The Impact of the Government Shutdown on Children and Families

While the government shutdown is well into its second week, it is important to keep in mind the devastating consequences that are continuing to impact the most vulnerable children and families. Though programs that directly ensure public health and safety have avoided the spending freeze, including Medicaid and Social Security, most of the programs that are affected are still vital supports and services that help sustain young women and children, low-income families, and the elderly.

Temporary Assistance for Needy Families (TANF), which provides temporary financial assistance to help pregnant women and families pay for food, shelter, utilities, and expenses other than medical costs, has stopped awarding new funds, however states have the option to continue providing benefits with state dollars. Since TANF provides significant services in addition to cash assistance, such as GED preparation, vocational training, postsecondary education, vocational rehabilitation, help with child care, work stipends, job retention services and more, discontinuing the program during the shut-down – particularly if it continues for much longer - would be a devastating for families in need.

Head Start programs will also be affected by the shutdown—a total of 23 programs serving 19,000 children will be affected as their grants begin to expire. Those cuts are in addition to the 57,000 children pushed of Head Start as a result of the sequester, on top of a $400 million mandatory cut to the program nationwide. The longer the shutdown continues, the more Head Start programs and young children will be adversely impacted.

Implications of the government shutdown to nutrition programs are equally alarming. The Supplemental Nutrition Assistance Program (SNAP), which helps over 47 million low-income Americans, will continue providing benefits, but only until the end of October. States have the option of continuing the SNAP program through 2014, but the $2 billion available for contingency funds that would be used to compensate the loss of funding would not be enough to support the program in the long-term, since SNAP provides about $6 billion in support to families per month.

The Special, Supplemental Nutrition Program for Women, Infants, and Children (WIC), which assists over 9 million at-risk mothers, infants, and young children in accessing healthy food, nutrition information, and health referrals, will also continue until the end of October. Like SNAP, most states have funds to continue WIC for a week or so, but the program won’t be able to continue for very long, with emergency funds running out by the end of the month.

The impact on supplemental nutrition programs is also impacting the elderly. Senior Nutrition Programs have stopped as a result of the shutdown. The Department of Health and Human Services can no longer fund Meals on Wheels, which provides more than one million home-delivered meals to seniors who need them each day. This crucial service has also been impacted by the sequester, which is discussed in this previous post.

The government shutdown is risking the basic supports and services low-income families need to survive. Although there are emergency funds to continue certain programs in the meantime, the long-term consequences will be harmful and widespread. State policymakers should use their discretion to continue the programs that can provide supports and services to vulnerable families; however, the only sustainable solution is for the government to go back to work in serving children and their families as soon as possible to minimize the impact.

Poverty and the Brain

Recent findings show that living in poverty, and the mental strains associated, can impede proper brain functioning. A series of experiments run by researchers at Princeton, Harvard, and the University of Warwick in the United Kingdom concluded that living in poverty can tax the cognitive abilities of anyone experiencing it and that those cognitive abilities return when the burden of poverty disappears. In essence, the research found that poverty imposes such a substantial burden that people living under those circumstances have difficulty making important decisions.

Previously released studies showed a correlation between poverty and “counterproductive behavior.” For example, these studies found that the poor are less likely to have preventative health care, fail to adhere to drug regimens, are tardier, and less likely to keep appointments. These behaviors can deepen poverty; however, previous explanations have only focused on the impact of environmental conditions as an explanation—predatory lenders in poor communities may create high interest rate borrowing, and unreliable transportation can cause tardiness and absenteeism. Other studies have focused on what they deemed the “characteristics of the poor,” for example lower levels of formal education that can create misunderstandings about contract terms, and less parental attention that may influence the parenting style of the next generation.

The research recently conducted at Princeton, Harvard, and Warwick is dedicated to a different explanation of poverty, one which focuses on the mental processes required for living in impoverished conditions. Their findings suggest a strong relationship between poverty and mental functioning. The poor must deal with having an inconsistent stream of income, juggle expenses, and are often forced to make difficult compromises, and these everyday occurrences can be distracting. Constant worries about budgetary concerns diminish the cognitive resources available to make thoughtful choices and actions-restricting the ability of people living in poverty to provide full consideration to problems that arise. The findings show that the mental burden of poverty is equivalent to losing 13 IQ points, which is the same as losing an entire night of sleep and is comparable to the cognitive difference observed between chronic alcoholics and “normal” adults.

As the report states, “Being poor means coping with not just a shortfall of money, but also with a concurrent shortfall of cognitive resources.” The importance of this research indicates that the problems associated with the poor are not actually within poor people themselves, but with anyone who finds themselves living in poverty. These findings have important policy implications—policymakers should create strategies and solutions that reduce and avoid cognitive taxes on the poor. Policies focused on alleviating poverty through raising the minimum wage as California recently did, help to address some of the institutional factors impacting poor families across the country. Other policies, which mitigate the effects of poverty, such as food assistance and health care are also ways to assist families trying to make ends meet.

In response to the recently released poverty data, it is important to keep in mind how many people are living within these conditions. Federal budget issues such as the maintained sequester cuts, totaled at a reduction of $986.3 billion in overall discretionary funding, are detrimental to the families that depend on these supports and services to survive.  This not only impacts parents and their children financially – but also cognitively.

2012 Poverty Data: New Data from the U.S. Census on Poverty, Income, and Health Insurance.

Earlier today, the U.S. Census Bureau released the 2012 data on income, poverty, and health insurance coverage. For the second consecutive year, neither the official poverty rate nor the number of people in poverty at the national level were statistically different from the previous year’s estimates—the poverty rate remained at 15 percent – amounting to 46.5 million people living in poverty. While there was not an increase in the poverty rate, the 2012 data still indicated significant racial disparities in both poverty and income. The poverty rates among non-Hispanic Whites and Asians were 9.7 percent and 11.7 percent respectively, while the poverty rates for Blacks and Hispanics were 27.2 percent and 25.6 percent respectively.

