer a complete picture of the gender-based wage differen-
tial. Using the PSID to track the same men and women
across a 15-year period, Rose and Hartman (2004) found
that prime-age (26–59 years) employed women earned
only 38% of that of prime-age men. The long-term effects
of this earning differential are large and can be devastating:

Across the fifteen years of the study, the prime age

working woman earned only $273,592 while the aver-

age working man earned $722,693 (in 1999 dollars).

This gap of 62% is more than twice as large as the

23% gap commonly reported. (Rose & Hartman

2004, p. iii)

Moreover, the gender-based division of domestic
responsibilities results in women, more often than men,
reducing their time in the paid labor force in order to take
on child and elder care and household management.
Across the 15-year time span, Rose and Hartman found
that slightly more than half (52%) of women had at least 1
calendar year without any earnings compared with just
16% of men. Similarly, women are more than twice as likely
as men to work part time (i.e., fewer than 25 hr per week).
In 2002, approximately 25% of employed women worked
part-time compared with 11% of employed men (U.S.
Bureau of Labor Statistics, 2003). The long-term earnings
data underscore that women’s time spent performing fam-
ily care often profoundly limits their economic resources in
later life. In fact, motherhood has been identified as the sin-
gle greatest risk factor for poverty in old age (Rappaport,

2004). Finally, women’s longer average life expectancy
compared with men’s means that they may be required to
stretch more limited financial resources over a greater
number of years. This pattern is also true of married
women who outlive their spouses. More than half (59%) of
women enter their later years of life not married, even if
they once were; as indicated in Table 2, these women face a
fourfold greater chance of being poor (Administration on
Aging, 2002).

The Importance of Social Security
to Older Women’s Lives

Social Security is a near-universal old age social insurance
program; 9 of every 10 older citizens are beneficiaries. In
fact, it is, in most respects, a highly successful program
(American Association of Retired Persons [AARP], 2005).
Because of women’s longer life expectancies, they comprise
58% of all Social Security beneficiaries age 62 and older
and approximately 71% of beneficiaries aged 85 and older.
Without Social Security, it is estimated that more than 50%
of our nation’s current population of older women would
be poor (Moody, 2002;Older Women’s League, 2003; Weir,
Willis, & Sevak, 2002).

From its beginnings, Social Security was never intended to
be the only source of retirement income; rather, it was
viewed as providing a foundation, along with incomes from
pensions, savings, and investments, in the creation of an eco-
nomically secure old age for U.S. citizenry. Yet for too many
older Americans who lack private pensions or extensive

TABLE 2. Percentage of Older American Women Living in Poverty, by
Marital Status in 2001


Married 4.3

Widowed 15.9

Divorced 20.4

Never married 18.9

Source: U.S. Bureau of Census, Current Population Survey, March 2002.






Less than 50%
of Income

50% to 89%
of Income

90% to 99%
of Income

of Income










Men Women




FIGURE 1. Gender comparison of Social Security as a percentage of
income for older Americans, 2001.

U.S. Census Bureau, 2002, Current Population Survey, March Supplement
as prepared by AARP Public Policy Institute, 2003.

Gonyea & Hooyman | Reducing Poverty Among Older Women: Social Security Reform and Gender Equity


assets, Social Security is their sole income source. As Figure 1
reveals, Social Security represents 90% to 100% of retirement
income for almost 59% of women and 29% of men. Analysis
by race further reveals that women of color currently rely
even more heavily on Social Security for their income in old
age than do White women. Social Security provides more
than half the retirement income for over 80% of nonmarried
older African American and Hispanic women compared
with 73% of older White women. Similarly, for more than
50% of African American and Hispanic women, Social
Security represents 90% or more of their retirement income
compared with 40% of White women (National Women’s
Law Center, 2003).

The heavy reliance on Social Security by America’s poor-
est elders is again underscored, as shown in Table 3, through
a comparison of the income sources for the lowest income
quintile of the 65-plus population, which is disproportion-
ately occupied by women, with that of the highest income
quintile for this age group. Greater workforce attachment
(e.g., full-time employment), job stability (e.g., longer job
tenures), and higher incomes are associated with a greater
accumulation of retirement resources. Women, as a result of
their different employment histories, are thus much less
likely than men to receive a private pension in old age. Yet
even when an older woman does have pension income, it is
typically much smaller than that of an older man’s. Using
CPS data from 1999 to 2001, Lee and Shaw (2003) found
that only about 30% of older women received pension
income compared with almost 47% of men. Women’s
median annual pension income was about half that of men:
$5,600 versus $10,340 (in 2000 constant dollars).

For both genders, the most common reason for not par-
ticipating in a pension plan is that the employer simply
does not offer one. Almost equal percentages of men and
women—39% and 35%, respectively—reported the lack of
an employer-sponsored plan as the primary reason for
nonparticipation. However, significant gender differences
in pension participation exist among employees working
for companies that offer pension plans: Female (24%)
employees were almost twice as likely as male employees
(13%) to report that their nonparticipation was due to not
working a sufficient number of hours to qualify for enroll-
ment (Shaw & Hill, 2001). This finding is of particular

concern given the dramatic expansion of part-time and
temporary employment in the United States during the
past few decades. Nearly 25% of the U.S. workforce—more
than 30 million Americans—is now engaged in part-time
employment with few employment-based benefits; women
of all races and minority men disproportionately fill these
positions (Hudson, 2000).

Three features of the Social Security program are partic-
ularly salient to women’s economic status. First, the Social
Security benefit formula is progressive. Benefits are deter-
mined based on workers’ earnings; thus, workers with
higher earnings pay more taxes and receive higher benefits
than those with lower earnings. However, the progressive
benefit formula means that Social Security replaces a
greater proportion of lower earners’ past income than of
higher earners’ past income (although higher income ben-
eficiaries will receive a larger benefit in dollars because they
have paid more into the system). As noted in our previous
discussion, because women typically earn less than men,
the progressive formula replaces a greater proportion of
their lifetime earnings. The progressive benefit formula is of
particular importance to women of color, who tend to be
heavily concentrated in low-paying occupations. African
American and Hispanic women who are full-time workers
earn, on average, only 65% and 56%, respectively, of the
earnings of White men and 74% of the earnings of White
women(Older Women’s League, 2003). For workers who
retired at age 65 in 2000, the replacement rate for what they
had paid into Social Security was 53% of preretirement
income for lower earners, 40% for average earners, 32% for
higher earners, and 24% for those with the maximum tax-
able earnings (Anzick & Weaver, 2001).

A second feature of the Social Security system that is
salient for women is that workers’ dependents have access
to benefits. Under Social Security law, a married woman or
qualified divorced woman (after a marriage of at least 10
years) is entitled to the higher of two benefits: a benefit cal-
culated based on her own employment history or a benefit
that is 50% of her husband’s (or former husband’s) benefit.
A widow or divorced widow is also entitled to the higher of
her own worker benefit or her husband’s (or ex-husband’s)
full benefit as long as she meets requirements related to
length of marriage and if her divorced husband has lived
long enough to collect benefits. The current reality is that
women are more likely to receive Social Security benefits as
a dependent—a spouse or widow—than men because their
lower lifetime earnings mean that their benefits are typi-
cally higher as a spouse or a widow versus as an employee.
Although almost all (95%) men receive a benefit based fully
on their own employment histories, only 37% of women
garnered worker benefits in 1997 (Anzick & Weaver, 2001).

Third, Social Security is more than a worker retirement
program; it offers both life insurance and disability insur-
ance for workers and their families. Moreover, these aspects
of the Social Security program are particularly crucial for

TABLE 3. Source of Income Among Persons Age 65 and Older
in the Lowest and Highest Income Quintiles, 2001


Social Security 83.0 20.0

Asset Income 2.0 19.0

Pensions 4.0 21.0

Earnings 1.0 38.0

Public Assistance 9.0 0.0

Other 1.0 2.0

Total 100.0 100.0

Source: Social Security Administration Income of Aged Chartbook, 2002.

