Where Will the House Budget Committee Go From Its War on the War on Poverty?

March 6, 2014

House Republican Budget Committee staff have been very busy. They’ve produced a 240-page report that summarizes — and provides snippets of research on — 92 programs creatively attributed to the War on Poverty.

“Creatively” because some of the programs have little or no bearing on efforts to reduce poverty, e.g., homeownership assistance, the fresh fruit and vegetable promotion program for elementary school children.

By and large, the research snippets are more balanced than one might expect — a triumph of low expectations, I suppose.

Ron Garver at The Fiscal Times cites four researchers who claim the report misrepresents or manipulates their findings. We get other examples of cherry-picking and misrepresentation in the Center on Budget and Policy Priorities’ commentary on the report.

There’s notable bias in presentation too — for example, the bolded conclusion that “Head Start does not improve student outcomes,” though the research cited shows it sometimes does, as Jonathan Cohn at New Republic notes.

And a HUGE exception to balance for Medicaid, as one might expect from a Committee that’s likely to again propose block-granting the program and slowly starving it. “Zombie Medicaid arguments,” proclaims the Incidental Economist‘s headline.

As this indicates, policy wonks of a progressive persuasion have already weighed in on the report — mostly, though not exclusively trying to set the record straight on what the research actually tells us.

I want instead to focus on a couple of the major messages, explicit and otherwise.

The report stretches to sweep in as many programs as possible in part because one of its messages is that there are far too many of them. Congress created them “to solve different problems — and at different times,” it says. As a result, “there is little coordination among them.”

Overall, this seems to me a reasonable assessment. Where it might take us is another matter.

The House SKILLS Act, for example, blows away 18 35 job training programs and rolls the surviving 17 into one big block grant. It also freezes funding for seven years — virtually ensuring that some of the formerly-targeted populations lose out to the more readily employable.

The larger problem, the report says, is that many programs are “a poverty trap” because they’re means-tested, i.e., provide benefits only to people below a certain income level.

They’re thus a disincentive to work — or at least to doing your best to get ahead because if you do, you face a “high marginal tax rate.” In other words, what you lose in benefits partially offsets what you gain in earnings.

No one, so far as I know, disputes the fact of marginal tax rates. They’re an inherent feature of programs that limit eligibility to people below a certain income level.

How big they are depends on who’s estimating and for what programs. Whether they actually “discourage … [people] from making more money,” as the report says, is less certain.

The Congressional Budget Office is inclined to think they do, though only for some people already in the workforce. Economist-blogger Jared Bernstein says that leading research has found the impact to be negligible.

Again, the question is where does this take us? Not, I trust, to the elimination of all means-tested programs. But like as not, to more expansive work requirements — and to time limits, since these would override any long-term disincentive.

Welfare “reform” is thus again pronounced a rip-roaring success — one of the instances of research misuse cited in the Garver article and by CBPP.

The report is surely a set-up for further spending cuts. Casting a wide net enables the Budget Committee to come up with a total anti-poverty bill of $799 billion in 2012 — and “trillions” over the last 50 years.

Ironically, as Cohn observes, the defects the report finds in a number of anti-poverty programs imply the need to spend more money.

But Budget Committee Chairman Paul Ryan seems to have something more grandiose in mind than fixing fixable problems, even when that might yield some savings — and something more grandiose than slashing here, slashing there.

In his view, federal anti-poverty programs need to be “entirely reimagined,” according to an indirect quote in the Washington Post.

We get a whiff of where he might be tending in a key test the report imposes whenever remotely feasible: Does the program encourage or discourage labor force participation?

Thus, for example, all the “evidence” cited to evaluate Supplemental Security Income relates to employment. Recall that adult SSI recipients under 65 are, by definition, blind or unable “to do any substantial gainful activity.”

SNAP (the food stamp program) is also viewed through the lens of labor force participation, as well as poverty reduction, based on the cash value of the benefit. “Evidence” for its effects on reducing hunger is apparently irrelevant.

But maybe there’s no real reimagining behind the words. As The New York Times editorial board observes, the report provides a “high-minded excuse” for Congressional Republicans “to eviscerate” major safety-net programs, as they’re already hell bent on doing.

