Supreme Court Fair Housing Decision Means More Than May Appear

June 29, 2015

Quite a morning at the Supreme Court last Thursday. As you all know, a six-member majority preserved affordable health insurance for low and moderate-income people — and not only the 6.4 million whose subsidies were at immediate risk, for reasons I explained.

The Court also, by the slimmest possible majority, ruled that the Fair Housing Act prohibits policies and practices that have a discriminatory effect, even if an intent to discriminate can’t be proved.

This is how the U.S. Department of Housing and Urban Development has interpreted the law — and how virtually all lower courts have interpreted it for 40 years, including all at the appellate level that have considered the issue.

But the ruling came as a pleasant surprise because advocates thought the Court wouldn’t have agreed to hear the case if it wasn’t likely to rule the interpretation over-broad.

The ruling removes a threat to HUD’s efforts to combat racial segregation, both the legacy of deliberately discriminatory policies and the effects of current policies and practices.

The just-decided case involved one of the latter — a local housing authority’s disproportionate awards of tax credits to developers with plans to locate low-cost housing in predominantly black inner-city neighborhoods.

The ruling will free HUD, from a legal standpoint, to issue a final version of its rule spelling out its responsibility — and thus the responsibility of state and local agencies — to “affirmatively further” equal housing opportunity, as the FHA requires.

This, in itself, has broader implications than the obvious because equal opportunities to rent and buy housing are closely linked to other opportunities — most, though not all related to advantages of living in a neighborhood where most fellow residents aren’t poor.

These include living closer to where a decent number of decent-paying jobs are available and/or to convenient public transportation, ready access to full-service grocery stores, better-funded — and therefore, generally better — nearby schools and less exposure to toxics in the environment, not to mention flying bullets.

They are all reasons that a plethora of research has found that place matters — including, as I wrote awhile ago, for children’s future prospects of moving up the income scale from the bottom fifth.

Now, it’s not only housing discrimination — intentional or otherwise — that tends to perpetuate income inequality and, with it, downright income insufficiency. We have ample evidence of discrimination in hiring, pay, promotions and the like.

We know that state and local funding for public schools can deny equal educational opportunities to children in high-poverty districts, which are often (though not always) predominantly black or Hispanic. And we’ve got evidence of what certainly seems to be discrimination in the way schools deal with students who’ve allegedly violated the rules.

Discrimination of these sorts affects not only racial and ethnic minorities, of course, but other groups our major federal civil rights laws are supposed to protect, e.g., women, people with disabilities, those whose religious beliefs and/or practices relegate them to minority status.

I’m off on what may seem an excursion because, as a lawyer-advocate friend of mine noted, the disparate impact (or effects) standard the Supreme Court upheld has also long been the basis for enforcement of the other laws.

What I, like many others said about fair housing applies equally to employment and to education, health care, social services, transportation and other programs that receive or benefit from federal funds.

You’re rarely, if ever going to be able to prove that a policy or practice has a greater negative impact on people who belong to a protected class because that’s what it was intended to do.

And indeed, some policies and practices with disparate impacts probably aren’t intentional, but rather “unconscious prejudices,” as Justice Kennedy, writing for the majority, said. Some, indeed, may not reflect prejudices at all, but a casual acceptance of the status quo, failures to think through consequences or not caring to address them.

Those policies and practices are nonetheless contrary to what Congress intended back in the days when it sought to level the playing field for people unjustly denied opportunities essential for upward mobility, personal well-being and full participation in our social and political institutions.

A decision for plaintiffs in the FHA case wouldn’t automatically have extended the overly-narrow intent standard throughout the fabric of our civil rights protections. But it would have given a new entering wedge to parties interested in constricting their reach.

So an altogether good Thursday at the Supreme Court. And as you all know, a great Friday too.


Big Sigh of Relief As Supreme Court Majority Upholds Affordable Health Insurance Nationwide

June 25, 2015

This is a post I’ve been hoping to write. And now I can because, as you’ve undoubtedly read, the Supreme Court majority has preserved the subsidies low and moderate- income people have been getting to help them afford health insurance purchased on the federally-operated exchange.