Poverty and Income Data Highlights

• The percent of people in deep poverty, with incomes below 50% of the poverty threshold, remained at 6.6 percent from 2011, which is still a substantial increase from the 5.2 percent rate seen in 2006 and 2007 (prior to the recession) and even from the data collected in 1967 where deep poverty was at 4.4 percent.
• The poverty rates for children, those under the age of 18, was 21.8 percent, not statistically different from 2011.
• Median household income in 2012 was $51,017, not statistically different from the 2011 median income of $51,100.

Health Insurance Data Highlights

• The percentage of people without health insurance coverage decreased to 15.4 percent from 15.7 percent between 2011 and 2012, while the number of uninsured people in 2012 was not statistically different from 2011, at 48 million people.
• The percentage and number of people covered by government health insurance increased to 32.6 percent and 101.5 million people in 2012 up slightly from 32.2 percent and 99.5 million people in 2011.
• The percentage of Asians and Hispanics without health insurance decreased from 16.8 percent and 30.1 percent to 15.1 percent and 29.1 percent respectively.
• The percentage of uninsured children decreased from 9.4 percent to 8.9 percent in 2012.

Safety Net Programs

• Unemployment insurance was able to raise 1.7 million people out of poverty in 2012.
• Social Security income helped 15.3 million people aged 65 and older out of poverty in 2012 – if these payments were excluded - it would quadruple the number of elderly people living in poverty.
• The Supplemental Nutrition Assistance Program (SNAP), while not included in the poverty calculations used for the data today, if considered, would have reduced the number of people in poverty by 4 million people in 2012.
• The Earned Income Tax Credit (EITC) also reduced the number of children classified as living in poverty in 2012 by 2.9 million children.

The Important Role of Public Policy. Public policy helps create pipelines of educational opportunity and new jobs. It also creates the supports and services that help poor individuals and families while they work toward those opportunities. As evident in the data, the most noticeable statistic changes that occurred in 2012 were in health insurance coverage – with the number of uninsured children dropping from 9.4 percent to 8.9 percent in 2012.  This demonstrates the critical value of policies that make a public investment in children and families. Public investments have proven to have a real impact on reducing poverty – and subsequently improving the quality of life for millions of children and families. Unfortunately, the $85 billion in cuts to supports and services as a result of sequestration are likely to only exacerbate the conditions of poverty and increase the percentage of those living in unacceptable conditions – unable to meet their basic needs.

The Need for a Focus on Equity. The racial disparities in the poverty data indicate that Black and Hispanic families have continued to have disproportionately higher poverty rates and lower incomes compared to White families, which has been consistent for more than three decades. This inequity shows the need for innovative solutions and public investments aimed at supporting real change.  Policy strategies should take into account the existence of disparate opportunities and outcomes—attention to equity creates solutions that best meet the needs of the entire community.

To read CSSP's Statement on the New Poverty Data and Implications for Children and Families please click here.

For more strategies to Ensure Children Grow Up in Safe, Supportive and Economically Successful Families visit PolicyforResults.org.

More from our blog: a primer on poverty measurement and the Census instruments used.

Where we are now 50 years later--The March on Washington

The 50^th Anniversary of the March on Washington that took place last Wednesday highlighted significant areas of progress, while also drawing attention to the advancements that still need to be made. Although there are many reasons to celebrate, including equal access to public accommodations, laws against racial discrimination and employment and African American voting rights as a result of the passage of the Civil Rights Act of 1964 and the Voting Rights Act of 1965, the hard economic goals of the march that were critical to transforming the life opportunities of African Americans have not entirely been achieved.

In fact, there are growing economic divides, and despite the important protections established through the law, discrimination has taken new forms. Fifty years after the march, and 45 years after the passage of the Fair Housing Act, major banks still discriminate on the basis of race through predatory practices and lending activities. For example, an investigation into the nation’s largest home mortgage lender, found that the bank charged higher fees and rates to more than 30,000 minority borrowers across the country than they had to white borrowers who posed the same credit risk. Another concern related to housing can be seen when you look at the population in homeless shelters. African Americans make up 40 percent of the population living in homeless shelters, while comprising of only 13 percent of the U.S. population.

The inequality extends to other areas of financial security – including other types of assets and income. In the last 30 years, there has been no significant progress in closing the gap between the income of African Americans or Hispanics and white Americans. In 2011, the median income for African American families was $40,495, just 58 percent of the median income of white families. By 2009, the median wealth of white families was 20 times that of African American families. The Great Recession also had a disproportionate impact on African Americans—the median wealth among African American households dropped by 53 percent between 2005 and 2009, and the poverty rate increased to 27.6 percent by 2011, 3 times the poverty rate for white households that year at 9.8 percent. About 65 percent of African-American children live in low-income families—45 percent of which live in communities with concentrated poverty, as opposed to 12 percent for white children. Living in neighborhoods of concentrated poverty can significantly impact the lives of children and their families.  Concentrated poverty is closely linked with many social and economic challenges, including behavioral problems in young children, higher crime rates, and environmental hazards that impact health.

Discrimination is also still prevalent in the job market. Research shows that applicants with “African American sounding” names get 50 percent fewer calls for interviews, and are twice as likely to be unemployed. In 2012, the African American unemployment rate was 14.0 percent, 2.1 times the white unemployment rate at 6.6 percent, and even higher than the national unemployment rate during the Great Depression from 1929 to 1939 (13.1 percent). 

Despite being the land of opportunity, many young children growing up in America are dependent on their parents’ income and education to determine the probability of their success into adulthood. Unfortunately, discrimination and lack of education and job opportunity is often persistent from one generation to the next, which limits the opportunities for improving future outcomes. The good news is – there are ways for public policy to begin to address the inequities that still exist. In keeping with the progress that has already been made, improving equitable access to decent housing, maintaining high-quality, integrated education, creating opportunities for equitable early childhood initiatives and creating a federal jobs program for full employment are all policy options aimed at advancing equity. To read the report on The Unfinished March by the Economic Policy Institute, click here. 

The Impact of the Sequester on Head Start

The on-going effects of the federal sequester are continuing to hit low-income children and families the hardest. As a result of the mandatory $400 million cut, Head Start programs this school year will eliminate services for 57,000 children, 1.3 million days from Head Start Center calendars will be cut, and 18,000 employees will have to undergo layoffs and reduced pays. These changes will affect tens of thousands of poor families across the country who rely on Head Start for early learning programs, day care, and a network of social services and medical care.

