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Great Recession

How Did Children and Families Fare During the Great Recession?

August 24, 2016

Many working families continue to struggle in the aftermath of the Great Recession, the deepest and longest economic downturn since the Great Depression. A new book from RSF, Children of the Great Recession, explores in depth the effects of the recession on parents and young children. The book is now available in full for free download from the foundation.

In Children of the Great Recession, a group of leading scholars draw from the Fragile Families & Child Wellbeing Study, a unique survey of nearly 5,000 economically and ethnically diverse families in twenty cities. By exploring the discrepancies in outcomes between these families—particularly between those headed by parents with college degrees and those without—this timely book shows how the most disadvantaged families have continued to suffer as a result of the Great Recession.

For example, in their chapter, Irwin Garfinkel and Natasha Pilkauskas examine changes in families’ household income, poverty levels, and economic insecurity throughout the first decade of the twenty-first century. They estimate the relationship between the local unemployment rates for parents in the study and their economic well-being, then use this estimate to predict what the economic well-being of these families would be given an increase

Strengthening the Safety Net to Mitigate the Effect of Future Recessions

May 10, 2016

On Monday, May 23, 2016, RSF president Sheldon Danziger and several RSF grantees and scholars will participate in a policy forum on strengthening the social safety net, hosted by the Hamilton Project at the Brookings Institution in Washington, D.C. The event will focus on three new papers released by the Hamilton Project that explore the effects of the 2008 fiscal stimulus designed to combat the Great Recession. Forum participants will discuss whether the stimulus contained the correct mix of tax cuts and targeted government spending, and whether it optimally utilized income support programs—notably TANF and SNAP—to stabilize the economy and protect millions of households from falling into poverty.

The first panel in the forum will discuss a proposal to strengthen the safety net through improvements to SNAP by RSF Visiting Scholar James P. Ziliak (University of Kentucky), and a proposal to make TANF more effective in serving needy families during economic downturns by incoming RSF Visiting Scholar Hilary Hoynes (UC Berkeley) and Marianne Bitler (UC Davis). RSF president Sheldon Danziger will speak on the panel along with Congressman Jim McGovern (Massachusetts) and Robert Greenstein (Center on Budget and Policy Priorities). The discussion will be moderated by RSF grantee Diane Whitmore Schanzenbach (Hamilton Project).

The second panel will focus on a new proposal by RSF author and former trustee Alan S. Blinder (Princeton University) that examines how to better leverage fiscal policy to mitigate the effects of future recessions. Blinder will be joined by panelists Cecilia Muñoz (White House Domestic Policy Council), Marc H. Morial (National Urban League), Alice M. Rivlin (Brookings Institution), and moderator Roger C. Altman (Evercore).

New Report: Growing Inequality Affects How Americans View Themselves and Others

February 26, 2016

The latest issue of the Annals of the American Academy of Political and Social Science contains an article by former Visiting Scholar Michael Hout (University of California, Berkeley), based on research partly funded by the Russell Sage Foundation. During his time at the Foundation, Hout studied trends in social mobility in the U.S. since the 1970s, looking in particular at the decline in upward social mobility and the rise of downward social mobility.

In his new report for the Annals, Hout examines the effects of the Great Recession, and of growing income inequality in general, on the psychological well-being of Americans. The abstract states:

Dozens of past studies document how affluent people feel somewhat better about life than middle-class people feel and much better than poor people do. New analyses of the General Social Surveys from 1974 to 2012 address questions in the literature regarding aggregate responses to hard times, whether the income-class relationship is linear or not, and whether inequality affects happiness. General happiness dropped significantly during the Great Recession, suggesting that the income-happiness relationship might also exist at the macro level. People with extremely low incomes are not as unhappy as a linear model expects, but there is no evidence of a threshold beyond which personal happiness stops increasing. Comparing happiness over the long term, the affluent were about as happy in 2012 as they were in the 1970s, but the poor were much less happy. Consequently, the gross happiness gap by income was about 30 percent bigger in 2012 than it was in the 1970s. A multivariate model shows that the net effect of income on happiness also increased significantly over time.

New Recession Briefs Investigate Great Recession’s Effects on Parents’ Health, Assets of Families with Children, and More

January 5, 2016

In 2014 the Russell Sage Foundation completed a major initiative to assess the effects of the Great Recession on the economic, political, and social life of the country. Officially over in 2009, the Great Recession is now generally acknowledged to be the most devastating global economic crisis since the Great Depression. Prolonged economic stagnation is likely to transform American institutions and severely erode the life chances of many Americans. To understand these effects across a broad swath of social and economic life, the Foundation identified 15 areas of inquiry—such as retirement, education, income and wealth—and funded proposals for innovative projects from a distinguished team of scholars.

Four new Recession Briefs summarizing research from the Great Recession initiative now are available for download. These reports include investigations of the impact of the recession on the health of families with children, research on changes to the criminal justice system as a result of the recession, and an analysis of the recession’s impact on car and home ownership, particularly for minority families.

New Reports Investigate the Effects of Recession on Parenting, Private Safety Net, and Public Assistance

March 30, 2015

The Russell Sage Foundation recently completed a major initiative to assess the effects of the Great Recession on the economic, political, and social life of the country. Officially over in 2009, the Great Recession is now generally acknowledged to be the most devastating global economic crisis since the Great Depression. Prolonged economic stagnation is likely to transform American institutions and severely erode the life chances of many Americans. To understand these effects across a broad swath of social and economic life, the Foundation identified 15 areas of inquiry—such as retirement, education, income and wealth—and funded proposals for innovative projects from a distinguished team of scholars.