You may also have read some of the dire warnings of what would happen if the Court had ruled otherwise. Perhaps not as many as I’ve ferreted out, however. So I’ll begin with them. Then I’ll briefly highlight a less publicized warning of yet further harm, presumably averted.

Nearly Three-Quarters of Subsidies Saved

As you probably know, plaintiffs contended that the federal government couldn’t subsidize the costs of health insurance purchased on the exchange it created for people in the 34 states that wouldn’t — or in some cases, decided they couldn’t — create their own exchanges.

Say five instead of three Supreme Court members had agreed.

About 6.4 million people would have lost the tax credits that serve as subsidies, according to the latest enrollment figures. That’s roughly 74% of all those who receive them.

Their subsidies average $272 a month. So if premiums stayed the same, they’d have had to come up with an additional $3,264 a year. But premiums wouldn’t have stayed anywhere near the same. They’d have increased by an average of 35% next year, according to Urban Institute analyses.

Basic market forces would have driven a so-called death spiral. First, relatively young, healthy people would have decided to forgo health insurance rather than pay what their subsidies had covered. Insurance companies then would have faced higher per-customer healthcare costs. So they’d have jacked up their premiums to compensate.

Which, of course, would have led to more younger, healthier dropouts. Which would have led to … Well, you see where this is going. Premiums would ultimately have increased by 47%, the RAND Corporation concluded — unless states belatedly set up their own exchanges.

Some might have given it a shot. But few, if any could have gotten their own exchanges up and running by next year.

Some surely wouldn’t have tried. We’ve still got 18 states that refuse to expand their Medicaid programs, even though the federal government would initially cover all the healthcare costs of newly-eligible beneficiaries — and virtually all so long as that part of the ACA remains intact.

Most of these states, as well as others were in a wait-and-see mode. Some clearly looked to Congress to let them do whatever they fancied. And indeed, the House Republicans’ latest block grant plan would have. Not a happy prospect, for various reasons.

Greatest Reprieve for Poor and Near-Poor

An adverse ruling wouldn’t have affected the very poorest Americans. They never had a chance to buy subsidized health insurance on an exchange because their household incomes put them below the federal poverty line.

Some are eligible for Medicaid, even in the recalcitrant states. Texas, for example, will cover parents in three-person families with annual incomes at or below 19% of the FPL — currently $3,817. No Medicaid for even the poorest childless adults — nor in any other non-expansion state except Wisconsin.

But the near-poor apparently took advantage of the exchange option. We see, for example, that 94.5% of Mississippi residents enrolled benefit from subsidies averaging $351 a month.

More generally, individuals and families hovering just above the FPL would obviously have been the least able to pay for unsubsidized premiums — and full out-of-pocket costs like copays too. For those Mississippi folks, the average premium hike alone would have been 650%.

Hospitals Saved From Large Losses

Meanwhile, hospitals would have faced bigger cost crunches because they’d have been obliged to provide more emergency care for uninsured people. Through their major associations, they agreed to a lower compensation rate for the uninsured on the assumption there’d be fewer.

A ruling for plaintiffs would have blown another hole in the assumption. (The earlier ruling that made Medicaid expansion optional was the first.)

But hospitals are — and would still have been — stuck with the compensation rate. Their losses due to newly-uninsured patients would have totaled $3.8 billion next year, the Urban Institute estimates.

Next Step in Gutting the Affordable Care Act Short-Circuited

A victory for plaintiffs could well have prompted another round of litigation to dismantle the ACA — or, as one of the strategists put it, to kill “the bastard … as a matter of political hygiene.”

In this scenario, the anti-ACA funders and their allies would probably have called on the courts to invalidate federal funding for Medicaid and the Children’s Health Insurance Program in those same 34 states where residents lost their subsidies.

A  bit of background to understand how they’d go at it. The case before the Supreme Court hinged on what the ACA means when it refers to “an exchange established by the state” — or alternatively, whether the use of that term was a drafting glitch, clearly at odds with the intent of the law and other provisions in it.

Well, two wholly separate provisions use the same term, as Modern Healthcare reports. The more consequential conditions federal Medicaid/CHIP funding on states’ ensuring coordination between these programs and “an exchange established by the state.”

