America is substantially reducing poverty among children | Hacker News Reader

America is substantially reducing poverty among children

economist.com

140 pointspaulpauper149 comments

I think this (COVID relief) is the closest America is going to get to a legitimate domestic experiment on UBI we're going to get for a while so it's rather heartening to see the drop in family poverty.

Nah, it's not.

Monthly lottery winners are.

If you know that 'free money' is just a temporary thing, you don't quit your job and move somewhere where that amount of money is enough to survive, and just stop working.... if ubi is permanent, and guaranteed to be "enough" to minimalistically survive, many more people would do that.

If a noteworthy number of people decided they were going to not work, the cost of labor would rise, and prices would rise until those people needed to work again.

I think this depends. If you work in a fungible occupation with limited career growth you very easily can take a year off. And most of these UBI experiment have targeted low-income folks who most likely work these kind of jobs.

Monthly lottery winners are a pretty poor basis for evaluating UBI since that is promoting an arbitrary individual to wealth - rather than providing a baseline income to a whole community. The effects of the later can easily be conceived to be quite different from targeted welfare. One of the common counter-arguments against UBI is that because the boon is applied across the board (and not just effecting the needy) that it will essentially cancel out and just cause a momentary bump in inflation - I think there are several very logical reasons that isn't the case but lottery winners are extremely poor experiments to disprove that theory.

As an example of how prevalent that counter-argument is please see all the siblings specifically about how UBI = inflation. (Also - I don't think this debate is settled - I think there are compelling reasons why UBI is not just free inflation... but there are also several reasons suggesting that it is - the UBI counter-argument is not at all illogical).

> providing a baseline income to a whole community

The rich oil sheikdoms in the Gulf are already providing a good income to all their citizens (not the working class gastarbeiters).

We should definitely observe them and learn from their experience. It is not precisely the same as UBI, but closer than anything else I can think of.

Canada has also carried out a few interesting UBI experiments with pretty positive feedback - but I think America needs to see something happen domestically to give it a serious consideration.

If only Alaska was considered "domestic" enough...

https://en.m.wikipedia.org/wiki/Alaska_Permanent_Fund

> sheikdoms in the Gulf are already providing a good income to all their citizens

which is looking to failing as soon as the price of oil drops. The saudis are now having to pay VAT to the state, for the first time recently.

UBI doesn't work if the productivity of the country would drop as a result of implementing a UBI. And i can't think of any reason why productivity would not drop, since there would definitely be some people who are currently productive, but would drop that productivity if there would be a UBI that's livable for them.

The argument that there would be a percentage who would increase their productivity (such as starting their own small business, etc) is merely speculative, since if they could start a small business, why don't they do it now, without waiting on UBI? If the UBI is what enables them to invest their time and capital, what makes UBI the only way to obtain capital, rather than seed capital? If it is _only_ UBI that can give them this seed capital, then they are effectively being subsidized by tax payers to entrepreneurship - if that was the goal, why not make that explicit, and give grants for such?

> if ubi is permanent…

The most likely outcome is that very quickly all the UBI money will be going to the few landlords and soon people will need "UBI plus a job" to pay rent and make ends meet.

And whilst the masses our back out in the wilds scrounging up their money, the landlord class will be consolidating into an every smaller group.

Inflation is what happens when too much money chases a limited supply of goods. And desirable housing is always limited.

That's why you need to fight asset inflation, reduce red tapes and increasing housing opportunities.

Sure, but it behoves advocates to UBI to say:

"We have a solution that not only includes handing outs cash to everyone forever, but to fight the associated, unavoidable rent inflation we will introduce sweeping changes to hard-earned building standards, negatively alter the character of many many neighbourhoods, and add a massive beurocracy to introduce and enforce with the power of the state all sorts of price controls."

They don't do this because obviously far fewer people would think its a good idea.

I thought the problem was with bureaucracy, especially with restrictive zoning laws, and the propensity to say no.

Rent is only affected by income/capacity to pay to the extent that supply is limited.

You could give everyone currently living in Detroit $10,000/month, and it wouldn't impact rental prices at all, because there is an abundance of supply. Do the same thing in NYC, and indeed rental prices will soar.

> The most likely outcome is that very quickly all the UBI money will be going to the few landlords and soon people will need "UBI plus a job" to pay rent and make ends meet.

This doesn't make sense. If it was the case, raising the minimum wage would have the same result, but studies have shown that people are better off when the minimum wage goes up. Landlords do not have infinite power to raise prices, because they are in competition with one another.

To the extent landlords have too much power, it's largely because we have decided to prevent the construction of new housing for many years.

> And desirable housing is always limited.

Does not have to be if you allow people to build more housing, and fix the regulations that make it overly expensive to do so.

I would argue raising minimum wage doesn't have the same effect, because the value produced by the job on this minimum wage, in totality, is still higher than the minimum wage (because if it weren't, those jobs would then be gone, and the person would end up with no job, rather than a raised minimum wage).

