A Roadmap to Reducing Child Poverty

February 28, 2019

The National Academies of Science, Engineering, and Medicine (NASEM) has released “A Roadmap to Reducing Child Poverty,” a new report supported in part by the Russell Sage Foundation that provides a comprehensive analysis of child poverty in the United States today. The report offers a series of detailed policy options for reducing the child poverty rate by half over the span of ten years. The report, commissioned from NASEM by Congress in December 2015, is authored by a committee of leading poverty experts and chaired by RSF author (Whither Opportunity?) and former visiting scholar Greg Duncan (University of California, Irvine). Among the committee members are a number of RSF authors and grantees, including J. Lawrence Aber (New York University), Dolores Acevedo-Garcia (Brandeis University), Janet Currie (Princeton University), Irwin Garfinkel (Columbia University), Hilary Hoynes (University of California, Berkeley), Robert Moffitt (Johns Hopkins University), Eldar Shafir (Princeton University), and Timothy Smeeding (University of Wisconsin-Madison).

Today the U.S. spends less to support low-income families than comparable English-speaking countries and has much higher rates of child poverty. In 2015, the child poverty rate in the U.S. was 13 percent, or about 9.6 million children. As the committee notes, poverty—particularly when it occurs during early childhood—has serious consequences for children’s life outcomes, and is associated with lower educational attainment, difficulty obtaining steady, well-paying employment, and greater likelihood of risky or criminal behavior. This combination of reduced productivity, increased crime, and higher health expenditures is estimated to cost between 4 to 5.4 percent of GDP, or between $800 billion and $1.1. trillion annually. “The future prosperity of our country depends on our children growing up to be healthy and productive adults,” committee chair Duncan said in a statement. “The fact that nearly 10 million children are living under the poverty line compromises their development and future prospects.”

In their review of current safety net programs, the committee found that many federal programs designed to alleviate poverty—either directly, by providing income transfers, or indirectly, by providing food, housing, or medical care—have been shown to improve child well-being. Specifically, they found that:

  • Periodic increases in the generosity of the Earned Income Tax Credit program have improved child educational and health outcomes.
  • The Supplemental Nutrition Assistance Program (SNAP) has improved birth outcomes as well as many important child and adult health outcomes.
  • Expansions of public health insurance for pregnant women, infants, and children have led to substantial improvements in child and adult health, educational attainment, employment, and earnings.
  • While evidence on the effects of housing assistance is mixed, children who were young when their families received housing benefits that allowed them to move to low-poverty neighborhoods had improved educational and adult outcomes.

As the committee notes, without these benefits, the child poverty rate, including the deep poverty rate, would be much higher. However, such programs would need to be expanded or supplemented in order to reduce the number of children in poverty by half. 

To achieve that goal, the committee examined ten different policy programs, ranging from work-based initiatives (such as tax credits and raising the minimum wage) to expansions of existing social safety net programs (SNAP, SSI) to adopting models used in other countries, such as a universal child allowance. Their simulations showed that while a $3,000 child allowance would produce the largest poverty reduction, no single program considered would meet the goal of reducing child poverty by half over ten years:

Yet, the committee also found that bundling a number of initiatives and programs could significantly reduce child poverty to the desired threshold. “The real innovation in the committee’s work was to develop packages of programs combining different elements—some increasing work, others decreasing child poverty—that meet the overall 50 percent reduction in child poverty goal while at the same time increasing employment among low-income adults,” said Duncan. Two policy packages in particular met the goal of reducing both poverty and deep poverty by half:

  • means-tested supports and work package combining expansions of the EITC and the Child and Dependent Care Tax Credit (CDCTC) with expansions of SNAP and housing vouchers.
  • universal supports and work package combining a child allowance, a new child support assurance program, an expansion of the EITC and CDCTC, an increase of the minimum wage, and the elimination of the immigrant eligibility restrictions imposed by the 1996 welfare reform.

As the committee points out, though the above policy packages would require an investment $90 to $100 billion per year, that cost is still lower than the estimated macroeconomic cost of child poverty ($800 billion to $1 trillion annually). “Acting on this report’s conclusions and recommendations has the potential not only to reduce child poverty, but also to build a healthier and more prosperous nation,” they write.

Read the report from NASEM.


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