Some Head Start centers are trying to minimize the impact as much as possible by cutting administrative costs and support services, but the effects are still unfavorable. For example, Head Start in Arlington County, Virginia is reducing their bus services this year, which means that many children will no longer have a reliable form of transportation to make it to class. Other Head Start programs are shortening their school year or the school day. The latest figures show that 18,000 program hours will be cut next year by centers that will start later in the day or end earlier. The cuts also force Head Start programs to lay off staff, reduce hours, and reduce benefits.

While some places are reducing services and staff, most programs have had to completely cut their services to children. In California and Texas, services were cut to 10,000 children combined. Virginia has trimmed nearly 1,200 spots, Maryland cut 460, and D.C. is reducing participants by 100. Nationwide, these cuts compromise 6,000 children in Early Head Start, which is designated for infants and toddlers up to age 3, and another 51,000 in Head Start programs. 

Some locations have been able to use local funds to compensate the drop in federal funding to maintain the level of service, and more affluent communities or outside organizations were able to fill-in for the loss, which is the primary reason why the budget cuts were not as dramatic as the initial projections; however, these solutions are not sustainable.

In addition to the important educational benefits for children in Head Start, the program also allows low-income families a form of quality daycare that they otherwise would not be able to access or afford. The exorbitant costs of daycare force many parents, and mothers in particular, to decide whether or not working is even affordable. Many women cannot be assured of both working and making a decent income after taxes and child care costs. For instance, daycare can cost up to 30% of one income in a two-salary couple and is the greatest expense for low-income households surpassing both food and housing. In New York, costs of daycare can average $25,000-$30,000 per child—higher than the cost of a year of public college.

The effects of sequestration on Head Start programs are devastating for low-income children and families nationwide.  It is essential to keep in mind that public investments in the health, welfare, and education of young children and their families have significant positive returns on investment, but the sequester is clearly eliminating lifelines.

Pathways to Opportunities for Ex-Offenders

When formerly incarcerated individuals reintegrate into the community, they face a number of barriers to employment, education, and access to services. If current trends continue, over half of released inmates are bound to return to prison within three years. To combat this issue, it is essential to reduce and avoid the possibility of recidivism.  One important way to do that is through workforce development and education programs for inmates while in prison.

Research has shown that higher education is directly linked to reducing recidivism rates; however, inmates have extremely limited access to programs that provide education and training. Education increases human capital and improves general cognitive functioning while providing specific skills, and for inmates, it can help to obtain and maintain employment while also deterring criminal activity. Education and training provides ex-offenders with marketable skills essential for employment and dramatically improves their outcomes, so making quality education programs accessible to inmates can minimize the obstacles for ex-offenders during their reintegration – which ultimately leads to safer communities for all of us.

This commentary from Spotlight on Poverty and Opportunity highlights the drastic limitations of incarcerated students, especially after their Pell Grant eligibility was removed in 1994—since then, higher education programs dropped from 350 to 8 for inmates nationwide. Up to that point, Pell Grants had been the primary source of funding for higher education programs in correctional facilities. Though some states have been able to provide funding streams to fill the gap, many of the effects are still present and impacting thousands of people who will return to the community.

The removal of Pell Grant eligibility and the deep cuts in education programs increased the already disparate outcome of educational attainment among the incarcerated population. The number of incarcerated individuals receiving postsecondary education in prison dropped by 44%. Only 17% of state and federal prisoners had some level of postsecondary education compared to 51% of the population outside of prison, and only 65% of state and federal prisoners had diplomas or GEDs, compared to 82% of the population. Additionally, 7 out of 10 prisoners who had a GED reported obtaining it while in prison, which demonstrates just how important these programs can be in helping inmates obtain their education.

Another important consideration is that inmates are not the only ones that are affected—the multiple barriers ex-offenders face affect their innocent children and entire families. An important statistic to keep in mind is that 1 in every 28 children in the United States has a parent behind bars, and failed reintegration harm both ex-offenders and their children. Policies to support employment for reintegrating ex-offenders support the well-being and economic success of both generations, as well as do much more to ensure community-wide safety and economic growth.

To read the commentary on Spotlight on Poverty and Opportunity, click here.

For more information on Promoting Workforce Strategies for Reintegrating Ex-Offenders – including providing the needed supports and services that help their families thrive - click here and here.

SNAP and the Minimum Wage

Last week the House Budget Committee held a hearing marking the War on Poverty’s 50th anniversary. The testimony provided, and the following discussions, included a wide variety of opinions regarding the effectiveness of safety net programs. Of the heavily debated, SNAP drew a significant amount of attention. Policy for Results has previously posted on the significance of SNAP, but in light of the hearing, here are a few important facts to keep in mind:

• Snap is targeted at the most vulnerable families
• 76% of SNAP households included a child, an elderly person, or a disabled person
• The majority of households have income well below the maximum allowed for eligibility
• SNAP benefits do not last most participants the whole month
• 90% of SNAP benefits are redeemed by the third week of the month
• 58% of recipients currently receiving SNAP benefits turn to food banks for assistance at least 6 months of the year 

Despite the support that SNAP provides to working families, in November, SNAP benefits will be cut for all participants. For families of three, the cut will be $25 to $30 a month—a total of $300 to $360 a year. Nationally, the total cut is estimated to be $5 billion in fiscal year 2014.

The SNAP program is intended to provide supplemental support to families and research shows that it does. However, the statistics also highlight another important factor addressed at last week’s hearing. A majority, 60%, of households receiving SNAP have someone who is employed, and 90% of households receiving SNAP have a family member who finds work within a year. While this demonstrates the importance of what a crucial support the program provides to working families, this also shows the inefficiency of the current minimum wage to provide families with the opportunity to meet their basic needs.

In the past, the federal minimum wage would increase slightly with inflation, helping to keep millions of Americans out of poverty—minimum wage workers who worked full-time and year round earned nearly enough to keep a family of three above the official poverty level. However, since the early 1970s, the minimum wage has fallen significantly – by over 25%. The current minimum wage is $7.25, but the minimum wage in 1968 would have been equivalent to $10 an hour. Even after the 2007-2009 federal increases, the minimum wage remains far too low to sustain working families.

