Here is a look at American social welfare policy throughout history and the argument is that there was no golden era of private charity:
One problem with the conservative vision of charity is that it assumes the government hasn’t been playing a role in the management of risk and social insurance from the beginning. It imagines that there is some golden period to return to, free from any and all government interference. As Senator Lee has said, “From our very Founding, we not only fought a war on poverty—we were winning.” How did we do it? According to Lee, it was with our “voluntary civil society.” We started losing only when the government got involved.
This was never the case, and a significant amount of research has been done over the past several decades to overturn the myth of a stateless nineteenth century and to rediscover the lost role of the state in the pre-New Deal world…
As for social insurance specifically, the historian Michael Katz has documented that there has always been a mixed welfare state made up of private and public organizations throughout our country’s history. Outdoor relief, or cash assistance outside of institutions, was an early legal responsibility of American towns, counties, and parishes from colonial times through the early nineteenth century. During this period, these issues were usually dealt with through questions of “settlement.” A community had a responsibility to provide relief to its own needy, native members, defined as those who had a settlement there. This became increasingly difficult with an industrialized society, as people moved to and fro looking for work and were forced out of communities when they couldn’t find any.
The next major initiative was the construction of poorhouses by state governments, especially in the early nineteenth century. The central idea was that by forcing people in need of aid to live in poorhouses where living conditions were quite harsh, there would be fewer applicants. This ended up not being the case, as able-bodied people would still seek out these poorhouses, especially when work was slack and unemployment high. Worse, these institutions became the default support for orphans, the mentally ill, and the elderly without income or family to support them…
That need was partly what gave rise to the Progressive movement. Private charity simply didn’t have the breadth and depth necessary to truly respond to the Four Horsemen in this industrializing era, and Progressives saw a greater role for government to address these ills.
In other words, the government has been involved with addressing social problems from the early days of America. Granted, it may not have looked like the centralized welfare state that is common in the industrialized world today but there was still some government involvement.
This also reminds me of a recommendation made by sociologist William Julius Wilson at the end of The Truly Disadvantaged. After looking at concentrated poverty, Wilson concludes with policy recommendations which includes the key proviso that American social welfare policy should try to raise everyone’s boat because targeted programs for specific groups tend to be seen unfavorably by the larger public. Think of Social Security, a program that benefits a majority of Americans and enjoys widespread support.