It depends on how much UBI is. There is plenty of housing in the US, for example -- except there isnt enough near where jobs exist. If UBI was sufficient for survival, people could migrate away from high cost areas to exurbs. There are huge swaths of housing once you go far enough, except that isnt possible if you still need to supplement UBI with a job and are hence tied to a major metro area.

If 20 quit their low wage job and one of them finally has time to study and become a researcher or doctor, I think it's worth it.

What if they become a shitty musician? And curent researchers get paid even less, because their money goes to a kid who'd rather play his ukulele inestead of working?

That's a valid argument only if you believe that a person only lives a life worth living if they have utility to others.

And honestly - the internet has democratized content creation to such an extent that a lot of really niche interests can attract funding (just, not very much).

Using Lotto Winners as your experiment has the problem of selecting only the people who play the lotto. Your data will be biased towards less fiscal responsibility.

While I'm certain that there are people who spend an irresponsible amount on lottery tickets, I don't know if those are also the lottery winners.

I'd be very interested in any statistics for that. Where I am lottery tickets cost about the same as a Starbucks coffee, and I'd bet the average lottery player buys tickets less than the average Starbucks drinker buys coffee, making me wonder about the label of "less fiscally responsible", unless we're also grouping all Starbucks drinks in there. And given the astronomically poor odds of winning, I also wonder how much more regular players win vs those who buy a ticket once every month or two - does it really help enough to be obvious in the statistics.

The lottery ticket purchase is a gamble: spend money, almost certainly get nothing, tiny chance of winning big.

The coffee purchase is just that, a purchase: spend money, get coffee.

The amounts might be similar but the transaction class is totally different.

I don't know, it's really a form of entertainment. The odd chances I do buy a ticket it's to think about what I would do if I won. I'm not expecting to win, I just like the idea.

And both are transient and rather empty - neither provide any real value outside of a brief joy.

If cost is not controlled I'd expect expenses of food, clothed and renting to rise after UBI being implemented.

Costs cannot be controlled. That’s not how it works. That’s how you get empty shelves.

I think some inflation will happen but not dramatically in food and clothing. We do not have many naked and starving people in America. It’s the premium consumer goods that will see higher demand - think dishwashers not Chanel.

I guess rent will be the one to go up in case of UBI.

UBI fundamentally does not solve the problems that:

a) some people do not want to live next to some other people, and are willing to pay extra for that privilege - now they have even more money to use for that purpose,

b) in the most expensive regions, demand exceeds supply a lot.

I even think that a vast majority of UBI would, at the end, accrue to landlords.

in the current context of this experiment rent dropped by 30% in SF while this was going on. Sure some of that was people fleeing dense urban areas to escape lockdowns, but also some was people decamping because the economic pressure to work in a city was lifted. UBI might be a terrible threat to landlords' incomes as people redistribute.

the drop in rent would be more attributable to the WFH policies instituted by many companies rather than any UBI imho.

It's gotta be combined with YIMBY policies, hopefully LVT.

The state can definitely influence the prices of goods (e.g. it can affect the price of money). Direct control is indeed infeasible.

> Costs cannot be controlled. That’s not how it works. That’s how you get empty shelves.

Many types of food in America are massively subsidized, including dairy[1], beef[2], and corn.

Government policies can certainly drive down prices. Direct price controls don't work, but subsidizing production most certainly works.

Though an economist would argue that a dollar saved at the market cost tax payers more than a dollar to get, due to inefficiencies, counter argument is that people who are poor pay less taxes and benefit more from reduced food prices. (At which points arguments about corn subsidizes and long term harm to the health of the citizenry are brought up.)

[1] https://www.numbeo.com/cost-of-living/country_price_rankings...

[2] https://www.numbeo.com/cost-of-living/country_price_rankings...

Sure but a subsidy is a market support. A price control is a market support. A subsidy is not a price control.

I can see the argument for the price of rent rising, but why would the prices of food and clothing rise? My understanding is that those are highly competitive markets, with low margins on top of the cost of production, at least in their non-luxury segments. Is that wrong?

Not necessarily non-luxury but also the middle brands I think. But it's difficult to prove though. As a user said the pandemic also sees a decrease in supplies so it's kinda difficult to do "tests" properly.

Food and clothing depend on other things (cost of employees, equipment, materials, etc.) When the costs of those things rise, the cost of food and clothing will have to rise.

Depends where we source them, for example American-made clothing is already prohibitively expensive to the economic demographic segments that are targeted by UBI experiments.

> Food and clothing depend on other things (cost of employees, equipment, materials, etc.) When the costs of those things rise, the cost of food and clothing will have to rise.

Not really. You're pointing to production costs, but production costs just define the price's lower bound, not the price itself.

Price depends solely on willingness to pay and pricing strategy, which is higher than the production cost when the product/service is not subsidized or a loss leader.

It seems like there are two effects we're considering at the same time:

1. UBI might increase people's willingness to pay for goods in general, and the prices of goods that are most strongly driven by willingness to pay would rise. (Rent in expensive cities might be an example of this. Milk, soap, and socks probably aren't.)