FAMILIES IN SOCIETY | Volume 86, No. 3


women. Despite increasing life expectancies, 1 of every 7
Americans (disproportionately men) will still die before
reaching age 67. Many of these individuals, who are the
family primary wage earners, lack life insurance policies.
Through Social Security, family members are entitled to
survivor’s benefits; currently, of the approximately 47 mil-
lion Americans who are Social Security recipients, 7 million
are the spouses and children of deceased workers. In fact,
for the average wage earner with a family, the Social Security
insurance benefit is estimated to be equivalent to a $322,000
life insurance policy (National Committee to Preserve
Social Security and Medicare, 2004). Long-term disability
may also jeopardize an individual’s ability to be employed.
Although the vast majority of workers lack long-term dis-
ability insurance, about 3 of every 10 young adult workers
will become disabled before reaching age 67. Fortunately,
Social Security offers protection to families and workers
with major disabilities that prevent them from being able to
work. For the average wage earner with a family, the Social
Security insurance benefit is calculated to be equivalent to a
$233,000 disability insurance policy (National Committee
to Preserve Social Security and Medicare, 2004).

These nonretirement features of the program are criti-
cally important to women across the life span because only
slightly more than 33% of female recipients of Social
Security receive benefits solely as retired workers compared
with more than 80% of male recipients (National Women’s
Law Center [NWLC], 2002). Analyses by race underscore
that the Social Security’s disability and survivor benefits are
critical particularly to the economic status of women of
color and their families. Approximately 20% of African
American and Hispanic beneficiaries are younger than 55
years compared with 10% of White beneficiaries. On the
basis of calculations with Social Security Administration
data, the NWLC (2003) found that African American
women rely disproportionately on these nonretirement
aspects of the Social Security program, given their higher
rates of disability and their likelihood of surviving their
husbands. The NWLC reports that

While African Americans make up 9% of all female

beneficiaries, African American women constitute

18% of female disabled worker beneficiaries.…

Whereas 7% of all Social Security beneficiaries are

children, 15% of African American beneficiaries are

children. In fact, African American children are almost

four times more likely to be lifted out of poverty by

Social Security than White children. (2003, p. 2)

Finally, the annual cost-of-living adjustment (COLA) fea-
ture of Social Security helps all beneficiaries cope with rising
costs such as utilities and prescription drugs. This third fea-
ture is especially valuable for women given their longer life
expectancies. Without this inflation protection feature,
Social Security benefits would buy considerably less over

time. For example, with a 3% annual inflation rate and with-
out the COLAs, it is estimated that benefits would buy 25%
less after 10 years (National Women’s Law Center, 2002).

Gender Inequities Inherent in Proposals
to Privatize Social Security

Social Security is a successful program precisely because it
remains the most important source of retirement income
for older Americans, especially low-income older women.
Although concerns have been raised about Social Security’s
longer term financial solvency program, efforts to reform it
should not undermine the protections it currently offers
our nation’s oldest citizens. Immediate fiscal reforms to
address a crisis appear to be unnecessary because the Social
Securities actuaries conservatively project that the trust
fund balance will not be depleted until 2042. Yet, even after
this date, Social Security would not be bankrupt; instead,
annual collections from payroll taxes would be sufficient to
meet more than 70% of benefits (Board of Trustees, Old
Age and Survivors Insurance and Disability Insurance,
2004). The Congressional Budget Office’s model estimates
the possible trust fund depletion date as 2052 and only a
1% payroll gap between income and benefits over the next
75 years, assuming no changes in the Social Security pro-
gram (Congressional Budget Office, 2004).

Although prior presidents and members of Congress
have discussed the private mechanisms of incentives to
save, the likelihood of privatization has increased dramati-
cally with the 2004 reelection of President Bush. Such a
shift is congruent with the beginning privatization of
Medicare through the 2003 Medicare Prescription Reform
in this current era of market and private or individual
responsibility (Binstock, 2002). Privatization would divert
payroll taxes (or general revenue income tax credits) to
new personal investment accounts among workers younger
than 55 years. This model assumes a strong economy and
stock market, discretionary resources to invest, and indi-
vidual knowledge and skills to make informed investment
decisions. The volatility of these assumptions, especially
related to the stock market, will result in both increased
individual risk and greater federal budget deficits.
Regardless of any particular model, privatization reflects
the following values: Free markets, not social insurance, are
the most efficient and fair way to distribute resources;
employment success is rewarded; and individual responsi-
bility and freedom of choice (or risks) are paramount.
These values contrast dramatically with the values of uni-
versalism, mutual responsibility, cross-generational bene-
fits, and earned right underlying the origin of Social
Security (Smallhout, 2002).

Privatization of Social Security would negatively affect
women, especially those of color, more than men (Older
Women’s League, 2002). Although the specifics of
President Bush’s current privatization model are not yet

Gonyea & Hooyman | Reducing Poverty Among Older Women: Social Security Reform and Gender Equity


fully known, the costs of moving to a privatization
scheme have been acknowledged in prior analyses by the
Social Security Administration and even by the
Moynihan Commission’s Report on Social Security.
Under privatization, the progressive benefit formula of
Social Security, which replaces a higher percentage of
earnings for lower income workers than higher income
workers, would be lost. Moreover, as low-income and
part-time employees, many women would have smaller
private accounts to invest. With more limited financial
resources, women typically avoid higher risk investments;
therefore, it is anticipated that the yield of their accounts
would generally be below average. In fact, women might
find a larger share of their private accounts going to
administrative costs. Many policy experts now estimate
that the administrative costs—perhaps as high as $1 tril-
lion—would be dramatically higher in individual
account systems (AARP, 2005). For example, if transac-
tion fees involve a flat per-account charge, administrative
costs would consume a larger portion of the accounts of
low- and moderate-income older adults (Diamond, 1998;
Munnell, 1999). Ultimately, the burden for the manage-
ment of the investment portfolio would fall squarely on
the individual’s shoulders. In addition, older women who
have historically received little training in financial man-
agement may be at greater risk for faulty or poor invest-
ment decisions.

Because of generally limited private investments, women
are less likely than men to have sufficient income to last
until death. Privatization means that there would no longer
be a lifetime guarantee of a benefit; instead, when funds in
the account are exhausted, the account ceases to exist.
Given women’s longer life expectancy compared with men,
coupled with their smaller accounts, women would face a
greater prospect of outliving all of their savings and assets.
Although women can purchase lifetime private annuities,
such annuities, unlike Social Security, are monthly pay-
ments based on gender-based life expectancies, resulting in
women receiving a lower lifetime benefit even when their
investments are equal to those of men.

Concerns are also raised that privatization would likely
eliminate death and disability protection and the cost-of-
living increase available through Social Security, all changes
that would disadvantage women’s benefits. Women, com-
pared with men, are much more likely to be responsible for
children and themselves after a spouse’s disablement or
death. How privatization would impact divorced women is
unclear. Under Social Security, divorced spouses and
divorced widows, after a marriage of 10 years, automatically
receive the same benefits that married spouses and widows
receive without any corresponding reduction in benefits to
the worker or subsequent spouses. In a privatized system,
however, the core benefit might be reduced, and division of
the private account between husband and wife would fall
under the jurisdiction of a divorce court.

The primary beneficiaries of privatization will be higher
income unmarried workers who will not be born until 2025
and who will be largely Caucasian males. In the short term,
women will bear the burden of transition and administrative
costs, including the need to cut current Social Security bene-
fits when funds are diverted into individual accounts and
being taxed twice (e.g., paying for their own retirement
through private accounts while continuing to pay for current
beneficiaries; Cavanaugh, 2002; Favreault & Sammartino,
2002; National Committee to Preserve Social Security and
Medicare, 2005; Williamson, 2002). Debates about privatiza-
tion also need to consider other ways to prevent a shortfall in
2040, such as expanding the number of workers participat-
ing in Social Security by requiring state and local govern-
ment workers to participate, raising the cap on taxable
income, reducing slightly future benefits or COLA increases,
or allowing the government to invest the funds in equity
markets. Several analysts, for example, have suggested that a
1.1% rise in the FICA tax would be sufficient to finance the
Social Security system throughout the baby boomer genera-
tion’s retirement years (Diamond & Orszag, 2003; National
Committee to Preserve Social Security and Medicare, 2005;
Quadagno, 1999). Although attention does need to be given
to Social Security’s future, its solvency can be achieved
through incremental changes and does not require privatiza-
tion, which undermines its basic principles and reduces
retirement income for women and persons of color.

Increasing Social Security’s
Antipoverty Protection

The current debate on privatization has overshadowed dis-
cussions of the plight of elders who continue to live in
poverty. Despite the enormous success of Social Security in
lifting generations of older Americans out of poverty, it
remains a flawed antipoverty program (Callahan, 1999).
Several proposals for programmatic reforms to Social
Security have been advanced to reduce older women’s
financial vulnerability, including raising the minimum
Social Security benefit; increasing the survivors benefit for
widows; and providing dependent care credits. A discussion
of each of these options follows.