A ruling for plaintiffs in the case just decided wouldn’t automatically have denied Medicaid/CHIP funding to the 34 states without their own exchanges. But would it have given ACA opponents a good shot at another challenge affordable health insurance for poor and near-poor Americans? You betcha.


Too Soon to Lock in DC Tax Cuts

June 25, 2015

Life is full of surprises, they say. So is the District of Columbia’s budget. I’m referring here to the Budget Support Act, the package of legislation that’s paired with the spending bill.

Turns out that the BSA the DC Council will soon take its second required vote on could trigger tax cuts before either the Mayor or the Council knows how much the District will need to spend just to keep services flowing — let alone how much it should spend.

Whoever knew? Doubtful all Councilmembers did, since Chairman Mendelson distributed the final BSA shortly before the first vote. Other interested parties surely didn’t because it wasn’t published.

And one would have needed time to figure out what the Chairman had done because his bill doesn’t spell out how it would change trigger provisions enacted as part of last year’s BSA.

Well, we know now — or could, thanks to a heads-up from the DC Fiscal Policy Institute and a DC for Democracy post that adds some angles.

The basic issue here — though not the only one — is when tax cuts recommended by the Tax Revision Commission should go into effect. Both the original BSA provision and the new version require a revenue projection higher than an earlier one.

Tax cuts wouldn’t all kick in at once, since that would immediately throw the budget out of balance. Last year’s BSA ranked them in priority order. The ranking would stay the same. But that’s as far as the parallels go.

Set aside for a moment the egregious lack of transparency. What’s wrong with the latest plan for triggering tax cuts based on rosier revenue projections? Three big things.

Tax Cuts Take Priority Over Spending Needs

The new plan would dedicated all of the projected revenue increase to tax cuts, rather than the excess over a threshold set by the current BSA.

And it would do that before the Chief Financial Officer had estimated the costs of sustaining existing programs in the upcoming fiscal year. These tend to rise for various reasons, as DCFPI notes.

Beyond that, we’re not spending as much as we should in a number of areas — affordable housing and homeless services, to name just two. This year’s budget makes some progress on both. But further progress will stall if the Mayor and Council can’t allocate the revenues needed.

Without them, the Housing Production Trust Fund — the single largest source of financial support for affordable housing construction and preservation — could have less next fiscal year, since half of the $100 million it has now reflects a one-time appropriation.

The next steps envisioned in the latest strategic plan to end homelessness in the District also hinge on further investments. For example, the plan envisions year-over-year increases in permanent supportive housing for families, plus some rapid re-housing vouchers extended past the usual one-year limit.

It also calls for some indefinite-term vouchers earmarked for families and single adults who can’t afford housing when they don’t need intensive supportive services any more or come to the end of their rapid re-housing extensions.

And at the risk of beating a dead horse, I’ll add that we’re likely to have homeless families until the Mayor and Council significantly increase Temporary Assistance for Needy Families benefits, which now, at best, leave a family of three at about 26% of the federal poverty line.

More generally, setting automatic triggers for a series of tax cuts denies both the Mayor and Council a chance to weigh priorities during budget seasons. Those tax cuts, recall, will mean relatively less in revenues not only next year, but every year — unless they’re repealed.

A whole lot harder politically to repeal a tax cut than to defer it until it won’t preempt spending that will do more good for more people than reducing tax obligations for some.

Cuts in the Offing Tilt Toward Well-Off Taxpayers

The Tax Revision Commission made nearly a dozen recommendations for cuts — a mixed bag if you believe that individuals and businesses should contribute to the general welfare according to how well they’re faring.

The Council adopted a couple that ease tax burdens for low and moderate-income residents. But those ranked highest in the BSA now don’t reflect a consistent preference for a progressive tax structure — far from it.

The second listed, for example, would reduce the tax rate on income between $350,000 and $1 million. Next on the list — and again in fifth place — are cuts in the franchise taxes that businesses pay.

The threshold for any tax on estates would increase to $2 million before filers would get larger standard deductions — the option virtually all low-income taxpayers choose because they’d pay more by itemizing.

