Working Our Way Out of Poverty

Transcription

1 Working Our Way Out of Poverty David Riemer Senior Fellow Community Advocates Public Policy Institute Milwaukee, WI NCSL Annual Conference Seattle, Washington August 3, 2015 d Working Our Way Out of Poverty

2 The Poverty Drop and Poverty Plateau Source: U.S. Census Bureau 2

3 Who is Poor? 27 million adults 8 million adults

4 Work-Centered Policy Package 4

5 Make Work Available Policy 1: Create a Transitional Jobs Program: Program: For unemployed & underemployed, ages Not incarcerated or receiving Social Security, SSDI, or SSI Opportunity to work in a minimum wage TJ, up to 30 weeks Min. 8 hours, max. 40 hours per week 5

6 Make Work Pay Policy 2: Increase in the Minimum Wage: Raise the minimum wage to $10.10 per hour as of 2015 (indexed for inflation) 28% increase through 2010 baseline year $7.25 $

7 Make Work Pay Further Policy 3: Reform the EITC Roughly $4,000 increase Remove marriage penalty 7

8 Reduce Obstacles to Work Policy 4: Strengthen Child Care Funding: Guaranteed subsidized child care for every family below 150% of official poverty line 8

9 Help Retired Seniors and Adults with Disability Income Policy 5: Secure Retirement and Disability Income Tax Credit: Eligibility Criteria: Income from Social Security, SSDI, or SSI Age 18+ and not a dependent of another taxpayer Credit Amount: Equals = 150% of Federal Poverty line - Sum of Social Security + SSDI + SSI + SNAP + Federal AGI (if positive) 9

10 Results? Reducing Poverty in the United States February Kye Lippold, Research Associate

11 SPM Poverty Rate Stand-Alone Policies = Small Impact 16% 14% 12% 10% 8% 6% 4% 2% 0% Baseline Transiitonal Jobs Minimum Wage EITC Reform Secure Retirement Credit Child Care Subsidies 11

12 SPM Poverty Rate Entire Package = Dramatic Impact: Poverty Reduced by 50% + 16% 14% 14.8% 12% 10% 8% 6% 7.4% 4% 2% 0% Baseline Policy Package 12

13 SPM Poverty Rate Impact by Age 18% 16% 14% 15% 16% 14% 15% 12% 10% 8% 6% 7% 6% 9% 7% 7% 6% 6% 5% 4% 2% 0% All Persons Age < 18 Age Age 65+ Baseline Community Advocates Package - Low TJ Take-Up Community Advocates Package - High TJ Take-Up 13

14 SPM Poverty Impact by Race & Ethnicity 30% 28% 25% 22% 20% 15% 15% 15% 16% 10% 10% 7% 7% 7% 5% 4% 0% All Persons White Black Hispanic Other 14

15 $332 Billion Cost in Perspective (Percent of Other Spending) 15

16 State Progress 16

17 City Increases in Minimum Wage 17

18 State Progress 18

19 Opportunities for State Legislatures Short-Term (1) Convert TANF/SNAP Benefits into Wage-Paying Jobs Enact state legislation enabling recipients of TANF and SNAP benefits to voluntarily convert their monthly cash grants into wages earned for performing useful wage-paying work in Transitional Jobs. Benefits: -- Higher income (since EITC can be claimed); -- Potentially faster movement from welfare to unsubsidized employment thus lowering state costs because: - Real work experience often improves self-confidence and results in positive employer references, and - Transitional Job employer may actually hire; -- Private sector creation of new jobs May require federal waivers or law changes 19

20 Opportunities for State Legislatures Short-Term (2) Establish State Pilots of Entire Policy Package Enact state laws, and obtain federal waivers or law changes (if needed) Select valid control and experimental groups in urban neighborhoods and rural counties Offer experimental group the entire policy package Compare results for control vs. experimental groups, looking at both: - Economic outcomes: employment, earnings, income, poverty; - Other outcomes: CJ activity, health, education, marriage Long-Term Enact state legislation that translates each component of policy package into law. 20

21 Questions and Answers Community Advocates Public Policy Institute 728 North James Lovell Street, Milwaukee, WI David Riemer, Senior Fellow, Conor Williams, Economic Policy Analyst, Julie Kerksick, Senior Policy Advocate, Community Advocates publications: ty/ Urban Institute report: Reducing Poverty in the United States, February 2015, 21