The November issue of the Annals of the American Academy of Political and Social Science examines the aftermath of the Great Recession and the ways in which federal and state policies affected the course of the crisis. The issue includes an introduction by Russell Sage Foundation president, Sheldon Danziger, and features contributions from a distinguished group of leading social scientists, including several papers by scholars who contributed research to the Foundation’s Great Recession Initiative.
As Danziger outlines in his introduction, the Great Recession—which the National Bureau of Economic Research officially dates as lasting from December 2007 through June 2009—marks the most severe economic downturn since the Great Depression in the 1930s. In looking at the lingering effects on the housing market, unemployment rate, and an ever-widening wealth gap, research from the issue documents the significant social and economic costs of the recession—effects that are likely to persist for at least another decade.
The Russell Sage Foundation’s Great Recession Initiative provided support for many of the papers published in this issue of the Annals. Established in 2010, the Great Recession Initiative is a major research project which examines the effects of the Great Recession across a broad swath of America’s social and economic life. Moving beyond a simple description of trends, the Initiative analyzes some unanticipated implications of the downturn and uses a variety of methods and datasets to investigate many of the vexing and often unprecedented policy problems posed by the economic disruption, such as the slow recovery of the labor market and the rightward drift of political sentiment. In collaboration with the Stanford Center on Poverty and Inequality, the Foundation also launched the Recession Trends website as part of the Initiative, a resource dedicated to monitoring the social and economic fallout of the recession.
Last week, the federal government unveiled its online health insurance marketplace, a milestone in the implementation of the Affordable Care Act. While much of the media coverage has focused on the technical glitches of the online portal—thousands of Americans reported long wait times, for example—a more fundamental policy question is at stake. The Obama Administration has argued that presenting insurance plans to consumers in one place and in a transparent fashion will spur competition among insurers, lower costs, and ultimately improve satisfaction. But what do we actually know about how consumers choose their health insurance plans? The stakes are high: If consumers choose wrongly, they may incur higher costs and premiums, and the federal government, which will subsidize these plans, may end up footing a larger bill. In this case, more competition may not lead to lower health care costs.
A new paper, published with the support of the Russell Sage Foundation, provides worrying evidence that consumers choosing health insurance are often prone to errors, over-confidence, and cost biases. The authors, Eric Johnson, Tom Baker, and Ran Hassin and their colleagues, used a model of the online health exchanges to test consumer decision-making. They asked subjects to pick a health insurance plan for a family of three, with a particular number of doctor visits and out-of-pocket health care costs over the next year. The results were dismal: When asked to choose among four plans, subjects selected the cost-effective option only 42 percent of the time, with the average error costing over $200. When presented eight options, subjects selected the correct option 21 percent of the time.
Steven Raphael is Professor of Public Policy at the University of California, Berkeley. Michael A. Stoll is Professor of Public Policy at the University of California, Los Angeles. They are the authors of Why Are So Many Americans in Prison?, a new book published by the Russell Sage Foundation that analyzes the shocking expansion of America’s prison system and illustrates the pressing need to rethink mass incarceration in this country.
Attorney General Eric Holder’s announcement last month that federal prosecutors will no longer seek stiff mandatory minimum sentences for low-level drug offenders marks a momentous shift in U.S. sentencing practices. After three decades of state and federal policy makers ratcheting up the severity of punishment for felony offenders, this is perhaps the most high profile example of policymakers across the country reevaluating the merits of these unusually harsh sentences. This is a welcome shift in policy that hopefully will be followed by state legislators across the country.
Legacies of the War on Poverty, a new book co-edited by Martha Bailey and Sheldon Danziger (Russell Sage Foundation, September 2013), offers a timely assessment of the War on Poverty, highlighting some remarkable policy successes of President Johnson’s antipoverty reforms in the 1960s—many of which still form the basis of the social safety net as we know it today. As we approach the fiftieth anniversary of Johnson’s 1964 State of the Union address—the speech in which he declared an “unconditional war on poverty”—we will feature research and additional author insights from the book in an ongoing Q&A series on the RSF blog.
Our first interview is with Jane Waldfogel, professor of social work and public affairs at the Columbia University School of Social Work and author of the chapter “The Safety Net for Families with Children.” Waldfogel’s research examines the lasting effects of War on Poverty initiatives for low-income families with children, focusing on three enduring areas of the Johnson administration’s efforts to provide support for poor families, including food assistance benefits, cash welfare, and employment-contingent income support. A policy brief on the research from her chapter can be found here.
Q. Your chapter in Legacies of the War on Poverty illustrates the success of Food Stamps-SNAP in reducing food insecurity and lowering poverty rates (when using the Supplemental Poverty Measure). Yet, the House recently passed a bill that would cut SNAP by almost $40 million. What kinds of political shifts have occurred between the start of the War on Poverty and today that would account for this dramatic turn?