Three new Recession Briefs summarizing research from the Great Recession initiative now are available for download. These reports use data from the Fragile Families and Child Wellbeing Study (FFCWS) in order to analyze the effects of the Recession on families in the U.S.:

New York Times and TIME Magazine Discuss New RSF Research

July 29, 2014

The New York Times and TIME magazine recently covered a new study by Fabian T. Pfeffer, Sheldon Danziger, and Robert Schoeni, released as part of the Russell Sage Foundation’s Recession Trends collaboration with the Stanford Center on Poverty and Inequality. In the study, the authors explore the extent to which the Great Recession altered the level and distribution of American families’ wealth. Their research concludes that for typical American households, net worth fell by about a third between 2003 and 2013. Yet, as Anna Bernasek notes in the NYT, “The Russell Sage study also examined net worth at the 95th percentile. (For households at that level, 95 percent of the population had less wealth.) It found that for this well-do-do slice of the population, household net worth increased 14 percent over the same 10 years.” In other words, the study uncovers not just the losses sustained by American households during the Recession, but also the troubling and still-growing increase in wealth inequality in the U.S.

The New York Times also recently highlighted new research by Andrew Cherlin, a former Visiting Scholar and the author of Labor’s Love Lost (to be published by the Russell Sage Foundation in December 2014). In his forthcoming book, Cherlin offers a new historical assessment of the rise and fall of working-class families in America, demonstrating how momentous social and economic transformations have contributed to the collapse of this once-stable social class and what this seismic cultural shift means for the nation’s future. As Cherlin explained to the Times, in the 50s and 60, most working class families were sustained by a male breadwinner. But the collapse of industrial blue-collar jobs and the increase in the number of women in the workforce have eroded this family structure.

Wealth Levels, Wealth Inequality, and the Great Recession

June 23, 2014

In a new Recession Brief for the Recession Trends initiative, Fabian T. Pfeffer (University of Michigan), RSF president Sheldon Danziger, and Robert F. Schoeni (University of Michigan) explore the extent to which the Great Recession altered the level and distribution of American families’ wealth, looking at the period between 2007 and 2013. While the Recession had a major impact on the net worth of families across the socioeconomic spectrum, it disproportionately affected households at the bottom of the wealth distribution. These households lost the largest share of their total wealth. As a result, wealth inequality in the US has been significantly exacerbated since the onset of the Recession. As of the end of 2013, the authors note that there have been few signs of significant recovery from the downturn.

New Working Paper Explores Low-Income Families’ Use of Social Safety Net Programs During the Great Recession

June 3, 2014

In a new working paper for the Great Recession Initiative, Robert A. Moffitt of Johns Hopkins University explores the extent to which families that participate in the Supplemental Nutrition Assistance Program (SNAP)—or food stamps—also receive benefits from other federal aid programs, such as Supplemental Security Income (SSI) or Social Security Disability Insurance (SSDI). As he finds, in 2008, 76 percent of families receiving SNAP also participated in at least one other major benefit, excluding Medicaid. However, over half of these only received one other benefit and only a very small fraction received more than two others.

As Moffitt explains, analyzing SNAP families’ participation in additional social safety net programs is crucial for understanding the other needs of SNAP households—such as whether these households tend to include family members with disabilities—or if overall, they simply have such low income that they require additional support for other expenses such as housing and medical care. Noting that policy analysts and scholars have long expressed concerns that the receipt of multiple programs may have negative effects on work incentives, Moffitt also investigates whether multiple-program participation by SNAP families deters household members from seeking employment.

New RSF Research Examines the Effect of the Recession on State Tax Revenues

February 13, 2014

New research funded by the Russell Sage Foundation sheds important light on the impact of economic downturns on state tax revenues. In 2007, on the eve of the recession, 49 percent of state tax revenues came from consumption taxes, and 32 percent from income taxes. Conventional wisdom has held that since consumption is more likely to remain stable than income during economic recessions, revenue from consumption taxes will similarly be less volatile than revenue from income taxes.

A Broken Public? Americans’ Responses to the Great Recession

November 25, 2013

Clem Brooks and Jeff Manza have published an article—“A Broken Public? Americans’ Responses to the Great Recession”—in the latest issue of the American Sociological Review. The paper, funded by the Russell Sage Foundation’s Great Recession Initiative, examines why support for income transfer policies among the American public declined between 2008 and 2010. Here is the abstract:

Did Americans respond to the recent Great Recession by demanding that government provide policy solutions to rising income insecurity, an expectation of state-of-the-art theorizing on the dynamics of mass opinion? Or did the recession erode support for government activism, in line with alternative scholarship pointing to economic factors having the reverse effect? We find that public support for government social programs declined sharply between 2008 and 2010, yet both fixed-effects and repeated survey analyses suggest economic change had little impact on policy-attitude formation. What accounts for these surprising developments? We consider alternative microfoundations emphasizing the importance of prior beliefs and biases to the formation of policy attitudes. Analyzing the General Social Surveys panel, our results suggest political partisanship has been central. Gallup and Evaluations of Government and Society surveys provide further evidence against the potentially confounding scenario of government overreach, in which federal programs adopted during the recession and the Obama presidency propelled voters away from government. We note implications for theoretical models of opinion formation, as well as directions for partisanship scholarship and interdisciplinary research on the Great Recession.

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