Bigger Revenue Losses Than Recommended

The Tax Revision Commission recommended revenue increases to offset the losses resulting from its recommended cuts. The Council took a pass on two. The new BSA would do the same, forgoing $67 million, DCFPI reports.

So there’d be a straitjack on revenue growth — possibly indeed future shortfalls. The District has had these before — the latest only just remedied by savings found.

What the shortfalls tell us is that revenue projections are inherently iffy — the more so as they estimate collections beyond the upcoming quarter of a fiscal year. That’s just how forecasts are. Ditto projections of spending needs.

Who, for example, can foresee a prodigious snowstorm, requiring millions more to clear the roads than budgeted? Who, at this point, can predict how much crucial programs will lose due to federal spending cuts?

So it seems unnecessarily risky to plow ahead with tax cuts before next year’s budget is even on the drawing board. And if past is prologue, programs that help low-income residents are what the BSA would actually put at risk.

UPDATE: I’ve learned, from reliable sources, that the excess revenue threshold in the current BSA applied only to the forecast used as the basis for next fiscal year’s budget. Under the current law, tax cuts would kick in with any higher revenue forecast, but not until next February. The Mayor could, if she chose, ask the Council to approve using the extra for unmet needs instead.

So what I wrote about the current BSA is misleading, but my basic point that the new BSA would trigger cuts prematurely stands.

 

 


Steps Toward Helping Low-Income People Get Connected to the Internet

June 22, 2015

You wouldn’t be reading this if you didn’t have swift, reliable access to the internet. You couldn’t be reading it if I didn’t.

We all, I suppose, take our high-speed connections for granted — except when our service is interrupted. Yet costs are apparently a barrier for well over half of our country’s poorest households. And that barrier is a barrier to many opportunities we also take for granted.

Two Democratic Senators and a Congresswoman, also a Democrat, have proposed a bill that could enable low-income people to afford broadband connections. The Federal Communications Commission has just voted to explore a somewhat similar plan the Chairman floated,  thanks to the Democratic majority there.

Both would expand the Lifeline Assistance program, which currently provides low-income households with discounts for landline or cell phone service. It’s what you may have heard of as free Obama phones, an allegedly fraudulent, wasteful use of our taxpayer dollars — another liberal “dole-out to dead beats” on welfare.

But the phone service isn’t free. And though welfare recipients are poor enough to qualify for discounts, eligibility extends to households at or below 135% of the federal poverty line and to some whose incomes are higher, e.g., certain recipients of federal housing vouchers.

The dollars that pay for the discounts don’t come out of our federal taxes. They’re often collected as one of those mysterious charges tacked onto our monthly phone rate. And the Lifeline program dates back to the notoriously liberal Reagan administration.

Both the Democrats’ bill and the FCC Chairman’s plan seek to bridge the so-called digital divide — a marked disparity in ready access to a broadband connection that’s increasingly income based. In 2013, only 42% of the poorest households had high-speed internet service in their homes, as compared to 90% of those with incomes of at least $100,000.*

Don’t suppose I need to say that children are now expected to do homework involving internet use or that it’s all but impossible to find and apply for jobs, except via the internet. Far less possible these days to develop job-related skills and networks — or to keep up with relevant news.

So it would seem that a Lifeline expansion would make it somewhat easier to move up from the bottom of the income scale. It could also lead to better opportunities in other ways, e.g., by creating a broader base of informed, engaged voters.

Neither the FCC Chairman’s plan nor the Congressional Democrats’ seems like quite the right answer, however. Both would require Lifeline beneficiaries to choose between a high-speed connection and phone service.

And the Chairman apparently envisions the same subsidy — just $9.25 a month. That’s obviously less than what companies generally charge for phone service.

It’s a much smaller fraction of a DSL connection, which cost, on average, $59.40 a month two years ago, according to an FCC estimate. Hard to imagine that many poor and near-poor households would pick up the whole cost of phone service, plus anything close to $50 a month.

Harder to imagine many would opt for the ‘net instead of a phone, if for no other reason than safety.

My mother-in-law, for example, is now in her mid-90s and coping with frailities common to someone of her age, e.g., a tendency to lose her balance and fall. She has one of those low-cost phone services, with an automatic dial for emergencies.

