How to Fix Child Poverty

It’s been three decades since the Annie E. Casey Foundation published its first Kids Count report, an annual collection of statistics on child well-being attractively packaged and broken up by state to maximize local coverage. (The most recent edition tells West Virginians that they lead the nation in teens who are not in school or working and New Mexicans that a quarter of their children live in high-poverty neighborhoods.) After the presidency of Ronald Reagan had filled the airwaves with images of crack houses and tales of welfare queens, Kids Count was part of an advocacy effort to reframe the poverty debate around children. The reasons were clear: “kids” were sympathetic in a way that “poor people” were not.

The strategy enjoyed some success, most notably in expansions of children’s health insurance, largely financed by the federal government. But for the most part the poverty debate stayed focused on adults, especially after Bill Clinton captured the White House in 1992 with a pledge to “end welfare as we know it.” Conservatives insisted that poor adults work more, and liberals sought to “make work pay”—pay better, that is, through tax credits, child care, and increases in the minimum wage. The politics of poverty has continued to focus mostly on adults, with America’s high levels of child poverty largely ignored. It took coronavirus to bring the problem back into view, as child hunger reached levels three times higher than the worst of the Great Recession—a reminder of just how vulnerable America’s poor children are.¹

In talking with scholars over the past year, I’ve been struck by how many substantive reasons there are for focusing on poor kids—even more now than three decades ago. Neuroscientists have shown how much of a child’s developmental trajectory is set during the first few years of life, before children even start school. Economists have shown that even a brief episode of poverty, especially in early childhood, can have life-long consequences—leading to fewer years of education, lower earnings, and worse health in adulthood. It’s also become harder to excuse America’s exceptional child poverty by arguing that the US enjoys exceptional mobility compared to other rich countries—that the poor have more chances to rise. Research suggests the American advantage in class fluidity has declined or disappeared, if it ever truly existed. Other rich countries, including the United Kingdom and Canada, have proven that child poverty can be cut and offered examples of how to cut it. A favorite tool is a cash grant known as a child allowance, a guaranteed income for families with kids. After Canada began offering up to $6,400 a year per child, its child poverty rate fell by a third.

Among those arguing for a child allowance is Jeff Madrick, a progressive journalist focused on economics, whose new book, Invisible Americans, is a call to action on child poverty. There is broad support among congressional Democrats for an American allowance, with a majority of the party in both chambers on board. (Notable supporters range from House Speaker Nancy Pelosi, a California progressive, to Senator Michael Bennet, a Colorado centrist, though Joe Biden has not taken a stance.) Columbia University’s Center on Poverty and Social Policy estimated that a grant of $3,000 per child ($600 more for children under six) would have reduced child poverty in the US, before the pandemic, by 42 percent—among black children by 52 percent.

The chances of enacting a child allowance are unclear—though it once seemed a long shot, we’re living through an upheaval in which assumptions of what’s politically plausible are rapidly shifting. Congress has already spent trillions to stimulate the economy and replace income lost in the coronavirus crisis. How much the expanded aid will constrain the rise in poverty is unknown. In mid-May Democrats proposed spending another $3 trillion, and included a child allowance in the plan. Republicans dismissed the overall proposal as profligate. Yet if the Democrats capture Congress in November and Biden wins the White House, one can imagine a bill that creates a child allowance meeting his willing pen.

A report published last year by the National Academies of Sciences, Engineering, and Medicine is an essential document for understanding child poverty in this atmosphere of crisis. Called A Roadmap to Reducing Child Poverty, it came together in unlikely fashion after two House Democrats (Barbara Lee and Lucille Roybal-Allard, both of California) persuaded the Republicans who controlled Congress in 2015 to fund a study of ways to reduce child poverty by half in ten years, as the United Kingdom had done under Tony Blair. The academy, which was founded in 1863, convenes ad hoc groups of prominent scholars to give the government scientific advice. The panel of fifteen was led by Greg Duncan, a distinguished economist from the University of California, Irvine and a careful empiricist, and included several conservatives, most notably Ron Haskins, a policy analyst and former Republican congressional aide who wrote the 1996 law “ending” welfare. The Roadmap is a work of consensus and scholarship, not liberal advocacy.

