Poverty: A New Agenda

special report

Poverty: A new agenda Tested by Hard Times

contents A2 A New Agenda for Tough Times

by mark schmitt and shelley waters boots

A4 Recovering Opportunity

by alan jenkins

A7 Behavioral Theory

by Dana Goldstein

A10 Race, Wealth, and Intergenerational Poverty

by Darrick Hamilton and William Darity Jr.

A10 Mis-Measuring Poverty

by the Editors

A13 Can

Separate Be Equal?

by Richard D. Kahlenberg

A16 Putting

A17 A

Poverty in Its Place

by Manuel Pastor

Modern Safety Net

by Shelley Waters Boots and Karin Martinson

A18 Don’t Forget the Men

by Dick Mendel

A20 A

National Mission

by James Crabtree

A22 The Poverty of Political Talk

by Alec MacGillis

Cover art by Brian Stauffer

this special report this special report

was made possible through was made possible through the generous support of the the generous support of the Charles Stewart Mott Foundation, Charles Stewart Mott Foundation, the Ford Foundation, and the Ford Foundation, and The The Annie E. Casey Foundation.

Annie E. Casey Foundation.

For bulk reprints, please For bulk reprints, please contact Dorian Friedman at contact Dorian Friedman at dfriedman@prospect.org. dfriedman@prospect.org.

publisher publisher George GeorgeW. W.Slowik SlowikJr. Jr. special specialreport reporteditor editor Mark MarkSchmitt Schmitt consulting consultingeditor editor Shelley ShelleyWaters WatersBoots Boots director directorof ofexternal externalrelations relations Dorian DorianFriedman, Friedman,(202) (202)776-0730 776-0730x111 x111

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a2 september 2009

A New Agenda for Tough Times After a decade of economic change and fresh thinking, it’s time for a new national effort to fight poverty.

by Mark Schmitt and Shelley Waters Boots

I

t has been 13 years since a Democratic president’s signature on the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 eliminated a flawed program that also provided the only protection against destitution. Yet that act also brought an end to the welfare wars, a long and debilitating period in which poor people were the focus of political conflict and racially loaded demagoguery, exemplified by former Sen. Phil Gramm’s image of a society divided between those “pulling the wagon” and those “riding in the wagon.”

Even liberals stepped with trepidation, insisting that they, too, would end welfare as we knew it.

In the years since, absent a high-profile conflict over policy, poverty has once again become invisible. As Michael Harrington wrote in 1962, “That the poor are invisible is one of the most important things about them.” But there is a sense that the shadows are lifting. Hurricane Katrina’s devastating effects on New Orleans and the Gulf Coast briefly drew into sharp relief the fragility of life for poor families, as well as the inescapable racial dimension of poverty. The Center for American Progress put forward a major initiative in 2007, outlining a goal of cutting poverty in half over 10 years, which showed that mainstream Democrats were no longer on the defensive.

John Edwards sought to inject poverty into the agenda of the 2008 presidential election, and the ascent to the White House of an African American who had worked as an organizer in lowincome communities, and whose campaign drew millions of poor Americans out of political quiescence, holds out the possibility that the conditions are right to once again “discover” poverty, as we do every few generations. While the economic crisis of the middle class

has overshadowed much else, it has also made poverty a realistic worry for many who thought they were safely outside its grasp. The distinction between “the poor” and everyone else, or the deserving and undeserving poor, which reinforces the vicious polarization encouraged by politicians like Gramm, is no longer tenable. We are all in this together.

But even while poverty has been off the political agenda—perhaps even because it has been off the agenda—these have been years of quiet experimentation and fresh thinking when it comes to poverty policy. For example: ■ Strategies to help poor families build assets, both for long-term security and to take advantage of economic opportunity, expanded from vague academic dreams to full-fledged experiments supported by foundations and government. The federal Assets for Independence program has provided matching funds to over 43,000 participants over 10 years.

■ Welfare reform coincided with an economic boom in the late 1990s, which gave states unprecedented financial resources to concentrate on helping former welfare recipients move into the labor market and stay there. But while labor-market participation was higher, wages for lowerincome workers stagnated. Income for the bottom 20 percent of households rose 11 percent from 1979 to 2006, while the richest 1 percent made two and a half times what they earned 30 years ago.

■ Federal and state improvements in child-support enforcement brought more cash into poor single-parent families. w w w. p ro s p ect. o rg

p ov e r t y : a n e w ag e n da Policy-makers also realized that the economic circumstances of poor fathers not living with their children have a significant impact on the well-being of children and women.

Projects to support fathers and increase their income enjoyed support from the left and right as well as particularly strong support among African American leaders, including the current president.

■ A concerted national effort to reduce teen pregnancy and childbearing led to significant progress during the 1990s. Teen pregnancy was reduced by 38 percent, and the birth New Development: This tent city in Sacramento, California, has been growing along with unemployment numbers. rate for teens dropped by a third in that time. But in 2005, the rates poverty than were older programs, as economic crisis will provide a strenuous began to creep back up, signaling a fail- shown by the rise in the number of chil- natural test of these newer initiatives. ure, at least in part, of the Bush admin- dren living below half the poverty line— As Alan Jenkins writes in this report, istration’s abstinence-only programs.

2.4 million in 2005, a million more than the federal response to the severe ■ By expanding eligibility for the a decade earlier. recession—the economic stimulus packEarned Income Tax Credit, Medicaid, As a result of these silent but dramatic age enacted in February—included a and other safety-net programs, the basis shifts, we have a set of policies and cir- surprising array of little-noticed provisions to expand economic opportunity.

While much work needs to be done to ensure that this reinvestment actually boosts the economic capacity of those left behind even in good times, it has been decades since the federal government moved so aggressively to extend of public benefit programs was shifted cumstances relating to poverty and poor economic opportunity to the poor. subtly from need to work. Conserva- families that are as different from the But money and economic opportutive scholar Douglas Besharov warned policies of the late 1980s as those of the nity are not the only answers to poverty. in 2002 that this shift amounted to “a Great Society were from the decades We have come a long way from the days startling expansion of the welfare state” previous. In many ways, these are poli- when John F. Kennedy’s economic advisand that “new welfare” would be “bigger cies designed to help people build their er, Walter Heller, could treat the problem and, for its supporters, better than ever. economic capacity when the economy is as a matter of setting a poverty threshIt is billions of dollars and millions of growing. They live up to the rhetorical old and calculating how much money it recipients larger—and it enjoys much calls for a “ladder” or a “trampoline” to would take to bring every poor housebroader public support because it is tied replace the “safety net.” Welfare reform, hold above it. It is no longer possible to to ‘working families.’” for example, was perceived as a great deny that expectations, incentives, strucMeanwhile, however, parents without success in the economic boom of the tural racism, neighborhood, schooling, the ability or opportunity to work full late 1990s. But we shouldn’t design anti- family structure, and many other factime, year round faced more restrictions poverty policies for good times, when tors are deeply intertwined with poverty, on their ability to pursue education and poverty is a relatively small problem particularly with its intergenerational training. “New welfare” programs lifted in the midst of affluence, but for times cycle. But knowing that doesn’t make it 14 million people above the poverty line when they will be put to the test by ris- any easier to solve. In fact, the complexbut were less effective at reducing deep ing economic hardship. And the current ity of these intertwined factors, and the

m a x w h i t ta k e r / r e u t e r s / l a n d o v

The economic crisis has made poverty a realistic worry for many of those who thought they were safely outside its grasp.

the american prospect

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context of relentless economic disruptions, makes it far too complicated for anyone to start a sentence with “The key to reducing poverty is ....”

The last decade has brought tremendous experimentation to these complex questions, including successful initiatives toward asset-building; cash incentives to encourage good behavior; initiatives to encourage social, racial, and economic mobility and integration; interventions to rebuild community; and supports for the working poor and childless workers. Some or all of these initiatives, as they show success, should be brought to scale so that they reach more than one city, one community, or one subpopulation. The core of this special report will assess these initiatives, their successes and limitations, the potential choices to be made among them, and the steps that can be taken to deepen their impact.

The challenge is to develop a set of policies that are suitable to both good times and bad and that provide both opportunity to help poor people get into the mainstream of the economy and security against the harsh disruptions of that economy and of life in general.

Apart from finding the right mix of policies, it will be necessary to bring these new ideas out from behind the curtain and rejoin the political fight.

There are limits to what can be achieved invisibly, through the subtle changes that created the work-based safety net or through the quick enactment of the economic stimulus. We may not be ready to declare a new national “War on Poverty” at a time when all Americans feel economically vulnerable, but prioritizing poverty reduction, even without the misleading “war” metaphor, is both necessary and a political challenge. Great Britain provides an example of how antipoverty efforts have proved politically successful, in part by setting a measurable goal so that policies can be evaluated. The election of Barack Obama, along with the sense of solidarity and shared vulnerability created by the recession, may allow a political reframing of poverty as part of a broader vision of a new social contract. tap a4 september 2009

Recovering Opportunity Racial barriers continue to hold back millions of Americans—and our economy.

by Alan Jenkins

W

hen he signed the American heart of today’s economic crisis. Federal Recovery and Reinvestment Act data show that African Americans and of 2009 (ARRA)—the econom- Latinos were more likely to be marketed ic stimulus package—President Barack high-interest, sub-prime loans than were Obama promised it would “begin the pro- similarly qualified whites, irrespective of cess of restoring the economy and making their income. Indeed, the racial gap in America a stronger and more prosperous sub-prime lending was greatest among nation.” The act invests some $787 billion higher-income borrowers. This probin unemployment assistance, tax cuts, lem has both historical and contemposupport to cash-strapped state govern- rary causes—from redlining and forced ments, job creation, job segregation in the past, training, education, and to the paucity of banks Unemployment in minority communiinfrastructure.

by Race Less noticed but just as ties and discriminatory, 2000–2009 important is the act’s compredatory lending prac14% ■ black mitment to securing more tices that continue today.