If the minimum wage were to increase to $10.10, a worker currently making $15,000 would earn $20,000 a year—a significant difference for families living in poverty.

Increasing the federal minimum wage to $10.10 by July 1, 2015, would raise wages for about 30 million workers, who would receive over $51 billion in additional wages over the phase-in period. Women would be disproportionately affected, comprising 56% of those who would benefit from the increase. Around 55% of affected workers currently work full time, more than a quarter are parents, and over a third are married. This would not only dramatically impact these families but would also positively impact the economy - GDP would increase by roughly $32.6 billion, resulting in the creation of approximately 140,000 net new jobs over the phase-in period.

Looking for meaningful solutions for the future, it is essential to maintain safety net programs that can assist the most vulnerable. However, long term solutions have to address the minimum wage. Families working full time should be able to provide their families with their basic needs – and right now they can’t. The research shows that many of the beneficiaries of SNAP are working and are still unable to afford food. To seriously address poverty requires ensuring working families are adequately paid and that when needed, there is a safety net in place to ensure that children and their families can continue to meet their needs.

Helping Families Afford a Decent Place to Live

Housing insecurity can have serious negative impacts on the health of young children. Research shows that when a child’s home is overcrowded or their family has to move multiple times due to financial pressures, children are at risk of poor mental health, have difficulty coping with stress, difficulty with social relationships and suffer from poor-quality sleep. Research on housing insecurity states that:

·         Housing insecurity increases the risk for childhood injuries, elevated blood pressure, respiratory conditions, and exposure to infectious disease

·         A history of multiple moves is associated with an increased risk of substance abuse, behavior problems, poor school performance and teen pregnancy for older children and adolescents

·         Adolescents who experience school moves are 50% more likely not to graduate from high school

·         Multiple moves in childhood are associated with lower overall health in adulthood

·         In some cases inadequate housing is a contributing factor in an increased risk of children being removed from their homes by child welfare services 

In light of the negative impacts of housing insecurity on the health, well-being and life outcomes of children, effective housing policy is crucial to keeping children safe, healthy and well. This includes both policies to help homeless families find proper housing and policies to prevent families from losing their housing in the first place. However, budget cuts at the federal, state and local level mean that many local housing agencies are unable to meet rising demand for housing assistance.  Federal funding cuts to the Housing Choice Voucher Program (formerly known as Section 8) due to sequestration means that thousands of eligible people including very low-income families, the elderly and people with disabilities are unable to get the assistance they need to afford the rent on a decent place to live.

Housing vouchers are a critical support for many working, poor families who live in areas where rents are high and affordable housing is in short supply. Under the program, families pay 30-40% of their income on rent and the voucher covers the remainder. As funding for the program has fallen, many housing authorities have closed waiting lists (which already number in the tens of thousands in many states) and have stopped issuing new vouchers. Some have laid-off staff to avoid cutting off assistance to families who currently have housing vouchers and might become homeless without them. The US Department of Housing and Urban Development (HUD) estimated earlier this year that 125,000 households will lose their housing assistance due to sequestration.

People who have been on the waiting list for years and finally reached the top  are being told that they won’t be getting help after all; for instance, the New York City Housing Authority is no longer accepting new applications or processing new vouchers, and says that “[f]or Section 8 voucher holders who have identified an apartment and not yet scheduled an appointment to have the housing unit inspected and for those voucher holders who are still searching for an apartment, the vouchers will be terminated immediately.”  The Housing Authority of New Orleans had to recall housing vouchers recently issued to 700 families who had spent years on the waiting list and who now will have to find some other way to avoid homelessness. In Hartford, Connecticut 20 families have had their vouchers rescinded, as have 42 families in Fairfax County, Virginia. In El Paso, Texas, 100 families currently receiving assistance were told in March that their vouchers were being taken away and they would have to either leave their homes and move into public housing or figure out another way to keep a roof over their heads. In Washington DC, the United States Senate is currently considering the Transportation, Housing and Urban Development (THUD) Appropriations bill, which would provide funding for housing choice vouchers and other housing and homelessness measures; however, at the moment local housing authorities do not know if next year they will face further cuts or be able to issue vouchers again.

Receiving a Housing Choice Voucher for a family whose housing is insecure is an invaluable support.  However, even if a family is one of the lucky few who receive a voucher, in most states landlords can legally refuse to rent to potential tenants simply because they are receiving rental assistance. Due to the widespread discrimination against tenants receiving housing vouchers, in recent years some state and local policymakers have acted to reduce the obstacles preventing low-income families from finding a place to live. Earlier this month, Oregon passed a new law prohibiting discrimination against tenants who pay part of their rent with a housing voucher. Chicago has a long-standing city ordinance prohibiting such discrimination, and in May an amendment to Cook County’s Human Rights Ordinance extended these rights countywide. States such as Minnesota, Vermont and Massachusetts have similar tenant protections, as do some other municipalities including New York City.

Legal protections and housing assistance programs help to reduce barriers to housing security, but ensuring that affordable housing is available in communities is critical to the success of such measures. A number of states have created innovative policy approaches in recent years in an attempt to increase the availability of affordable housing so that families are not priced out of the market in their area. The Illinois Affordable Housing Planning and Appeal Act requires that at least 10% of housing in each community have affordable rents or mortgages. Connecticut, Massachusetts and Rhode Island have similar statutes. Such policies help to encourage the expansion of affordable housing so that families are not forced to repeatedly move due to rising rents or remain in areas of concentrated poverty because no other affordable housing is available.

State policymakers should consider new approaches to increasing the availability of affordable housing – to ensure that working families aren’t “priced out” of the market. They can also increase the legal protections that prevent landlords from discriminating against families who use housing assistance to make ends meet. Approaches to ensuring safe, stable and affordable housing options for families not only provides a critical concrete support now – but leads to better health, education and other well-being outcomes for children in the future.  

For policy strategies that promote affordable housing, please visit PolicyforResults.org.

