Top Quotes: “Tightrope: Americans Reaching for Hope” — Sheryl WuDunn & Nicholas Kristof
Introduction
“Life’s journey for affluent, well-educated American families is like a stroll along a wide, smooth path, forgiving of missteps. But increasingly, for those from lower on the socioeconomic spectrum, life resembles a tightrope walk. Some make it across, but for so many, one stumble and that’s it. What’s more, a tumble from the tightrope frequently destroys not only that individual but the entire family, including children and, through them, grandchildren. The casualties are everywhere in America, if we only care to notice.
Some 68,000 Americans now die annually from drug overdoses, another 88,000 from alcohol abuse and 47,000 from suicide. More Americans die from these causes every two weeks than died during eighteen years of war in Afghanistan and Iraq.”
“America ranks number 41 in child mortality, according to the Social Progress Index, which is based on research by three Nobel Prize-winning economists and covers 146 countries for which there is reliable data. We rank number 46 in internet access, number 44 in access to clean drinking water, number 57 in personal safety and number 30 in high-school enrollment. Somehow, “We’re number 30!” doesn’t seem so proud a boast. Overall, the Social Progress Index ranks the United States number 26 in well-being of citizens, behind all the other members of the G7 as well as significantly poorer countries like Portugal and Slovenia, and America is one of just a handful of countries that have fallen backward.”
“Opioids and other drugs now kill more Americans each month than guns or car crashes. Every seven minutes, another American dies of a drug overdose, and one American child in eight is living with a parent with a substance use disorder.”
“If the federal minimum wage of 1968 had kept up with inflation and productivity, it would now be $22 an hour instead of $7.25.”
“Ron Haskins and Isabel Sawhill of the Brookings Institution have found that of people who follow three traditional rules — graduate from high school, get a full-time job and marry before having children — only 2 percent live in poverty. So play by these rules, called “the success sequence and by and large one can avoid poverty. In contrast, of those who do none of those three things, 79 percent live in poverty. Overall, one-quarter of girls still become pregnant by the age of nineteen, so clearly there has been irresponsible behavior, by boys and girls alike.
Yet the irresponsibility is not entirely with adolescents. American kids have sex at the same rates as European kids, but European girls are one-third as likely to get pregnant — because European countries offer much better comprehensive sex education and easier access to reliable forms of contraception.”
“The 1970s was an optimistic time in Yamhill, a town south west of Portland with one flashing red light, four churches and at that time, 517 people, almost all of them white. Built as an overnight stop for the stagecoach from Portland to the coast, it boasted about having been the first town in Oregon to get electric streetlights.”
“The policy of confiscating driver’s licenses for nonpayment of child support or fines is shortsighted but widespread, affecting at least 7 million Americans. Hawaii, Kansas, Vermont and Virginia have all suspended the licenses of more than 9 percent of their adult populations.”
“If wages had continued to grow since the 1970s proportionately with the economy as they had in the post-World War I period, the average wage for a male full-time nonsupervisory worker today wouldn’t be $43,000 a year, but closer to $90,000. Think about that. It is likely that the poverty rate would be less than half of what we have today, it is unlikely that the nation’s political fabric would be as riven by race and class, and the desperation that contributed to the opioid crisis would not be at its current crisis level.
Official unemployment rates today are impressively low, but they don’t count people like Kevin who dropped out of the labor force: for every man aged twenty-five to fifty-four who counts as unemployed, three more don’t have jobs but aren’t looking for work. The percentage of these prime-age men who are out of the labor force has soared more than fivefold since the 1950s, although there has been significant improvement in recent years.”
Inequality
“Medical advances mean that even the indigent today get better care than, say, the family of a president a century ago; Calvin Coolidge’s sixteen-year-old son developed a blister while playing tennis on the White House lawn in 1924, and the boy died of the resulting infection.”
“Children from the richest 1 percent of households are seventy-seven times more likely to attend an Ivy League college than children from the bottom 20 percent.
The writer Matthew Stewart noted that in the old aristocracies, the rich were better nourished and thus were physically distinct from the malnourished, stunted masses; in nineteenth-century England, upper-class sixteen-year-olds were eight inches taller than boys of the lower classes.”
“In 2019, the hedge fund manager Ken Griffin purchased the most expensive home ever sold in the United States, a 24,000-square-foot penthouse on Central Park South in Manhattan, for $238 million — but because of a tax break for owners of condos in prime locations, he will pay property taxes as if it were worth only $9.4 million.”
“77 percent of kids in the top quartile of incomes graduate from college, compared to 9 percent of kids in the bottom quartile. This matters hugely for life outcomes and social mobility: a college degree on average is worth an additional $800,000 in lifetime earnings. Because Canada does not have such large educational disparities, low-income Canadian children are about twice as likely as their American counterparts to vault to higher incomes.”
“Black students are on average two grade levels behind white students, and kids in poor districts are four grade levels behind those in rich districts. “Quietly and subtly, the opponents of integration have won,” writes Rucker C. Johnson in his book Children of the Dream about school integration.
We came to a historic fork in the road in 1973, when this school funding system came within one vote of being overturned in a 1973 Supreme Court decision, San Antonio Independent School District v. Rodriguez; if it had been found unconstitutional, American education would look more like European and Canadian systems and we would be a more egalitarian country. The court based its decision in part on the idea that poor schools wouldn’t necessarily have worse outcomes.”