13% ■ latino 12% equitable opportunity for Similarly, research

white ■ 11% all Americans. In its text shows that people of color 10% and in its implementation, still face subtle but per9% the act holds the potential sistent bias in job selec8% for a transformative shift tion. Resumés with “white 7% 6% toward greater equity in sounding” names like Brad 5% our economy. But fulfilland Cindy, studies show, 4% ing the potential of this receive more callbacks 3% little-noticed mission of from employers than do 2% equal opportunity will identical resumés with 1% 0 require vigilance, activ“black sounding” names ’00 ’03 ’06 ’09 ism, and innovation. like Jamal and Lakisha. source: bureau of labor statistics With an African AmerWhether this discrimiican president, it is tempting to think that nation springs from intentional bias or racial and ethnic barriers to opportu- subconscious stereotypes, it’s clear that nity are largely a thing of the past. More these practices combine with systemic prominent in progressive circles is the barriers like under-resourced schools, idea that modern racial inequality flows inadequate public transportation, and a almost entirely from class inequality, and dearth of health-care facilities in comtherefore class-based fixes will inevita- munities of color to diminish opportunity bly advance racial equity. Unfortunately, based on race.

Other systemic factors place particuresearch and experience prove otherwise. lar racial and ethnic groups in a disadWhile we’ve made significant progress in vantaged posture that warrants a more our country when it comes to race relations, racial barriers to opportunity con- particularized approach. Federal mistinue to hold back millions of Americans management of American Indian trust and, in so doing, hurt our economy. funds, for example, has cost the native Consider, for example, the exploit- population billions of dollars. Ameriative sub-prime lending practices at the can Indian tribes also hold a sovereign w w w. p ro s p ect. o rg

p ov e r t y : a n e w ag e n da Effective Measures: Head Start programs are receiving increases in funding because they have a proven track record of boosting student achievement.

g r e g wa h l- s t e p h e n s / a p i m a g e s

and language differences, and controlling costs. A robust system of community health centers in inner cities and rural areas can create jobs, improve health and productivity, and lower the daunting cost of care for diverse communities. Similarly, ARRA’s $2 billion to expand Head Start and Early Head Start programs supports an initiative with a track record of serving all kids well and helping, in particular, to boost the preparedness and achievement of children of color. At the same time, it will create jobs in disadvantaged communities and aid working parents who cannot afford child care.

Second, the act recognizes that different communities may require different types of investment in economic participation. It shores up tribal governments status commensurate with the 50 states under our Constitution but have seen that sovereignty persistently ignored and eroded, with devastating economic consequences. In 2007, American Indians were three times as likely as whites to live in poverty. And unemployment rates on some reservations top 80 percent.

For these and other reasons, even the socioeconomic improvements of the boom years do not reliably translate to more equitable opportunity. According to the Bureau of Labor Statistics, in May 2007, before the current economic downturn, the unemployment rate was 3.9 percent for whites, 5.8 percent for Latinos, and 8.5 percent for African Americans. All three figures roughly doubled over the next two years, but the racial gap remained about the same. The pre-recession economy also included stark racial inequality in wages and assets. In 2007, African Americans earned only 75 cents for every dollar earned by whites, and Latinos earned only 73 cents. Families of color held just 15 cents of “wealth” (assets minus debt) for every dollar held by white families, making it profoundly more difficult for them to survive a downturn without becoming further mired in debt.

Because we are all part of an inter-

If the economy is merely restored to the inadequate conditions of 2007, economic insecurity will continue to worsen. connected economy, the need to address these gaps in opportunity is an economic as well as a moral imperative. The United States cannot stage a full or lasting recovery without addressing these gaps.

Moreover, if the American Recovery and Reinvestment Act merely restores the economy to the inadequate and unequal conditions of 2007, the nation will remain on a long-term path toward sustained economic insecurity.

How can ARRA catalyze a period of greater and more equitable opportunity?

The seeds are there, but they need cultivation and care.

First, a number of provisions in ARRA invest in initiatives that have proved over the years to serve all Americans while offering communities of color more access and opportunity. For example, the act invests in improving and expanding community health centers across the country. These centers are known for providing quality care to diverse and lowincome communities, addressing cultural

and reservation communities—just as it aids struggling state governments—with investments in reservation roads and bridges, public transit, housing improvement, tribal law enforcement, and efforts to end violence against women.

Third, and perhaps most significantly, the White House has explicitly directed federal agencies distributing ARRA funds to uphold established equal-opportunity, anti-discrimination, and labor protections. That’s a marked departure from the Bush administration, which sought to waive those provisions in Gulf Coast rebuilding efforts after Hurricane Katrina.

This body of protections cuts across employment, housing, education, transportation, criminal justice, and environmental protection, and mandates that the benefits and burdens of federally funded projects be nondiscriminatory in practice as well as intent. It requires equal opportunity based on race, ethnicity, and, in some sectors, gender, religion, the american prospect

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age, language ability, disability, and familial status. (Protections based on sexual orientation remain a gaping hole in existing equal-opportunity laws.)

Yet there is no certainty that the promise of an equitable recovery will be realized. Doing so requires transparency, coordination, and political will.

Watchdog groups have noted the lack of practical transparency surrounding stimulus spending. That is especially true regarding the information necessary to assess and ensure equal opportunity. Although the president promised in signing the ARRA that “the federal government will be held to new standards of transparency and accountability,” spending decisions on the ground have proved very difficult for affected communities to track or participate in. The federal government’s economic recovery Web site, Recovery.gov, contains some useful bits of information—for example, the fact that $72 million has been allocated to improve public housing in Louisiana and $441 million disbursed by the Department of Transportation a6 september 2009

as of June. But it lacks the specificity, demographic, or geographic disaggregation necessary to assess the impact of ARRA investments on greater opportunity. State and municipal stimulus tracking sites vary widely in information and transparency, and few if any provide adequate data or analysis.

While the nation’s equal-opportunity laws are well established, the infrastructure for monitoring and enforcing them is badly atrophied after a decade of neglect by the prior administration.

And truly effective interagency coordination of those laws has been lacking since, at least, the Nixon administration.

Experience shows that without monitoring, technical assistance, and rigorous enforcement, the opportunities and burdens created by ARRA projects will not be equitable. Rather, as we saw in the flawed rebuilding of the Gulf Coast, they are likely to deepen existing patterns of inequality. In doing so, they will fail to achieve the robust and lasting economic recovery that is ARRA’s chief goal.

Finally, equitable implementation

will require mustering significant public and political will. Contemporary barriers to equal opportunity are not well understood by the public, and few states or municipalities have a robust system for addressing them. Entrenched special interests and political influence may overtake fairness in funding decisions. And investment targeted toward disadvantaged communities may draw conservative backlash.

Despite these challenges, there are a range of things that the president, Congress, state and local officials, and civil society can do to promote a widely shared economic recovery.

The president should immediately integrate equal-opportunity monitoring and coordinated enforcement measures into the administration’s stimulus implementation. An interagency task force could establish a protocol for collecting data on the distribution of funds by geography, race, gender, and other demographics, monitor projects on the ground, and provide technical assistance to federalfund recipients to encourage their comw w w. p ro s p ect. o rg

rich addick s / ap images

Work-Ready: Thousands turn out for a job fair sponsored by the U.S. Equal Employment Opportunity Commission in downtown Atlanta, February 2009.

p ov e r t y : a n e w ag e n da pliance. Requiring Opportunity Impact Statements from funding applicants can help to quickly select among shovel-ready projects and incorporate public input.

The White House must also greatly improve Recovery.gov by providing more project-specific and demographic data, as well as information on the equity measures attached to approved projects. And the president must use the bully pulpit, as he did so eloquently during the campaign, to explain to Americans why equal opportunity is crucial to our shared prosperity.

Congress should provide rigorous oversight of stimulus spending as it relates to equal opportunity and require regular reporting by the White House. It should also close gaps in existing law by prohibiting employment discrimination based on sexual orientation and restoring individuals’ ability to challenge discriminatory policies in court.

State, municipal, and tribal governments should adopt public equal­opportunity policies, detailing how they’ll ensure equitable benefits and burdens from stimulus-funded projects. They should seek public input on spending decisions, engage community groups in implementation, and report their impact, including the facts and data behind them.

Nonprofit organizations also have an important role to play in monitoring stimulus spending, holding local governments accountable to equal-opportunity standards, providing job training and other support services, and helping to shape projects that can expand opportunity for all.

In order to be successful, the American Recovery and Reinvestment Act must not only stimulate the economy but also instigate a new era of opportunity. While the law itself provides an important starting point, the hard part lies ahead. tap Alan Jenkins is the executive director of The Opportunity Agenda, a communications, research, and advocacy organization. He is co-editor, with Dr. Brian Smedley, of All Things Being Equal: Instigating Opportunity in an Inequitable Time.

Behavioral Theory Can Mayor Bloomberg pay people to do the right thing?

by Dana Goldstein

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roundwork is a tiny, storefront service agency that sits across the street from a hulking housing project in East New York, the Brooklyn neighborhood infamous for being one of the poorest and most dangerous in New York City. Though on the surface many blocks in East New York lack the blight of inner-city Detroit or Baltimore, the statistics here speak volumes: The infant mortality rate is double that of the city as a whole. Half of all residents rely on public assistance. Two years ago, Mayor Michael Bloomberg shut down the local public high school, which had a graduation rate of only 29 percent.

On a rainy spring morning, a string of East New Yorkers visit Groundwork’s office, looking for help. A middle-aged man with a speech impediment is confused about the status of his taxes; a

taking their kids to the dentist to getting a new job to attending parent-teacher conferences.

A project of Bloomberg’s Center for Economic Opportunity, Opportunity NYC is funded entirely by private philanthropies and is modeled after Opportunidades, a successful Mexican program that also uses “conditional cash transfers”—the social-science term for welfare payments conditioned on “good behavior.” Small-scale cash-transfer programs have been tried before in North America: During the 1990s the Canadian Self-Sufficiency Project and Minnesota Family Investment Program offered cash to single parents on welfare who found full-time work. But Opportunity NYC exceeds the scope of those experiments by including rewards for education and health goals as well. Since its

Funded entirely by private philanthropies, Opportunity NYC awards “conditional cash transfers” for its clients’ good behavior. staff member offers to call the Internal Revenue Service for him. An elderly woman wants to arrange nurse visits for a homebound friend. A laid-off Verizon fieldworker comes in to update the staff: He has successfully applied for food stamps.