How TANF programs support family economic success

This week the House Ways and Means Committee held a hearing entitled What Really Works: Evaluating Current Efforts to Help Families Support their Children and Escape Poverty. The hearing is the second in a series of three on ways to reform the Temporary Assistance for Needy Families (TANF) program (commonly referred to as welfare). Although the federally-funded TANF block grant represents a small fraction of total social spending, it helps over a million low-income families make ends meet.  

One key aspect of state TANF programs is their role in helping parents find jobs by connecting them to job training resources and assisting with their job search so that they can find employment that pays a family-sustaining wage. However, approaches to supporting family economic stability vary widely from state to state. According to a report released earlier this year by the Center for Budget and Policy Priorities, the current ‘workforce participation’ rules often make it difficult for states to help families lift themselves out of poverty. For instance, current work rules severely limit the amount of time that parents receiving TANF benefits can spend on educational activities such as getting their GED or completing a job training program.

 According to the witness testimony of Kristen Cox, the Executive Director of Utah’s Office of Management and Budget at this week’s hearing, current requirements mean caseworkers spend about 70% of their time proving clients are in compliance with rules and regulations. Ms. Cox explained in her testimony that caseworkers spend the majority of their time doing paperwork such as keeping track of how many hours each individual client has spent on work-related activities, which of the 12 categories of work each of those hours falls into and whether those hours are below the maximum number of hours allowed per week for that category of work activity. Ms. Cox suggested that additional flexibility in the rules related to job training and workforce participation is needed to allow states to innovate and help clients more effectively. She stated that rather than‘one size fits all’ solutions for assisting clients in their job search, states need room to implement new strategies and focus on what works to help families lift themselves out of poverty.  

Another witness, Tara Smith of the University of Texas at Austin’s Ray Marshall Center for the Study of Human Resources   testified that ‘work first’ policies are often very ineffective because they don’t take into account the obstacles that many families face in achieving economic stability or the local circumstances such as the unemployment rate or local growth industries. Smith stated that for many families, a two-generation focus that connects the education and employment sectors has been used successfully to help participants establish family-sustaining careers and begin building a better future for their children.

Some states are already rethinking how they use TANF funding to achieve better outcomes for children and families. States such as Maryland, Minnesota, Utah and Wisconsin have been refocusing the way they measure success to put more emphasis on helping families build a foundation for future economic stability by finding permanent jobs with higher pay. For instance, Maryland tracks the rate of paid work placement, the job retention rate and participants’ gain in earnings. Minnesota measures program success by looking at the rate at which participants leave the program for employment, their earnings at the time of placement and the ‘Self Support Index’, or number of participants who are able to partially or wholly support their families through employment after three years.

South Carolina’s TANF-funded Family Independence program more than doubled the number of families that successfully found employment by setting goals based on ‘positive closures’ (the number of TANF benefits cases closed because families’ earnings increased until they surpassed the eligibility threshold) rather than compliance with federal workforce participation activities. South Carolina’s organizational change efforts include utilizing data in decision-making to identify strategies that work as well as streamlining program implementation to let caseworkers focus more on helping clients and less on paperwork.  

State policymakers can re-evaluate the role of the workforce participation rate requirements in how success is defined and measured in their state’s TANF-funded programs and work toward a more effective framework for efforts to support family economic stability and reduce poverty. They may also wish to consider ways that data could be more effectively utilized to identify successful strategies and streamline implementation to focus more resources on what works.

For more on ways to reduce child poverty, please visit PolicyforResults.org.

Protecting Children from Toxic Stress

A new video from Frontiers of Innovation at Harvard’s Center on the Developing Child highlights the importance of promoting the well-being and skills of parents and caregivers to promote healthy child development. The 5-minute video, entitled Building Adult Capabilities to Improve Child Outcomes: A theory of change emphasizes the way that toxic stress can harm children’s development and argues that the best way to prevent children from being exposed to toxic stress is to strengthen the capabilities of their parents and other adults in their lives.  

Learning to manage daily life stress such as dealing with frustration, meeting new people or getting vaccinations is an important part of children’s growth and development. If, however, a child experiences long periods of intense, repeated stress or does not have a caregiver who is responsive to the child’s need for emotional support, the stress level becomes toxic. According to the American Academy of Pediatrics (AAP), severe toxic stress in childhood can weaken the architecture of a child’s brain and other growing systems. Over time, toxic stress will increase their risk of developmental delays, learning disabilities, and childhood behavior problems, as well as diabetes, heart disease, depression, drug abuse, alcoholism and other major health problems as adults. Risk factors for toxic stress in childhood include living in extreme poverty, experiencing abuse and neglect, exposure to family or neighborhood violence and the substance abuse or mental health issues of a caregiver.  

According to a 2012 policy statement by the AAP, parents and other caregivers play a crucial role in buffering such sources of stress by responding to the child’s distress with love and support. Absent this type of caring support, children are less equipped to learn how to manage stress and emotions in times of difficulty. Empowering parents with the skills to meet children’s emotional needs and deal with difficult problems such as poverty and family violence is therefore essential to children’s well-being. A parent cannot prevent violent crimes or natural disasters from occurring in their neighborhood, but they can develop skills to protect the emotional well-being of their children when these sources of stress occur.  

In a commentary for Spotlight on Poverty and Opportunity, Jack P. Shonkoff, director of the Center on the Developing Child at Harvard University, highlighted the importance of ‘executive function’ skills for parents and caregivers, which include ‘the ability to focus and sustain attention, set goals and make plans, follow rules, solve problems, monitor actions, delay gratification, and control impulses’.According to Shonkoff, these are skills that are learned most rapidly between the ages of three and five, with a second window of accelerated development in adolescence and early adulthood. The part of the brain that controls executive function skills remains plastic until age 25 or even 30. Shonkoff argues that this second period of growth provides an opportunity to help young parents whose own development was undermined by early-life adversity to strengthen these skills, which he calls ‘the building blocks of resilience’. Shonkoff recommends that early childhood providers and workforce development agencies incorporate the development of executive function skills into their programming to strengthen the capacity of parents and other caregivers in order to build strong, healthy families and reduce children’s risk of toxic stress.  

