Thursday, February 19, 2015

New Report Calls for 60 percent Reduction in Child Poverty

The Children’s Defense Fund recently published Ending Child Poverty Now, a report outlining their approach to comprehensive child poverty reduction. According to the US Census Bureau and highlighted in this report, 1 in 5 children growing up in the United States live in poverty. Children of color have an even greater likelihood of living in poverty, with 1 in 2 black children and 1 in 3 Hispanic children living in poverty. Poverty doesn’t just have an adverse experience on children early in their lives. Children living in poverty experience lifelong consequences including poor health, lower educational attainment, and more frequent involvement with the criminal justice system.

While child poverty in the United States is inexcusably high (19.9 percent), there are programs and policies that have been shown to make a difference. CDF’s recommendations suggest building on these successful programs - and analysis conducted by the Urban Institute found that, if implemented, these recommendations would reduce poverty for 6.6 million children. The policy recommendations included in the report are projected to reduce child poverty by 60 percent when measured with the Supplemental Poverty Measure (SPM).

According to the report, reductions in poverty can be made by expanding federal policies that are already in place. The report suggests:
  • Increasing the Earned Income Tax Credit for lower-income families with children: 9 percent reduction
  • Increasing the minimum wage from $7.25 to $10.10: 4 percent reduction
  • Creating subsidized jobs for unemployed and underemployed individuals ages 16-64 in families with children: 11 percent reduction
  • Making child care subsidies available to all eligible families below 150 percent of poverty: 3 percent reduction
  • Making the Child and Dependent Care Tax Credit refundable with a higher reimbursement rate: 1 percent reduction
  • Increasing SNAP benefits: 16 percent reduction
  • Making the Child tax Credit fully refundable: 12 percent reduction
  • Making housing vouchers available to all households with children below 150 percent of poverty for whom fair market rent exceeds 50 percent of their income: 21 percent reduction
  • Requiring child support to be fully passed through to TANF families, fully disregarded for TANF benefits, and partially disregarded for SNAP benefits: 1 percent reduction in the number of children in poverty

The report also includes suggestions of ways to pay for these policy changes. They suggest investing $77.2 billion to pay for the recommendations included in the report and that the money could be found by taking any of the following actions:
  • Closing tax loopholes for corporations ($90 billion)
  • Eliminating tax breaks for the wealthy by taxing capital gains and dividends ($84 billion)
  • Closing tax loopholes included in the Tax Reform Act of 2014 ($79.3 billion)
  • Cutting 14 percent of the FY2015 $578 billion in military spending ($80.9 billion)
  • Scrapping the F-35 fighter jet program ($1.5 trillion)
The CDF report analyzes the impact of individual policies, but also demonstrates how the most successful anti-poverty strategy involves a combination of policy changes. Though these recommendations are based on federal policies, state policymakers can help to influence state counterparts of these policies and programs to reduce poverty among children within their states.

For the full analysis of each policy recommendation, please see CDF’s complete report.

For state policies to reduce child poverty, please read CSSP’s report Results-Based Public Policy Strategies for Reducing Child Poverty.

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