2. To the extent that UBI is paid for with higher taxes, the prices of everything would go up. This seems obviously true on average and to some extent, but the specific numbers matter a lot. For example if prices go up by 10%, but the people whom UBI is designed to help see their income rise by 20%, then UBI is achieving its stated goal. (Importantly, the hypothetical 10% rise in prices doesn't reflect wealth being burned or spent, but rather resources being moved around in some sense.)

> 1. UBI might increase people's willingness to pay for goods in general, and the prices of goods that are most strongly driven by willingness to pay would rise.

It's reasonable to assume that UBI would be linked with an increase in the demand for some goods and services, but there is no indication that this would reflect in a proportional increase in prices. For example, those who live in poverty already tend to purchase substitute goods due to lower price, which is reflected in some aspects such as the link between poverty and malnutrition. In this scenario it's likely that the increase in purchasing power from UBI would actually cause a shift in the market so that it brings down the demand for said substitute goods and instead spread the newly-found demand through other products.

The same scenario also applies to other markets, such as housing. If UBI grants you a little bit of economic freedom so that you are no longer tied to a specific job or place of residence or even access to public transportation, you can also consider moving to a better/cheaper place somewhere else without your livelihood being a constraint.

Keep in mind that one of the enablers of living frugally/off-the-grif is ensuring that you secure your financial needs. Once people are no longer forced to endure a horrible job to make ends meet, they start to make changes to improve their lives.

> Not really. You're pointing to production costs, but production costs just define the price's lower bound, not the price itself.

I was replying to a comment about how intensely competitive these markets are, and how that means margins are driven down. If your business is operating at a very low margin, and costs rise, you will necessarily raise prices, because you are already operating on the price floor.

Low margin businesses are defined by the price floor (the cost) being very close to, if not equal to, the price sold at.

I think that's one of the biggest weaknesses of using the pandemic as an experiment on UBI - it's one of the best ones we'll get for a while (and I think we have seen increases in luxury spending from most sectors which would indicate greater financial security) but at the same time we're seeing the continued echoes of supply chain shortages. It'll be hard to determine precisely why the price of meat has gone up from two prior, there are quite legitimate additional costs on production by having increased sanitary and working space requirements - and I think both sides of the UBI debate will be able to sanely say that those costs were either mostly due to the pandemic or mostly due to labour shortages driven by the covid benefit... and I don't know if we'll ever get a really clear answer.

That might be true. But the payouts were more limited than a nominal UBI program, and the costs were astronomical.

The US added 20% of GDP in debt in a single year. [1]

The US Fed added 4 Trillion to it's balance sheet in 2 years [2] which is ballpark maybe 25% of GDP.

Obviously there was more than just wealth distribution in there, but what becomes clear in the calculation is the gigantic expense of UBI.

UBI doesn't work in current terms, it's not a program that can be remotely afforded without a 'total re-work of the system'. Surely there are opportunities with taxing the ultra-wealthy and considering loopholes (esp. offshore tax havens) but there's just no calculus where it works out neatly. In other words 'UBI' is not like 'child care benefits' or some kind of regular social program where can argue about the balance sheet. It's a completely different scale of costing problem.

If the US focused really hard on 'some kind of healthcare for all' (not making any statements about what that might look like) and controlling costs there, improved minimum wage, and did 'basic structural tax reform' - things might improve quite a lot. (i.e. doing the hard work of reforming normal programs we have to have would go a very long way). But I don't think there's any actual magic math that would allow for a true, enduring UBI situation. Even really well managed Oil-rich places like Norway don't quite have that, they sort it out using the more accessible, 'normal' social programs etc..

For more context 'the current payout program' which is not not 'U' in the UBI, just for about 10% of the population, is going to cost 0.5% of GDP. Meaning just that limited program, expanded to 'U' i.e. 'Universal' is 5% of GDP, every year.

Edit: finally should not that a lot of the expansion of the Fed's balance sheet amounts for 'welfare for the rich' and it's not a small amount. That's a problem as well.

[1] https://en.wikipedia.org/wiki/National_debt_of_the_United_St...

[2] https://www.federalreserve.gov/monetarypolicy/bst_recenttren...

> a legitimate domestic experiment on UBI

The pandemic spending is unsustainable.

Parent said "experiment".

A lot of people on the left do want to make the child tax credit permanent, and there is no logistical reason we couldn't do that other than political constraints.

The amount we've spent on child tax credits and toe-dipping into UBI is a drop in the bucket compared to spending $300m/day for 20 years in Afganistan without even breaking a sweat. Clearly we can handle this kind of spending, and more, especially if we increase tax enforcement on the top 1% of earners and gasp actually re-assess the capital gains tax to ensure that people like Jeff Bezos are paying at least 28% tax on their capital gains just like they would on regular income.

These programs are also an investment in the economy that pays itself forward in the form of increased social mobility, and thus increased future tax revenue, so it is by no means a net loss. It could even be the case that every $1 invested in these kinds of programs results in more than $1 in created new tax revenue a few years down the road. This is called investing in our future. A new concept, I know.