In the video, Building Adult Capabilities to Improve Child Outcomes, they argue that strengthening the capacity of everyone who interacts with children is one of the best ways to promote healthy early development and prevent children from being exposed to toxic stress. The video also emphasizes the importance of the wider community in reinforcing these efforts and the need for effective policy that helps families overcome barriers to well-being such as poverty, family and neighborhood violence, child maltreatment and parental mental health or substance abuse issues. While skill-building for parents and caregivers is described as a bridge to help children overcome obstacles, the video highlights the role of policy in removing these obstacles from their path altogether. Mitigating the harmful effects of stress can improve child well-being, but the ideal would be to prevent children from being exposed to risk factors such as violence and poverty altogether.  

The US Department of Health and Human Services, Administration for Children and Families (ACF) said in an information memorandum that many state and county child welfare systems are investing significant funds in providing services intended to improve well-being outcomes for children and their families such as counseling, parenting classes, and life skills training, but that ‘a number of studies suggest that some of these services are not grounded in the best available evidence and may be provided to children without sufficient attention to their specific maltreatment and trauma histories’. It is important to consider outcome-focused and research-informed solutions to ensuring the needs of children and their families are being appropriately addressed. To that end, policymakers may wish to explore evidence-based approaches to services to help children who have suffered maltreatment in their healing process. They may also wish to consider incorporating evidence-based or research-informed programs for families that reduce the risk of child abuse and neglect as well as the risk of toxic stress that can result from maltreatment. 

In addition to broader policy efforts to promote the well-being of families and address gaps in child mental health care, new state and local-level policies and programs are attempting to incorporate executive function skills into early learning and parent education programs. Frontiers of Innovation has begun working with organizations in sites across the United States to establish working groups and develop neighborhood-level efforts to strengthen the capacity of parents and create opportunities to develop executive function skills. Washington State is the first state to participate in Frontiers of Innovation - with the aim of creating state-level policy change that benefits young children and families statewide by reducing barriers to learning and positive health outcomes. In particular, early learning policies in Washington State aim to promote the development of ‘executive function’ skills. Washington State has incorporated executive function skills into their 2012 Early Learning and Development guidelines by including an introductory text on executive function, as well as expanding their developmental indicators and strategies for parents and caregivers with a focus on these skills. The state has developed an online training module for teachers, caregivers, trainers of early education professionals and Quality Rating and Improvement System coaches.  

However, while skill-building can help parents cope with the challenges that threaten their family’s well-being and reduce the likelihood of toxic stress in children, it is essential that their efforts are supported by policy change to address the social issues such as poverty and violence that put their children at risk in the first place. Neighborhoods with high rates of poverty and violent crime expose entire communities of young children to an increased risk of toxic stress. Policies that promote family economic stability to reduce childhood poverty and policy approaches that prevent children from being exposed to violent crime in their neighborhoods can therefore have a major impact on reducing toxic stress for young children throughout the community. 

Effective policy approaches to family violence are also important for the prevention of toxic stress in children; according to the Bureau of Justice Statistics, between 2001-2005 there were children under the age of 12 living in 35.2% of households where intimate partner violence was occurring. Seeing a parent being abused has serious emotional consequences for children. The availability of mental health care and substance abuse treatment programs for parents is also critical. Policies that promote access to appropriate care can have a big impact on reducing the risk of toxic stress for children whose parents do struggle with mental illness or substance dependency. At the state level, policies to provide parents with mental health and substance abuse treatment supports can be incorporated into programs such as workforce development.

State policymakers may wish to consider expansion of poverty-reduction policies and efforts to prevent children from being exposed to violence in their communities, as well as re-examining the mental health and substance abuse programs that are available to parents in their state.  

Policymakers could also consider ways that active skill building could be incorporated into early childhood education, workforce development and parenting education programs – and could consider implementing protective and promotive factor frame works into those settings. They may wish to partner with health care and human service professionals in their state to promote screening for toxic stress risk factors in well-child visits or through expanding home visiting programs and find ways to support parents in reducing their children’s exposure to toxic stress.
 
For more information about reducing child poverty and promoting children’s social, emotional and behavioral health, please visit PolicyForResults.org. To learn about CSSP’s Strengthening Families Initiative aimed at reducing child abuse and neglect by building protective and promotive factors visit cssp.org.

 

SOTU 2013: Promising Prospects for Anti-Poverty Policy

“Let’s declare that in the wealthiest nation on Earth, no one who works full-time should have to live in poverty.”

After a distinct lack of mention of poverty throughout the 2012 Presidential election campaigns—from either candidate—President Obama, in his 2013 State of the Union address, mentioned “poor” and “poverty” five times.

With clear frustration in his demeanor, Obama spoke of how unacceptable it is that wages and income have barely budged for the vast majority of Americans, while corporate profits have skyrocketed. To address this, he proposed increasing the minimum wage to $9/hour, up from the current $7.25/hour. For a family where the parent is working 40 hours a week at minimum wage, this would put an extra $280 in their pocket, money that could go towards rent, utilities, transportation, child care, or even leisure activities like going to see a movie. Furthermore, this increase in the minimum wage would be indexed to the cost of living, which would cushion the impact of inflation on the buying power of a family’s income.

President Obama’s housing plan to let families refinance at today’s interest rate and save $3,000 a year, while beneficial to many, will be especially beneficial to people of color, who were disproportionately affected by the housing crisis. Nationwide, Black and Latino families saw their wealth and assets decimated as their homes went into foreclosure.

The President spoke at length about the tremendous value of early childhood education: “Every dollar we invest in high-quality early education can save more than seven dollars later on – by boosting graduation rates, reducing teen pregnancy, even reducing violent crime. In states that make it a priority to educate our youngest children, like Georgia or Oklahoma, studies show students grow up more likely to read and do math at grade level, graduate high school, hold a job, and form more stable families of their own.” We all know that children are our future, but put into economic terms there is no doubt that infusing children with services early in their lives results in a strong return on investment for the nation. Obama committed to working with states to make high-quality pre-school available to every child.

Finally, the President also mentioned reforming some of the financial penalties in our public policies that he views as dissuading some people from marriage. In addition, he put a greater emphasis on policies that encourage fathers to take responsibility for their children. Children fare better when they are raised in two-parent households, so the President’s commitment to these policies is a boost to strengthen family relationships. The President did not go into detail about specific policies to address family strengthening, but given the diversity of formations that make up American families today, including multigenerational households, children raised by relatives, and single parents, it would be helpful for policymakers to consider these realities moving forward.