Watching the daily grind, you’d never guess that Groundwork is actually ground zero for one of the most innovative—and controversial—anti-poverty programs in America. This modest communitybased nonprofit is one of six neighborhood partners in the experimental Opportunity NYC program, which pays poor people—mostly single moms—for a broad range of health, education, and work-related activities, everything from

September 2007 launch, the New York initiative has paid $10 million to 2,400 families living at or beneath 130 percent of the poverty line—about $22,000 for a family of three. The typical participating family earned just under $3,000 during Opportunity NYC ’s first year.

Bloomberg created the Center for Economic Opportunity in 2006, an effort that includes 40 different anti-poverty programs spanning 20 city agencies. The Obama administration is observing the center carefully, looking for successes that can be scaled up at the national level. But while longtime New York City anti-poverty advocates are grateful to Bloomberg for his focus on the issue, they are not all sold on his approach. the american prospect

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Many regard Opportunity NYC in particular as the questionable pet project of their hyper-capitalist, billionaire mayor—the richest man in New York, who is expected to spend $100 million in his quest to win a third term.

“Opportunity NYC borders on offensive —the idea that a person can be bribed into doing better in school or being a better parent,” says Mark Winston Griffith, executive director of the Drum Major Institute for Progressive Policy in New York City. “It sort of suggests that poverty is a lifestyle choice, that somehow if we’re just given a nudge, that we can choose not to be in this condition, or choose for our children to do better in school, or choose as parents to provide better child care. It comes out of the idea that poor people are almost sort of culturally and inherently dysfunctional. Not because of structural circumstances but because of their own personal failings.”

In April the city published initial results of the trial, which is the largestever controlled test of conditional cash transfers in the United States. There have been some notable successes: Only 43 percent of families had a bank account when they enrolled in the program; now over 90 percent of the famia8 september 2009

lies have accounts, a requirement for receiving the payments. And families have been very successful at earning the rewards for annual doctor’s visits ($200 per family member) and good school attendance in the lower grades ($50 per child every two months).

Yet for a program modeled on the idea that intergenerational poverty is, at least in part, a “behavioral” problem that can be modified through free-market incentives, there have also been challenges—ones that reflect advocates’ concerns about the Bloomberg approach to poverty-reduction. Because of child-care problems and low skills, only about 3 percent of Opportunity NYC single moms have been able to find or maintain parttime work while taking a skills-building course, even though the city will pay them $3,000 to do so. Dovetailing with the larger Bloomberg school-reform agenda, the program emphasizes academic achievement. Yet according to the contractors who administer Opportunity NYC and are studying its results, children in the program have not done particularly well on standardized English and math tests or on the New York state Regents examinations required to earn a high school diploma—perhaps

a result of low-performing, segregated neighborhood schools or poverty-related education deficits dating back to infancy or even to a lack of prenatal care.

Unsurprisingly, some behaviors are much easier to change through cash incentives than are others—in part because poor people don’t have much control over the institutions and conditions that shape their lives. “Opportunity NYC reflects an understanding of poverty as a cultural problem,” Griffith says.

“The missing piece is a candid conversation about the role of wages, for instance, or affordable housing.”

The idea of fighting the “culture of poverty” is nothing new. It dates back to sociological studies of the late 1950s and was popularized by Sen. Daniel Patrick Moynihan of New York, whose 1965 “Moynihan Report” focused on the so-called pathologies of the African American family, including the lack of future-oriented financial planning and a disregard for academic achievement.

There is no doubt such attitudes continue to be prevalent among poor families. Candice Perkins, a 27-year-old Groundwork staff member who helps East New Yorkers apply for their Opportunity NYC rewards, encounters them w w w. p ro s p ect. o rg

s p e n c e r t. t u c k e r / n e w yo r k c i t y m ayo r ’s o f f i c e

Pay Pal: Mayor Michael Bloomberg launches the Opportunity NYC initiative, a conditional cash-payment program, at a press conference on September 12, 2007.

p ov e r t y : a n e w ag e n da every day, especially since the recession hit. “I hear so many sad stories of parents saying, ‘I have no future, I have bills to pay, I can’t even think about getting a house or a car,’” Perkins says. “And their child is sitting right there. I try to step in. But hearing that promotes the kids not going to school, not going to college, being on the streets, being in gangs.

What they see parents do is pretty much what they’ll do with their own lives.”

That’s not to say families haven’t changed at all thanks to the payments.

Perkins works with a mother whose kids were truant before Opportunity NYC; now the mother drives them to school every day to make sure she earns the good-attendance payment. Another mom took each of her 12 kids to the dentist for $100 a pop and then enrolled herself in nursing school. “You can earn a whole salary from this program” Perkins notes. “But this is also teaching some type of self-sufficiency.”

The city isn’t tracking how families spend their Opportunity NYC income, but anecdotal evidence suggests no clear pattern. Most families use at least some of the money to meet basic needs, such as housing and food costs. One mom

The larger question, though, is whether paying for good behavior now can combat deeply ingrained hopelessness in the long term—even after the payments disappear, as they will when the program’s three-year pilot period ends in 2010.

Many poverty experts would say that a poor, single mom’s negativity is perfectly rational. After all, only a handful of remarkable inner-city kids ever make it to college, graduate, and join the middle class. Without universal heath care, better schools, or affordable rent, can a $25 reward for obtaining a library card really turn around a child’s future?

David Jones, president of the Community Service Society of New York, is skeptical, even though he was a member of the city task force that led to Opportunity NYC ’s creation. “In New York City, almost 50 percent of African American men are not currently employed. We have nearly 200,000 young people who are neither working nor in school,” he says.

“Those numbers can’t be addressed with incremental incentive programs. Not because the ideas are bad but because the scale of the problems is huge.”

Given these limitations, the Bloomberg administration is careful not to oversell

What if intergenerational poverty is a behavioral problem that can be modified through free-market incentives? bought a freezer so she could save on groceries by buying in bulk. A number of immigrant families have taken trips to visit relatives abroad. A graduating high school senior who earned $600 for passing each of her Regents examinations bought a car to drive herself to college classes.

Of course, some families fritter the money away on video games or fancy sneakers, Perkins says. That is why conditional cash-transfer programs won’t work in the United States exactly as they do in foreign countries: A subsistence farmer in Mexico or Bangladesh isn’t subjected to anything like the competitive consumer culture present in American cities.

Opportunity NYC. During an April visit to Washington, D.C., to promote the Center for Economic Opportunity and lobby for a similar anti-poverty push at the federal level, the mayor highlighted the city’s job-placement, nutrition, and community college-prep programs— not conditional cash transfers. Veronica White, executive director of the Center for Economic Opportunity, also emphasizes that the jury is out on Opportunity NYC. “It would be such a hugely expensive program on the federal level,” she says.

“It would need more research results from across the country.”

That said, we’ll probably be hearing a lot more about conditional cash transfers in the coming years. According to White,

a number of mayors have visited New York to learn more about Opportunity NYC . In early June, the White House announced that Secretary of State Hillary Clinton will host an Organization of American States summit in New York this fall to share anti-poverty strategies across borders. Conditional cash transfers will be a special focus.

That tells anti-poverty advocates that the Obama administration is deeply influenced by Bloomberg’s “experimental” approach, his strategy of letting a thousand flowers—or research-backed programs—bloom. And while they applaud the mayor’s willingness to openly discuss poverty, they question whether “creativity” is really what’s needed to solve the problem.

“Some of the ideas we’re talking about are too small-bore for the third of New Yorkers who live in poverty,” says Jones of the Community Service Society. “I have some concerns that there’s an assumption here that the problem in dealing with chronic poverty is one of a lack of new ideas. In fact, New York, through its nonprofits and government, has been a laboratory of ideas for generations. The difficulty is bringing successful models to scale.”

At a cost of $25 million annually for just 2,400 families, Opportunity NYC certainly may not be the easiest anti-poverty model to recreate at citywide levels, let alone nationally. And the Bloomberg administration has many other jobs and education programs in the works, some of them far more promising in terms of bang for the buck. But despite its shortcomings, Opportunity NYC continues to be the calling card for the Bloomberg anti-poverty agenda, leaving less sexy issues, like the need for more public housing, by the wayside.

“Mayor Bloomberg has most definitely made an attempt to be a champion of what he regards as progressive ideas,” says the Drum Major Institute’s Griffith. “I applaud him for it, and I think he deserves some recognition and support. But a lot of his programs are sort of isolated and concentrated interventions that don’t change the structure and system that poor people live in.” tap the american prospect

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Race, Wealth, and Intergenerational Poverty There will never be a post-racial America if the wealth gap persists.

by Darrick Hamilton and William Darity Jr.

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espite an enormous and persistent black-white wealth gap, the ascendant American narrative is one that proclaims our society has transcended the racial divide. But wealth is a paramount indicator of social well-being.

Wealthier families are better positioned to afford elite education, access capital to start a business, finance expensive medical procedures, reside in higher-amenity neighborhoods, exert political influence through campaign contributions, purchase better legal representation, leave a bequest, and withstand financial hardship resulting from an emergency.

The wealth gap is the most acute indicator of racial inequality. Based on data from the 2002 Survey of Income and Program Participation, white median household net worth is about $90,000; in contrast it is only about $8,000 for the median Latino household and a mere $6,000 for the median black household.

The median Latino or black household would have to save nearly 100 percent of its income for at least three consecutive years to close the gap. Furthermore, 85 percent of black and Latino households

have a net worth below the median white wealth gap but still embrace the idea of household. Regardless of age, household a post-racial America have crafted two structure, education, occupation, or explanations for this disparity. The first income, black households typically have is that, in search of immediate gratificaless than a quarter of the wealth of other- tion, blacks are less frugal when it comes wise comparable white households. to savings. Indeed, in an April lecture at Morehouse College, FedSince the election of Barack Obama, a growing Median Household eral Reserve Chair Ben belief has emerged that Net Worth by Race Bernanke attributed the race is no longer a definracial wealth gap to a lack In thousands ing feature of one’s life $100 of “financial literacy” on ■ black chances. But the extraorthe part of blacks, par90 ■ latino dinary overlap between ticularly with respect to 80 ■ white wealth and race puts a lie savings behavior.

70 to the notion that America Such an explanation, 60 is now in a post-racial era. however, is not the case.