It’s been a genuine lifeline for her — and one I’m sure she’ll never swap for the chance to see photos of her grandchildren online or keep up with local news now that her hometown paper is delivered only three days a week.

The Democrats’ bill would direct the FCC to monitor prevailing broadband access prices, as well as some other relevant information, e.g., the prevailing speed households use. The agency would use these findings to set the subsidy rate.

Where the extra money would come from isn’t clear — at least, to me. If from a hike in the Universal Service Fund fee (our contribution to the subsidies), we should expect pushback. If not that, what?

The FCC will probably adopt some fleshed-out version of the Chairman’s plan. But the initiative itself will almost surely into flack on Capitol Hill, as The New York Times has predicted.

Not much enthusiasm for broadband expansion there. Only nine more Senators and House members have signed on to the proposed Broadband Expansion Act. Not a single Republican.

So it’s far from certain that we’ll soon help low-income people gain home-based access to the diverse opportunities the internet offers. And as I’ve suggested, the proposals seem problematic.

On the other hand, some influential policymakers have recognized a problem and come up with an approach to solving it. If it needs tweaks and/or clarifications, well, that’s what rulemaking and legislative processes are for.

So as with many issues affecting low-income people (and others), this one boils down to political will. Which in this case (and others), boils down to how we choose to view those low-income people and our government’s role in helping them surmount barriers that marginalize them.

* The FCC Chairman cites somewhat higher percents, based on the Census Bureau’s American Community Survey. The differences reflect differences in the income bands the ACS analysis and my source, Pew Research, use.


House Makes HUD Funding Bill Worse

June 18, 2015

Last week, House Republicans, joined by three Democrats, passed a bill to fund the Department of Housing and Urban Development’s programs in the upcoming fiscal year.

I’ve already blogged on how it shortchanges key programs for homeless and other low-income people — and leaves the National Housing Trust Fund with no money at all. Amendments made the final bill worse by undermining HUD’s efforts to enforce the Fair Housing Act.

One amendment that squeaked through would stall the agency’s belated push to “affirmatively further” the purposes of the law.

As I recently said, HUD has proposed rules that would reduce neighborhood segregation and strengthen actions against practices that deny racial and ethnic minorities, as well as others subject to discrimination equal opportunities to rent and buy. Most House Republicans — and no Democrats — voted to block them.

Another amendment would deny HUD funds to support nonprofits that supplement its enforcement efforts — for example, by sending testers, e.g., black and white, to apply for an apartment or a mortgage loan and filing complaints when they detect discrimination.

Still another would prohibit HUD from using funds to enforce a rule it’s issued that spells out its interpretation of how the FHA prohibits certain policies and practices that have discriminatory effects.

All but 13 Republicans — and again, no Democrats — decided HUD should have to prove that public and private-sector entities, e.g., zoning boards, mortgage companies, intended to discriminate.

This comes hard on the heels of a similar amendment to the bill that would fund the Justice Department, plus agencies responsible for science and commerce.

Documenting intentional discrimination is extremely difficult, as you might imagine. How often do you have, say, a zoning board on record saying, ” We’ll prohibit apartment buildings here because that will keep blacks out”?

This is one of the reasons that virtually all federal court rulings during the last four decades have upheld the effects standard House Republicans would prohibit both HUD and Justice from using.

Well, the HUD funding bill isn’t going to become law. And the Commerce-Justice-Science bill probably won’t either. It’s doubtful the responsible Senate committees will fold the amendments into their funding bills — some maybe, but not all.

It’s also doubtful the full Senate will have a chance to vote on the bills any time soon. The Senate Democratic leadership is reportedly marshalling its forces to block substantive votes on any and all bills that reflect the spending caps imposed by the Budget Control Act.

And all will (or seem to) because both the House and Senate budget plans adopt them, with a clever workaround for Defense.

The President’s got the Democrats’ back — or perhaps they’ve got his. He’s said he’ll veto any appropriations bill that adheres to the caps. Even if Republicans all hang together, they don’t have enough votes in either the House or Senate to override a veto.

