Brooding on My Blog’s Seventh Birthday

December 7, 2015

Yesterday was my blog’s seventh birthday. The occasion always prompts reflections, some of which I’ve shared.

I’ve spoken in the past about how things were when I launched the blog, compared to how they were when the birthday rolled round. I’ve spoken about the value of the blog as a source of discipline for learning and of relationships with advocates who inspire me — and readers who keep me going.

What’s top of mind today — and has been for awhile — grows out of the scope I carved out for the blog, but only gradually got a purchase on.

The scope is very — or one might say self-indulgently — broad, as the blog’s name indicates. It essentially licenses posts on any nexus between public policies and poverty, though as a practical matter, I’ve confined myself to the American scene.

I’ve stretched the scope as I’ve come to understand how our official poverty measure fails to do justice to the extent of economic hardship in our country.

Some of our major federal policies recognize this and so set income eligibility maximums above the federal poverty line — a simplified version of the thresholds the Census Bureau uses for the official measure.

At the same time, those income eligibility maximums vary a lot from state to state insofar as federal programs grant states flexibility.

We also see marked variations when we look at how states invest their own tax revenues in programs that provide a safety net and others that can help low-income people achieve a modicum of financial security.

States have always faced the challenges these choices reflect. They surely face them now, as they have ever since the Budget Control Act capped federal spending on non-defense programs that depend on annual appropriations.

The fact that the recent budget deal temporarily lifts the caps doesn’t relieve them from the challenges because the non-defense part of the budget includes a very wide range of programs.

Congressional appropriations committees have divvied up the new, higher spending level now. And at least on the House side, Labor, Health and Human Services, and Education — a major source of funds for programs that benefit low-income people — reportedly won’t get its fair share.

Highly doubtful that the Transportation-Housing and Urban Development budget will fully undo the damages to the federal housing voucher program or the capital fund that local agencies use to keep public housing units habitable.

Meanwhile, Congress will clearly do nothing now about a long-neglected piece of the federal budget that’s not subject to annual appropriations — the Temporary Assistance for Needy Families block grant.

It’s not only the federal government’s major share of funding for states’ TANF programs. It also determines how much of their own funds they must spend to get that share.

And as I’ve written (perhaps too often), it’s never gotten a penny more than it did the year that TANF ended welfare as we knew it. This means it’s now worth about a third less in real dollars.

Which brings me to the other nexus I’ve tried to deal with, but mostly one nibble at a time. That’s the nexus between federal policies — budgets included — and related state and local policies. These too include budgets, but not budgets only.

I’ve referred to states’ TANF policies — mainly the very low cash benefits they provide. And I’ve taken a poke from time to time at some states’ Medicaid eligibility policies.

I’ve also cited states’ varying responses to federal policy choices that can enable them to enroll more low-income people in SNAP (the food stamp program) — and qualify some of them for higher benefits.

I’ve noted disparities in minimum wages, as some states raise their minimums above the federal, while others either preserve the link or have no minimum of their own at all. I haven’t noted, but probably should have how much those higher minimums vary.

These and other such differences have made me increasingly conscious of what I think of as geographic inequality. We read a lot about income inequality — and about how children’s future financial prospects hinge so much on whom they’re born to.

But how low-income people, including children fare depends a whole lot on where they live. Part of that, of course, is that some local economies offer better opportunities than others. But a major part stems from policy choices.

I know I’m not saying anything new or original here. Only taking this occasion to say how the more I learn, the more I’m disturbed by how unfair our federal-state-local system is to so many poor and near-poor people who’ve got little, if any choice of where they live.

Not saying I’d like to see all policies determined by our federal government — surely not the one we have now. Low-income people have it bad enough already. I shudder to think how much worse off the geographically fortunate would be if left to the tender mercies of the majorities in Congress.

Won’t think because I can’t bear to what would happen to all struggling people if the next election not only sustains those majorities, but puts a like-minded candidate — or a loose cannon — in the White House.