50 The smallest racial wealth E conom ist s ra ng ing 40 gap exists for families in from Milton Friedman to 30 Marjorie Galenson to the the third quartile of the 20 10 recently deceased foundincome distribution where 0 er of the Caucus of Black the typical black family 1998 2000 2002 has only 38 percent of the Economists, Marcus source: U.S. Census Bureau wealth of the typical white Alexis, found that, after family. In the bottom income quartile— accounting for household income, blacks the group containing the working poor—a historically have had a slightly higher savblack family has a startlingly low 2 percent ings rate than whites. In 2004, economists of the wealth of the typical white family. Maury Gittleman and Edward Wolff also Those who recognize the racial found that blacks save at a moderately

Mis-Measuring Poverty

of expenditures, as the costs of housing, child care, and other necessities have grown. The current poverty threshold, $21,200 for a family of four, is still based on that outdated rough estimate and is widely understood to be inaccurate.

In determining income, the current poverty measure also fails to include important non-cash government benefits such as the Earned Income Tax Credit, food stamps, and housing subsidies, leaving policy-makers without an accurate picture of whether anti-poverty programs actually work. Finally, the measure also treats the costs of basic needs the same everywhere in the U.S., whether

I

n 1965, when Mollie Orshansky, an economist at the Social Security Administration, first devised the “poverty threshold,” she was very clear about its limits: “If it is not possible to state unequivocally ‘how much is enough,’ it should be possible to assert with confidence how much, on an average, is too little.”

Orshansky noted that families typically spent one-third of their income on food, so to define “too little,” she took a minimal food budget and multiplied it by three. But today, food accounts for a smaller share a 10 s e p t e m b e r 2 0 0 9

you live in Manhattan or Missoula.

In recent years, there has been a growing effort to revamp our poverty definition. A revision could range from a simple adjustment of the balance of food and other costs in a household budget to a full shift toward a relative measure of poverty—for example, a percentage of median income, as in the United Kingdom—that more accurately reflects the social exclusion created by poverty.

In the mid-1990s, Congress directed the National Academy of Sciences to devise a new methodology. Its report led to a set of recommendations, which Rep. Jim McDermott of Washington and w w w. p ro s p ect. o rg

j s t o c k / f o t o l i a ; e t o m b o t r o n / c r e at i v e c o m m o n s

p ov e r t y : a n e w ag e n da higher rate than do whites, again after adjusting for household income. This indicates even greater black frugality because many higher-income blacks offer more support to lower-income relatives than do whites, further reducing their resources to save.

The second explanation given to support the post-racial narrative is that inferior management of assets owned by blacks has resulted in lower portfolio returns. However, recent research finds no significant racial differences in asset appreciation rates for families with positive net worth.

Recessions disproportionately affect black and Latino families. During the 1999–2001 recession, median household wealth fell by 27 percent for both Latinos and blacks, while it grew by 2 percent for whites. The current recession likely will worsen the racial wealth gap. Although whites are more likely than blacks to own their home, the share of black wealth in the form of housing is nearly twice as large as the white share. And with blacks far more likely than whites to have been steered toward sub-prime loans in discriminatory credit markets, the foreclosure crisis is bound to have a more deleterious effect on black wealth than on white wealth.

For example, a recent report on mortgage lending and race by the Institute on Race and Poverty at the University of Minnesota found that black Twin City residents earning over $150,000, in comparison to whites earning below

Two Americas: Back Bay (top) is a wealthy, white neighborhood in Boston, and North Philadelphia (bottom) is predominantly black and Latino. The “asset” disparity will likely worsen with the current recession.

Sen. Christopher Dodd of Connecticut have used as the basis for the Measuring American Poverty (MAP) Act. The legislation instructs the Census Bureau to develop a new measure of poverty, what the law’s authors call the “modern poverty measure.” The measure uses a new calculation of income—one that adjusts for tax credits and other non-cash benefits. It then sets the level of poverty at the income needed to cover the 33rd percentile of spending on food, clothing, shelter, and utilities, plus an additional 20 percent for other costs.

The threshold would adjust year to year based on the costs of these expenditures.

It would also account for geographic differences and adjust for housing status.

Additionally, the legislation directs the Census Bureau to start working on a measure that determines how much income is enough to meet a decent living standard.

While this all sounds logical, the devil, in this case, is in the politics. Few administrations have wanted to take on enacting these changes if a new definition would result in poverty rates going up on their watch. Best estimates, however, show that overall poverty rates will only rise modestly using this new calculation. Further, tying a new measure to program eligibility and how program money is allocated to states

would most likely lead to the proposal’s quick death. As a result, the MAP Act authors wisely do not link the new measure to program eligibility or allocation formulas. Instead, they instruct Census to continue calculating the “traditional” poverty measure for these purposes.

As the late Sen. Daniel Patrick Moynihan once said, “You can’t solve a problem until you first learn how to measure it.” Even if the modern poverty measure can’t be used immediately to adjust the vast number of programs that are tied to Orshansky’s poverty threshold, it can at least help us measure the effectiveness of our current efforts. —the editors the american prospect

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excluded any corporate subsidies and tax savings and was more than 15 times the amount spent on education.

At issue is not the amount but the recipients. Those earning over $1 million a year received about one-third of the entire allocation, while the bottom 60 percent of earners received only 5 percent. Individuals in the bottom 20 percent typically received a measly $4.24 benefit. A more progressive distribution could be transformative for low-income Americans.

The surge in the post-racial perspective has moved us away from race-specific policies. However, wealth, given the racial disparity of its distribution, can be an effective non-race-based instrument to

To promote asset building, eligibilty for a “baby bond” program could be based on family net worth rather than income.

Apart from the national failure to endow ex-slaves with the promised 40 acres and a mule after the Civil War, blacks were deprived systematically of property, especially land, accumulated between 1880 and 1910 by government complicity and fraud as well as seizures by white terrorists. During the first three decades of the 20th century, white rioters destroyed prosperous black communities from Wilmington, North Carolina, to Tulsa, Oklahoma. Restrictive covenants, redlining, and general housing and lending discrimination also inhibited blacks from accumulating wealth.

Given the importance of intergenerational transfers of wealth and past and present barriers preventing black wealth accumulation, private action and market forces alone cannot close an unjust racial wealth gap—public-sector intervention is necessary.

Indeed, the public sector already subsidizes asset acquisition. A 2004 report by the Corporation for Enterprise Development estimates that, even before the current financial crisis, the federal government allocated $335 billion of its 2003 budget in the form of tax subsidies and savings to promote asset development such as mortgage deductions. This a 12 s e p t e m b e r 2 0 0 9

eliminate racial inequality. We could shift from an income-based to a wealthbased test for transfer programs. Policy eligibility based on net worth below the national median would qualify a large proportion of black households. Electronic financial records and publicly available home appraisals now make it easier to estimate net worth, and to avoid savings crowd-out, the program could be structured similarly to the Earned Income Tax Credit program, which uses a phase-out schedule to avoid work disincentives.

These changes in eligibility should be coupled with policies to promote asset building. For example, the American Dream Demonstration program uses individual development accounts to

create match incentives for low-income savers. Another initiative, the Saving for Education, Entrepreneurship, and Downpayment, established children’s development accounts (sometimes called “baby bonds”) to create endowed trusts for children at birth. In the United Kingdom, since 2005, every newborn receives a trust ranging from 250 pounds to 500 pounds depending on familial resources.

In 2004, the American Saving for Personal Investment, Retirement, and Education (ASPIRE) Act was introduced in Congress to establish children’s development accounts in the U.S. While the nation’s first black president eschews race-specific policies, perhaps a strongly amended ASPIRE bill designed to progressively distribute funds based on familial net worth can be the policy that enables him to “bind … [black America’s] grievances … to the larger aspirations of all Americans.”

We envision a “baby bond” plan of much greater magnitude—progressively rising to $50,000 or $60,000 for children in families in the lowest wealth quartile and accessible once the child turns 18 years of age. We also would determine eligibility for such a program based upon the net-worth position, rather than the income, of the child’s family (all children whose family fell below the national median for wealth would receive baby bonds).

We should strive not for a race-neutral America but a race-fair America. For that to occur, the transmission of racial economic advantage or disadvantage across generations would have to cease.

Public provision of a substantial trust fund for newborns from wealth-poor families would also go a long way toward achieving the ideal. tap Darrick Hamilton is assistant professor at Milano, The New School for Management and Urban Policy, and affiliate faculty of economics at The New School for Social Research. William Darity Jr. is arts and sciences professor of public policy and professor of African and African American studies and economics at the Sanford School of Public Policy at Duke University. w w w. p ro s p ect. o rg

don sebrook / ap images

$40,000, were twice as likely to be denied a home loan. Those fortunate (or unfortunate) enough to get a loan were more than three times as likely to have a sub-prime loan.

Economic studies also demonstrate that inheritances, bequests, and intrafamily transfers account for more of the racial wealth gap than any other demographic and socioeconomic factor, including education, income, and household structure. These intra-familial transfers, the primary source of wealth for most Americans with positive net worth, are transfers of blatant non-merit resources.

Why do blacks have vastly fewer resources to leave to the next generation?

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Can Separate Be Equal?

The classroom is where poor and middle-class kids should meet—to the benefit of both.

By Richard D. Kahlenberg

pa b lo m a r t i n e z m o n s i va l s / a p i m a g e s

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or generations, those seeking to break the cycle of poverty have divided into two camps: integrationists, who believe that separate schools and neighborhoods for rich and poor perpetuate poverty, and community organizers, who want to “fix” inner-city communities and schools rather than move people around. Generally speaking, integrationists have had stronger social-science research on their side, while community organizers have claimed to be more politically realistic.

During the Democratic presidential primary campaign, candidates Barack Obama and John Edwards neatly embodied the two approaches.

Edwards proposed expanding housing vouchers to allow low-income families to move to better neighborhoods while Obama called for increasing funding for the Community Development Block Grant program. In the education arena, Edwards proposed giving middle-class suburban public schools a financial incentive to recruit low-income urban students trapped in failing schools. By contrast, Obama supported creating 20 versions of the Harlem Children’s Zone, which provides pre-K, parenting classes, and extra social services to low-income, inner-city residents. Edwards called for doubling funding of magnet schools, which have the purpose of integrating students from different backgrounds, while Obama called for doubling funding of charter schools, which are agnostic about integration, and some research suggests may actually increase both racial and economic segregation.