So even if too many Senate Democrats defect from the block-all strategy, the HUD funding bill will ultimately become a bargaining chip in negotiations to avert a massive government shutdown.

Why am I bothering with the pernicious amendments then? Well, we’re coming up on elections, as anyone not living in a cave knows. What may seem futile, politically-motivated gestures now won’t necessarily be in 2017.

And it won’t take an amendment to the FHA to undermine the law’s intent. Nor so-called budget riders, i.e., backdoor policy changes tacked onto appropriations bills. We know from experience that if an administration doesn’t like an intentionally broad civil rights law, it can minimize its reach.

A ProPublica report tells us how Nixon prevented his HUD Secretary (former Presidential candidate Mitt Romney’s dad) from using the agency’s grant-making authority to desegregate predominantly white neighborhoods.

That’s not the only strategy administrations have used to minimize the effectiveness of the FHA. For example, Reagan’s Assistant Secretary for Civil Rights refused HUD’s requests to prosecute violators of the law unless the agency had clear evidence of an intent to discriminate.

And then as now, HUD couldn’t go to court on its own. So federal litigation to enforce the FHA ground to a halt. The House Republican majority apparently wants to set the clock back.

Like I said, the House appropriations bills aren’t going to become law. But they’re a clear warning, should one need it, that what’s happened before could happen again.

And, as before, an administration could deny not only fair housing, but other opportunities, e.g., for a decent, appropriate education, employment, timely health care, to racial and ethnic minorities, people with disabilities and others our civil rights laws are supposed to protect.

 


A Bold, Smart Bill to End Child Poverty in America

June 15, 2015

Four Congressional Democrats have introduced a bill to reduce — indeed, to end — child poverty in our country. Will it pass? Not in this Congress. But as a lobbyist friend used to remind me, it took eight years to pass the Family and Medical Leave Act.

So should we press for a law like the proposed Child Poverty Reduction Act? I think so, as do some of our leading children’s advocates. Three reasons, with an asterisk.

Far Too Many Poor Children. Well over 14.6 million children in the U.S. are officially poor, according to the latest report. That’s nearly one in five. We’ve got too many poor adults as well, but children are the poorest age group the Census Bureau counts.

This is still true when the Bureau uses its better poverty measure, which factors in major near-cash benefits like SNAP (food stamps), as well as refundable tax credits. These lower the child poverty rate, but still leave nearly 12.2 million children below the applicable poverty threshold.

Lifelong Consequences. Children born to poor parents are more likely than others to die while infants. Research tells us that those who survive, as most do, can soon suffer damages to their brain and other systems caused by toxic levels of stress.

They’re at high risk for physical and mental health problems due to a wide range of poverty-related factors — inadequate nutrition, unstable (or no) housing, parental abuse and (more often) neglect, neighborhood violence and exposure to toxins, e.g., mold, lead paint, air pollution from nearby power plants, dumps and/or highways.

Needless to say (I hope), children suffering from such problems don’t arrive at school ready to learn — or in some cases, behave themselves, as classroom decorum dictates.

They’re more likely to miss school days because they’re ill, can’t get to school or have to stay home to care for a younger child — or because they’re suspended for misbehaving, especially likely if they’re black, Hispanic or Native American.

They may choose to miss school days because they don’t want to sit in classrooms where they can’t understand the lessons and to suffer humiliation because of that and/or because their peers gang up on them.

Ultimately, far too many drop up — mostly, though perhaps not always because they’re failing academically. Or they graduate, even though they can barely read or do basic math. Barring further education, most will face a lifetime of low-wage employment — if they’re lucky. Some, as we know, will find more gainful employment in drug dealing and the like.

A somewhat dated but still indicative study estimated that child poverty costs our country $500 billion a year in lost earnings, higher crime-related costs and increased health expenditures.

So if we need a cost-benefit rationale, which I’d like to think we don’t, then making child poverty rare and brief would seem a sensible priority.

Not a National Priority. We’ve already got programs to break the poverty cycle — too many to even simply list here. We’ve got research indicating other promising initiatives, e.g., the housing pilot evaluation I blogged on recently. We’ve got at least one full-blown agenda for dramatically reducing child poverty.

