AEI revisits question on how to escape poverty, issues weak report

In 1987 the American Enterprise Institute (AEI) published The New Consensus on Family and Welfare. The institute gathered the nation’s leading experts in welfare, both liberal and conservative, and asked them to come up with a consensus about what people needed to do to escape poverty. The group’s findings were simple: finish high school, get a job---any job—get married and stay married, and you will slowly rise.

Nearly 30 years later, AEI is at it again. Once again, they have gathered the nation’s leading experts in assessing poverty and welfare and asked them to come up with a consensus. The panelists include Russell Sage Foundation president Sheldon Danziger, New York University psychologist Jonathan Haidt, and Jane Waldvogel, who is a “professor of children and youth problems” at Columbia. (The only person to serve on both panels is New York University political scientist Lawrence Mead.)

The new report—Opportunity, Responsibility, and Security—is far more problematic than the earlier volume. If the 1987 report reflected the optimistic age of Reagan, the new volume is written in the sour era of Obama and Trump. In addition, the new volume is a joint venture between AEi and the Brookings Institution. I know the work of two of the three Brookings scholars on the panel—Ron Haskins and Stuart Butler[1]—and these are indeed well qualified experts. (I’m not familiar with the work of the third Brookings fellow on the panel, Richard Reeves.)

Two of AEI’s leading experts on poverty—Charles Murray and Nicholas Eberstadt—are, for some reason, not part of the panel. Their absence ensures that Opportunity, Responsibility, and Security is a center-left document that reads as if the liberals on the panel agreed to support the importance of two-parent families in return for the conservatives agreeing to support an ever-expanding welfare state. This ensured that the left won the argument.

For a report that stresses the importance of work, it is curious that we do not know who actually wrote the report. Nor are any editors or research assistants credited. Don’t AEI and Brookings believe the efforts of their support staff should be recognized?

There are also phrases that are troubling. At one point we are told that some members of the panel “identify as conservatives.” An editor should have taken out his or her blue pencil at that phrase. People are conservatives or liberals; they don’t “identify ”as conservatives

Those of us mossbacks who grumbled when “virtues” was replaced with “values” learn from this report that we can’t refer to people’s “values” anymore. The phrase used in this report is “cultural norms.”

Perhaps the best chapter concerns the evidence about changes in poverty over the past decades. The unambiguous evidence is that the marriage rate is steadily falling and that workers with less than a college education have seen their wages stagnate or fall, especially when compared with workers with advanced degrees.

The evidence of how many people in the U.S. live in poverty is more ambiguous.

The official rate has flatlined, stating that somewhere between 14 and 15 percent of Americans are poor since the 1960s. But an index created by Bruce Meyer of the University of Chicago and James Sullivan of Notre Dame, which looks at how much people consume, says that by their measure, the percentage of poor Americans has fallen from 16 percent in 1972 to 4.5 percent today. According to Meyer and Sullivan, the Earned Income Tax Credit has played a key role in steadily falling poverty rates.

As for the panel’s recommendations, they tend towards moderate statism. For example, the chapter on the importance of family repeatedly says, correctly, that the government shouldn’t be a parent, but then advocates that government should be a “guide,” as in this phrase:

“The government isn’t an effective parent, and shouldn’t dictate to parents how to raise a child. But government can paly a role, almost always through a third party receiving government funding, on the practices and skills that fit best with the high aspirations that parents hold for their children.”

So government can’t be a parent, but it can fund nonprofits that can act like parents.

In the area of work, the panelists realize that existing job training programs do little good but think that better ones can be devised. But the panelists—six of whom hold endowed chairs at universities and two that hold endowed chairs at think tanks—largely ignore the transition of the labor market into the “gig economy,” and have nothing to say about how to encourage entrepreneurship and job creation. It may be, as Financial Times columnist Tim Harford argues, that independent contractors need some, but not all, of the protections provided full-time workers. But to ignore the devolution of the full time labor force is a mistake.

On education, the panelists ignore something with which I thought everyone agreed—namely that children should learn to read, write, count, and respect their teachers, and schools were doing a poor job at this. Instead, they are in favor of something called “social-emotional learning,” which they never define, but which they think is terribly important. They also call for seeing “the school as a hub for a range of health, social, and other services in addition to teaching,” which was a goal the Great Society tried—and failed—to achieve. (See Daniel Patrick Moynihan’s Maximum Feasible Misunderstanding for insights into this particular policy failure.)

I found this sentence particularly irritating.

“The toxic stress caused by economic hardship and violence can lead to harsh, abusive, disengaged, or neglectful parenting.”

This sentence insults the countless low-income parents who do sacrifice for their children and do make sure that their children turn out to be responsible adults.

The panelists call for reducing regulation in two areas. They argue that child support can be onerous, particularly for fathers struggling to re-enter the labor force after long periods of unemployment (or prison). A second comment comes from the footnotes, where the panelists feel that apprenticeships and training programs can be strengthened, but that many companies don’t do adequate training for their workers because of “accounting rules that do not allow them (companies) to expense such investments.” What are these rules and how much of a roadblock are they to implementing good training programs?

The New Consensus on Family and Welfare was a significant achievement. Opportunity, Responsibility, and Security is tendentious and far less important.

[1] Think tank geeks will note that Butler was at Heritage for decades before he ended up at Brookings. Perhaps he is happier being at an employer whose staff would cheer rather than hiss him when he is introduced as the intellectual father of Obamacare.

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