Some also seem to cherish the notion that the reforms Ryan says it’s a precursor to will persuade us that they truly care about “people who’ve fallen through the cracks.”

Not, I think, if the report foreshadows what we’ll soon see in the House budget plan.


Rethinking Poverty in America

January 6, 2014

According to the official poverty measure, being poor means having very little cash income — for a parent with two children, less than $18,499, according to the latest Census Bureau thresholds.

For the Supplemental Poverty Measure, being poor means not having enough cash income and certain near-cash benefits like refundable tax credits and food stamps to pay for everyday basic needs, plus some other necessary expenses, e.g., medical out-of-pockets.

Those of a liberal persuasion, including yours truly, often cite analyses in the annual SPM reports as evidence that our anti-poverty programs work.

A recently-published study by some Columbia University professors was heralded because, by using a slightly modified SPM, they were able to show that major safety net programs reduced the poverty rate by 40% between 1967, shortly after the War on Poverty was launched, and 2012.

This isn’t going to make one whit of difference to the right-wingers who are fond of recycling former President Reagan’s (in)famous “We fought a war on poverty, and poverty won.”

On the other hand, we do have 16% of the population — 49.7 million people — in poverty, according to the SPM. And this isn’t because we gave up on the anti-poverty enterprise, though surely “welfare reform,” harsh anti-drug laws and diverse other policies help explain it.

Professor Mark Rank at Washington University in St. Louis argues that economist John Galbraith put his finger on the problem 30 years ago, when he said we were attacking poverty from the wrong end.

Instead of beginning with root causes, he says, we begin with preferred remedies and tailor our view of the causes to fit.

More generally, we begin with a fondness for our free enterprise system and the American Dream, which promises a reasonably comfortable lifestyle to anyone who works hard and plays by the rules.

Working backwards, we locate both the causes and solutions to poverty in the individual. For conservatives, this means finding character flaws, e.g., a propensity to laziness, imprudent choices like having children out of wedlock, indulging in alcohol and/or drugs.

So safety net programs are badly structured because … well, because they provide a safety net. So there are no bad consequences for bad behaviors. Indeed, some have long argued that the programs reward bad behaviors.

Liberals focus more on inadequacies that disadvantage individuals in the labor market — lack of education, training and thus of in-demand skills. So we have a variety of programs to level the playing field — for those who’ll exercise personal responsibility.

In either case, Rank says, “the poor are by and large at fault for their poverty,” though we make an exception for those unable to work for reasons that have nothing to do with their behavior.

And we as a society feel limited responsibilities for poor people because it’s up to them to take advantage of such opportunities as we offer. We tinker with the incentives and disincentives. We don’t doubt what Rank, like a true academic, calls the “paradigm” that underpins the remedies.

He calls for a new paradigm, based on “realities,” rather than “the myths of America.” It’s got five components — none of which, he acknowledges, is altogether new.

The first seems to me in some ways the most important because it speaks directly to the role of public policies. We need to recognize, Rank says, that poverty in America is largely the result of “structural failings.”

The most obvious of these is that there simply aren’t enough decent-paying jobs for the number of workers who need them. Indeed, there aren’t enough jobs, period. And there haven’t been even when the economy was booming along, according to research Rank cites.

At the same time, our social safety net is “extremely weak.” By way of contrast, we’re asked to consider the range and reach of income supports and publicly-funded insurance programs that are common in Europe, e.g., child or family allowances, expansive child care, universal health coverage.

Put the two together and you’ve got widespread deprivation — Rank’s preferred concept of poverty (and mine).

He asks us to think of a game of musical chairs. As you know, there are always fewer chairs than players. Those most likely not to get a seat have some disadvantage. In the game itself, that tends to be pushiness, as I unhappily recall.

In the economy, it’s lack of education and/or marketable skills. We focus on these, Rank says, when we should ask “why the game produces losers to begin with.” In other words, why aren’t there enough “viable economic opportunities and social supports” for everyone?

Rank is hardly the only one to call for a refocused approach to poverty in this country. Many progressives have, in various ways, urged us fellow travelers to shift our attention to structural economic reforms.

They’re pushing back against what Rortybomb blogger Mike Konczal refers to as “pity-charity liberal capitalism” — a doubling-down on “welfare” at the expense of policies that would empower workers, both in the workplace and the in political sphere.