But, as First Focus President Bruce Lesley observes, tackling child poverty isn’t a national priority to the extent that top-level policymakers feel they must actually do something about it — or that we, the public, demand they do.

The Child Poverty Reduction Act aims to change this by importing elements of an approach that worked in the UK. Adopted there in 2000, it drove policy changes and investments that cut the child poverty rate, as we measure it,* in half by 2008.

The proposed approach has three major prongs. Like the UK’s, it sets goals — half as many children living in poverty and none in deep poverty in 10 years and no children in poverty at all 10 years thereafter.

The proposal doesn’t include new and/or reformed policies and programs to achieve these goals. Here too, it’s like the initial UK law. It does, however, differ somewhat in how the agenda would develop.

The elements of the UK’s child poverty initiative emerged over time, though the goal-setting law required both the overarching government and the nation-level governments the UK comprises to issue strategies.

The CPRA would instead set the stage for policymaking by mandating a national plan for achieving the reduction-elimination goals, plus recommendations for achieving related goals, e.g. understanding the root causes of child poverty, eliminating race, ethnicity and other disparities.

A working group of officials in at least six federal agencies would be responsible for developing the plan and other recommendations. It would first, however, have to commission workshops and research papers from the independent National Academy of Sciences.

So we’d have a blueprint of sorts, based on research already conducted — and perhaps new studies — to launch the actual war on child poverty.

Then, much as in the UK, the working group would monitor relevant programs and services and annually publish results. Reports would include states’ child poverty reduction efforts and recommendations for further legislation.

Political Will. As Lesley says, all major parties in the UK have embraced the child poverty goals there. And their leaders apparently feel they’re accountable to the public for the impacts of their policies and other decisions.

They face a major test because recent projections suggest the child poverty rate will rise, as a report for First Focus notes. The policy largely responsible for bringing the rate down would cost too much to replicate, it says, “even if the political appetite were there.”

The lesson here isn’t one we have to learn from the UK. We’ve had goals before. Then-candidate Obama was going to end child hunger by this year, for example.

We’ve had recommendations from independent research agencies, including the recently overridden exclusion of white potatoes from foods mothers could use their WIC benefits to buy. We’ve had reams of plans to achieve worthy goals — more than 243 to end homelessness, for example.

Don’t mean to sound cynical. My point is simply that even if Congress passed the CPRA, we’d still be merely looking at the annual Census reports and shaking our heads unless we create — and sustain – enough political will to convince our elected officials that they have to show progress toward the goals.

* Countries in the European Union ordinarily use a poverty measure based on their median income. Our official measure uses incomes adjusted only for inflation to divide the poor from the not-poor year after year. The UK now uses both types of measures for child poverty.

 


Low-Income Children Can Move Up If They Grow Up in a Good Place

June 11, 2015

We know you’ve got to choose the right parents if you want to wind up higher on the income scale — or so the research tells us. Now we’ve got a massive data analysis telling us they’ve got to choose the right zip code. And they’ve got to do it while you’re young, preferably before you turn ten.

The analysis was the focal point of a recent “conversation” about place, opportunity and policy hosted by the Brookings Institution. Featured speaker was the lead analyst, Harvard economics professor Raj Chetty.

Some mind-opening data, a handful of policy recommendations and a striking (to me) focus on race discrimination. Summary, brief as I could make it, follows.

Place Matters for Children’s Future, With Caveats

Children born in the bottom fifth of the income scale have a much better chance of moving to the top fifth as adults if they grow up in a community that gives them and their families advantages like decent schools, safe homes and streets, ready access to jobs and beneficial networks. No surprise here. But new numbers, some surprising.

Chances for low-income children raised in Washington, D.C. are 10.5%. This is better than the national average — 7.5%. And it’s a whole lot better than their counterparts’ chances in most of the deep South. But their chances would be better if they’d grown up in San Jose, California, hub of the Silicon Valley.

Shifting the income level, as the breakouts do, children whose families have incomes in the bottom quarter of the income scale will earn 5.8% more as young adults if they grow up in D.C. than if they’d grown up in “an average place.” But if they’d grown up in nearby Fairfax County, they could look forward to more than double that relative income gain.