Assuming we count the $1,800 dollars of total stimulus last year as one years worth of UBI, that alone costs 5 times yearly (1.5 billion per day) what the Afghanistan war cost. Which is both much less money than what I would consider necessary for a useful UBI, and not even universal. Sure, we could have given out a $300 a year “UBI” instead of funding the war on terror (and that would have been a much more reasonable use of the money) but the scale of how much a true UBI would cost is preposterous. We are just not yet productive enough as a society to make it work, no amount of taxing the 1% could reasonably pay for a UBI.

We definitely can and should be doing more and taxing the wealthy more than we are, but even then some things are out of reach.

This is true, but I think when the tabulations are all finished, we'll discover that the war in Afghanistan really cost something north of $100 trillion -- we just aren't including everything we should be including in the tabulation currently. In these types of situations, it is very easy to exclude things like personnel and research going on at home supporting the war effort. It's also been politically convenient to fudge Afghanistan spending numbers for 20 years up until a few months ago, so we have no reason to expect the reported numbers are the full story. I say this as an ex-DOD civilian.

I bet the new child tax credit will stay on the books. It's such a game changing boost to lower income families.

This is going to last only as long as it will take for the labor supply pressures to squeeze out small- and medium-sized businesses for the large corporate interests to scoop up on the cheap. They're not going to permanently constrict the reserve army of labor.

No, COVID relief isn't like UBI because most of it, the unemployment benefits, are conditional on not working.

The reason UBI is better than other welfare is it doesn't discourage working as much.

I’m a bit surprised by these comments. This seems like data driven evidence of a government policy working quite well.

Yet there are people complaining about this causes inflation and is “printing money”. The article clearly points out that most of the spending is on essentials and directly contributing to the children’s quality of life.

Not the article I would expect to see fiscal hawks on.

"fiscal hawks" probably isn't correct.

What about the trillions airdropped on Wall Street? That was surely also "printing money" ... And it was a lot!

It’s not that it’s not working. It’s that it’s not a sustainable model. Or if it is, we need to cut a LOT of other stuff.

Our $2000 per capita annual war budget would be a reasonable starting place.

Or raise taxes among the top earners, corps, cap gains. Seems worth it to me.

It works very well and has been sustainable for many decades in a handful of other countries around the world.

It's simply a question of priorities, and evidently that is not high on the list.

Maybe. Hard to say what "a lot" means.

But anyway, assuming there is some connection between things like child poverty, later life income, incarceration, taxes, welfare usage, entrepreneurship, etc., etc., it's entirely reasonable to hope this could be a net benefit even in purely monetary terms, which of course is not the only way to measure its success.

A lot of people don't care much about the poor and instead care primarily about their own wallet. Whether it works or not is irrelevant to some folks.

I care enough about the poor to donate my time and money voluntarily. But I absolutely despise government welfare which amounts to theft and forced donation for something the government is not chartered to do.

Most people's protest of federal welfare has nothing to do with insensitivity to the plight of our fellow man.

Would you accept work sharing so that people who would do charity simply work less and those who would receive charity work in a job opportunity that pays them as much as they demand from the economy?

I bet you would be against this because you want to defend your right to private property even though money is just a promise that someone works for you, it's a relationship. It's absurd that people want to own relationships as if the other person is a slave.

As long as you hold onto that promise, the other person doesn't get to work so blaming others for the inability to work (often rebranded as "laziness") you created is hipocritical. As I said before, the best solution would be to simply work less, so that the promise to work doesn't end up in the hands of those who have no intention to let others work.

A bug fix can still work well even if you don't address the root cause. But sooner or later it will reveal itself again.

By root cause you mean the fact that some people work more than they demand in work back, leading other people to demand more work than they do work.

If people do not spend their full time income then they do not create demand for a full time job on the other side. If everyone insists on working full time while demanding less than full time, then there must be people who are simply unemployed.

It's like household chores. The number of chores goes up with the number of family members but there aren't enough chores to let everyone do the chores as a full time job. So if you assign all the chores to a single person others will get to do nothing. Leading to jealousy and the desire to call others lazy.

If every single person did as much chores as they create the need for chores then everyone would have a fair share of the chores. You take out the garbage you produce.

Mostly because the pandemic caused panic stimulus spending, not because of permanent, structural changes to fiscal policy.

Not sure if you're aware but the US recently started sending checks to families every month.

The blurbs I've heard say this has cut US child poverty in half. I should find a source...

You can't honestly believe that this reduced child poverty. While the Child tax credit has been increased, it's been on a steady increase for a while, and the net amount hasn't changed that much. If the claim is that the timing of payments is reducing poverty.. that's quite the claim.

The more obvious answer is that America had quite the recovery from the great recession including a pre-pandemic unemployment rate approaching 0%.

> While the Child tax credit has been increased, it's been on a steady increase for a while, and the net amount hasn't changed that much.

From what I can tell, it increased by 80%[0], from $2,000 to $3,600. (It varies for different household structures/incomes, but in general the poorest get the most.)