At the same time, we do need those safety net and social insurance programs. They’re under such heavy attacks from the right these days that we’re forced into a defensive posture.

We should acknowledge, however, that the challenge ahead is not only to preserve what works, but  change what doesn’t — or does, but not as well as it should, including our economy.

I expect we’ll be hearing a lot about this in the days to come because we’re about to celebrate the 50th anniversary of the War on Poverty.


Congressman Ryan Renews War on the War on Poverty

August 7, 2013

Congressman Paul Ryan, Chairman of the House Budget Committee, held a hearing last week supposedly to get a “progress report” on the War on Poverty.

A highly suspect enterprise, since Ryan had already proclaimed the War on Poverty a failure — most recently less than a week before the hearing.

“When I look at the money spent, when I look at the programs created, when I look at the miserable outcomes and the high poverty rates, … [I say] ‘We can do better than this.”

Interestingly, however, most of the witnesses he’d called didn’t engage in wholesale trashing on our anti-poverty programs, though Jon Baron, who heads the Coalition for Evidence-Based Policy, came pretty close.

Ryan’s Republican committee colleagues pulled out all the stops. References to “perpetual dependency,” confiscating taxpayers’ money, a remarkable attack on the Catholic church for calling on the government to help serve the poor.

Democrats countered with some myth-busting — mainly the notion that poor people don’t want to work. They also repeatedly noted that large majorities of safety net beneficiaries either are working or aren’t expected to — because they’re children, elderly and/or severely disabled.

And they took the occasion to point out the irony of a hearing on poverty when the House has already passed a budget (Ryan’s creation) that guts several major safety net programs and sets a spending level that will force severe cuts to others.

In the midst of all the bickering and posturing, some genuine issues emerged. To me, the biggest of all was what we should expect anti-poverty programs to do — and how we can know whether they’re doing it.

For Ryan, the programs have “miserable outcomes” because about 46 million people fell below the official poverty threshold last year.

Congressman Van Hollen, the committee’s highest-ranking Democrat, and Sister Simone Campbell, best known as the leader of the Nuns on the Bus, countered with top-line figures from the Supplemental Poverty Measure.

As I’ve written before, the SPM factors in major non-cash benefits, e.g., SNAP (the food stamp program), plus money received from the refundable Earned Income Tax Credit and partially refundable Child Tax Credit.

These benefits reduce the SPM poverty rates — or, as is commonly said, lift people out of poverty. Some examples from the Center on Budget and Policy Priorities, which foresightfully launched a preemptive strike on Ryan’s messaging.

Not good enough for Congressman Sean Duffy. We need to “get to the root cause of poverty, not just address pain.”

Nor for Ryan. “We focus on how much money the government spends.” True in his case for sure. “We should focus on how many people get off public assistance — because they have a good job.”

Or more tellingly in the TV clip I linked to above. “Our goal is not to make poverty easier to handle … and live with. Our goal in these programs ought to be to give people a temporary hand so that they can get out of poverty.”

And so Ryan chose to put Eloise Anderson, head of his home state’s Department of Children and Families, on the panel — the Republicans’ “star witness,” Greg Kaufmann at The Nation smartly observes.

The state’s welfare program got 93% of families off the rolls, she said. What we need in other programs are work requirements and time limits like those in the Temporary Assistance for Needy Families program.

No one, I think, would argue against programs that help people who can work prepare for and find jobs that will enable them to support themselves and their families. (Whether that’s a good description of TANF is another matter.)

But time-limiting all our safety net programs will surely leave some people in destitution — rather like the conditions former reporter Dan Morgan recalls from the early 1960s.

And is getting people off the rolls and over the official poverty line the only result we should measure?

What then do we do about people who are too old or too disabled to work — or working and still unable to make a go of it without public assistance?

About children, whose health, well-being and future prospects are significantly improved when they’ve got enough to eat, good medical care, a safe, stable place to live and positive learning experiences from an early age?

I’d be the last person to say that our anti-poverty programs are all they ought to be. But the only result Ryan and compeers seem willing to credit is far too narrow.

I personally think that a group so eager to claim their Christian bona fides would hesitate to dismiss programs that feed the hungry and heal the sick — services that local charitable organizations can’t do alone.