Had nothing else come of it, the report would have been worth the effort simply for three pages of revised data that show that child poverty rates have already fallen in half since the 1960s, when President Lyndon B. Johnson declared his “war on poverty.”² That finding undercuts a major tenet of modern conservativism: that the government’s antipoverty programs—food stamps, housing aid, health insurance, child care, job training, and the like—have been futile or worse. “The Federal government declared war on poverty, and poverty won,” Ronald Reagan said in 1988 to devastating effect. His argument, that government cannot reduce poverty and that it is harmful to try, has been passed down among conservative politicians as if on granite tablets. Newt Gingrich, who in 1995 became the first Republican Speaker in four decades, claimed that “after the War on Poverty programs were adopted, the years-long decline in American poverty suddenly stopped.” One of his successors, Paul Ryan, recycled the same notion while casting himself as a fresh antipoverty thinker. “Washington has spent trillions of dollars on dozens of programs to fight poverty,” he said in 2016, “but we have barely moved the needle.” To such claims, the academy implicitly and decisively responded, “Bunk.”

You’d think the answer to a question as basic as whether child poverty has declined would be clear—a starting point for debate, not a subject of debate. But the measurement of poverty in America is plagued by technical and ideological disputes. The Census Bureau’s Official Poverty Measure, which dates back to the 1960s, has become all but meaningless, since it counts only a family’s cash income before taxes. This ignores most of the aid that poor families get, which now arrives either in non-cash form (such as food stamps and subsidized housing) or through the tax code (most significantly, the refundable earned income tax credit, which delivers a cash bonus of up to $6,600 year). So by official standards, a family that gets $10,000 a year from food stamps and tax credits is just as poor as if it had received nothing. If hundreds of billions in antipoverty spending doesn’t appear to be reducing poverty, that’s because the statisticians don’t count it.

Recognizing this, the Census Bureau in 2011 began publishing a Supplemental Poverty Measure that includes a fuller accounting of benefits and taxes and also local variations in the cost of living. The government hasn’t gone back to create a historical series using this fuller poverty measure, but a team of scholars has.³ Drawing on their work, the academy found that child poverty, more accurately measured, has fallen from 28.4 percent in 1967 to 15.6 percent in 2016. By contrast, the official measure shows that over this period child poverty slightly rose.

The implications of this revision are profound. Child poverty, prepandemic, remained too high—much higher than in comparable countries. But the halving of child poverty makes it hard to sustain the conservative critique that we fought a “war on poverty, and poverty won.” To continue the military metaphor, a half-victory might demand a surge and not a surrender. Appreciating the efficacy of the safety net has only become more important in the midst of a pandemic that has crippled the economy and increased hardship.

Congress asked the academy to assess how much damage poverty does to kids. The question is harder to answer than it might seem. It’s clear that children raised in poverty suffer worse outcomes, like lower earnings and less educational achievement. But correlation isn’t causation. What hasn’t been certain is whether the lack of money itself harms children or whether other problems that harm children also cause the lack of money. Parental depression, for instance, might be the root cause of a child’s problems, and the family’s poverty might be a separate manifestation of the parent’s mental health. A poor mother’s lack of education might be what hampers her child in school, rather than her low income per se. If it is a lack of money that holds children back, a check might provide the solution. But if poverty is merely a symptom of other issues, money might not help; with problems like addiction, it might even hurt.

Over the last ten years or so, researchers have made special efforts to isolate the effect of income in the lives of poor families. They’ve done so in part by capitalizing on “natural experiments,” like sudden expansions of aid for one group of people that allow comparisons with other, similar groups. Evaluating this body of research, the academy delivered twin verdicts: “income poverty itself causes negative child outcomes,” and programs that raise incomes “improve child well-being.”

Translation: money matters.