A Higher Minimum Social Security Benefit
As we have shown, even a lifetime of employment does not
guarantee a financially secure retirement, especially for the
working poor. Raising the minimum Social Security bene-
fit would be particularly valuable to women and persons of
color, given their overrepresentation in the secondary labor
market, a sector that is characterized by low-paying jobs
with few benefits. Moreover, many women and persons of
color are employed in physically demanding or taxing jobs
(e.g., domestic, industrial, and farm labor) that lead to an
earlier departure from the paid labor force. Lower income
is also associated with a greater risk for earlier onset of a

FAMILIES IN SOCIETY | Volume 86, No. 3


number of chronic and disabling health conditions that
might force earlier retirement decisions (Kijakazi, 2003).
Using the data from the National Health and Retirement
Study, Flippen and Tienda (2000) found that African
Americans, Hispanics, and women experience more invol-
untary job separation in the years immediately before
retirement and that these periods of joblessness often result
in permanent labor force withdrawal.

In fact, a special minimum Social Security benefit cur-
rently exists for low-wage workers with a history of steady
employment that provides these retirees with a higher
monthly benefit than they would receive under the regular
benefit formula. Few individuals, however, are currently
eligible for the special minimum benefit because of its
restrictive eligibility requirements. In 2000, only about
144,000 individuals, or 0.33% of Social Security beneficia-
ries, received the special minimum benefit. Moreover, the
maximum benefit amount remains at only 85% of the fed-
eral poverty threshold for an adult aged 65 and older
(Anazick & Weaver, 2001). A number of policy analysts,
such as Wendall Primus of the Center on Budget and Policy
Priorities, have offered proposals for a revised benefit for-
mula and eligibility standards in order to both raise the
minimum benefit amount and more effectively target these
funds to the working poor (See Kijakazi, 2003, and Anazick
& Weaver, 2001, for more detailed discussions of this pro-
posed reform.) Finally, increasing the minimum Social
Security benefit would particularly benefit poor employed
women who either never married or were married fewer
than 10 years and thus receive a benefit based solely on
their own employment histories.

Increase the Survivor Benefit for Widows
Women often experience a significant decline in their
income with the death of their husband. Under the current
Social Security system, a married couple is allowed to
receive 100% of the higher earner’s income as well as a
spousal benefit equal to 50% of the higher earner’s income
(or her own earnings history if that would result in benefits
higher than the spouse’s benefit). On her husband’s death, a
woman receives 100% of her own benefit or 100% of the
deceased spouse’s benefit. For most widows, the decline in
Social Security income greatly exceeds the decline in their
living expenses. The federal poverty threshold for a 1-per-
son older household equals 79% of the federal poverty level
for a 2-person older household. Thus, policy experts often
suggest that the survivor’s benefit should be increased to
75% of the couple’s benefit; in other words, the surviving
spouse’s benefit should not be reduced by more than 25%
of the couple’s combined benefit (Anzick & Weaver, 2001;
Burkhauser & Smeeding, 1994).

Raising the survivor benefit would provide gains for older
widowed women, but the largest increases would be to wid-
ows from families with higher lifetime earnings (Favreault,
Sammartino, 2002). As Harrington Meyer (1996) notes,

middle- and upper-class White women are more like to
receive noncontributory Social Security benefits. Because
more women have entered the paid labor force and fewer
women are married for the qualifying 10-year marriage,
what was originally an important safety net for lower
income retirees has greatest value for traditional families in
higher income brackets (Harrington Meyer, 1996).

Offering Dependent Care Credits
Care credits are often debated as a way to reward and rec-
ognize women’s disproportionate responsibilities for rais-
ing children. Rather than marital status as an eligibility
criterion, women would receive benefits based on their
contribution to the economy through both their labor
force participation and their unpaid work of child care. Yet
care credit reforms need to take account of race and socioe-
conomic class differences within the female population.
The most commonly debated type of care credit proposal
is to remove zero-earnings years—when women have been
out of the paid work force because of child care responsi-
bilities—from women’s benefit calculation. This approach
may further class and racial inequities, however, because
upper income White married women, who can afford not
to work for pay, are more likely to benefit than low-income
married women of color who are employed out of eco-
nomic necessity. Because most low-income women have to
work, they are unlikely to have zero-earnings years in their
benefit calculation. A second care credit model would drop
additional low-earnings years (9 years) from the benefit
calculations. Currently, workers can drop 5 low-earnings
years between the ages of 22 and 62, which leaves them
with 35 earnings years. Because the rewards for caregiving
are directly tied to women’s earnings histories, women with
high earnings would again fare better than women with
low earnings. Placing a value on care is a third way to struc-
ture care credits; such credits would be a set amount of
earnings, which would substitute for a certain number of
years of earnings that are below this level. To illustrate, if
the care credit was $15,000 and a woman within her high-
est 35 years of earnings had 2 years in which she earned
only $8,000, she would be credited with an additional
$7,000 for those years. This approach would benefit lower
income women more than those with higher earnings
(Herd, 2002). Care credits would be a more progressive way
to distribute benefits than spousal benefits, because women
would move onto the worker benefit and their lower
incomes would be buffered by economic value being
assigned to their unpaid care work. Generally, low-income
women would be hurt most by a system that dropped more
zero- or low-earnings years and would benefit most if half
of their median wage were substituted into low-earnings
years. Because care credits would eliminate spousal bene-
fits, this approach would probably be revenue neutral for
the government, unlike privatization proposals that carry
heavy transition and administrative costs.

Gonyea & Hooyman | Reducing Poverty Among Older Women: Social Security Reform and Gender Equity


All three of the identified programmatic reforms would
redistribute women’s benefits from earlier to later in life.
However, it is evident that each of these programmatic
changes would differentially impact various subpopula-
tions of older women, given the complexity and diversity of
their life experiences. In one of the most significant studies
to date, Favreault and Sammartino (2002) use a dynamic
microsimulation model on the 1990–1993 Survey of
Income and Program Participation data to explore the
impact of expanding the minimum benefit, increasing the
survivor benefit, and offering dependent care credits. Their
analysis underscores that programmatic reforms to
improve Social Security’s adequacy and equity for current
and future generations of women can be designed to be
low-cost or revenue neutral. They conclude that

Policymakers should be careful not to rely on intu-

ition when designing reforms to shore up women’s

Social Security benefits, but rather to rely on rigorous

analyses … we have demonstrated that policymakers

can change the parameters in the existing system to

target the highest-risk low-income and older women.

Our analyses show how legislators can combine a

series of changes into packages that meet multiple

needs. (2002, p. ix)

Since its origin, the Social Security program has been
amended a number of times to increase its antipoverty
effectiveness. Amendments have included, for example,
raises in benefit levels, the indexing of levels to inflation
(COLAs), and shortening of the marriage duration require-
ment from 20 to 10 years. Each of the identified reforms—
raising the minimum benefit level, increasing the survivor
benefit level, and offering dependent care credits—repre-
sent critical programmatic reforms that would further
strengthen Social Security’s antipoverty protection.

Unfortunately, the current focus on Social Security’s
long-term solvency overlooks its centrality to older
women’s relative economic security and protection from
poverty, especially among low-income women of color.
Even though a significant percentage of older women who
receive Social Security benefits still remain poor or near
poor, their economic status is likely to be at even greater
risk under a system of privatization that assumes individu-
als have adequate resources and investment capability.
Given the relative invisibility of older women in our public
policy-making process, their needs for protection from
poverty under revenue-neutral proposals are unlikely to be
heard compared with the financial gains from privatization
for investment companies. Although the Older Women’s
League has been a strong advocate for changes in Social
Security to benefit older women, their voices are likely to be
silenced by the powerful interest groups that characterize
policymaking in this current era of free market and indi-
vidual responsibility (Binstock, 2002).

The characteristics of future cohorts of women Social
Security beneficiaries will differ markedly from current
women beneficiaries. Changing marital, family, and labor
force patterns suggest that a smaller proportion of women
will be entitled to benefits solely as spouses or survivors and
a growing proportion will receive worker-only benefits,
dually entitled spouse benefits, and dually entitled survivor
benefits. It is critical to recognize, however, that these trends
will not eliminate concerns about the adequacy and equity
of Social Security benefits. As the debate regarding how to
“save” Social Security intensifies, progressives must effec-
tively make the case that privatizing Social Security would
mean less retirement income for the majority of Americans
and would be particularly harmful to women. The Social
Security program can be protected for future generations of
retirees without introducing the risk of and high cost of
individual private accounts. Further, progressives must
advocate strongly that this current period of reform offers
an opportunity not only to protect but also to raise the
safety net of Social Security for older women who are at
high risk for poverty.