Democrats were clearly correct to pick the more politically adept (and romantically monogamous) candidate, but does Obama have the better poverty-fighting approach? Or can economic integration of schools and neighborhoods

Plans To Expand: Obama greets Geoffrey Canada of the Harlem Children’s Zone at the White House.

become a politically palatable supplement to Obama’s innovative but limited community-revitalization agenda?

Any effort to break the cycle of intergenerational poverty begins with education. Four decades of research has found that the single best thing one can do for a low-income student is give her a chance to attend a middle-class school.

The landmark 1966 Coleman Report found that the most important predictor of academic achievement is the socioeconomic status of the family a child comes from, and the second most important predictor is the socioeconomic makeup of the school she attends. A low-income student given the chance to attend a middle-class school is likely to be surrounded by peers who are academically engaged and less likely to act out; a set of parents who volunteer in the classroom and know how to hold school officials accountable; and high-quality teachers who have high expectations.

That more advantaged school environment translates into dramatically different achievement levels. On the 2007 National Assessment of Educational Progress (NAEP) given to fourth-graders in math, for example, low-income students attending more affluent schools scored almost two years ahead of low-

income students in high-poverty schools.

Indeed, low-income students given a chance to attend more affluent schools performed more than half a year better, on average, than middle-income students who attend high-poverty schools.

This matters because performance in early grades tends to predict performance in later grades, and high school performance predicts the level of educational attainment, which in turn predicts adult earnings.

Today, more than 60 school districts are explicitly seeking to reduce concentrations of school poverty. For example, in Wake County, North Carolina, which includes the city of Raleigh and surrounding suburbs, the district adopted a goal in 2000 that no school should have more than 40 percent of students eligible for free or reduced-price lunch. The results are quite impressive, with Wake County’s low-income, minority, and middle-class students generally outperforming peers in other large North Carolina districts.

Districts like Wake County are emphasizing integration by economic status as opposed to race because doing so avoids the constitutional problems associated with racial integration plans and is also consistent with the social-science research that has long found that black students don’t do better sitting next to white students; rather low-income students of all races do better in a middleclass school environment.

But make no mistake: In the United States, it is black and Latino students who overwhelmingly attend high-poverty schools. Almost two-thirds of black and Hispanic public school students attend schools in which more than 50 percent of students are eligible for subsidized meals, compared with just one in five white students. One reason lowincome whites tend to outperform lowthe american prospect

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income African Americans and Latinos is that they are attending schools with more middle-class classmates.

Similarly, well-designed efforts to deconcentrate neighborhood poverty have had broad success. As a remedy to housing discrimination under the 1976 Gautreaux Assisted Housing Program, almost 25,000 African Americans in public housing in the Chicago metropolitan area were given a chance to live in mostly white, affluent suburbs. Because the program was oversubscribed, researchers could compare families who moved to the suburbs with those who wished to move to the suburbs but were instead assigned to housing in the city. Scholars at Northwestern University found that children of suburban movers were four times more likely to finish high school and twice as likely to attend college as city movers. A more recent experiment aimed at replicating Gautreaux, the federal Moving to Opportunity (MTO) program, found few benefits, but it was a poor test of povertydeconcentration strategies, as students

tently found that the many billions of dollars expended have failed to produce significant academic gains.

In recent years, however, some observers have claimed to have figured out how to make “separate but equal” work. Indeed, the existence of highly successful highpoverty schools such as the Knowledge Is Power Program (KIPP) chain of charter schools and the Harlem Children’s Zone

An emphasis on economic integration of schools dovetails nicely with Obama’s winning vision of “One America.” in the treatment group attended schools with a mean subsidized lunch population of 67.5 percent, compared to 73.9 percent in the control group. This looked more like moving to mediocrity than opportunity.

While well-run socioeconomic school integration and housing-mobility programs like Gautreaux have been highly successful, most efforts to improve highpoverty neighborhoods and schools have proved disappointing over the years. Billions have been invested in Community Development Corporations (CDCs), but as researcher David Rusk notes, even the nation’s best CDCs “are losing the war against poverty.” Likewise, numerous evaluations of the federal Title I program for high-poverty schools have consisa 14 s e p t e m b e r 2 0 0 9

(HCZ) package of pre-K programs, social services, and charter schools suggest to some that segregation is just an “excuse” for failure. Because most charter schools are non-unionized, some draw the profoundly conservative lesson that teachers’ unions, not segregation, are the primary impediment to equal opportunity.

The success of these programs has had an important influence on key figures in the Obama administration. But on closer examination, the high-poverty school success stories are very difficult to replicate on a national scale because the parents, students, and teachers in KIPP and HCZ schools are not representative of those typically found in high-poverty public schools.

KIPP educates a subset of students fortunate enough to have striving parents who take the initiative to apply to a KIPP school and sign a contract to read to their children at night. Moreover, one study found that among those who begin KIPP, an extraordinary 60 percent leave, many because they find the program too rigorous. Nor are the teachers typical of those attracted to regular high-poverty public schools. The dedication of KIPP teachers—who work from 7:15 A.M. until 5:00 P.M. and then go home to plan for the next day as they take phone calls to help students with homework—is legendary but may not translate into an effective model for 3 million teachers nationally.

To its credit, the Harlem Children’s Zone set out to educate an entire 97-block region of Harlem—not just the most motivated subset—but to date, its charter schools have reached only 1,300 students, whose parents must apply for a lottery to participate. Like KIPP, HCZ’s positive results come not from the entire cohort of students but rather from the subset who survive a longer school day and school year. In the case of HCZ’s middle school, more than a third of students left between sixth and eighth grade, and unlike at public schools, no new students entered.

Even high-poverty schools that beat the odds have trouble breaking the cycle of poverty because students at such schools are still cut off from valuable w w w. p ro s p ect. o rg

wilfredo lee / ap images

Divided Camps: “Integrationists” arguing for diversity champion magnet schools (left); while community organizers who want to elevate inner cities push for charter schools, like KIPP (right).

s u s a n wa l s h / a p i m a g e s

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social networks that ease employment opportunities. U.C. Berkeley researcher Claude Fischer and colleagues found that even after controlling for individual ability and family home environment, attending a middle-class school reduced the chances of adult poverty by more than two-thirds.

If there is a broad social-science consensus that economic segregation impedes equality of opportunity, there is also a durable—if outdated—political consensus that housing mobility and school integration programs are politically toxic. For the Obama administration, the political calculations about school integration may be particularly sensitive.

Put crudely, does America’s first black president want to be seen as supporting “busing”? The concern is understandable but outdated, for three reasons.

First, most school districts today integrate students through voluntary programs that rely heavily on incentives rather than compulsory busing.

Thirty years ago, districts shipped kids across town and parents had no say in the matter, a practice that fueled white flight. Today, however, most districts seeking integration rely primarily on systems of magnet schools and publicschool choice. In Cambridge, Massachusetts, for example, all schools have been designated magnet schools, each with something distinct to offer. Parents rank

their preferences among schools, and the district honors choices in a way to ensure that all schools are within plus or minus 10 percentage points of the system’s average eligibility for free and reduced-price lunch. The most sophisticated plans poll parents ahead of time, asking them what sort of themes or pedagogical approaches would attract them to attend a school further away.

Second, the “neighborhood school” does not have the same resonance it did three decades ago. Although Americans are divided on private-school vouchers, they overwhelmingly support giving greater choice and options to students within the public school system. The number of families choosing a nonneighborhood public school increased by 45 percent between 1993 and 2007.

Third, a growing number of Americans now recognize that diversity is a good thing for all students. The research has long found that integration is not a zerosum game: Low-income students can benefit from economically integrated schools, and middle-class achievement doesn’t decline so long as a strong core of middleclass children is present. Moreover, many families now believe that racial, ethnic, and income diversity enriches the classroom, noting that students can’t learn how to live in a multicultural society in a segregated white school.

The number of districts using socio-

economic status in student assignment has increased dramatically over the last decade, and notably, the list includes districts from “red” states and “blue” states, from Wake County (Raleigh), North Carolina to Omaha, Nebraska; from San Francisco, California, to McKinney, Texas.

While conventional wisdom declares school integration a thing of the past, more than 3.2 million students live in school districts with some form of socioeconomic integration plan in place.

Taken together, the emphasis on school integration—through voluntary incentives rather than compulsion, with an emphasis on economic status rather than race—dovetails nicely with Barack Obama’s winning vision of “One America.” Obama’s centrist education agenda to date—charter schools, performance pay for teachers, and accountability—has its place, but simply supplementing what was essentially the Bush administration’s platform with more money is not bold enough for the challenges we face. If the Obama administration wants to make real inroads on breaking the cycle of poverty, it needs to do better than Plessy v.

Ferguson. tap Richard D. Kahlenberg is a senior fellow at The Century Foundation and author of All Together Now: Creating Middle Class Schools through Public School Choice. the american prospect

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Putting Poverty in Its Place Neighborhood-based approaches can succeed, if they’re part of a broader urban strategy.

By Manuel Pastor

T

he Harlem Children’s Zone (HCZ) has given new meaning to the adage that failure is an orphan but success has a thousand parents. The zone, a public-private partnership founded and led by the charismatic Geoffrey Canada, has produced significant gains in student achievement in the context of a deeply troubled neighborhood. This has made it both a darling of some conservatives and a supposed paradigm for the Obama administration’s approach to urban distress.

It is a worthy model, but utilizing it to make a dent in our national poverty problem will require two realizations: first, that the conservative enthusiasm, most recently voiced by columnist David Brooks, is decidedly partial, and second, that any neighborhood-based approach, including the HCZ , must be nested in a far broader strategy to revitalize urban America—including everything from the expansion of the Earned Income Tax Credit to changes in transportation funding to targeted training for the emerging green economy.

Conservatives make the mistake of attributing student success solely to the charter schools operating in the HCZ , which have a longer school day, the ability to dismiss teachers, and an embrace of oldfashioned discipline. But they don’t call it a zone for nothing—the secret of the HCZ is that the charters operate within a full set of neighborhood services, including a “baby college” to teach expectant parents about child-raising, support for community organizing aimed at neighborhood betterment, and even an asthma initiative to tackle environmental health.