The evidence comes from eclectic sources. One group of scholars found that in families receiving the earned income tax credit (EITC), children’s math and science scores had risen to a degree that predicted they would gain an additional $40,000 in lifetime income. Another research team, looking at Supplemental Security Income, a disability program, found that low-birthweight babies whose families got payments, about $650 a month, improved their motor skills more rapidly than slightly heavier babies who did not qualify. Since the heavier, healthier babies on average should have suffered fewer developmental delays, the faster progress of the lower-birthweight babies makes money seems especially significant. Yet another research effort isolated the effect of income by studying a program of casino payments that gave thousands of dollars a year to Eastern Cherokee families but nothing to their nontribal neighbors. The children in families that got the payments were significantly less likely as young adults to abuse alcohol, suffer psychiatric problems, or get arrested, and they were 15 percent more likely to finish school. That different scholars studied different programs but reached similar conclusions only bolsters researchers’ confidence that raising incomes helps poor kids.

The academy is careful not to overstate what income support achieves. The evidence that increased income boosts children’s long-term prospects isn’t uniform, and the impact often isn’t big. A modest ($1,000) increase in the EITC brought a modest (6 percent of a standard deviation) gain in math and reading scores. On the other hand, the EITC has rapidly grown, so its impact may likewise have grown. (Of course there are other reasons to help poor kids—eliminating hunger is good, even if it doesn’t raise test scores.)

Advocates for safety net programs may wish the evidence was more consistent and the gains more profound. But progress rarely arrives in leaps; it collects like compound interest, a few cents at a time. If the US benefits modestly from its safety net, it spends modestly, too. Federal spending on families with children is less than one percent of GDP, not even half the average among the thirty-six countries in the Organization for Economic Cooperation and Development. Australia spends nearly 3 percent; Ireland and the United Kingdom spend more. To an extent few Americans realize, high child poverty rates are a result of policy choices.

The largest federal expenditure on children comes through the child tax credit, which has expanded rapidly with little public notice and largely leaves out the poorest families. The Republican tax bill of 2017, Donald Trump’s most notable domestic achievement, doubled its value to $2,000 per child and extended it to families with annual earnings as high as $400,000. The credit now costs the government $127 billion a year, more than food stamps and the EITC combined.

But because it phases in as earnings rise, the neediest get the least benefit: a single parent with two children needs to earn about $30,000 to fully qualify. About 35 percent of children fail to receive the full credit because their parents earn too little.⁴ A quarter receive a partial payment, and 10 percent get nothing. Among those failing to receive the full amount are half of Latinos, 53 percent of blacks, and 70 percent of single mothers.

Republicans say the program is mostly a tax cut, not an antipoverty measure, so it’s appropriate that those who pay more in taxes reap the biggest reward. Most Democrats say it’s perverse to spend vast sums on children’s subsidies while shortchanging those with the greatest need. They would convert the tax credit, which is based on earnings, to a child allowance for all poor and moderate-income families—ideally in a monthly check, to smooth out income swings. Simply giving the current $2,000 child tax credit to all low-income kids, the academy found, would cut child poverty by about a quarter. With a few lines of altered tax code, Congress could do it in a snap.

There are thirty-seven congressional districts, in twenty-two states, where half or more of the children live in families with earnings too low to receive the full child tax credit—meaning they earn less than about $15 an hour. Last fall I took a trip to one of them, the Louisiana Fifth, which stretches north from Cajun country to the Arkansas border and includes the city of Monroe.⁵ I was curious to learn what childrearing was like for families too poor to get the full credit and what difference $2,000 a year might make.

In Monroe, I met a teacher’s aide named Letha Bradford who lives with her teenage sons, Tony and Micah, in a small rental home with plaques of biblical verses on the wall. Bradford has worked in the public schools for more than a decade but earns just $16,000 a year, which brings her a credit of about $1,000 per child—half as much as families higher up the income ladder. She receives other benefits but told me money was so tight that she listened to Tony’s football games in the stadium parking lot to save the entrance fee. After storms flooded thousands of homes in the city a few years ago, including theirs, the three of them spent months living in their car. Bradford and her sons told this story in good cheer with asides about finding safe parking lots to sleep in and the locations of public toilets.

One question in the debate over child allowances is whether poor families will spend the money in ways that help their children. I paid special attention, then, when Bradford said that despite her punishing budget she had been using her tax refunds to send the boys on annual Boy Scout trips, which had taken them to forty-two states, including Alaska and Hawaii. “I’m trying to instill in them that education gives you knowledge and power,” she said. To prepare for a trip to the Vietnam Veterans Memorial in Washington, their troop leader made the boys write an essay about a Monroe man killed in the war. When Micah found the name of the man he wrote about on the wall, he said, it felt like “touching history.” The report is on file at the public library.