The profession of social work has a long history of grass-
roots advocacy and speaking out about the role of govern-
ment in protecting our nation’s most vulnerable citizens.
Social workers, individually and collectively through the
National Association of Social Workers, can play a significant
role in communicating concerns about the president’s pri-
vatization plans, particularly for women. As a historically
female profession, social work represents an important
voice in working to preserve and strengthen Social Security
not only for the current cohort of older women but also for
our daughters, granddaughters, and great-granddaughters.

Administration on Aging. (2002). A profile of older Americans: 2002.

Retrieved May 20, 2005, from

American Association of Retired Persons. (2005, February 12). AARP and
Social Security: A background briefing. Retrieved May 20, 2005,

Anzick, M. A., & Weaver, D. A. (2001). Reducing poverty among elderly
women. ORES Working Paper Series Number 87. Washington DC:
Social Security Administration, Office of Research, Evaluation and

Binstock, R. (2002). The politics of enacting reform. In S. H. Altman & D.
I. Schatman (Eds.), Policies for an aging society (pp. 346–377).
Baltimore, MD: John Hopkins University Press.

Board of Trustees, Old Age and Survivors Insurance and Disability
Insurance. (2004). Annual report of the Board of Trustees of the
federal Old Age and Survivors Insurance and Disability Insurance
trust funds. Washington, DC: Author.

Burkhauser, R. V., & Smeeding, T. M. (1994). Social Security reform: A
budget neutral approach to reducing older women’s disproportionate
risk of poverty. Syracuse, NY: Maxwell School of Citizenship and
Public Affairs/Center for Policy Research.

Callahan, D. (1999). Still with us: Elderly poverty in America. The
American Prospect. 10(45), 74–77.

Cavanaugh, F. X. (2002). Feasibility of Social Security individual accounts.
Washington, DC: Public Policy Institute, AARP.

Congressional Budget Office. (2004). The outlook for Social Security.
Washington, DC: Author.

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Diamond, P. A. (1998). The economics of Social Security reform. In R. D.
Arnold, M. J. Graetz, & A. H. Munnell (Eds.), Framing the Social
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Judith G. Gonyea, PhD, is associate professor and chair, Boston
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PhD, is endowed professor of gerontology and dean emeritus, University
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Manuscript received: November 15, 2004
Revised: March 24, 2005
Accepted: March 25, 2005


Predictors of
among Older Adults
in New York City

Disability, Economic,
Human and Social Capital
and Stressful Events

New York University, USA
The Partnership for the Homeless, USA


We interviewed 61 housed and
79 homeless adults aged 55 and over
about disability; economic, human
and social capital; and stressful life
events prior to becoming homeless.
Over half of the homeless group had
previously led conventional lives.
Human capital, social capital and life
events were more important than
disability or economic capital in
predicting homelessness. The
homeless adults were younger, more
likely to be male and better educated
than housed adults, but had shorter job
tenure and fewer social ties. Homeless
adults faced multiple, cascading risks,
including job loss and housing loss.
Implications for prevention are

Journal of Health Psychology
Copyright © 2007 SAGE Publications
Los Angeles, London, New Delhi and
Vol 12(5) 696–708
DOI: 10.1177/1359105307080581

AC K N OW L E D G E M E N T S . We thank the Partnership for the Homeless for
funding interview incentives, the Jacob A. Riis Settlement House for
furnishing the comparison group, Marcia Liu for data entry and interviewers.
We are especially grateful to respondents, both homeless and housed. This
article is based in part on an undergraduate honors thesis by Jamie Gottlieb.

C O M P E T I N G I N T E R E S T S : None declared.

A D D R E S S . Correspondence should be directed to:
MARYBETH SHINN, New York University, 715 Broadway, Room 201,
New York, NY 10003, USA. [email: [email protected]]


■ aging
■ disability
■ homelessness
■ life events
■ social capital

UNTIL RECENTLY, homelessness among older adults
in the United States seemed to be vanquished. In
1973 a book on homeless adults in New York was
entitled Old men drunk and sober (Bahr & Caplow,
1973), but by the 1980s attention shifted to ‘the new
homeless’: young minority men and families (e.g.
New York Commission on the Homeless, 1992). In
1990, adults aged 50–61 used shelter at less than a
third the rate, and adults aged 62 and over less than a
15th the rate, of adults aged 18–39 (0.41%, 0.09%
and 1.40–1.45% of the population respectively,
Culhane & Metraux, 1999). But homelessness
among older adults is again on the rise. This study
asks why, and what to do about it.

The reduction in poverty among adults aged 65 and
older in the United States from 35 percent in 1960 to
10 percent in 1995 is widely hailed as an accomplish-
ment of Social Security. However, although older
people continued to make progress relative to the
poverty line until the mid-1990s, progress relative to
median non-elderly income stagnated in the 1980s
(Engelhardt & Gruber, 2004). Further, the poverty
rate for people aged 65 and older is nearly twice as
high in New York City as in the nation as a whole
(17.7% vs 9.4% in 2004, US Census Bureau
Factfinder, n.d.). Perhaps as a consequence, the age of
homeless New Yorkers is creeping up again. Single
adults in New York’s shelter system were an average
of five years older in 2002 than in 1988. Those over
40 made up 53 percent of the total in 2002, compared
to less than 30 percent in 1988 (New York City
Department of Homeless Services, n.d.). By 2005, 13
percent of residents of single adult shelters were 55
and over (M. Schretzman, Associate Commissioner,
NYC Department of Homeless Services, personal
communication, October 2005).

It is natural that homeless adults should age along
with the overall population, but why might they be
aging faster? One possibility is that individuals once
dubbed the ‘new homeless’ remained homeless as they
grew older. Cohen suggests that ‘personal risk factors
[for homelessness] may accumulate over a lifetime’
and enculturation to street or shelter may prolong
homelessness, although systemic and programmatic
factors also matter (2004, p. 425). He reports that older
homeless men ‘commonly have long histories of
homelessness’ whereas homelessness among older
women is more often caused by a crisis (2004, p. 428).
However, studies of shelter records indicate that
relatively few people are chronically homeless; most
exit from this state (Culhane, Dejowski, Ibanez,
Needham, & Macchia, 1994).

Another possibility is that as incomes stagnate and
housing costs rise, adverse events may lead older
adults to become homeless for the first time late in life.
Indeed, in a cross-national study in England, Australia
and the United States, Crane et al. (2005) found that of
older adults who became homeless within the last two
years, two-thirds (four-fifths in the United States) had
never been homeless before. However, by definition,
this study did not include adults with long, continuous
histories of homelessness.

The current study has two goals. First, we examine
risk factors for homelessness by comparing homeless
and housed but poor adults over the age of 55. Based
on prior research with homeless populations of differ-
ent ages, we hypothesize that five classes of factors
would differentiate homeless adults from their housed
counterparts. These include disability, economic,
human and social capital and stressful events in the
period leading up to homelessness. In order to under-
stand potential causes of homelessness, we tied our
assessment to the last year that study participants
spent in conventional housing, that is an apartment or
a house. Second, we use narrative descriptions of
respondents’ lives to understand the extent to which
homeless older adults always had tenuous ties to
housing or led relatively conventional lives before
becoming homeless in old age.


Numerous studies have found elevated levels of
physical health problems, mental illness and substance
abuse among homeless single adults both in the United
States (Burt et al., 1999; Koegel, Burnam, & Baumohl,
1996) and in Europe (Firdion & Marpsat, 2007;
Muñoz, Crespo, & Pérez-Santos, 2005; Philippot,
Lecocq, Sempoux, Nachtergael, & Galand, 2007).
Gelberg, Linn and Mayer-Oakes (1990) found more
chronic disease and functional disability among home-
less individuals over 50 than among younger homeless
people. They and others have concluded that in terms
of health, homeless people over 50 resemble the gen-
eral population over 65 (Cohen, 1999; Gelberg et al.,
1990). Substance use and mental illness accounted for
69 percent of hospitalizations among homeless adults
in New York City, from 2001–3 compared with 10
percent in the general population (Kerker et al.,
2005), although it is important to realize that a single
person can account for multiple hospitalizations. We
expected that high levels of disability would also
predate homelessness.