The comprehensive nature of Harlem Children’s Zone attracted the attention of candidate Barack Obama and elicited a campaign promise to enact a nationwide system of “Promise Neighborhoods.” In a 16 s e p t e m b e r 2 0 0 9

reaction, some, like David Kirp in this magazine [see “Audacity in Harlem,” TAP, October 2008], have been anxious about the feasibility of replication—are there really that many Geoffrey Canadas in the world? Other observers have expressed concern that this is yet another place-based dead end, like the Enterprise Zones and Empowerment Zones of the 1980s and 1990s, that will fail to really move the needle on urban poverty.

But the administration’s approach is far from single-pronged. Both Housing and Urban Development Secretary Shaun Donovan and White House Director of Urban Affairs Adolfo Carrion have embraced a point made by David Rusk in his 1999 book, Inside Game, Outside Game: Poor communities rarely do well if they are part of an overall metropolitan area that is sinking. Buoyed by analysis (and analysts) from the Brookings Insti-

program’s conversion of public housing but with a fuller suite of complementary community-based services) as well as a Sustainable Communities Initiative that will incentivize regional planning and inter-jurisdictional collaboration.

Making the connection between the inside and outside game, between inner cities and metropolitan economies, is critical for all of us. An intriguing series of studies—including one from that wellknown bastion of liberal thinking, the Cleveland Federal Reserve—has suggested that metropolitan areas characterized by high levels of segregation and inequity do poorly in part because they fail to keep up their investments in human capital and in part because they are wracked by social conflict and jurisdictional fragmentation.

It’s an inconvenient truth that we have increasingly come to understand at a

Who can doubt that urban poverty has shackled metropolitan prosperity? tution, the administration has adopted what Rusk called an outside approach, a metropolitan agenda that sees the real solutions to poverty as involving “regional equity”—the attempt to remake our transportation, housing, and workforce systems to keep cities competitive and spread opportunity.

Promise Neighborhoods are one part of the complementary inside strategy— and a small part at that. The $10 million in planning grants to be run through the Department of Education are dwarfed by a proposed $550 million increase in the Community Development Block Grant program (up 14 percent from the previous year), with some of the spending geared to a Choice Neighborhoods program from HUD (based on HUD’s Hope VI

national level. Who can doubt that rising inequality, which left some so rich they were forced to speculate and some so poor they were forced to borrow, helped feed our financial crisis? Likewise, urban poverty has shackled metropolitan prosperity. While innovative neighborhood approaches are no silver bullet, turning around the pockets of distress that plague urban America will be key to both a sustainable recovery and an effective anti-poverty agenda. tap Manuel Pastor is professor of geography at the University of Southern California and co-author of This Could Be the Start of Something Big: How Social Movements for Regional Equity are Reshaping Metropolitan America. w w w. p ro s p ect. o rg

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A Modern Safety Net We need to update our social contract for the real lives of working families in a brutal economy.

By Shelley Waters Boots and Karin Martinson

mark lennihan / ap images

T

he Great Recession has revealed that our social safety net—primarily established by Frank lin D. Roosevelt during the Great Depression— is more hole than net. For many Americans, this is not news. Low-income families have spent decades dealing with economic insecurity and a system that provides little buffer on the way down.

The current downturn has only made matters worse.

The latest unemployment numbers bear this out. For workers with the least education, the May unemployment rates jumped to 15.5 percent, up from 6.7 percent in 2007. Job seekers now average nearly 6 months without a job. Hidden behind these numbers, however, are the underemployed—those lucky enough to still have a job, but a job that is offering fewer hours than what they are willing to work. Bureau of Labor Statistics data suggest that nearly 9 million workers are in part-time positions but want full-time jobs—an increase of 4 million workers since the recession started.

This dramatic collapse of the lowwage job market takes place against the backdrop of a 10-year shift in poverty policy away from income support for the very poor and toward programs that emphasize work and supports for those who are working, often under the label “Work First.” As a result, the fundamental income-support programs for those in need—unemployment insurance, cash welfare through the Temporary Assistance for Needy Families (TANF) program, and food assistance through the Supplemental Nutrition Assistance Program (SNAP, formerly food stamps)— have been off the front burner in the policy debate and are in need of reforms.

How threadbare is the net? Urban Institute researchers found that lowincome programs in 2005 lifted fewer

A Family Affair: With unemployment on the rise, more people will be relying on social service resources.

families out of deep poverty (those living at below half the official poverty line) than programs in 1995. Of the major programs, SNAP seems to be working the best in providing for basic needs. Caseload data from March shows that participation in this program has increased 28 percent since 2007. Still, a recent study shows that in 2006, the program served about two-thirds of those eligible, but rates vary widely by state: California, for example, serves only half of its eligible food-stamp population. Further, some eligible populations, like low-income seniors and individuals in working families, are less likely to be enrolled. Despite these challenges, SNAP provides an instructive model because eligibility for this program is based primarily on financial need, not tied to work or past work efforts.

TANF and unemployment insurance, on the other hand, do not seem as well suited to buffering low-income families during recessions. TANF, where the workfirst principle is the most entrenched,

is particularly ill-suited to helping the poorest Americans. Despite rising unemployment and increasing poverty, initial reports show that states’ cashassistance programs have remained flat or experienced only small increases in the number of people they serve in the early stages of the recession (more recent data is not yet available). Even before the economic nosedive, there were signs that the TANF program was not meeting its mission. Less than half of all eligible families receive TANF, and studies show that one in five adult recipients who left welfare is not working.

Unemployment insurance is also disconnected from the current labor market and the needs of low-wage workers. This program reportedly provides benefits to about one-third of all those unemployed and an even smaller percentage of lowwage unemployed workers. Additionally, the benefit amount participants receive is typically capped, so that the average replacement rate is under half of average the american prospect

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earnings. While unemployment insurance was greatly enhanced through provisions by the American Recovery and Reinvestment Act (ARRA), some states are not taking advantage of these resources because of the required policy expansions tied to the federal dollars. In addition, seven states have borrowed more than $2 billion from the U.S. Treasury to cover their unemployment-insurance systems, and experts project that up to 20 states might need federal loans by the end of 2009 to cover trust-fund losses.

The combination of changes in policy, the economy, and our lives has led to a shift from a safety net that once primarily lifted the very destitute to a level somewhat higher, to one that now focuses benefits heavily on people who are employed year round. While there are advantages to that approach, it leaves the vast majority of poor people without a net when work is inconsistent or when life gets in the way of full-time employment. To fully address the realities of the low-wage labor market and the needs of low-income families, a modern safety net would take into account today’s economy, in which workers tend to stay with individual employers five years instead of 40, in which nearly half of the work force is made up of women (including single parents), and in which more than a quarter of the work force is part-time, temporary, or contract workers. It would address the

fact that many workers struggle to find employment that allows them to earn enough to support their families, and only one-quarter advance to jobs that move them out of their low-income status. And it would acknowledge that all of these pressures exist within a 24/7 economy that moves at a pace unimaginable to the architects of the current social safety net nearly 80 years ago.

A new safety net would also account for changes to workers’ “life course,” an approach touted by European research-

ers and policy-makers as they examine the social welfare state. European policymakers have begun to examine their labor markets, social-security systems, and working-time regulations with the need to find, as the European Foundation for the Improvement of Living and Working Conditions notes, “a new deal combining sufficient flexibility and competitiveness of companies with higher levels of flexibility and employment/income security for workers.” This would mean incorporating security systems that buffer not only economic shocks but also account for times when a person might need to

programs such as unemployment insurance to help ensure that eligible families are enrolled. Also, states could work to develop relationships with employers, both to help with outreach to working poor families and to target those experiencing layoffs.

Unemployment insurance could be updated both to address the structural inequities of the programs (including varying benefit levels from state to state) and the financing issues that have left many programs on the brink of bankruptcy. We could also greatly expand federal requirements to ensure that unemploy-

Don’t Forget the Men

(EITC) for these workers would help them, in turn, either support their children or build a stronger economic base for their families in the future.

The EITC has for decades enjoyed broad support from Republicans (who like that it rewards work) as well as Democrats (who like that it subsidizes the poor). It is the nation’s largest anti-poverty program by far, providing $44 billion to low-wage workers last year.

But 98 percent of that amount goes to families with kids. The maximum benefit for a worker without a child at home ($438 per year) is one-tenth that of a single parent with two children ($4,824).

In just about five years, the idea of expanding EITC for childless workers has

become highly popular with the left and enjoys some support on the right. The policy was proposed by then-Sen. Barack Obama in 2006, and the Center for American Progress made it a core element of its 2007 povertyreduction plan. Ron Haskins, a former staffer in Newt Gingrich’s House of Representatives who helped author the 1996 welfare-reform bill, is a vocal advocate, and in New York state, Gov. George Pataki, a Republican, enacted a limited version of the plan before leaving office in 2006.

So why has helping single, childless workers become the darling of poverty policy, especially for those concerned about families with children?

First, enhancing the value of work addresses an increasing need within a

by dick mendel

W

hen we think of reducing poverty and breaking its multigenerational cycle, we tend to think of poor families with children, in particular families headed by a single parent facing staggering challenges in finding both the time and income to provide a stable home.

But there is a growing interest in an innovation that would help break the cycle of poverty by supporting a different population: low-wage workers without children, primarily noncustodial fathers and men without children.

Doubling the Earned Income Tax Credit

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exit the work force to care for a new child, to handle a disability or illness, or for learning and skill development. These transitions happen much more frequently than our systems admit.

A stronger net of programs for workers and their families could build on the systems we already have. SNAP could make jobless adults without children permanently eligible for food assistance (a temporary policy under ARRA). We could streamline the application process and coordinate SNAP with other benefit

Low-income families have long dealt with economic insecurity and a system that provides little buffer on the way down.

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p ov e r t y : a n e w ag e n da unemployment compensation, only one nation finances the program by ‘experience rating’”—that is, by applying a higher tax rate to businesses that have more layoffs. The goal of this rating system is to discourage layoffs and encourage companies to retrain their own work force to meet changing production needs.

But this system encourages employers to deny unemployment-insurance claims lest they face increased tax liabilities.