Although the President spoke at length on issues that would help low-income and poor Americans, there were still key issues left unaddressed. Of critical importance is the mass incarceration of people of color, particularly Black men for non-violent crimes, which continues to have deleterious effects on whole communities, affecting men’s ability to be good fathers, gain employment, or continue their education (if they were youths).

President Obama’s State of the Union speech was significant because just uttering the words of ‘poor’ and ‘poverty’ means that federal policymakers will be more apt to address poverty in the coming months. This is of timely importance because of the imminent due dates for major budget decisions, involving the sequester, debt ceiling, a final fiscal year 2013 budget, and release of the fiscal year 2014 budget. All of these are opportunities for policymakers to protect low-income and poor Americans by not cutting the services and supports that help them to work and support their families.

For results-based policies to support children and their families – visit PolicyforResults.org.

For Working Families, Growing Difficulty in Making Ends Meet

There is beginning to be some mention of income and social inequality in mainstream discussions. While it does not come up as often as it should – when it does it is often considered provocative.  In the past month the conversation has really been heating up, topped off by President Obama’s inaugural address in which he stated America “cannot succeed when a shrinking few do very well and a growing many barely make it.” Media outlets are highlighting the impact of income inequality in the United States and the ways that this gap obstructs economic growth.

A new report from the Working Poor Families Project (WPFP) reveals the extent of the problem for low-income families, and how the increase in the wage gap has spread over the last few years and across the United States. Although the economy is in recovery—the unemployment rate has declined, the housing market is recovering and the stock market is bouncing back—even with employment, millions of families are still struggling to afford basic needs. With incomes at just 200% of the federal poverty level and often with no assets, working families are vulnerable to unforeseen events that could suddenly drop them into poverty (e.g. job loss, accidents, costly medical issues).

Many of the jobs to which people are returning are not the pre-Recession middle class jobs they once had, but are a mix of part-time and low wage jobs. The WPFP report states in 2011, about one-fourth of adults in low-income working families were employed in just eight occupations, as cashiers, cooks, health aids, janitors, maids, retail salespersons, waiters and waitresses, or drivers.

Key findings from the report, include:

• The number of low-income working families in the U.S. increased to 10.4 million in 2011, up from 10.2 million in 2010.
• The total number of people in low-income working families now stands at 47.5 million.
• In 2011, there were 23.4 million children in low-income working families.
• There are 10 states, spread across the U.S., where the share of working families increased by 5% or more between 2007 and 2011.
• The richest 20% of working families took home 48% of all income, while those in the bottom 20% received less than 5%.

The high cost of living for low-income working families is significant. In 2011, 61% of low-income working families had a high housing cost burden—defined as spending more than 33% of household income on housing costs such as mortgage, rent and utilities. For working families below the poverty threshold, 81% had a high housing cost burden. Other expenses they deal with on a daily basis include transportation, made more difficult with the high cost of gasoline, and child care. For families that work long hours, nights and/or weekends, child care is especially burdensome.

This data proves that even though families are taking advantage of the employment opportunities available to them, they are still unable to make ends meet. Fortunately, there is a place for federal and state policymakers to begin to turn the tide on inequality. According to the Working Poor Families Project, policymakers can take actions to strengthen job growth and job quality by supporting the following policies:

• Raising and indexing the minimum wage;
• Providing all workers access to paid sick days and family leave;
• Enforcing work rules and wage standards; and
• Ensuring that if public job creation expenditures persist, they benefit workers and their communities

Beyond policies focused on employment, policymakers can help the economic security of families by supporting policies that control household costs, build household assets, and curb household debt. For more information on those ideas, visit CSSP’s Policy for Results webpage on reducing child poverty.

Not Mentioned at the Debates: Poverty, and the Case for Maintaining and Strengthening the Safety Net

Last night, at the first Presidential debate, we heard the candidates focus their remarks on how they would help the middle class. Unfortunately, moderator Jim Lehrer did not ask a question about how the candidates would alleviate poverty, and they did not talk specifically about what they would do to help Americans in the lowest income bracket.

What should have been conveyed to the American people is how crucial it is to maintain the federal safety net, or “the floor below which you cannot fall” as President Obama referred to it last night. A large component of this “floor” is Social Security, which the candidates spoke about in reference to seniors, but not nearly as much about how it helps low-income people. In addition to Social Security, two other important components of the safety net are refundable tax credits and food assistance.

As the 2011 poverty data from the US Census revealed, policies such as the Earned Income Tax Credit (EITC) and the Supplemental Nutrition Assistance Program (SNAP) have kept millions of Americans out of poverty. Yet there are still 46 million Americans in poverty, 16 million of whom are children—an alarming 1 in 5 children. In order to begin to assist more of the 46 million poor people in this country, the safety net needs to be expanded—not capped, converted to a block grant or eliminated altogether.

As the Center for Budget and Policy Priorities showed, making cuts to SNAP would cause millions of people to lose their benefit, which could be devastating considering the current economic hardship experienced by so many families.

The federal deficit was a major point of contention at the debate last night, so it is of worthy note that not only does SNAP address a serious need among Americans experiencing food hardship and food insecurity, it also stimulates the economy. According to an analysis by the Food Research and Action Center (FRAC):

• Nearly 1 in 5 people in the U.S. didn’t have enough money to purchase food they need for themselves and their families in the first six months of 2012.
• More than 50.1 million Americans lived in households that struggled against hunger in 2011.
• Each federally funded dollar of SNAP benefits generates nearly double that in economic activity, because people are using the money to purchase food.
• Increased SNAP participation can increase state revenues. For example, in California each dollar of SNAP benefits frees up an estimated 45 cents more recipients spend on taxable goods, yielding additional tax revenues for the state.

In 2011, SNAP was responsible for lifting 3.9 million Americans (1.7 million children) out of poverty.

Another critical component of the safety net, refundable tax credits, were responsible for lifting an additional 9.2 million Americans (4.9 million children) out of poverty in 2010. These tax credits include:

• EITC kept 6.3 million Americans out of poverty (500,000 due to improvements brought via the American Recovery and Reinvestment Act).
• The Child Tax Credit (CTC) kept 2.6 million Americans out of poverty (1 million due to ARRA improvements).