Economic capital

Homeless individuals live in deep poverty, with aver-
age incomes in a national survey of only $367 per
month in 1996 (Burt et al., 1999). We hypothesized
that poverty would predate homelessness. In particu-
lar we expected that low levels of income (in the
job participants held for the longest period) and high
levels of economic stressors (in the last year in
conventional housing) would predict homelessness.
In the United States, a home is the primary economic
asset for middle-class adults, but New York is a city
of renters, and poor adults are unlikely to own homes.
Thus we examined title to housing, defined as owning
a home or having one’s name on the lease rather than
doubling up with others. We also examined housing
quality. The protective effect of a housing subsidy—
another form of economic capital—could not be exam-
ined, because comparison group members all had
subsidized housing.

Human capital

Human capital refers not to economic assets but to the
ability to earn them. We considered educational attain-
ment and work history as measures of human capital,
and predicted that low levels of both would predict
homelessness. Caton et al. (2000) found low educa-
tional levels to be a risk factor for homelessness
among men in New York.

Social capital

Social capital refers to the social and organizational
ties on which individuals can draw for assistance.
Many studies have found that homeless individuals
and families lack social supports, or wear out their
welcome with relatives and friends before becoming
homeless, although findings are not uniform (Shinn,
Knickman, & Weitzman, 1991). We assessed the
extent to which children, or other relatives and friends,
would serve as housing resources, and also examined
respondents’ participation in community-based orga-
nizations. We hypothesized that social capital would
be negatively related to homelessness. A number of
studies have found that disruptive childhood experi-
ences, such as abuse or being in foster care, are asso-
ciated with homelessness (Herman, Susser, Struening,
& Link, 1997; Shinn et al., 1991). We assessed such
experiences as negative indicators of social capital but
posed no hypothesis, because it was unclear whether

childhood disruptions would have enduring conse-
quences for older adults.

Stressful life events

Crane et al. (2005) describe events or transitions that
may serve as ‘triggers’ for homelessness in older
adults such as widowhood, marital breakdown, stop-
ping work, evictions and onset or increased severity of
mental illness. (We included the last under disability.)
We hypothesized that stressful life events would be
associated with homelessness. However, life transi-
tions may also be common for older adults who
remain securely housed. Here, as for all measures, our
strategy was comparative. We asked not simply about
the levels of disability, capital and stressful events
among homeless adults during their last period of
stable housing, but about the relative levels in homeless
and housed but poor adults, and the extent to which
each factor predicted homelessness in the context of
the others.


Participants were 79 homeless and 61 housed adults
aged 55 and older. Homeless adults were recruited
from Peter’s Place, the only drop-in center in New
York City dedicated to serving adults 55 and older.
Drop-in centers are low-demand settings that provide
food, social, medical and housing services to home-
less individuals coming off the street. They are open
24 hours a day, seven days a week. Some participants
go to informal night shelters in churches and return to
the drop-in center during the day; others remain on
chairs in the drop-in center at night or return intermit-
tently to the street. Peter’s Place often serves older
adults wary of the city’s mixed-age shelter system.
Housed respondents were recruited from a settlement
house serving a public housing project in New York
City, ensuring that all were low income. Based on
directors’ estimates of attendance at the two agencies
during the interview period, response rates were
approximately 82 percent for the homeless adults and
68 percent for the housed adults.

Interviewers (undergraduate and graduate psychology
students who received extensive training) visited
the drop-in center and settlement house repeatedly
over a period of several months, becoming a familiar



presence. Respondents, who were paid $20, could sign
up for interviews, or were solicited informally by
interviewers. After giving informed consent, partici-
pants were interviewed in English or Spanish in
private spaces for about an hour.

Two measures were used to assure respondents’
competence to provide data. First, we included a mea-
sure of cognitive competence (Chestnut Health
Systems, n.d.), however, individuals with failing scores
were primarily non-native speakers of English and, in
the interviewers’ judgments, difficulties had to do with
language rather than memory. Interviewers also rated
the coherence and consistency of the interview. Three
interviews with homeless respondents, one rated as
having ‘serious problems of coherence or consistency’,
one terminated by the interviewer when the respondent
seemed confused and one broken off by an agitated
respondent were excluded from analysis.

Most measures were tied to a ‘target year’, that is the
most recent 12-month period in which the respondent
had lived continuously in conventional housing with-
out a move, in order to understand how events and
conditions in this year may have precipitated home-
lessness. The interviewer obtained a housing history to
identify the last residence that qualified, and asked
several questions about its location, who else lived
there and when and why the respondent left in order to
fix the location in the respondent’s mind. For 59 of 61
comparison respondents, but none of the homeless
respondents, this target year was the 12 months imme-
diately preceding the interview.

Measures of disabilities included physical disabil-
ity, mental disability and substance use in the target
year. Physical disability included reports that health
problems affected ability to carry out any of five tasks
(e.g. engage in moderate physical activity such as car-
rying groceries or climbing stairs), or hospitalization
for a medical problem. Mental disability included
reports that a ‘mental or nervous problem’ affected
‘your ability to do the things you had to do’ or hospi-
talization ‘for a nervous problem’. A substance prob-
lem included reports of using marijuana or other
drugs weekly, having any of four other symptoms of
abuse of alcohol or drugs from the GAIN–Short
Screener (Chestnut Health Systems, n.d., e.g. ‘did you
try to hide that you were using alcohol, marijuana or
other drugs’), or staying overnight in a detox facility.

Measures of economic capital included income for
the final year at the longest job the respondent had
held, and economic stressors, title to housing and

building problems during the target year. Income at the
longest job was divided by the poverty threshold for
the relevant year, to adjust for inflation. Economic
stressors were assessed by an eight-item scale (based
on Pearlin & Schooler, 1978) with high scores indicat-
ing high levels of stressors (Cronbach’s alpha = .90).
Items asked about inability to afford necessities (e.g.
‘the kind of food you should have’) and difficulties
with finances. Because the items used different
response scales, they were standardized before averag-
ing, and the average was again standardized to make
units meaningful. Title to housing assessed whether
the respondent owned a residence or was named on a
rental lease. A count of four serious building problems
(e.g. lack of heat for a week or more in winter, rats;
Shinn et al., 1998) indexed housing quality.

Measures of human capital included receipt of a
high school (or equivalency) diploma and length of
the longest job the respondent had ever held.
Measures of social capital included a count of six dis-
ruptive events in youth such as living in foster care, or
being physically abused, reported by the respondent
before age 18 (Shinn et al., 1991), and three adult
measures: child housing resource indicated that the
respondent had at least one child who would allow the
respondent to stay with him or her. Relative/friend
housing resource indicated that the respondent had a
friend or a relative who would allow this. Organiza-
tional ties were scored on a three-point scale where 0
indicated no organizational affiliations in the target
year; 1 indicated attendance at a place of worship,
community or senior center, or other club or regular
meeting (excluding the agencies where we sampled
respondents) and 2 indicated that someone would ask
about a respondent who missed a meeting or did not
go for a long time.

Stressful life events was a count of the number
out of 11 events the respondent experienced during the
target year. Events were related to housing (eviction,
being told to leave), employment (job loss), relation-
ships (divorce, ceasing to live with a partner, spouse or
family member’s death or illness) and criminal victim-
ization or involvement (self or family member arrested
or jailed).

After the interview, the interviewer wrote a
‘thumbnail sketch’ of the respondent’s life and, for
homeless respondents, the circumstances that led to
housing loss. The interviewer also rated the coher-
ence and consistency of the interview, and the
extent to which homeless respondents had a ‘con-
ventional life’ in terms of housing and employment
prior to becoming homeless. To assure consistency



in the latter ratings, two experienced interviewers
re-read the full set of thumbnail sketches for homeless
respondents, and rated respondents again, focusing
on whether the respondent had a stable lifestyle for a
decade or more before becoming homeless. Agreement,
corrected for chance (kappa) between the two sets
of ratings was .75; disagreements were resolved by

Missing data
Thirty-five respondents (25%) were unable to recall
their income for the final year at their longest job, and
we doubted the accuracy of additional reports. Thus
we use this variable descriptively, but exclude it from
regression analyses. No other variable was missing
data for more than 3 percent of cases, and missing data
were scattered. We used the Expectation Maximization
method, SPSS version 14.0, to impute missing values
for regression analyses (excluding income from the
data used for imputation).


Description of sample
Table 1 shows the demographic characteristics of
homeless and housed respondents as of the time of the
interview. Housed respondents were approximately
seven years older (and 13 years older during the ‘tar-
get year’ in which both groups were in conventional
housing, see Table 2). They were also much more
likely to be female and Black, and marginally less
likely to be foreign born. Few respondents in either
group were currently married. Housed respondents
were more likely to be widowed, and homeless respon-
dents more likely never to have married.