Employers contest one in four unemployment insurance claims, leaving many employees with the burden of a legal fight to access the benefits they need. A system of no-fault unemployment benefits, funded by a level and fair tax on all employers (perhaps shared with workers) would strip out these incentives and create a uniform safety net for all workers.

We should also revisit the TANF provisions that reward states for pushing people out of the program even when poverty and need are rising. Education and training should count as work activity, especially in periods of high unemployment when building skills for better jobs later makes sense. The federal government should also encourage states to provide more services to those with significant employment barriers. And penalizing states for failing to meet work participation requirements should be lifted when unemployment makes them impossible targets.

The next generation of safety-net poli-

cies will certainly need to connect workers to an improved and expanded system of education and training. This system would provide significant new and targeted investments in financial aid, particularly for part-time, certificate-oriented programs that target low-income individuals. The Workforce Investment Act (WIA), the cornerstone of our job-training system, should be retooled—funded at adequate levels and directly linked to industry needs. Additionally, given that many in need of training are also trying to keep food on the table and care for children, we need to ensure that they have financial support and child care while they are attending training.

Finally, the safety net should acknowledge that for the vast majority of workers, there will be short spells of non-work driven by personal circumstances and family needs. Five states and Puerto Rico in fact recognized early on—some as early as the 1940s—that there was a need for temporary-disability insurance programs to help support workers and their families during brief periods of illness and disability. However, since the 1960s no additional states have adopted this coverage. Recent policy innovations, though, in two states with temporary-disability insurance programs, California and New Jersey, have expanded beyond disability insurance to also address paid family leave—or wage

population that has been facing acute hardship, even before the recession.

There’s growing alarm at the levels of joblessness among young minority men.

From 1966 to 2003, the employment rate of black men ages 20 to 24 declined from 83 percent to 56 percent. Nearly twothirds of poor black men ages 16 to 50 and three-fourths of those ages 16 to 24 were not employed at all in 2004.

Second, improving the well-being of poor children hinges on increasing fathers’ economic contributions. Between 1992 and 2005, the labor-force participation rate of never-married mothers jumped from 53 percent to 73 percent, and earnings of female-headed households doubled. Yet most former welfare recipients—as well

as many other single mothers—are mired in low-wage jobs with dim prospects for advancement. Consequently, the child-poverty rate hovers at 18 percent nationwide.

And while intensified child-support enforcement efforts increased payments in recent years, 70 percent of the 3.5 million poor noncustodial fathers pay no child support at all. Half are jobless. Unlike single mothers, however, absent fathers and other single men receive little assistance from the nation’s welfare and job-training systems.

For conservatives, much of the appeal of increasing the EITC for childless workers rests on the prospect that wage subsidies might boost marriage rates.

Census data show that young men earning $20,000 to $40,000 are two and a

half times as likely to be married as those earning less than $10,000.

Despite Obama’s early leadership on the issue, expansion of EITC for childless workers was surprisingly omitted from both the economic stimulus legislation and the administration’s 2010 budget. But the House inserted the EITC expansion into cap-and-trade legislation it passed in June, and whether on that vehicle or another, enacting this legislation will provide a critical next step in poverty reduction efforts by helping poor working adults and the families that rely on them. tap

rich pedroncelli / ap images

ment insurance covers part-time and temporary workers and to provide a greater benefit amount to low-wage workers.

The National Employment Law Project estimates that another 500,000 workers would be eligible for unemployment insurance if all of the provisions outlined in ARRA were passed in the states.

Additionally, as unemployment­insurance expert Wayne Vroman has noted, “out of 61 nations providing

Dick Mendel is a writer and editor specializing in poverty-related issues involving youth, families, and community development. e rn i cp ar no sppreoc st p eac19 t t h e ta hmee raimc a

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replacement for the times when workers need to exit employment temporarily to care for a new baby or sick relative.

These two state programs have laid the groundwork for a national Family Security Insurance program. This short-term safety net could be built on the foundation of our national Social Security system, following the lead of many other industrialized nations. Specifically, a nominal tax added to current Social Security payroll taxes would provide a base of funding to support workers who need to temporarily leave the workplace—for their own short-term illness, a sick family member, or to care for a new baby. By providing 12 weeks per year, (to align with current Family and Medical Leave Act requirements), even low-income workers who are less likely to have paid time off could afford the much needed time to provide care. As in other states with temporarydisability insurance, workers would need some work history to be eligible for the program. For low-income workers, job protection must also be extended to help ensure that they can access the payments without the fear of losing their job.

Particularly in times of economic crisis, we need a safety net that supports all people: those who are unemployed but able to work, those who cannot work, and those who are currently working. There is more to do beyond these core programs, but fixing them would create an important and fundamentally new fabric for our safety net. While it is true that the Obama administration is not lacking in things to reform, the president should take his cues from another leader in a time of national crisis: Franklin Roosevelt. “It is childish to speak of recovery first and reconstruction afterward,” Roosevelt said. “In the very nature of the processes of recovery we must avoid the destructive influences of the past.” tap Shelley Waters Boots currently consults for philanthropic foundations on poverty, work-family, and children’s issues. Karin Martinson is a senior research associate at the Urban Institute specializing in welfare reform, employment and training strategies, and work supports. a 20 s e p t e m b e r 2 0 0 9

A National Mission Britain’s national goal of reducing child poverty was a political success. Did it work?

By James Crabtree

H

ow do you build a bipartisan consensus to tackle seemingly unfashionable social problems? Look at Britain. In October 2007 David Cameron, head of the U.K.’s partially revamped Conservative Party, made a speech that boldly concluded, “We can make British poverty history.” In March 2008 he attacked a “Labour Party that rests on its historical laurels as the voice of the poor and downtrodden while all the time the poor have got poorer and inequality has gone up.” The jibe was unusual coming from a party that, under then-Prime Minister Margaret Thatcher, had unflinchingly presided over a sharply rising poverty rate. But here was Cameron, ratcheting up pressure on Prime Minister Gordon Brown’s government, in advance of a crucial annual budget, for more action to end poverty among children.

Britain has a patchy record on poverty reduction. But the last decade has seen the beginning of remarkable political consensus on child poverty. In 1999 then–Prime Minister Tony Blair outlined a plan for “ours to be the generation that ends child poverty forever.” He also announced a goal to halve its rate by 2010 and eradicate it completely by 2020.

The target became a totem—galvanizing Blair’s Labour Party, uniting anti-poverty campaigners, and winning over political opponents. Politicians quit debating the worthiness of the objective and raged instead over how to meet it.

Ten years later, an embattled Brown has admitted that even the halfway target will not be met. The 2020 goal remains far out of reach. Even at the time it was made, a policy adviser who worked closely with Blair told me, the target was an aspiration at best. Just as President John F. Kennedy launched a quest to put a man on the moon, so Blair’s promise mixed rhetori-

cal boldness with only a vague notion of how the task was to be achieved. Indeed, many were surprised it was made at all.

Blair, the arch centrist, had learned from Bill Clinton that electability and fiery campaigns against injustice mixed badly.

Blair had even deliberately rebranded poverty as “social exclusion,” a related but not identical concept.

Yet two decades of often-brutal Thatcherite economic policies had left Britain with the highest child-poverty rate in Europe. New evidence from social-policy academics had drawn attention to the ways disadvantage in childhood lowered opportunity later in life. Just as important, Brown (who at the time was Blair’s treasury minister) found a mechanism to do something about it, again borrowed from Clinton: a new system of tax credits for parents and working families. Add to this Blair’s need to keep his left flank in step, and Brown and Blair agreed to the 2020 poverty-reduction target.

In 1999, 3.4 million British children, or around a quarter of the total, lived in poverty (officially defined as those in households earning less than 60 percent of median income). At first, the government chipped away nicely at its new goal, helped by a booming labor market but driven in particular by a series of redistributive budgets in the early years of the new millennium. Brown directed billions in benefits to poorer families, bringing in a new Child Tax Credit (paid to poorer mothers) in 2003, along with increases in child benefits (for all parents), and more generous support for the unemployed. As a result, the 2004 quarter-way goal was missed, but only just: 600,000 children were lifted above the poverty line in five years.

Unfortunately, meeting the pledge was like scaling a steepening mountain. Climbw w w. p ro s p ect. o rg

p ov e r t y : a n e w ag e n da ing halfway meant reaching a million more children, an increasingly expensive task. Yet the early success made the target more popular. This was a case where policy really did deliver. Blair struggled to raise exam results and reduce hospital waiting lists, but extra tax credits reliably delivered lower poverty rates only a year later. The target also served to unite the formerly disparate British poverty lobby.

Its major players, including Oxfam and the National Society for the Prevention of Cruelty to Children, announced in 2001 the formation of the End Child Poverty Coalition, a high-profile effort to keep public attention, and government money, focused on meeting the target.

Unity among pressure groups would have meant little without political leadership. Here Brown can take much credit for orchestrating the annual bureaucratic pushes that funded the early stages of the effort. Politically, it also provided a helpful platform for his own fractious succession struggle with Blair. Competition from the other side helped, too, spurred in particular by the arrival of a

best projections say that by 2010, 2.3 million children will remain poor.

One million children lifted out of poverty in just over a decade nonetheless remains a substantial progressive achievement. But this doesn’t stop critics questioning Labour’s approach. The focus on tax credits, in particular, meant the

London demonstration, 2008

j o h n s t i l lw e l l / a p i m a g e s

The last decade has seen the beginning of remarkable political consensus on child poverty in Britain. new, liberal Tory leader. In 2006 Cameron allowed one of his allies, Oliver Letwin, to announce that the party now backed the “aspiration” behind the 2020 target.

Their pledge, while vague on details, meant every major British political party was notionally supportive of the push to reduce child poverty.

This political unity came just at the time when progress began to stall. A slowing economy increased unemployment and curtailed Labour’s spending boom. Even while running low on funds, Brown still managed to eke out money in both 2007 and 2008; financial injections that will likely see the U.K.’s childpoverty rate fall slightly this year and next, even in the midst of the recession.

Nonetheless, these efforts fell well short of the roughly 4 billion pound sterling poverty campaigners say is needed. The

to Britain’s poorest, but did so quietly.