See, for example, the Bread for the World figure Sister Simone cited to show this — a $50,000 per year additional burden on every single congregation in the country merely to compensate for the SNAP cuts in Ryan’s budget.

And it’s genuinely offensive to hear Ryan claim that his attacks on anti-poverty programs aren’t “about cutting spending.”

If he really wanted to “start a conversation” about how we could better approach the multifarious problems that underlie our high poverty rate, then why has he plunged ahead with budgets that embody his radically right-wing conclusions?


Over a Million and a Half U.S. Families Live on $2 Per Person Per Day — Or Less

July 15, 2013

The World Bank draws one of its “extreme poverty” lines at $2.00 per person per day — the equivalent of $2,190 a year for a family of three.

This is a level of deprivation we associate with villages in sub-Saharan Africa or the slums of New Delhi. It’s about 12% of the Census Bureau’s official poverty threshold for the three-member family.

But by one measure, an estimated 1.65 million U.S. households with children were at or below the Bank’s threshold in 2011 — 4.3% of all households with children headed by someone who wasn’t elderly.

This is the headlined finding of a newly-published paper by sociologists Luke Shaefer and Kathryn Edin (yes, the same one whose work I used for my post on unwed fathers).

They came to their project from Edin’s earlier interview-intensive studies of poor single-mother families. “She mentioned that she felt like she was going into more and more homes where there was really nothing in income,” Shaefer says.

So the two decided to find out how many families were in such straits and how they survived.

To do this, they analyzed years of data from the Census Bureau’s ongoing Survey of Income and Program Participation, using the Bank’s $2.00 a day threshold.

They started in 1996, just before states began implementing “welfare reform,” and ended in 2011, when the Great Recession was officially over, but not its effects on the labor market.

Various complex statistical maneuvers I won’t even try to account for. This paper is not for popular consumption.

What we need to know to understand the findings is that the Shaefer-Edin team looked at households in extreme poverty based first on their cash income, including what they received (or didn’t) from the Temporary Assistance for Needy Families program and the program it replaced.

They then sequentially added in the largest federal means-tested benefits — SNAP (the food stamp program), housing subsidies and refundable tax credits, i.e., the Earned Income Tax Credit and Child Tax Credit.

The results clearly document what the team refers to as “the virtual disappearance of a cash safety net for non-workers.” Also, I should add, for some low-wage workers without full-time, year round jobs.

In 1966, cash assistance lifted about 1.15 million families above the extreme poverty line in any given month. By mid-2011, it lifted only about 291,000.

Though means-tested benefits expanded over this period, they couldn’t offset the combined impacts of the deliberate shrinkage of welfare caseloads and the recessions and sluggish recoveries during the 2000s, including the last and biggest.

We see, for example, that extreme poverty among households with children increased by 50%, even when all the means-tested benefits are factored in.

For single-mother families — the single largest type in TANF — the extreme poverty rate increased by nearly 68%, again after adjustments for the means-tested benefits.

Leave them out and the increase soars to 229% — a clear reflection of the end of a cash assistance guarantee for extremely poor families.

On the brighter side, SNAP reduced extreme poverty among households with children by 48% in mid-2011. This is with the soon-to-expire benefits boost that was part of the Recovery Act.

Fold in the rest of the means-tested benefits and 2.38 million children lived in families where they and their parents had somewhat more than $2.00 a day to live on.

But 1.17 million children still didn’t.

No policymaker, I suppose, deliberately decided to let any of America’s children live at a poverty level defined as “extreme” for developing countries.

But our policymakers share bipartisan responsibility because they decided to focus anti-poverty efforts on “the working poor” and let families headed by parents with the greatest barriers to ongoing gainful employment fend for themselves.

We see this in the Census Bureau’s own poverty figures.

In the past two decades, Shaefer and Edin report, families in deep poverty, i.e., below 50% of the applicable threshold, have received substantially less aid from public programs, while those at 50% to 150% of the threshold have, on average, gotten more.

Thus, the team concludes, “our current major safety-net programs are blunting some of the hardship that … households ["at the very bottom"] would otherwise face. However, it would be wrong to conclude that the U.S. safety net is strong, or even adequate.”

We knew this, of course, but perhaps not how shockingly inadequate it is.


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