What would a ninth birthday post look like then?

 


Of Poverty Traps and Benefits Cliffs

April 28, 2014

Congressman Paul Ryan, as we know, views safety net programs as a “poverty trap” because they’re means-tested.

“The federal government effectively discourages … [poor families] from making more money, his War on Poverty report says, because they’ll lose benefits if they do — and pay higher taxes as well.

Whether these prospects actually discourage work is debatable — and at the very least, contingent on many variables. The loss of benefits isn’t. Progressives and conservatives alike have commented on the so-called “cliff effect” — to different ends, as you might imagine.

I’ve been puzzling over policy solutions because cliffs or something very like seem inherent in means-tested programs. And to some extent, they are.

But that doesn’t mean we should just shrug our shoulders — or view the only solution as “universal programs” akin to Medicare, as Roger Senserrich at the Connecticut Association for Human Services apparently does.

A recent report by Children’s HealthWatch shows that we could make progress by looking carefully at the real-world causes and effects of cliffs.

The report focuses on SNAP (the food stamp program) and, as one might expect, effects on children’s health when families lose all or a portion of their benefits due to income increases.

The distinction here indicates that SNAP is already structured to create a downward slope, rather than what the word “cliff” brings to mind. Benefits nevertheless dwindle — and eventually disappear — as income rises.

Families can be hit with a double or triple whammy because other safety net and work support programs are also means-tested. A Witness to Hunger, for example, worked overtime for a month, “and they just cut me off food stamps, and they cut my kids’ medical insurance off.”

This may be one reason that income increases are often not enough to compensate for lost SNAP benefits, as results of a CHW survey show.

For example, young children in families who’d altogether lost their benefits were 78% more likely to be food insecure than those in families who’d consistently received them.

For those in families whose benefits had been reduced, the likelihood was 55% greater. And caregivers were 30% more likely not to seek health care for themselves or another family member because they felt they couldn’t afford it.

The CHW report is entitled Punishing Hard Work, though not only wage increases can send families over the cliff.

They can also lose SNAP benefits when a disabled child starts receiving Supplemental Security Income, for example, or when an absent parent starts paying child support. In either case, children should be better off, but may not be.

CHW advocates several federal policy solutions to moderate the cliff effect.

One reflects a recommendation the Food Research and Action Center has made for many years. Use the U.S. Department of Agriculture’s Low-Cost Food Plan instead of the Thrifty Food Plan as the basis for determining maximum SNAP benefits.

As FRAC has explained — and the Institute of Medicine confirmed — the TFP is unrealistic in various ways. And it understates the costs of foods in the market baskets used to set benefit levels, as CHW itself has shown. Even more so the costs of foods that would make up a healthful diet.

A shift to the Low-Cost Food Plan wouldn’t affect the maximum income threshold, but it would leave families with larger benefits during the tapering-off period.

Two other recommendations address permissible deductions in gross household income. Both would increase the likelihood of a net income below the poverty line — the eligibility cut-off for SNAP.

One would eliminate the cap on deductible housing and utility costs — just $478 a month for most families.

The other would expand the current medical expenses deduction, which is now available only to elderly family members and those who receive disability benefits. Yet families can incur out-of-pocket healthcare costs for other members, even if they’re covered by Medicaid.

These costs often increase with income, as families move to private health insurance plans, as CHW observes. So expanding the medical expense deduction would help preserve one benefit as another shrank.

This is one example of why policymakers should “look across programs to determine … unintended consequences related to increasing family income.”

CHW looks to the Affordable Care Act as a potential vehicle, since it gives states an opportunity to create linkages between healthcare subsidies and other federal benefits.

Well, we know what Congressman Ryan thinks of the ACA. Another “poverty trap,” he calls it.

But if he were really concerned about encouraging people to “begin … getting the dignity of work, rising [sic] their income,” etc., he’d be focusing on the kinds of solutions CHW advocates instead of trying to gut programs like SNAP.