Surprisingly, the homeless respondents were sub-
stantially better educated than the housed comparison
group. Just under half of the housed group had com-
pleted high school, and only 13 percent had any post-
high school education, whereas three-quarters of
the homeless group had completed high school and



Table 1. Descriptive characteristics of homeless and housed groups

Homeless group Housed group Test of difference
(N = 79) (N = 61) (t or χ²)

Age, years, mean (SD) 63.6 (7.6) 70.5 (7.4) 6.88***
Female, % 19 77 49.74***
Race/ethnicity, % 22.26***

Blacka 41 75
Latino 13 13
White 33 8
Other 14 3

Foreign birth % 30 17 3.57t

Marital status, % 30.19***
Married 4 13
Separated 17 16
Divorced 23 15
Widowed 19 49
Single (never married) 37 7

Education, % 18.55**
8th grade or below 12 21
9th to 11th grade 14 30
Completed high school 31 36
Some college 27 8
College graduate 10 2
Post-graduate 6 3

Income/poverty line 4.1 (2.5) 2.6 (1.9) 3.51**
(at end of longest job)b

tp < .10; *p < .05; **p < .01; ***p < .001
a Mostly African-American, but also African and Caribbean
b Excluded from regression analyses due to 25 percent missing data

43 percent had some higher education. Reported jobs
(including teacher, engineer, army officer and many
business posts) were consistent with these educations.
The homeless group also reported higher incomes at
their longest job.

Prediction of homelessness
We predicted homelessness from age (as of the target
year), gender and measures of disability; economic,
human and social capital; and stressful life events. Table
2 shows univariate relationships between variables in
each domain and homelessness. Taken one at a time,
only physical disability, building problems and disrup-
tive events in youth failed to predict homelessness at
p < .05.

Table 2 also shows the adjusted odds ratios and 95%
confidence intervals for a parsimonious multivariate

model, arrived at by backwards elimination: non-
significant predictors were removed, one at a time,
from a full model with all the predictors in the table,
until only variables that were related to homelessness
at p < .05 remained. To check whether the order of
removal mattered, each excluded variable was added
back to this parsimonious model individually; none of
the excluded variables was related to homelessness at
p < .10.1 The adjusted odds ratio is the amount by
which the odds of homelessness are multiplied for each
unit increase in the predictor variable, controlling for
other variables in the model. For dichotomous vari-
ables (such as gender or high school education) it is
simply the amount by which the odds are multiplied
for women, or for high school graduates. For variables
measured in years, such as age or length of longest job,
it is the amount by which the odds are multiplied for



Table 2. Predictors of homelessness along with odds ratios for logistic regression model predicting homelessness from
life history and conditions in last year in conventional housing (target year)

Adjusted odds ratio
Homeless group Housed group (95% confidence

Predictor: mean (with SD) or proportion (N = 79) (N = 61) interval)b

Age during target year 57.6 (10.3) 70.5 (7.4)*** 0.84 (0.74, 0.94)
Female .19 .77*** 0.01 (0.00, 0.12)

Disability in target year
Physical disability .42 .57t

Mental disability .24 .08*
Substance problem .34 .05***

Economic capital in target year
Economic stressors (Z-score) 0.2 (1.1) -0.3 (0.7)**
Housing title .69 .89**
# Building problems (out of 4) 0.6 (0.9) 0.6 (0.9)

Human capital
High school or GED .74 .49** 38.52 (2.29, 648.68)
Length of longest job (years) 10.8 (8.2) 17.1 (10.3)*** 0.81 (0.71, 0.93)

Social capital
# Disruptive events in youth 0.8 (1.1) 0.6 (1.1)
Child housing resource .33 .85*** 0.08 (0.01, 0.59)
Relative/friend housing resource .25 .79*** 0.03 (0.00, 0.28)
Organizational ties, mean (0–2 scale) 1.0 (0.9) 1.7 (0.6)***

Stressful life events in target year
# of events 1.0 (1.1) 0.4 (0.6)***
Apartment or job lossa .48 .02*** 31.02 (1.99, 483.68)

tp < .10; *p < .05; **p < .01; ***p < .001 in univariate analyses predicting homelessness
a Apartment or job loss in the target year was substituted, post hoc, for full index of stressful life events. The
substitution did not change the significance of other predictors
b Odds ratios are from the parsimonious model including all variables where odds ratios are given. No other variable
reached significance at p < .10 in the context of this basic set

each year—a five-year increase in age multiplied the
odds of homelessness by (.84)5 or .42. If the confidence
interval includes 1, the variable is not significant (mul-
tiplying by 1 yields no change). Because of the rela-
tively small sample size, only rather substantial effects
reached statistical significance.

In terms of demographic variables, homeless indi-
viduals were younger and more likely to be male than
housed individuals, and both these variables remained
significant in the context of all other variables.

No form of disability was a significant predictor of
homelessness in the context of other variables. The
adjusted odds ratios when each variable was added to
the parsimonious model were 1.18 for physical dis-
ability and 1.08 for mental disability, suggesting that
these forms of disability were not important to home-
lessness. However, the confidence intervals were
quite broad: (0.13, 10.54) for physical disability and
(0.12, 9.38) for mental disability, so that neither large
increases in the odds of homelessness nor large
decreases could be ruled out. In the case of substance
problems the adjusted odds ratio was substantial
(9.13), suggesting that substance abuse could well be
important to homelessness in this age group, but the
broad confidence interval (0.58, 145.05), made it
impossible to specify this association. (Both sub-
stance abuse and homelessness were correlated with
younger age and male gender.) No indicator of eco-
nomic capital contributed to the final model, although
economic stressors and title to housing were signifi-
cant taking one variable at a time. Of these, title to
housing seemed more likely to be important, with an
adjusted odds ratio (when added to the parsimonious
model) of 7.98, but a very broad confidence interval
(0.54, 118.05). Both groups experienced relatively
high levels of economic stressors in the target year,
e.g. 38 percent of homeless and 31 percent of housed
adults reported not having enough money to afford
the kind of food they should have at least once in a
while. Although we could not examine the association
of housing subsidies with homelessness, because the
comparison group was recruited from subsidized
public housing, only 24 percent of homeless respon-
dents had received a housing subsidy in their last year
in stable housing.

The two indicators of human capital had opposite
relationships to homelessness. As already noted,
educational attainment was positively associated
with homelessness, but length of the longest job
was negatively associated. Housed individuals had
worked over six years longer, on average, at the
longest job they had held, but the homeless group

also had substantial work histories, with tenure at
the longest job averaging almost 11 years.

Two measures of social capital were also signifi-
cant predictors of homelessness controlling for other
variables. Housed respondents were much more
likely than homeless respondents to report having a
child or another relative or friend who would house
them. Nevertheless, a third of homeless respondents
said a child would allow them to stay, and a quarter
said someone else would do so. Why, then, were
they homeless? Respondents commonly reported
contentious relationships with someone in the house-
hold, not wanting to impose or wanting to remain
independent (14–19 respondents each). Other network
members lived far away, had not been in touch with
the respondent for years, lived in crowded circum-
stances or were in the military or institutional settings
(5–9 respondents each). (Respondents could offer dif-
ferent reasons for different network members.)

Although homeless individuals reported over twice
as many stressful life events in their last year in con-
ventional housing as did housed respondents, the
overall index of life events did not contribute to the
prediction of homelessness, controlling for other vari-
ables. A post hoc examination of specific life events
showed that homeless respondents were far more
likely than housed respondents to report events relat-
ing to loss of housing or jobs during their last year in
conventional housing: 25 percent had been evicted,
8 percent had been asked to leave by someone they
were staying with and 22 percent had lost a job.
Altogether, 48 percent of homeless but only 2 percent
of housed respondents had experienced one or more
of these events in their last year in conventional hous-
ing. The average number of other events reported by
the two groups (0.43 for homeless, 0.42 for housed)
was virtually identical. An indicator that the respon-
dent had lost an apartment or a job in the year before
becoming homeless, when substituted for the life
events index in the logistic regression analysis, was
highly significant, increasing the odds of homeless-
ness by a factor of 31 (with broad confidence
bounds). No other variable changed in significance as
a result. The odds ratios and confidence intervals in
Table 2 are from the equation using the indicator of
apartment or job loss.