ARRA was able to expand these crucial tax credits for low-income families by creating a new tier for larger families, and by providing marriage penalty relief. Unfortunately, as part of the large bundle of expiring financial policies constituting the looming “fiscal cliff”, the ARRA improvements are set to expire at the end of 2012. Without the Child Tax Credit, a single mother with two children working full-time at minimum wage would lose $1,545 annually. In order to prevent millions of families from facing additional financial burden, policymakers at the federal and state level should consider options that would expand EITC and CTC or consider the development of state compliments where they are not currently in place.

As the New York Times discussed, the Presidential candidates hold starkly different views of the role and scope of government in American society. However, both the data and history have shown that specific policy changes related to strengthening the safety net not only help American families by keeping them out of poverty, but also benefit the economy. Policymakers can lead by strengthening the policies and programs that serve the needs of low-income and poor families as well as strengthen the country’s economic circumstances.  Luckily for us, it is possible to do both.

New Data from the U.S. Census on Poverty, Income and Health Insurance

Earlier today the Census Bureau released the 2011 data on income, poverty and health insurance coverage. The good news is after three consecutive years of increases, neither the official poverty rate nor the number of people in poverty were statistically different from the 2010 estimates. The bad news is there is still an unacceptable poverty rate, marked income disparities by race, and a continued shift of wealth to people in the top income percentiles.

Highlights from the Census data on poverty and income:

• The 2011 official poverty rate for the nation was 15.0% and there were 46.2 million people in poverty, not statistically different from last year.
• There still persists a large income disparity among racial groups, as Blacks had a poverty rate of 27.6%, Hispanics 25.3%, Asians 12.3% and Non-Hispanics Whites 9.8%.
• Hispanics were the only ethnic group to see a change in poverty rate, which decreased from 26.5% in 2010 to 25.3% in 2011.
• The percentage of people without health insurance coverage decreased in 2011 to 15.7% from 16.3% in 2010. The number of uninsured also decreased to 48.6 million in 2011 from 50.0 million in 2010.
• There was a significant change in the share of aggregate income, as the top 5% of earners saw their share of aggregate income increase by 5.3%. Those in the second, middle, and fourth quintiles saw their share of aggregate income decrease by 1.6%, 1.9%, and 1.6%, respectively. Those in the lowest quintile saw no significant difference.
• People in the lowest quintile of income increased their percentage of year-round, full-time workers by 17.3%, which was much higher than any other income quintile.
• The percent of people in deep poverty (i.e. their income is 50% of their poverty threshold) was 6.6%--although this is not a significant change from 2010, it is important to note that 6.6% is a substantial increase from the 1967 level of 4.4%.
• Unemployment insurance benefits saved 2.3 million people (600,000 of whom were children under 18) from being poverty
• Social Security income saved 21.4 million people (1.1 million of whom were children under 18) from being in poverty
• Although the Supplemental Nutrition Assistance Program (SNAP—food stamps) and the Earned Income Tax Credit (EITC) are not counted in the poverty measure, if they were: SNAP would have decreased the poverty number by 3.9 million people (1.7 million of whom were children) and the EITC would decreased the poverty number by 5.7 million people (3.1 million of whom were children).

On health insurance:

• In 2011, the percentage of people without health insurance decreased to 15.7% from 16.3% in 2010. The number of uninsured people decreased to 48.6 million, down from 50.0 million in 2010. This is the first time in four years that the number fell.
• However, coverage levels remain below levels prior to the Great Recession. The percentage of people without coverage remains higher than in 2007, when 14.7% of the population was uninsured.
• Among adults aged 19-25, in 2011 27.7% were uninsured as compared to 29.8% in 2010. This is a decrease of 2.2%. There was not a significant change in insurance coverage for children under 19.

The poverty data released today tells us the percentage and demographic information of people in the United States that live in poverty.  However, the numbers indicate something else too: the impact that public policies have on poverty.  Public investment in policies that create jobs and support families significantly impacts whether or not people experience poverty.  In an earlier post, the Center on Budget and Policy Priorities connected the numbers on health insurance to related federal policies. They found that the decrease in the percentage of uninsured young people aged 19-26 can be explained in part because of the new provision under the Affordable Care Act that allow adult children to obtain coverage from their parents’ health insurance plan up to their 26^th birthday. Similarly, in a recent piece by Half in 10, they outline the impact of public policy choices on poverty, including information on the tax programs that were included in the Recovery Act. Furthermore, CBPP found that it is possible to reduce poverty while reducing the deficit, as the three largest three largest deficit-reduction packages of the last two decades achieved both by increasing the EITC (in 1990 and 1993), increasing SNAP (in 1993) and creating the Children’s Health Insurance Program (CHIP) (in 1997).

The Take-Home Message

While the official poverty rate did not change from last year, it is important to note that the data shows the wealth gap between rich and poor continues to increase, and the rate of people in deep poverty remains staggeringly high.

The Census data also showed a link between full time work and the leveling-off of the poverty level.  This has meaningful implications for policymakers. Continuing to focus on job creation will help to bring more people out of poverty and stable employment at a reasonable wage will ensure they stay there. However, the data also shows the immense value of safety net programs like SNAP, the EITC, unemployment insurance, and Social Security which are there to support those  who have a job but are still struggling to meet their basic needs, those who have lost their jobs and those who may be unable to work.

While budgets are tight and falling short, and while unemployment rates and poverty remain high, it is important for policymakers to continue to work on supporting the families in greatest need - all while considering the feasibility within the current economic climate. Understanding how communities are being most affected and why will help policymakers create safety-net programs that will meet family and community needs. Creating policy with a focus on results will help to do this in a way that also efficiently allocates scarce resources and improves the odds that problems will be addressed effectively.

To read CSSP's Statement on the New Poverty Data and Implications for Children and Families please click here.

For more strategies to Ensure Children Grow Up in Safe, Supportive and Economically Successful Families visit PolicyforResults.org.

More from our blog: a primer on poverty measurement and the Census instruments used.