> If the claim is that the timing of payments is reducing poverty.. that's quite the claim.

As someone who's got some close friends who are poor, yes, monthly payments can make a big difference.

But really, the extra $1,200 isn't insignificant. It's 5% of the 25%ile income, and 14% for the 10%ile[1]. $1,200 a year is literally over 50% some of my friends' total food budgets. (I'm sure someone will jump in to explain how they could never eat for that little, but I can assure you that many Americans do.)

[0] https://www.forbes.com/advisor/taxes/will-i-receive-the-chil...

[1] https://dqydj.com/income-percentile-calculator/

Is the claim that 1600 dollars made the difference between poverty and subsistence?

I have nothing against the child tax credit. I think it's great. But I am hard pressed to believe 1600 dollars has eliminated poverty. If it did... Great that's a really cheap way to do it!

Jeez, how'd I get $1200? $1600, yeah, thanks.

If your monthly bills are $100 below what you make, then it makes sense that an extra $133 will shift you from "guess I'll skip dinner" to "I don't have to skip dinner", at least until costs change or some financial shock like a car repair comes up. Still others hopefully went from just being able to cover the monthly bills to that + saving for unexpected expenses.

Some people are fine with none, some people need much more, but across a large set of people, some percentage of people will go from below the bar we've defined to above, or above more often than before.

We definitely haven't come close to fully eliminated poverty, but if measurably fewer children are undernourished (or whatever metric we use) that's pretty nifty.

Those checks are prepayment of a child tax credit. In my case, it just increases what I'll owe when I file my taxes.

They are merely paying out a tax credit early. Families are not getting more (or at least, not much more) than before due to this.

I am aware. However, any reduction in child poverty that was observed in July cannot be due to the rebate checks currently being sent out.

> depending on how it is measured, somewhere between one in six or one in five children counted as poor

This is an alarmingly high number. I've been primed by media to blame this on an inverse relationship between income and number-of-children (i.e. poor people have many babies, rich people have few babies).

Does anyone have an alternative explanation for the surprisingly high child poverty rate?

Iirc its correlated with education level

An explanation for why child poverty is so high or why you're surprised that it's so high?

I think the relationship between fertility and income generally goes the other way: the richer you are, the fewer children you choose to have. You can see this broadly by comparing different countries.

There are serious structural problems with the American economy that make class mobility difficult. Two obvious ones, healthcare and child care, should be treated as urgent crises. We have policies that discourage the poor from working. And that's before even getting into the sexism and racism. (The child poverty rate is MUCH higher in female-led households or black households.)

Could you provide a basis for this theory? I think the burden is on you to establish your claim, not on others to disprove it. So far, it's baseless, supported only by:

> I've been primed by media ...

The media isn't responsible for what I believe; I am. If I know I'm being "primed", then I don't believe it. Also, I'm not sure what media the parent refers to, but it's much different from what I read.

I am aware that most of my knowledge about income distribution comes via news articles/videos. In the instances where they DO cite sources (which is rare), I have never personally investigated the data behind claims.

That is why I prefaced my comment about being "primed" by media.

Commenter's aim is to seek knowledge. He is putting forth a hypothesis, and is seeking alternative theories. If he gets viable ones, he'll put less faith in his hypothesis, or may abandon it altogether.

If one merely finds flaws in his hypothesis, he'll realize he's wrong, but will be no closer to the truth.

Pointing out that he hasn't backed up his theory is reasonable, but it doesn't bring him closer to his goal.

A relevant quote from Carl Sagan:

"If you’re only skeptical, then no new ideas make it through to you. You never learn anything. You become a crotchety misanthrope convinced that nonsense is ruling the world. (There is, of course, much data to support you.) Since major discoveries at the borderlines of science are rare, experience will tend to confirm your grumpiness. But every now and then a new idea turns out to be on the mark, valid and wonderful. If you’re too resolutely and uncompromisingly skeptical, you’re going to miss (or resent) the transforming discoveries in science, and either way you will be obstructing understanding and progress. Mere skepticism is not enough."

He also gave some good examples from the history of science of theories that eventually turned out to be true, but were originally on shaky (or even faulty) grounds for a long period of time. A culture of skepticism would likely have killed those theories. Unfortunately, I noted only this quote and not the examples.

Sagan's quote doesn't apply; Sagan also didn't invest time in baseless claims. If you told Sagan you had a theory of chemical composition of Saturn but had no basis, Sagan wouldn't continue the conversation. Sagan would (I imagine) want to hear novel theories based on evidence and solidly reasoned. And if you said you have no basis, but will believe it unless Sagan proved otherwise ...

Sagan also didn't write in an age of massive disinformation and misinformation. It's one of the critical issues of our time; it's important to do something about it, which includes pointing it out when it's happening.

> Sagan also didn't invest time in baseless claims.

That shows a great degree of ignorance about Carl Sagan. He did this several times - and one of the people he did this with later became his wife.

> Sagan also didn't write in an age of massive disinformation and misinformation.