Conventional lives and
qualitative analyses
We coded 42 or 53 percent of the 79 homeless
respondents as having conventional lives prior to
becoming homeless. This designation did not mean



that individuals had no problems, simply that they
managed to keep conventional housing and jobs for
extended periods of time prior to becoming home-
less late in life.

Table 3 shows differences between the homeless
respondents coded as having more conventional and
less conventional lives. The two groups were nearly
the same age, but those with less conventional lives
were 15 years younger on average, when they first
became homeless, were four times as likely to have
had multiple bouts of homelessness and, based on the
thumbnail sketches, often had tenuous ties to housing
throughout adulthood. The less conventional group
was twice as likely to have had a substance problem
in the target year and twice as likely to have experi-
enced disruptive events in childhood. The more con-
ventional group was more likely to have graduated
from high school, and had held their longest job for
almost twice as long, on average. They were also
more likely to report organizational ties and that a
child would allow them to stay. Although the groups
did not differ on overall stressful life events or the
combined index of apartment and job loss, the less
conventional group was more likely to have lost a job
and the more conventional group more likely to have
lost housing during the target year. The groups did not
differ on any other variables in Tables 1 and 2.

In summary, the less conventional group fit the pro-
file of individuals with long histories of homelessness
or housing instability and accumulated risk; the more
conventional group did not. Why, then, did the latter
group become homeless in old age? Summaries of the
thumbnail sketches for five more conventional
respondents give qualitative answers.

José (not his real name), age 77, graduated from
college in Cuba, and came to the United States, where
he owned a furniture business and raised eight chil-
dren, before retiring and selling the business at age 72.
Although he thought that he could live on his pension,
he was soon unable to afford the rent for his long-time
apartment, and was evicted. José is close to his chil-
dren, but says that they are enjoying their lives and he
does not want to be a burden to them, or a ‘pain in the

Bill, age 74, graduated from high school and lived
in the same apartment for 50 years until age 68, when
he developed a crippling physical illness which pre-
vented him from working or living alone. He thus lost
the construction job he had held for 15 years and was
unable to afford his rent. He stayed with a nephew for
two years and a sister for one year; but became home-
less after ‘using up’ these social resources.

James, age 68, came to New York from a southern
state in the 1960s. He had some college education,



Table 3. Differences between homeless individuals with more and less conventional lives

Less conventional More conventional Test of difference
Characteristic: mean (SD) or proportion (N = 37) (N = 42) (t or χ²)

History of homelessness
Age at interview 62.5 (6.6) 64.7 (8.4) 1.30
Age first homeless 44.2 (15.0) 59.4 (10.2) 5.06***
Multiple bouts of homelessness .70 .17 22.62***

Disability in target year
Substance problem .49 .21 6.56*

Human capital
High School or GED .62 .85 5.59*
Length of longest job (years) 7.4 (6.1) 13.7 (8.8) 3.66***

Social capital
# Disruptive events in youth 1.2 (1.3) 0.5 (0.8) 2.49*
Child housing resource .19 .45 6.36*
Organizational ties, mean (0–2 scale) 0.8 (0.9) 1.2 (0.8) 2.16*

Stressful life events in target year
Evicted or asked to leave .19 .45 6.36*
Job loss .35 .10 7.89**

*p < .05; ** p< .01; *** p< .001
The groups did not differ on gender, race, foreign birth, marital status, income relative to poverty line, mental or
physical health, economic stressors, title to housing, building problems, relative/friend housing resource or the full
index of stressful events

and owned a grocery store, from which he retired at
age 67. A year later, he lost his apartment in a fire. The
City placed him in a single-room occupancy hotel,
which he left because it was dirty and infested with
roaches. Although he could stay with either of his two
children, he wants to get back on his feet in a place of
his own.

Bob, age 58, is a Vietnam veteran with some college
education who was diagnosed with generalized anxi-
ety disorder, bipolar disorder and post-traumatic stress
disorder (PTSD), but nevertheless earned $70,000 a
year in a management position for a bank. He became
homeless at age 56 when the girlfriend with whom he
had lived for seven years left. Two months later he
left his job and lacked money to pay the rent. He had
problems with both gambling and alcohol abuse, and
reported stays in detox and in a hospital for both med-
ical and nervous problems in that year.

Susan, age 86, became homeless at age 74 when
she was evicted from the apartment where she had
lived for 29 years for hoarding. She never married and
had no children. She had some college education and
had served in the military, done fundraising for a
social service agency and worked as assistant public-
ity director for a large arts organization, among other
jobs. After an injury restricted her ability to work, she
began to manage a thrift shop. She brought so many
items home that it created a fire hazard. Susan has
three elderly siblings who are in nursing homes or
living with children and unable to help her.

These case studies suggest that the quantitative
measures were sometimes too specific to capture
respondents’ situations. Neither James, whose apart-
ment burned down, nor Bob, who could not afford
the rent after his girlfriend left, reported being
evicted or asked to leave by someone they were stay-
ing with. Other ‘conventional’ respondents reported
losing their housing in ways our stressful event
inventory did not capture (e.g. a flood, a death of the
primary tenant, a shooting, a move that did not work
out). No case-study respondent reported losing a job
in the target year, although Bill and Susan lost jobs
earlier, due to illness and injury, and Bob left work
for unspecified reasons that may have been related to
mental disability.

The case studies also show that it is typically the
confluence of multiple risk factors or a cascade of
events that make someone homeless, rather than
just one. Susan was coded as having both a physical
and a mental health problem in her last year in con-
ventional housing, no child, friend or relative hous-
ing resources and a relatively short period of five

years in her longest job (she held many jobs over
the years). None the less, she remained housed until
age 74, living in her last apartment for 29 years.

Based on the qualitative findings that homeless
respondents experienced multiple risk factors, we did
a final post hoc analysis. For each respondent we
counted the number of 12 risk factors: physical dis-
ability; mental disability; substance problem; eco-
nomic stressors above the sample mean; lack of title
to housing; longest job of less than 10 years; any dis-
ruptive event in youth; lack of child housing
resource; lack of relative/friend housing resource;
lack of organizational ties; job loss in target year; and
housing loss in target year. On average, homeless
individuals had three more risk factors than did
housed individuals (homeless M = 4.97, SD = 1.97;
housed M = 2.05, SD = 1.51, t(138) = 9.60, p < .001).
Among housed respondents, 67 percent had 0–2 risk
factors and none had more than six. Among homeless
respondents, only 10 percent had 0–2 risk factors,
and 25 percent had 7–10. The only homeless respon-
dent with no identifiable risk factors described giving
everything up and taking to the street after his wife
died, but his example shows the value of a compara-
tive approach. As Table 1 shows, widowhood was far
more common in the housed sample.


Conventional lives
Perhaps the most interesting finding to emerge from
the study is that over half of the homeless respon-
dents lived relatively conventional lives, typically
involving long periods of employment and residen-
tial stability before becoming homeless at an aver-
age age of 59. Multiple events shifted people who
were unsupported by family and society from these
conventional lives into homelessness. Just under
half of the homeless respondents had longer histo-
ries of instability, more in line with earlier findings
(e.g. Cohen, 2004). The dividing line between these
groups is a fuzzy one—the slide into homelessness
was often slow, with lives looking less conventional
as time went on.

Predictors of homelessness
The quantitative analyses isolated factors that differen-
tiated the entire group of homeless adults from poor
adults who remained housed. Key predictors were
male gender, younger age, higher levels of education,
shorter tenure in the longest job held, loss of an



apartment or job while in conventional housing and
lack of children or other ties who would provide hous-
ing. Because confidence intervals were often broad,
the study should not be interpreted as providing evi-
dence against the contributions of other factors to
homelessness. In particular, substance problems and
title to housing may play important roles. The sam-
pling design, in which all housed respondents were
drawn from public housing, meant that the role of
housing subsidies in protecting against homelessness
could not be examined, despite their scarcity in the
homeless group and importance to other populations
in the same city (Shinn et al., 1998).

Demographic differences between groups were
unsurprising. Studies of single homeless adults (e.g.
Burt et al., 1999) typically find many more men than
women whereas differential mortality leads to larger
numbers of women than men among older adults
generally. Very old adults may not be able to survive
on the street (Gelberg et al., 1990). Adults who are
too old to readily gain employment if they lose jobs
but who are too young to be eligible for social secu-
rity benefits may be at special risk as Okamoto
(2007) also found in Japan. As in national studies (e.g.
Burt et al., 1999), there were relatively more Black
respondents in the homeless group than in New York
City, but this was even truer of the comparison group.