Money—even modest sums—helps kids in part because of what it buys, like Boy Scout trips. It also helps by alleviating stress, which researchers have found can reach toxic levels in families living on so little.⁶ Despite Bradford’s extraordinary efforts, the strain on the household was evident. The car they had slept in had 300,000 miles on it and regularly stalled in traffic. Food often ran short, even with a reliance on ramen noodles. When I asked the boys whether the stress affected them, they both told the same story—how the power company’s threat to shut off the lights had left their mother so upset they couldn’t concentrate in school. Tony said, “Sometimes, the look in her eye, it’s like she’s sick, but she’s not sick, she’s just stressed. It makes me feel the same way.” Micah said his teacher chastised him for losing focus, but he didn’t explain because “I didn’t want her to look down on us, like we come from a poor family.”

The National Academies estimate that child poverty costs the country as a whole $800 billion to $1.1 trillion a year—4.0 to 5.4 percent of GDP—including lower adult earnings, worse health, and higher crime. The good news about a loss so immense is that it translates into a recommendation for investment: money spent on poor kids will likely be “very cost-effective over time.”

In formulating its plan to halve child poverty, the academy examined twenty policy options—two different-sized expansions of ten different programs (including job training, housing vouchers, and nutrition assistance). No single program expansion would do enough to achieve the 50 percent reduction. But one came much closer than the others: a child allowance. Offering families $3,000 a year per child would reduce child poverty by a walloping 41 percent. The main political hurdle, beyond the cost ($54 billion, in this prepandemic measure), is the possibility that giving people money will encourage them to work less. The academy predicts that the reduction in earnings would be tiny—about two thirds of one percent. Still, for conservatives who consider maximizing work a higher priority than reducing poverty, this could provide reason to oppose the allowance.

The academy also examined four different programmatic packages, each consisting of multiple policy changes. Notably, the one that best reflected conservatives’ goal—increasing employment—did the least to cut poverty. This “work-based” package (more job training, tax credits, and a higher minimum wage) would put nearly a million more people to work at modest cost (less than $9 billion a year) but cut child poverty by only 19 percent. Cutting child poverty “only” 19 percent, of course, would be a considerable achievement—one no prominent conservative has yet championed.

By contrast, the package that would cut poverty the most was built around a child allowance. An annual payment of $2,700 per child, coupled with work incentives (expansions of childcare, tax credits, and the minimum wage), would put an additional 600,000 adults to work and cut child poverty by 51 percent. More work and less poverty—it’s expensive, but at $112 billion a year it’s less than half of what the Trump tax cuts were estimated to cost in 2020, with the main difference being that the latter mostly helped the rich. By my rough calculation, a package like this would give Letha Bradford an extra $500 or so a month to stock the cupboards and pay the electricity bill. The academy doesn’t explicitly say that a child allowance is the indispensable tool for cutting child poverty, but it’s hard to read its report any other way. At least seventeen other wealthy countries have them.

Child allowances “are the silver bullet we need,” Jeff Madrick writes in Invisible Americans. The title nods to the book’s central argument, that child poverty is a moral and economic tragedy met with a shrug. Invisible Americans synthesizes the work of dozens of researchers (to whom it is dedicated), rather than presenting original scholarship or reportage. It’s a summons to action in the spirit of Michael Harrington, whose book The Other America, from 1962, is often credited with inspiring the War on Poverty and whom Madrick cites on the first page. Just as Harrington “awakened America,” Madrick writes:

My purposes here are to document the scourge of child poverty, the many ways it damages children and limits their possibilities, to make clear the immense irresponsibility of the world’s richest nation to tolerate basically the highest child poverty rates in the developed world, and to recommend what should be done about it.

Madrick’s answer is simple: give them money. He proposes a child allowance much larger than those the academy modeled—$4,000 to $5,000 per child a year, available to all families to broaden its political appeal, but taxable so the wealthy return a large share. When given more money, he writes, “poor children do better in school, are more likely to graduate from high school, are often more stable emotionally, are healthier, make higher wages as adults, avoid incarceration, and live longer.”