Sorry, but I was alive when he was, and I had to deal with a similar level of nonsensical beliefs as I do today. The main difference I see is that there is more awareness about this phenomenon today.

> it's important to do something about it, which includes pointing it out when it's happening.

Sorry, but this is mere post hoc justification for your behavior. I would recommend you read the book "The Righteous Mind" which goes into the psychology behind it.

70% of African-American children are born outside wedlock:

https://upload.wikimedia.org/wikipedia/commons/3/36/Nonmarit...

Which is driven by a welfare system that punishes married couples with lower payments (witness the huge rise in out-of-wedlock births since the welfare schemes of the 60s/70s).

35% of African-American children live in poverty:

https://www.nccp.org/wp-content/uploads/2020/05/wpc10-fig3.j...

Creating a subsect of society which is endlessly reliant on transfer payments to avoid poverty is not a good outcome for society. It would be better to encourage family planning and marriage.

http://marripedia.org/effects_of_out-of-wedlock_births_on_so...

"The evidence is clear and disturbing, being born outside of marriage lowers the health of newborns and increases their chances of dying; it delays children’s cognitive (especially their verbal) development; it lowers their educational achievement; it lowers their job attainment; it increases their behavior problems; it lowers their impulse control; it warps their social development; it helps change their community from being a support to being a danger to their development; and it increases the crime rate in their community.

To make the situation worse, the government has instilled powerful incentives in the welfare system which makes illegitimacy a community way of life, particularly in very poor communities. The widespread incidence of illegitimacy in turn passes on all these effects to the next generation in an even more malignant form.

While the government cannot instill virtue, it does not need to subsidize this rejection. Government policies have subsidized illegitimacy, and the evidence of its serious effects are steadily growing. Congress must adopt policies friendly to children. But to do that Congress must first become more friendly to married fathers and mothers."

> Which is driven by a welfare system that punishes married couples with lower payments

Is this true? If you're not married, then doesn't only one person get to claim the benefits? Not benefits x2?

Single parents get more money than two parent families. Only one parent gets to apply but the payout is higher for a single parent. The system absolutely incentivizes single parent households.

I think this might apply only if you are married but filing together. Not separately. Not 100 percent sure about this though, so feel free to fact check me. We’ve been doing married filing separately and my wife has been getting the full amounts afaik.

Edit: did some light googling and yeah there was nothing obvious that being single parent is better than being married, financially. So I think the above claims will need some qualification.

Are you sure these families aren't simply reporting that their children are being born outside wedlock to obtain welfare?

"Poor people have more children" gets by without enough examination.

It's a weird, tautological statement. Only workin adults provide income to a family unit. Children and the disabled members of a household divide that income.

Given the same income, a family with more dependents is sent into poverty by the mathematics of division.

Right, so given this a naive observer might imagine the rich would elect to have more children, and the poor fewer…

> poor people have many babies, rich people have few babies...Does anyone have an alternative explanation for the surprisingly high child poverty rate?

The question makes me think of Malthus. He argued that population grows geometrically, while agricultural production is linear, but the major restraint on reproduction would chiefly be access to food. You could extend that to say that the poor will be less numerous, but feeding them will cause their population to rise and result in inflation (I think that was apropos the Poor Laws).

That was the 18th century thinking, at any rate. Some explanations I've encountered for why it doesn't work out that way involve examining other checks on reproduction which include things like education level and rights of women, and rate of child mortality. I think you raised a great question that's worth examining -- hopefully someone else can shed light on the subject.

I find the Malthus argument amusing because populations simply stop growing if there isn't enough food. The worst thing that will happen is that there are lots of hungry people. I don't see how that is different than today.

Meanwhile, in the reality we live in today, our economies are actually struggling because of a lack of population growth. Lots of economists simply assume endless exponential population growth to justify endless economic growth.

The dependence on growth relies on our insistence to work full time. Technology reduces the need for labor. So to give everyone full time jobs we have to grow the economy. It's quite stupid.

Imagine a simplified dishwasher economy. We have a replicator that generates food for free but it doesn't clean dishes. To increase labor efficiency keep building bigger and bigger dishwashers. For some strange reason we still insist on working 40 hours per week loading and unloading the dishwasher. There is something strange about this. Every time we build a bigger dishwasher, we have to eat more (=have more children) just to keep the 40 hour work week filled. This is the dependence on growth.

We have to keep growing just to stand still at full employment.

It might help to understand a bit more about poverty statistics (at least as they manifest themselves in the US):

https://www.manhattancontrarian.com/annals-of-poverty

Basically the "poverty rate" that makes it to the headlines is a very misleading metric. On particular flaw is that it excludes the value of many anti-poverty programs, for example the value of food stamps and public housing is not counted! So you could double cash outlays for those programs and the "poverty rate" wouldn't change.

> So you could double cash outlays for those programs and the "poverty rate" wouldn't change.

This is absurd. This is like saying that you can no longer consider yourself a gunshot victim if you've been treated and recovered.

How do you characterize the converse of your scenario? How would the "poverty rate" change if the cash outlays were eliminated? Do we get to blame the politicians that eliminated the outlays for putting people in poverty?

