The next generation of antipoverty policies

Although the American economy has enjoyed a healthy growth rate over the past four decades, stagnant wages among the least skilled have made it hard for people holding low-wage jobs to escape poverty. This problem has been exacerbated by changes in family composition that have ballooned the share of children being raised by a single parent. And government spending, which has grown rapidly, has reduced poverty less than had been hoped.

Focus of the volume
We believe that progress against poverty is still possible. The latest volume of The Future of Children presents several specific public policies that would achieve this goal. These policies cover a spectrum of short- and long-term strategies that the contributing authors believe have the best chance of reducing poverty in a cost-effective way.

Good policy can make a difference
The 1990s provided several good examples of how public policy can both help individuals make better choices and reward them for doing so. The 1996 welfare law created work requirements, time limits, and reductions or terminations in benefits for welfare recipients who did not work, while at the same time other measures expanded the work support system, including the Earned Income Tax Credit and food stamps, to reward those who chose work over welfare. Starting in the mid 1990s hundreds of thousands of mothers left the welfare rolls for work and child poverty in single-parent families fell to its lowest level ever.

Why these policies?
The editors of this volume, Ron Haskins and Isabel Sawhill, believe that a combination of policies based on sticks (such as work requirements) and carrots (such as child care and the Earned Income Tax Credit) is an especially effective strategy for fighting poverty. Moreover, this approach is consistent with the philosophies of the nation's two major political parties. Republicans emphasize that progress will not be possible unless individuals behave more responsibly – and more in accord with traditional American values – than they have in the past. Democrats emphasize that serious personal effort and responsible behavior alone will not be enough to allow millions of poorly educated adults and their families to escape poverty. Both individuals and government, in other words, have major roles to play in reducing poverty.

Keeping this winning combination of approaches in mind, the editors asked the authors of this volume to detail a set of specific strategies to reduce poverty in the future.

Incentives and work mandates for men
In the past, most antipoverty policies have focused on single mothers for whom the combination of sticks- -and-carrots policies seemed to work in the 1990s. But at the same time that poor women were entering the labor force by the hundreds of thousands, the work rate among less-educated men fell and their wages stagnated. Thus, Gordon Berlin proposes to offer the Earned Income Tax Credit to all full-time working adults while Larry Mead emphasizes mandatory work programs for ex-offenders and men who owe child support payments.

Improve the work support system
Many believe the current work supports for low-income workers, whether male or female, are inadequate and should be improved. Two of the most important problems in the current system are the shortage of funding for child care and the number of poor working adults who are not covered by health insurance. Accordingly, Mark Greenberg proposes a major overhaul of child care subsidies and tax credits in a proposal that would guarantee child care to all children in families under 200 percent of poverty. Alan Weil proposes a tax credit program that would guarantee health insurance for low-income families while ensuring that a variety of health insurance options are available for purchase through a combination of individual earnings, employer contributions, and government contributions.

Create longer-term strategies
A distinguishing characteristic of the above policies is that they lead to almost immediate payoffs by getting adults into the labor force and providing government work supports that supplement wages and offset work expenses. But these policies do not do much to reduce poverty in the long term by promoting children's development and enhancing their life prospects. Especially in a nation that prides itself on the claim that all children should have a chance to do better than their parents, policies to reduce poverty and inequality in the long run are essential. To boost the development of poor children, the authors who appear in this volume suggest four additional strategies for reducing poverty in the long run:

Reduce Nonmarital Births and Increase Marriage. Poverty in female-headed families is four or five times greater than poverty in married-couple families, and studies have shown that children fare better in married-couple families. Paul Amato and Rebecca Maynard argue for investments in more effective teen pregnancy reduction programs and premarital education to increase the share of children reared by their married parents.

Improve Preschool Education. Greg Duncan and his colleagues note that high-quality preschool can boost children's development and decrease the achievement gap between poor children and their more advantaged peers. They propose to fund a high-quality preschool initiative that targets resources towards the most disadvantaged children.

Improve Public Education. Children living in poverty tend to be concentrated in low-performing schools staffed by ill-equipped teachers. These children are especially likely to drop out and to leave school without the skills necessary to earn a decent living in a rapidly changing economy. Richard Murnane proposes to build on the No Child Left Behind Act in ways that would improve the accountability, incentives, and capacity for schools to address these shortcomings.

Help the Most Disadvantaged Mothers. Some mothers face multiple barriers to work, including low education, health problems, or a history of domestic violence or substance abuse. Rebecca Blank argues that these mothers and their children need greater assistance and support than that provided by current welfare-to-work programs. She proposes a new program that would focus exclusively on serving the most disadvantaged mothers.

Many of these proposals are expensive. But poverty is expensive too: it drains resources from the nation while simultaneously depriving it of human capital that would increase productivity and reduce social problems. Investments in these proposals, which could be financed out of savings from cuts in other government spending or tax increases, are not only consistent with public concerns about increasing inequality in America but are likely to produce numerous benefits in the long run.

This feature is the Executive Summary of The Future of Children, vol. 17, no. 2, Fall 2007. The full issue may be viewed at http://www.futureofchildren.org/pubs-info2825/pubs-info_show.htm?doc_id=521579