Madrick is right that most Americans don’t realize how unusual our child poverty rate is, and he is right that material hardship is more widespread than the numbers suggest. That’s because hardships like hunger and eviction plague families well above the official poverty line ($26,200 for a family of four). It’s also because many more children experience poverty at some point in their childhoods than do so in a given year. “More than one out of three American children live in official poverty for at least one year,” he notes. Madrick rightly emphasizes the long-term damage child poverty inflicts and correctly notes in passing that child poverty ranks curiously low among progressive concerns. (He doesn’t explain why, and I’m not sure I can either, beyond the obvious fact that children don’t donate or vote.) Twenty years of presidential debates had passed without a question on the issue before one made it in this year, in the New Hampshire Democratic debate, where the answers generally lacked specificity or passion. (Andrew Yang did renew his call for a guaranteed income.) By contrast, think of the detailed discussion Medicare for All received. The advocacy group First Focus finds no mention of child poverty on Joe Biden’s website.

While Madrick makes many important points, several elements of his style may limit his reach. For a book on child poverty, Invisible Americans is largely devoid of poor kids. The few who appear are mostly drawn from secondhand sources or masked behind pseudonyms. Not every work on child poverty needs fresh reporting, but some humanization here would have deepened readers’ interest and understanding.

For a sense of how advocacy and portraiture can combine with force, consider my New York Times colleague Nicholas Kristof’s reporting, with his wife, Sheryl WuDunn, on his childhood friends in Yamhill, Oregon, for their book Tightrope (2020). The five Knapp siblings, Kristof’s neighbors, were children of farmworkers who had risen “to the solid, union-fortified working class” when the rungs on the class ladder disappeared. Four of the five were dead by middle age, from forces within their control (alcohol and drugs) and forces far beyond it (falling wages and the loss of meaning in working-class life). When Kristof and WuDunn advocate a child allowance, the reader can feel the stakes. (Among other things, such financial support might have helped the Knapps’ mother escape the husband who beat her and terrorized their kids.)

Or take Alex Kotlowitz’s latest book, An American Summer (2019), which focused on a very different group of poor children, the victims (and perpetrators) of Chicago’s street violence. Kotlowitz’s reporting is so vivid it provokes a mix of outrage and sorrow on every page. “I ask, Your Honor, to be lenient to this young man,” pleads one mother at the trial of the drug dealer who killed her troubled son, knowing how easily the two might have traded places. A forgiving mother on unforgiving streets—the book is filled with such powerful scenes.

Madrick also limits his reach by adopting a dismissive tone toward those of a different ideological bent. A man of the left, he describes conservative welfare critics mostly as racists and opportunists without engaging their arguments. And he considers even center-left scholars worried about cultural or behavioral issues, like the rise of single-parent families, as “wayward liberals,” to be forgiven, perhaps, but not taken seriously. Can’t poor children benefit from both government aid and the emotional and financial support of two parents? One strength of narratives, like the stories Kristof, WuDunn, and Kotlowitz provide, is that they implicitly resist oversimplification by showing the complexity of individuals’ lives—a special value in a polarized age.

Lastly, Madrick is too reluctant to acknowledge the progress that had been made. He cites the National Academies study but is skeptical that child poverty had fallen by half since the Sixties. Were hardship properly measured, he writes, “a more likely reduction is 20 to 25 percent.” Measurement issues aside, he appears to fear that recognizing a reduction in poverty will undercut the urgency of the problem that remains. That’s understandable, but downplaying progress carries its own risk—the risk of making action seem futile (and unwittingly echoing the Reagan argument that “poverty won”). Indeed, falling poverty rates strengthen the argument that safety net programs work, a point that’s especially important now when so many are relying on them.

Still, Madrick’s book is not only valuable but more timely than he could have possibly imagined or desired. Invisible Americans performs a service: it elevates an issue of moral urgency, at times with eloquence, and makes recommendations that would benefit millions of children. “Cutting child poverty in half would be a great victory,” he writes:

It would profoundly reduce the cognitive, neurological, and emotional disadvantages of poor children, substantially improve child health on average, raise the downtrodden esteem of these children, and have constructive long-term consequences.

At times he may be preaching to the choir, but on that note—amen.