The problem is that if you are trying to measure the effectiveness of government programs you can't exclude their value in your metric. In a very simple stripped down version:

    * assume 20% of people need public assistance
    * assume that that assistance has been provided via government programs

It is disingenuous to then assert that since 20% of people still need assistance (because you haven't counted the assistance in the metric) and therefore the government programs have not "reduced poverty" and need to be increased.

I do agree that you might observe that 20% of people still need assistance and want to think about ways to make them more self-sufficient, but you can't use that number to obscure the fact that the assistance has indeed been provided.

Part of the problem is that "poverty line" is a stand-in for "can (or cannot) afford food and shelter".

Part of the problem is that there are two different statistics that need to be measured

  - the percentage of the population that could not afford food and shelter before assistance
  - the percentage of the population that still could not afford food and shelter even after assistance

Part of the problem is that "poverty line" is an arbitrary demarcation point. (This doesn't even get into the fact that the "poverty line" is a national statistic, but the demarcation point in NYC is very different from that in rural Kansas.)

You seem to be complaining that some percentage of recipients have moved past the arbitrary line, while ignoring that they still can't afford food and shelter.

How is this not a No True Scotsman argument?

The label you apply to a recipient (above/below an arbitrary line) is irrelevant. What matters is whether or not they can survive.

> You seem to be complaining that some percentage of recipients have moved past the arbitrary line, while ignoring that they still can't afford food and shelter.

No that isn't at all what I was trying to point out (or "complain" about).

If I can refer to the two stats you listed as "before-assistance" and "after-assistance", then all I'm saying is that is terribly misleading to use the "before-assistance" statistic to assert that we aren't doing enough to help people. At least use the "after-assistance" statistic in order to measure the effectiveness of the programs.

If you don't use the "after-assistance" metric then it doesn't matter how much assistance you give, the "before-assistance" number won't change and you'll continue to have people "living in poverty" even though that really isn't the case (because they have received assistance).

https://archive.is/I6wrL

The data from the graph in the article shows a very obvious downward trend of child poverty from the end of 2020 until now. The line that demarcates the 'monthly cheques' I don't think is remotely remarkable.

That's not to say anything for or against the program, but I think that they are overstating things.

If you want a chart that shows a 'possible driver' of lowered poverty that lines up a little bit more nicely with that graph, try this [1] which is just US BLS unemployment. As millions of people become unemployed ... child poverty rates spike, as they become employed, they go down.

[1] https://tradingeconomics.com/united-states/unemployment-rate

This is not a zero sum game. By providing funds for necessities, there will be increased demand. This demand will spawn new supply, which will bring prices back down. If this child tax credit is left in place, it should cause our economy to restructure some, paying more attention to essentials for children. Those providing for these needs create jobs, further economic activity, and tax revenue.

I fully understand that people do not want to share their income with other adults because "it's already too late".

However, sharing income to increase the potential of future adults? There simply isn't any good argument against that. They are the ones who will take care of you when you are old.

Good to hear.

There may well be starving children in the EU, but there certainly are not posters on bus shelters solicitating donations to feed starving children in the EU.

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How can children be poor? Aren't their parents poor? Or are children supposed to provide for them selves in US?

We attach a dollar figure to make it easier to measure, but a different way to look at it is when your basic needs are not met (food, shelter) you live in poverty; you are impoverished.

Consider this: the intention is quite obvious, and the gravity of the situation makes pedantry like this come across as completely tone-deaf.

The phrase isn’t “children who are poor”, it’s “children living in poverty.” Which yes primarily counts children living with poor parents, but could also count runaway children, children living as wards of the state in bad conditions, etc. Either way, it’s defined as children in living conditions that don’t have enough resources to meet a minimal acceptable standard.

Dependents can certainly live in poverty - that does almost always indicate that the family unit as a whole lives in poverty but it does allow some differentiation for families that are struggling with debt but manage to provide a relatively poverty free childhood for their offspring.

You're getting downvoted for the joke, but in a way, yes everyone in the USA is supposed to provide for themselves.

Aside from a few demeaning and complicated government programs, the USA has only distributed resources through factor payments based on labor, or ownership of capital. Most of our programs aiming to help the poor only phase in after the poor have earned a certain amount of money through labor.

I would look past the literal question in the parent, and think about the implications: Who provides for children? Why should they suffer poverty, having no power or responsibility for their own condition?

Wait until you start to really feel the effects of inflation. The tone of this article is very pravda-esque.

Agreed. Simply a changing unit of measurement. Wait until this finishes out, you will see decimation of the middle class

For an outlet called "economist" you'd think they would be more cautious at jumping for joy at 1 month of data which is barely even a blip.

Behold, the shrinking American middle class:

https://twitter.com/scottlincicome/status/144006410544490496...

At the same time the largest growing group is supposedly "Asian" Americans according to Pew research. It's funny how they group over four billion people into one ethnicity. Ironically (or not) the two major economic work horses in the American "alliance" are experiencing sharp declines in population growth, while the Chinese and Filipinos make up the largest group.