Instead of making the case for poverty reduction and equality in general terms, Blair and Brown focused only on undeniably deserving causes: children and, to a lesser extent, retirees. The result is a broad-but-thin political consensus, insufficient to achieve its aim and vulner-

party spent political capital on bureaucratic maneuvering and demanded a topdown strategy with a mechanistic focus (among government and campaigners alike) on funneling money toward meeting targets. This neither attacked the deeper causes of social disadvantage, nor built public support for the cause itself. Domestically, the issue carried none of the energy of the international “make poverty history” campaign, and campaigners admit that their hard-won political consensus is rarely reflected in opinion polls.

Last year, when dreadful public finances meant no extra money for the target, there was little public outcry.

But this lack of support is also partly rooted in Labour’s conflicted attitude toward redistribution, common to many center-left parties over the last decade.

The party did, in fact, redistribute money

able to being rolled back in the future.

Meeting the second half of the target is now impossible. It would require a massive new phase of redistribution, more fundamental efforts to root out social inequality in education and the labor market, or both. With Cameron’s Conservatives likely to win power in 2010 and Britain’s public finances deep in the red, neither is politically plausible.

But Brown had one final trick up his sleeve. Last year he announced plans to place the 2020 child-poverty target in law: mandating future governments to make plans to meet the goal, and report on progress. The pledge benefited from being cost free. It might well be politely ignored.

Still, the Conservatives will find it hard to ditch its aspirations entirely. They might downgrade the issue or claim insufficient funds, but it will almost certainly remain on the agenda. And that is something of an achievement in itself. tap James Crabtree is managing editor of Prospect, a magazine of current affairs and cultural debate in Britain. the american prospect

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The Poverty of Political Talk It’s still hard for politicians to speak clearly about the poorest Americans.

By Alec MacGillis

I

n the spring of 2007, I traveled to Allendale, South Carolina, a struggling town near the Georgia line, to interview John Edwards about his ideas on fighting poverty. I watched as, photographers in tow, he strolled the back alleys and shook hands across broken fences with some of the 40 percent of Allendale residents who live below the poverty line.

“We’ve got 37 million people who wake up every day in poverty,” he declared to a group of local Democrats gathered under a giant live oak. “This is not OK, not in the richest country on the planet.”

Two years later, Edwards has left the scene, in one of the more sudden vanishing acts by a national political figure. But what about the issue he addressed more explicitly than any other major candidate since Bobby Kennedy? I managed to get Edwards on the phone recently for his first extensive interview since admitting his extramarital affair, and he told me he was worried that poverty as an issue has fallen off the radar again. “There’s reason to be concerned,” he said. “The poor and the issue of poverty [have] been relatively quiet over the last few months, in part because of the economic crisis.”

Regardless of what one thinks of Edwards, it is hard to dispute him on this point: We aren’t talking very much about poverty. Edwards’ two campaigns were an aberration in a two-decadelong shift in which the Democratic Party tried to frame its concern for the neediest Americans as part of a broader economic agenda directed, above all, at the middle class. The process began with Bill Clinton, who crafted this reframing with political goals in mind. It is now being carried on by Barack Obama, who is taking a similar approach—not only because he shares some of Clinton’s political instincts but also, his advisa 22 s e p t e m b e r 2 0 0 9

ers insist, because his whole economic mind-set is truly systemic in nature. The fact that we are in the midst of a historic recession makes it even easier for a politician to submerge the poverty issue and argue that we are all in the same boat.

The debate over whether this reframing is a good thing invariably begins with welfare reform. To many of its Democratic supporters, the mid-1990s overhaul not only succeeded in shifting several million families from long-term dependency to employment, it also detoxified the issue of poverty and buttressed the social safety net against political attacks by reasserting the value of work. “In the Reagan years, Republicans pitted the poor against the middle class to great effect,” said Democratic Leadership Council President Bruce Reed, who as Clinton’s chief domestic policy adviser helped write the law. “In the Clinton years, we worked hard to show that it was possible and necessary to help the poor and the middle class get ahead at the same time.” As Reed sees it, Obama is simply carrying on in the same vein as Clinton, with the unbidden help of George W. Bush: “In the wake of the Bush years, the interests of the poor and middle class have been brought yet closer together, because we’re all losing ground.”

Others say the political ramifications have been more complicated. Margy Waller, who went to work as Clinton’s senior adviser for welfare and working families shortly after the reform was signed, hoped at the time that greater public confidence in the welfare program would make it possible to improve on the reforms in the future. But she was dismayed that when it came time for the reform’s reauthorization early in the Bush administration, Democrats were still on the defensive. As she saw it, Clinton’s efforts had the inadvertent effect of reinforcing some of the old biases. If welfare

now came with strict time limits, didn’t that mean that those who were still left on the rolls were the ones who had “made poor choices”? Indeed, polling in the first half of this decade showed that public attitudes have gotten more negative toward the poor since the early 1990s. Welfare reform, Waller says, “created a distinction between people who work hard and play by the rules and everyone else.”

Waller decided the issue needed a new framing and settled on a theme that became the name of her advocacy group: the Mobility Agenda. Her model was Britain, where Tony Blair was tackling poverty in terms of “social inclusion.” Fighting poverty, Waller argued, was a smart thing to do because fewer low-wage jobs and uninsured workers mean a stronger economy overall. Waller had plenty of company—any number of “mobility” initiatives are now underway, spurred by data showing growth in income inequality, calcification of class lines, and the first recorded rise in poverty during an economic expansion—not to mention polling that suggests Americans are more upset about unequal opportunity than unequal results.

And then the Democrats nominated a presidential candidate who has long thought about poverty in these more inclusive and politically palatable terms.

Barack Obama worked amid Chicago’s poor and, as a state legislator, fought on their behalf by trying to add more carrot than stick to Illinois’ welfare laws.

But his campaign rhetoric from 2004 and 2008 made clear that he sees the plight of the poor as but one symptom of an economy that has gotten off kilter and that helping the poor is best done by restoring balance across the board.

His advisers insist that this is different from Clinton’s defensive gambit against Republican attacks—that Obama’s framw w w. p ro s p ect. o rg

j e f f h ay n e s / r e u t e r s / l a n d o v

p ov e r t y : a n e w ag e n da ing indicates a self-confident willingness to rethink the fundamentals of economic security and opportunity.

“From the minute I met him, I saw that this was someone who believes that jobs were the best antidote to poverty and that we really needed to rethink the social compact,” says Karen Kornbluh, Obama’s Senate policy director. “That getting education right was important for everyone in the country, that getting health care right was unbelievably important for poverty amelioration—that if you were willing to tackle the big things, it would have an impact on poverty, and that the rest of the country was ready for that.”

The debate over how to talk about poverty now hangs on what Obama is able to accomplish. To an extent that went little noted, the stimulus package was riddled with targeted assistance for those most in need—including expanded unemployment insurance, funding for food stamps, an extension of the child tax credit to more of the working poor, a new “homelessness prevention” initiative, and an increase in Pell grants. “There wasn’t a whole lot of framing around poverty, yet that legislation did more for low- and moderateincome families than any legislation in many years,” says Robert Greenstein, director of the Center for Budget and Policy Priorities. “They just didn’t talk about it in that way, in the way that it got talked about in the ’60s—and frankly, I don’t think they thought about it that way, either.”

Post-stimulus, administration officials say, the anti-poverty agenda is embedded in the big priorities of health care and education reform and in the rest of Obama’s proposed budget. The administration is committed to funding only what has been shown to work—for one thing, officials want better research on job-retraining programs. Even with the housing- and stock-market crashes, the White House remains interested in finding ways to promote wealth and asset accumulation. With welfare reform up for reauthorization next year, advisers are monitoring how the safety net, which is built around work requirements, holds up as jobs disappear. Above all, the focus is on the next generation—home visits for new mothers, early childhood education,

“promise neighborhoods” modeled on the Harlem Children’s Zone. There is also more talk now about how to get absent fathers back in children’s lives. “There’s a little bit of writing-off the adults, as we’ve learned that it’s very hard to change their life course. There are some supports there, but [the administration] is really focused on the youngest generation.” says Lynn Karoly, a RAND Corporation researcher.

It remains to be seen whether the administration will be able to find the money and public support for this agenda.

Isabel Sawhill of the Brookings Institu-

a question about urban joblessness at his June 23 press conference. “That’s what my strategy is focused on.”

There is precedent for that view. As William Julius Wilson often reminds us, the employment boom of the late 1990s was as effective a poverty-reduction policy as the country had seen in years.

But already there are those who see in this broader framing yet another subtle shirking off of the poor. Donald Norris, a University of Maryland, Baltimore County, political scientist and editor of a 1995 book on welfare reform, sees it as a bad omen that Obama has so far been unable to push some of his progressive tax reforms through Congress. Poverty is “not an issue that America cares about at this moment. If you can’t get traction on that with Democrats, there’s little hope that you can get traction with it in other parts of the country,” Norris says.

“Obama hasn’t touched it, and he’s politically smart not to touch it.”

Watching from afar in his Chapel Hill, North Carolina, mansion, Edwards basically agrees. He says his explicit framing

Edwards addressed the issue of poverty most explicitly, but it’s now up to Obama to assume the anti-poverty mantle. tion argues that the only way the administration can pay for key initiatives in early childhood development and worker training is by making unpopular decisions in other areas, such as reducing Medicare and Social Security for wealthy retirees.

It will be a difficult sale, she says.

Administration officials concede it has been easier to expand the safety net at a time when the fear of poverty is more present for Americans—recent polls have shown a clear uptick in support for the poor. But the officials are more optimistic than Sawhill about their agenda’s postrecession prospects. In fact, they say, real progress on poverty will not happen until the economy is in a stronger position, providing jobs for low-income workers and tax revenues for social uplift. “The most important thing I can do is lift the economy overall,” Obama said in response to

of poverty was never intended as a winning campaign tactic. People in poverty “are not the slightest bit interested in political strategy—they want to know, will they have a chance, will someone stand up for them,” he says. “I believe someone needs to stand up for them and live with the consequences. If that means it’s not couched in the right political language or not comfortable enough, well, these people don’t live in any comfort; they live in fear. For the world to respond, we have to feel it in our gut. It can’t be politically comfortable, it can’t just be on the editorial page of The New York Times; it has to be in our lives, inside of us.”

He says he believes it is inside of Obama. tap Alec MacGillis is a Washington Post staff writer. the american prospect

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