In short, place matters, as another recent study also showed. This one, also co-authored by Chetty, reevaluated results of the U.S. Department of Housing and Urban Development’s Moving to Opportunity pilot.

Families got housing vouchers, but only if they moved to lower-poverty neighborhoods. An earlier evaluation measured increases in parents’ employment and income. Basically, zip.

But when Chetty and his colleagues looked at how preteens fared as adults, they found a 31% boost in earnings, compared to peers whose families didn’t get the MTO vouchers. This, I would guess, is at least partly because the young MTO beneficiaries had a higher college attendance rate.

For older children, however, moves to opportunity had negative effects on earnings, as well as other measures. The disruption of the move outweighed the advantages of living in a higher-income neighborhood, the researchers say.

What Public Policies Could Do

At the highest plane, these findings support two policy thrusts. The first is to help more families move out of high-poverty neighborhoods — and to do so while their children are very young. That would seem to require more housing vouchers, perhaps with subsidies scaled to encourage use in mixed-income neighborhoods.

But there’d have to be more relatively low-cost housing in those neighborhoods too. Several panelists at the Brookings event had quite a bit to say about exclusionary zoning, e.g., density limits that cap building height and/or prohibit multi-unit housing.

At the same time, it’s both practically and theoretically infeasible to move all poor and near-poor families out of high-poverty neighborhoods. And not all families want to move, fearing loss of “social capital,” e.g., connection to a local congregation, supportive friends nearby.

So the second major policy thrust is to improve those neighborhoods. Oddly, Chetty and panelists didn’t delve into the how issue, though one recommended diversifying public housing locations so as to dilute the poverty concentration.

Discussion focused mostly on affording families in high-poverty neighborhoods access to opportunities elsewhere — better schools especially. Recurrent, favorable references to vouchers, lotteries and charter schools. One panelist also mentioned redrawn public school attendance zones.

Chetty himself believes we need more “big data” analyses to pinpoint initiatives that would make economically-disadvantaged neighborhoods less disadvantageous for the children growing up in them.

But he did cite possibilities, based on his research to date — specifically, neighborhood characteristics correlated to better (and worse) outcomes for kids. Big news here is that the race in the place matters a lot.

Race Matters for All Children

We all know now, if we didn’t before that our public safety and criminal justice systems often make life worse — if they don’t end it — for residents in predominantly black neighborhoods. The victims are usually blacks.

What Chetty’s research tells us is that the racial makeup of a neighborhood affects economic mobility for whites, as well as blacks. Outcomes worsen as black density increases for both, he said.

We don’t need his research, though we’ve got it now to identify major factors — under-funded schools with over-crowded classrooms, less experienced teachers and insufficient resources to mitigate disadvantages that impair children’s ability to learn, lack of convenient public transportation, etc.

What Policies Have Done and Could

Plowing more money into the schools, transportation systems and the like would seem a solution to the drag on upward mobility that living in a predominantly black neighborhood exerts. And indeed, it is, but not the only one. Nor sufficient because it would address symptoms, but not root causes.

Several panelists zeroed in on the latter. Predominantly black neighborhoods —  and their attendant disadvantages — didn’t just happen, they stressed. The neighborhoods reflect housing segregation policies dating back to the 1920s.

And we’ve still got policies that perpetuate segregation. More widespread private-sector practices, however, e.g., selective treatment by real estate agents, egregiously unequal mortgage loan terms.

The 1968 Fair Housing Act was supposed to dismantle segregation and prevent further discrimination on various bases, including race.

But weak and/or co-opted local agencies let business go on as usual. And HUD has never had to resources to effectively enforce the law. Nor has it always been allowed to do what it could, as a ProPublica report indicates.

HUD has proposed new rules that would put teeth into the Fair Housing Act’s requirement that it — and thus state and local agencies — “affirmatively further” the purposes of the law. The final rules — assuming they’re issued and enforced — could make place matter less for low-income children’s chances of moving up the income scale. Make life better for their parents too.

But they won’t make every place a launching pad for upward mobility. For that, we need a broader range of policy initiatives. Bigger investments in equalizing opportunities too.

 

 


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