This is just PR from the Economists, so that we think everything is fine. Its NOT! Just Google and find the mountain of evidence how the US fails its children and families.

Mind you, that "current reducing != ended completely". While we are nowhere near being as performant as a Western European state, we are taking the correct steps even if for the wrong reasons (Covid pandemic).

"Things are getting substantially better" doesn't mean "everything is fine".

Considering that the article points out the US's abnormally high child poverty rate, the difficulty the US has in actually getting the new child tax credits to those to whom it is warranted (since you have to file a tax return to get it, and the very poorest don't file tax returns), points out that the credits are only temporary and their permanent extension is not guaranteed, the article comes across not as "everything is fine" but rather as "this is a start, not the end--now keep at it!"

We don't need to Google to find the mountain of evidence. The article starts out by saying the US has exceptionally high child poverty and spends relatively little trying to solve it:

> America has long tolerated an anomalously high rate of poverty among children relative to other advanced countries—depending on how it is measured, somewhere between one in six or one in five children counted as poor. The reason why is not mysterious. The safety-net has always been thinnest for the country’s youngest: America spends a modest 0.6% of GDP on child and family benefits compared with the OECD average of 2.1%.

It criticizes the roll-out of the program:

> That does not mean that the roll-out has been flawless. To reduce administrative barriers, the credits are supposed to flow automatically from the Internal Revenue Service (IRS) to family bank accounts. However, a significant minority of American families have not filed tax returns in the past two years—meaning that eligible children are missing out.

And reports that it's currently scheduled to expire despite great success:

> All this progress is currently slated to be time-limited, though. Democrats in Congress only agreed to implement the enhanced payments for one year.

No one read this article and thought "everything is fine". It's about how things are terrible and making it clear that we need to fund programs that help.

Poverty is more than an financial state. Giving away money to move someone from just below the poverty line - which is artificially low - to just above that line is honorable, but "curing" poverty is not that simple. Unfortunately, articles like this help the myth persist.

More political magician-y mumbo jumbo.

It's also important to ask: at what cost? If these monies were financed by printing more money, then that's a form of tax. It discounts all other money in circulation. Who does that hurt the most?

No doubt something should be done. Poverty is a cruel and unnecessary disease. But printing money...a one off??? Let's not over sell this. Unfortunately.

Money is always printed. The only difference is how fast we inflate the current supply, not that we inflate it. Inflation is a function of the system itself. Its fundamental.

Poverty is a desired outcome of this system.

Keeping money moving is the desired outcome of inflation.

Spending money isn't what keeps people in poverty.

This argument is absurd. Inflation is high right now and it's because people are getting higher wages.

I just can't comprehend how people have become this stupid. the 80s neoliberal policy package was intentionally aimed at killing inflation in response to the oil crisis. The way they reduced inflation is through global trade, destroying unions and deregulation. All of this was to make sure that negotiation power of workers dropped like a rock and inflation followed wages. Low wage growth lead to low inflation.

A money system with low inflation or even deflation systematically undervalues present labor for the benefit of the holders of the biggest share of money. Someone who spends all their money massively benefits from wage increases and therefore inflation. Just look at Bitcoin. If you own $100k of Bitcoin and it goes up 10x you will be a millionaire. If you only own $1000 then you only get $10000. It's rigged in favor of the already rich and rigged against those who are poor.

Literally every time someone talks about raising wages people use the inflation counter argument. "If we pay people more it would drive price increases and therefore inflation".

People take this shit for granted and then when they complain they talk about how 2% inflation is eating away at the $500 they have in their bank account and don't even consider that 2% inflation eats away at someone with $1 million in their bank account.

Let me tell you what saving in monetary terms does. It's just reducing your demand for labor. Labor cannot be stored. You either use it or lose it. Your insistence to not spend your money has to be balanced by letting the unpaid party take on debt in hope that you spend your money one day. So excessive saving is what drives excessive debt, not some stupid moral sense of irresponsibility. The alternative would be to keep the unpaid party unemployed and unemployment is a pretty obvious driver of poverty.

Don't make the mistake of thinking that saving lets the bank lend. No, the supply of credit is infinite. The only limit is the availability of solvent borrowers.

Inflation always directly hurts those with the most the most by value alone - but it can specifically cause hardships to those who are in some critical point where an extra dollar could cause a dramatic increase in quality of life.

I think most proposals around sustaining this benefit in the long term don't rely on pure monetary creation but instead would shift it to a budget item that is directly funded by taxes (which in theory can be better targeted to hit those with excess)

Note that many of the administrative hurdles could be overcome by moving the benefit to the Social Security Administration, who already have the data needed. Also, it's been a while since I looked at this, but Republican Mitt Romney had the best proposal out of all the child benefit proposals that were kicking around earlier this year. That the democrats didn't pick up on it is a sad statement about them.

https://www.peoplespolicyproject.org/2021/02/15/who-should-a...

Poor children don't vote and they don't contribute campaign funds. As implied by TFA, they were only helped this time by mistake.

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