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$9 Trillion Didn't End Poverty -- What to Do?
Cato Institute | 9/3/04 | Jenifer Zeigler
At the Republican National Convention this week, there was a lot of talk about money. Pay raises for firefighters. Money for Swift Boat ads. Money to rebuild Iraq, and so on. One thing the pundits and presidential candidates didn't say much about, however, is how much money has been spent fighting the "war on poverty"--$9 trillion and counting. Yes, $9 trillion.
Yet, as the Census Bureau just reported, poverty in America is up. So what do the candidates propose we do?
Well, one candidate believes the solution is to spend more money on social programs, while the other believes the solution is to spend more money on ... social programs. Since 2000, Temporary Assistance for Needy Families (the traditional welfare program) spending has increased 6 percent. What did we get for that money? A higher poverty rate. Obviously a stagnant economy and poor job market are responsible for the increase in those living below the poverty line. However, spending more money on social programs is not raising them back out of poverty.
The best way to reduce the poverty rate is to convince people to avoid poverty in the first place by finishing school, delaying parenthood, and getting a job (any job). High school dropouts are roughly three times more likely to end up in poverty than are those who complete at least a high school education. A common reason why teens drop out of high school is out-of-wedlock births. Teenage pregnancy initiates a single mother into a life of dependency that is difficult to overcome, especially if she goes on to have additional children. Over half of welfare money is spent on families that began with a teen birth.
Getting a job as a solution to poverty may seem like common sense. Granted, not every job pays a wage that will catapult a family into the middle class. However, every job provides job experience, and that leads to a better job. Maybe today's minimum-wage, service industry employee is not on a track for management. But he is showing that he is a reliable worker who can learn and perform duties, something a future employer will value.
Despite all this common sense, Democrats refuse to endorse welfare reform that would emphasize actual work experience. They would spend money to send single moms to college or train them in a specific skill for which there may be no demand in the job market. Republicans are not doing much better by encouraging social spending on programs like marriage initiatives, suggesting that coupling off the poor will somehow raise them out of poverty. In the past 40 years, we have spent at least $8.9 trillion (in constant 2003 dollars) on the "war on poverty." Isn't it time that one of the candidates admit we cannot spend our way out of poverty?
If education, pregnancy prevention, and employment are the solutions to poverty, we need a candidate that advocates policies that promote them. Education reform, including school choice, would provide a real opportunity for children to start on an equal playing field, prevent "at risk" students from dropping out, and produce a more competitive national workforce. Pregnancy prevention programs need to educate teenagers about how to avoid pregnancy, as well as emphasize the life-altering repercussion of parenthood as a minor. Finally, job growth results from a dynamic economy. Lower taxes, less regulation on business and industry, and freer trade would produce the jobs necessary to escape the bonds of poverty.
So, listen this campaign season as candidates offer their solution to the rise in poverty. Be wary of promises to throw more money at the problem. That clearly doesn't work.
Cato Institute | 9/3/04 | Jenifer Zeigler
At the Republican National Convention this week, there was a lot of talk about money. Pay raises for firefighters. Money for Swift Boat ads. Money to rebuild Iraq, and so on. One thing the pundits and presidential candidates didn't say much about, however, is how much money has been spent fighting the "war on poverty"--$9 trillion and counting. Yes, $9 trillion.
Yet, as the Census Bureau just reported, poverty in America is up. So what do the candidates propose we do?
Well, one candidate believes the solution is to spend more money on social programs, while the other believes the solution is to spend more money on ... social programs. Since 2000, Temporary Assistance for Needy Families (the traditional welfare program) spending has increased 6 percent. What did we get for that money? A higher poverty rate. Obviously a stagnant economy and poor job market are responsible for the increase in those living below the poverty line. However, spending more money on social programs is not raising them back out of poverty.
The best way to reduce the poverty rate is to convince people to avoid poverty in the first place by finishing school, delaying parenthood, and getting a job (any job). High school dropouts are roughly three times more likely to end up in poverty than are those who complete at least a high school education. A common reason why teens drop out of high school is out-of-wedlock births. Teenage pregnancy initiates a single mother into a life of dependency that is difficult to overcome, especially if she goes on to have additional children. Over half of welfare money is spent on families that began with a teen birth.
Getting a job as a solution to poverty may seem like common sense. Granted, not every job pays a wage that will catapult a family into the middle class. However, every job provides job experience, and that leads to a better job. Maybe today's minimum-wage, service industry employee is not on a track for management. But he is showing that he is a reliable worker who can learn and perform duties, something a future employer will value.
Despite all this common sense, Democrats refuse to endorse welfare reform that would emphasize actual work experience. They would spend money to send single moms to college or train them in a specific skill for which there may be no demand in the job market. Republicans are not doing much better by encouraging social spending on programs like marriage initiatives, suggesting that coupling off the poor will somehow raise them out of poverty. In the past 40 years, we have spent at least $8.9 trillion (in constant 2003 dollars) on the "war on poverty." Isn't it time that one of the candidates admit we cannot spend our way out of poverty?
If education, pregnancy prevention, and employment are the solutions to poverty, we need a candidate that advocates policies that promote them. Education reform, including school choice, would provide a real opportunity for children to start on an equal playing field, prevent "at risk" students from dropping out, and produce a more competitive national workforce. Pregnancy prevention programs need to educate teenagers about how to avoid pregnancy, as well as emphasize the life-altering repercussion of parenthood as a minor. Finally, job growth results from a dynamic economy. Lower taxes, less regulation on business and industry, and freer trade would produce the jobs necessary to escape the bonds of poverty.
So, listen this campaign season as candidates offer their solution to the rise in poverty. Be wary of promises to throw more money at the problem. That clearly doesn't work.
