The Great Society and Its Limits

The Great Society and Its Limits

President Johnson praised education as the “key which can unlock the door to the Great Society.” The president supported the Higher Education Act, which expanded work-study programs and provided loans for tuition and living expenses. These loans would be serviced through private banks but would feature low interest rates because the federal government would guarantee payment. Now all young adults who did not have a wealthy family member to cosign their college loans could turn to their Uncle Sam.

More controversial was Johnson’s desire to vastly expand federal aid to K-12 education. Kennedy had attempted a similar measure, but his opposition to funding parochial schools (a provision the Catholic Kennedy supported but feared would prove politically suicidal) derailed the measure. Johnson’s bill worked around the controversy by providing subsidies for families with children in private schools (rather than the schools themselves). The primary feature of the Elementary and Secondary Education Act of 1965, however, was the allocation of $1 billion in federal aid for public schools. By bridging the political divide between the supporters of private and public schools, Johnson’s bill was the first legislation providing significant funding to K-12 education. Previous laws tied this funding to school integration, which probably did more than Brown v. Board to encourage integration in hundreds of school districts. Equally important, the 1965 law began a historic shift in the way public schools were financed. Advocates of federal aid believed that this revenue would compensate for the inequities of locally funded schools. However, poor districts still spent far less per pupil, and federal aid increasingly became an excuse to cut school funding in many districts.

Medicare provided benefits for nearly 20 million Americans but did not cover a host of expenses, such as prescription drugs, leading many to criticize the program for its “gaps” in coverage. In addition, the program quickly became one of the government’s leading expenses and required continual increases in taxes. Part of the reason was that the plan was designed to placate lobbyists representing the American Medical Association (AMA), which had derailed two decades of government health insurance proposals that contained cost controls and limits on procedures as “socialized medicine.”

Desirous to pass the law without the opposition of the AMA, the plan did little to regulate the costs of medical care or the procedures that might be covered. As a result, medical providers were now paid primarily by insurance companies and the federal government, and they responded by raising their prices an estimated 14 percent per year. Unlike the free market where consumers pay directly and therefore shop for the best prices, recipients of Medicare and Medicaid cared little for the cost of service. Medicaid recipients had previously gone without medical service due to their inability to pay, but once the federal government assumed payment for emergency care, an increasing number of poor Americans went directly to emergency rooms for medical care. In addition, a handful of doctors set up clinics in poor neighborhoods, and these clinics routinely performed unnecessary and expensive tests on Medicaid clients as a way of defrauding the government.

Figure 11.10

Claudia Taylor Johnson, better known as “Lady Bird” Johnson, celebrates a Minnesota Head Start program with some of its students. The First Lady was active on behalf of a number of causes during her husband’s administration and was also a successful business leader both before and after her tenure in the White House.

The nation’s increasing standard of living, expanded government programs for the poor, and even the rhetoric of civil rights activism were helping to create a culture of entitlement among many Americans. The notion that a certain minimum standard of living was a “right” that all Americans were entitled to increasingly gained currency throughout the 1960s. Most recipients of government aid in the United States ate meat every day and lived in homes with electricity, running water, and central heating. Each of these was a rare luxury in most nations, while the latter three were relatively new inventions. However, federal programs such as Aid to Families with Dependent Children operated through matching grants to states and therefore failed to provide any benefits to some of the poorest families in states that could not adequately subsidize the program. Still, conservative reservations about providing direct aid to the poor, combined with reported abuses of governmental assistance, led to relative declines in public support for Johnson’s war on poverty.

Figure 11.11

As a daughter of the Jim Crow South, civil rights leader Ella Baker devoted most of her efforts to challenging racism. However, Baker also believed that racism was a symptom of a larger social illness that kept people and communities from recognizing their common interests and working together to solve common problems.

One of the first casualties of the Great Society was the gradual defunding of community action agencies. Inspired by sociologists who identified a “culture of poverty” as the greatest enemy in Johnson’s war, federal money was supposed to be directed to these local and autonomous community groups who would then decide how the money would be best spent. The law required that the poor themselves were supposed to lead these groups as much as possible, a provision Johnson hoped would help the poor to learn to help themselves. The provision was both simple and radical. If larger and larger numbers of poor people became engaged in their own welfare, the cycle of poverty might slowly grind to a halt.

Believing that ordinary people who mobilized in an organized, democratic, and meaningful manner might reinvent themselves and their communities, reformers and activists joined with the working poor to create a host of programs such as Head Start, which provided aid for education in poor communities. Many liberals hoped the Office of Economic Opportunity (OEO) would radically challenge the concept of democracy. As civil rights icon and community organizer Ella Baker explained, “In order for us as poor and oppressed people to become a part of a society that is meaningful, the system under which we now exist has to be radically changed.” For Baker, this meant that the people must “learn to think in radical terms…getting down to and understanding the root cause” of their problems and “facing a system that does not lend itself to your needs and devising means by which you change that system.”

However, those that hoped the OEO might breathe new life into poor neighborhoods and new meaning into the concept of democracy were disappointed by the limited funding that represented less than 1 percent of the federal budget and less than $230 for each of the 35 million poor Americans each year. At the same time, the decentralized nature of the plan also provided ample opportunity for mistakes or even fraud. All the rhetoric about these groups providing a “hand up instead of a handout” for the poor was quickly forgotten when a handful of those hands misappropriated funds. In addition, while the president portrayed himself as a modern-day FDR, Johnson increasingly focused his efforts on events overseas. Just as Truman’s social programs were derailed by a war in Asia, efforts to contain the spread of Communism largely determined the outcome of Johnson’s presidency after 1965.