From the late 1960s to the mid-1990s, a number of developments turned out to have profound effects on destitute families in the United States, which Kathryn J. Edin and H. Luke Shaefer’s “$2.00 a Day: Living on Almost Nothing in America” brings into sharp relief. Critics of welfare repeatedly argued that the increase of unwed mothers was mainly due to rising rates of welfare payments through Aid to Families With Dependent Children (A.F.D.C.). Even though the ­scientific ­evidence offered little support for this claim, the public’s outrage against the program, fueled by the “welfare queen” stereotype that Ronald Reagan peddled in stump speeches during his 1976 run for the presidency, led to calls for a major revamping of the welfare system.

In 1993, Bill Clinton and his advisers began a discussion of welfare reform that was designed to “make work pay,” a phrase coined by the Harvard economist David Ellwood in his 1988 book “Poor Support.” Ellwood, one of Clinton’s advisers, argued that to ease the transition from welfare to work, it would be necessary to provide training and job placement assistance; to help local government create public-sector jobs when private-sector jobs were lacking; and to develop child care programs for working parents. President Clinton’s early welfare-reform proposal included these features, as well as ­another component that Ellwood submitted — time limits on the receipt of welfare once these provisions were in place.

Republicans, however, seizing control of Congress in 1994, devised a bill that ­reflected their own vision of welfare ­reform. Designed as a block grant, giving states considerably more latitude in how they spent government money for welfare than A.F.D.C. permitted, the Republican bill also included a five-year lifetime limit on benefits based on federal funds. States were allowed to impose even shorter time limits. Although the bill increased child care subsidies for recipients who found jobs, the all-important public-­sector jobs for those unable to find employment in the private sector were missing. Moreover, there wasn’t enough budgeted for education and training. Much to the chagrin of the bill’s critics — including Senator Daniel Patrick Moynihan, who predicted in 1995 that the proposed ­legislation would lead to poor children “sleeping on grates” — President Clinton signed the bill, called Temporary Assistance for Needy Families (TANF), on Aug. 22, 1996, two days after his signing into law the first increase in the federal minimum wage in five years.

In the immediate years following the passing of welfare reform, supporters of TANF argued that Moynihan and other critics were proved wrong. The number of single mothers who exited welfare and found work exceeded all expectations; child poverty rates fell; the expansion of the earned-income tax credit, a wage subsidy for the working poor, combined with the 1996 increase in the minimum wage and the additional availability of dollars for child care (as long as the parents were employed), boosted government provisions for working-poor families.