More surprisingly, health and disability did
not play a statistically significant role in predicting
homelessness, although confidence intervals were
broad, so that the data cannot rule out important asso-
ciations, especially for substance abuse. Health may
have deteriorated after individuals became homeless,
consistent with other literature (e.g. Burt et al., 1999;
Cohen, 1999; Firdion & Marpsat, 2007; Gelberg et
al., 1990; Muñoz et al., 2005; Philippot et al., 2007).
Also, the qualitative data suggest that disability
sometimes precipitated other, more proximal causes
of homelessness, and substance abuse was more
common among the homeless adults with less con-
ventional lives. Crane et al. (2005) also found that
newly homeless older adults reported housing and
relationship problems as more direct antecedents of
homelessness than physical or mental health or sub-
stance problems, which were sometimes ‘predispos-
ing or contributory’.

Sample biases may have affected reported health.
Adults with physical disabilities or dementia may be
more likely to be in institutional settings, and those
with substance problems or paranoia may be less
likely to come into a drop-in center than to stay on
the street. Interviewers and staff believed that poten-

tial homeless respondents who were not interviewed
had more cognitive problems and mental illness than
those who were, and the three homeless respondents
whose interviews were not usable were more agitated
or less coherent than those whose interviews were
analyzed. On the other hand, Gelberg et al. (1990)
found older homeless adults less likely than younger
ones to have psychotic symptoms, and no more likely
to have memory loss.

Economic capital also seemed relatively unimpor-
tant. No predictors were significant, although having
title to housing could not be ruled out as a protective
factor. Levels of economic stressors were high for
both groups, but may not have threatened homeless-
ness for the comparison group whose public housing
rents were tied to income.

The high levels of educational-level attainment
among homeless respondents, and their rates of par-
ticipation in college and post-graduate education,
were surprising. Nor did the higher education levels
of homeless adults with conventional than with
unconventional lives protect them from housing loss.
The other indicator of human capital, tenure in the
longest job a respondent had held, favored the housed
group, as expected. Even so, homeless respondents
averaged 10.8 years and those with conventional lives
averaged 13.7 years in their longest jobs. We did not
assess the total number of years that respondents
worked, but it is clear that many had a series of
responsible and often well-paid jobs commensurate
with their educational levels.

Social ties, especially ties to children who would
allow the respondent to stay with them, were an
important protective factor. Organizational ties
(which were not explicitly tied to housing) were
less important. The number of homeless individuals
who declined opportunities to stay with children or
relatives may suggest that they overestimated these
resources. In some cases, such as Bill’s, respon-
dents had stayed with others and had worn out
their welcome. (Note that 11 percent of the housed
sample did not have title to housing, but were dou-
bled up with others who may have protected them
from homelessness.)

It is also interesting that disruptive experiences in
childhood, which have been robust predictors of
homelessness in younger samples (e.g. Herman
et al., 1997), were not important after controlling
for other variables here. Such disruptive childhood
experiences were relatively high among homeless
adults with unconventional lives, suggesting that
they may play an indirect role, by setting processes



in motion that lead to more proximal predictors of

Stressful life events during the last year in conven-
tional housing did not predict homelessness, but
events that indicated loss of resources (eviction,
being asked to leave, job loss) did. This post hoc
selection of events that best differentiated the groups
should be replicated. It is also possible that the low
levels of such events in the comparison group is an
artifact. Housed individuals had been living in their
present apartment in public housing for a median
of 26 years, and were largely retired (only 21 percent
of the comparison group, compared to 53 percent of
the homeless group had been employed since 2000,
χ²(1, n = 140) = 15.2, p < .001). Thus they were
unlikely to have lost jobs or housing in the past year.
Nevertheless, it is plausible that events that affected
access to housing resources and income would be
particularly important to homelessness (see similar
findings by Okamoto, 2007).

The study has several limitations. Ideally, we would
compare a random sample of homeless individuals
over the age of 55 with a random sample of poor
adults of the same age. Because Peter’s Place is the
only drop-in center for older adults in New York City,
the homeless sample is not a bad one, but may
still differ from samples drawn from institutions or
the street. The comparison sample is more limited
because all had access to subsidized housing and were
recruited at a settlement house, so they were unlikely
to be socially isolated.

Focusing the interview on the last year in stable
housing (the target year) was both a strength and lim-
itation of the study. Collecting information on respon-
dents’ circumstances prior to homelessness (or the
most recent instance of homelessness, for respondents
with multiple bouts) justified considering these cir-
cumstances as predictors rather than consequences of
homelessness, and may account for differences
between this study and others with respect to health.
However, retrospective recall of past events may mag-
nify biases inherent in self-report data and the longer
time lag for homeless than for housed respondents
may have led to differential recall in the two groups.
Future research might have housed respondents recall
a period three years in the past (the median time lag
for homeless respondents). Focusing on a year in stable
housing also minimized reporting of events incom-
patible with such housing, such as imprisonment. In

addition to focusing on the last period in stable hous-
ing, future research might inquire about earlier events.

Implications for prevention
Despite these limitations, this study provides useful
guidance for preventing homelessness among older
adults, and challenges some assumptions that might
be drawn from considering only the circumstances
of people who are currently homeless. The analysis
of health and disability suggests that efforts to provide
more health services, however valuable on other
grounds, may do little to prevent homelessness.
Rather, the analysis of stressful life events suggests
that efforts to prevent homelessness late in life should
target those who lose jobs or housing for any reason.
Cohen (1999) found that 80 percent of older homeless
men wanted to be employed and 56 percent had been
continually looking for work. Over half of the home-
less respondents in our sample had recent work histo-
ries. Age discrimination in employment is illegal in
the United States, although laws are not always
enforced. Older workers can face difficulties finding
new work if they are laid off, or if illness or injury
requires a period of unemployment or a change in
activity. Providing jobs for adults aged 50–64, who do
not qualify for entitlements available to older adults,
could prevent some homelessness (Cohen, 1999).

Older adults and those with disabilities should be
helped to apply for available income supports.
However, housing costs put even adults who work full
time at risk of homelessness, and place unsubsidized
housing out of reach for people receiving disability
benefits. The fair market rent for a one-bedroom
apartment in New York City during the study was
$1003 per month—more than the entire after-tax
income of a full-time minimum wage worker
(National Low Income Housing Coalition, 2005), and
much more than such a person would receive in retire-
ment. Supplemental Security Income (SSI) for dis-
abled individuals was only $666 per month.

Thus, rent subsidies are important supports for
older adults, but in our study, only one-quarter of
respondents on the verge of homelessness received
one. Both general subsidies (e.g. Section 8) and
those targeted to older adults (e.g. Section 202)
should be expanded. New York’s Senior Citizens
Rent Increase Exemption Program, which exempts
low-income senior citizens from increases in rent
by giving landlords reductions in property taxes, is
an entitlement, but should be publicized more
broadly and extended to subsidize base rents (not



just increases). New York City currently offers legal
help to prevent eviction, but many older adults are
unaware of their rights and do not access these
programs. Additional inexpensive housing options,
such as clean, safe single-room occupancy hotels
for seniors, could also reduce homelessness.

Efforts might also focus on adults who lack
family, especially children who would take them in.
Social policy cannot change social ties, but it can
provide in-home services to allow older people to
remain independent, legal and other forms of advo-
cacy with housing providers and access to benefits
that might substitute for social resources.


1. To check the robustness of this model, we added
race (Black vs other) as a control; no variable
changed significance at p<.05, but confidence
intervals were broader. Race itself was not a sig-
nificant predictor.


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Author biographies

MARYBETH SHINN is Professor of Applied
Psychology and Public Policy in the Steinhardt
School of Culture, Education and Human
Development and Wagner School of Public Service
at New York University.

JAMIE GOTTLIEB is a first-year Distinguished
Public Interest Scholar at Seton Hall School of
Law. She graduated with honors from New York
University in 2006 with a BA in Psychology.

JESSICA WETT received her BA in Psychology
from New York University in 2006. She plans a
career in social work.

AJAY BAHL is an aspiring psychiatrist who will
graduate from NYU with a Psychology major in
spring 2007. He hopes to pursue a Masters in
Bioethics before attending medical school.

ARNOLD S. COHEN is President and CEO of the
Partnership for the Homeless, which offers services,
research and education to end homelessness. He
worked previously as a public interest attorney.

Older Adult Services at The Partnership for the
Homeless. She is also director of Peter’s Place, a
multi-service center for homeless older adults.

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