“Some elements of America’s modern feudalism are so embedded that we don’t notice them. Dentists are paid substantially more in America than in Canada or Europe, and Americans often can’t afford to care for their teeth, partly because the dental lobby has worked ferociously to block dental therapists (found in fifty other countries) from providing cheap and simple services, even in rural areas where there are few dentists.
Americans flying in coach class subsidize the tycoon flying in a private jet, because air traffic control is financed by commercial tickets. Tax depreciation rules subsidize the purchase of private planes.”
“Put a few goats on your golf course and you can classify it as farmland, as President Trump did, and save large sums in taxes.
The tax code has come to serve the interests of the wealthy
in myriad other ways. According to documents obtained by The New York Times, Jared Kushner appears to have paid zero federal income tax, year after year, even as his net worth quintupled to more than $300 million. In 2015, he had an income of $1.7 million. It’s all quite legal, because lobbyists won loopholes for real estate tycoons. The custodians in the buildings don’t have artful options like these to avoid paying taxes. Similarly, Amazon paid zero federal income tax in 2018 despite profits of $11.2 billion; indeed, it managed to get a $129 million “rebate” from taxes it didn’t pay.”
“Americans pay about $30 more per month for smartphone service than Europeans do, for the same-quality service. Researchers believe that’s because European regulators pursue antitrust policy more aggressively, while for a generation, American antitrust regulators have been asleep at the wheel. “The United States invented antitrust and for decades has been the pioneer in its enforcement,” Luigi Zingales, a finance professor at the University of Chicago, noted. “Not anymore.”
The wealthy have also fought to underfund and defang the Internal Revenue Service, so it doesn’t have the resources to audit or fight dubious deductions. Only about 6 percent of tax returns of those with income of more than $1 million are audited, along with 0.7 percent of business tax returns. Meanwhile, there is one group that the IRS scrutinizes rigorously: the working poor with incomes below $20,000 a year who receive the Earned Income Tax Credit. More than one-third of all tax audits are focused on that group struggling to make ends meet, even as the agency cuts back on audits of the wealthy — while the top 5 percent of taxpayers account for more than half of all underreported income.”
“In Denmark, partly because of strong unions, workers at McDonald’s earn $20 an hour, have paid maternity and paternity leave, overtime, work schedules four weeks in advance, pension plans and five weeks of paid vacation each year.”
“The United States was one of the first regions of the world to offer near universal basic education, and then one of the first countries to introduce high schools for nearly all children. By the early twentieth century America educated its youth to a far greater extent than did most, if not every, European country, Claudia Goldin and Lawrence F. Katz write in The Race Between Education and Technology, their exploration of how investments in human capital made America the world’s leading country. “Secondary schools in America were free and generally accessible, whereas they were costly and often inaccessible in most of Europe. Even by the 1930s America was virtually alone in providing universally free and accessible secondary schools.”
“And those like Kevin who didn’t graduate from high school do even worse.
The last half century is also the period in which the American pathway began to diverge significantly from the paths of Canada and Europe. In the 1970s, the top 1 percent earned a similar share of income, 10 percent, whether in the United States or Europe. That rose modestly in Europe to 12 percent today; in the United States it doubled to 20 percent.”
“In 1970, tax revenue made up about the same share of gross national product in the United States as the average in the OECD, the club of industrialized nations. It then inched up in every other rich country, as one might expect when populations age and need more public services, while remaining unchanged in the United States. So people in other wealthy countries today pay about an extra ten cents on the dollar in taxes, but in exchange get health insurance, better infrastructure, less poverty, reduced homelessness and, we’d argue, a healthier society.”
“A woman in America is now roughly twice as likely to die in childbirth as a woman in Britain.”
“The civilized world had begun to close debtors’ prisons in the 1830s, seeing them as barbaric. Yet when we dropped in on the Tulsa jail one day, we found twenty-three people inside simply for failing to pay government fines and fees. One gray-haired woman, Rosalind Hill, fifty-three years old with a long history of mental Illness and drug addiction, had spent eighteen months incarcered for failure to pay a blizzard of fees and fines. With penalties and interest, her total owed had soared to $11,258, but her depression and bipolar disorder made it impossible for her to hold a job. So she was periodically imprisoned for failure to pay, and then new fines would be tacked on top of the old ones.”
“In Oklahoma, criminal defendants can be assessed sixty-six different kinds of fees, ranging from a “courthouse security fee” to a “sheriff’s fee for pursuing fugitive from justice.” There’s even a fee for an indigent person applying for a public defender, even though the indigent by definition can’t pay; once they confirm their indigence by failing to pay, they are arrested. The sums accumulate to staggering levels.”
“The latest fashion for smacking the downtrodden among some lawmakers: work requirements to receive benefits such as Medicaid. In theory, requiring certain people to work in return for benefits could be a useful way to nudge the long-term unemployed back into the labor force. But in practice these requirements are often just an excuse to cut off benefits. Arkansas in 2018 became the first state to impose work requirements for Medicaid. It also required participants to log their work hours online with an email address and a code sent by mail, and proceed through several successive web pages. Unfortunately, Arkansas ranks forty-eighth among states in internet access, and many Medicaid recipients have no email or internet. Even months later, in early 2019, Arkansas’s Medicaid website had no clear explanation of the new work requirements or how to re-apply or input work hours. Of the first group subjected to the requirement, 72 percent could not comply. So families lost health insurance, and then some people were unable to get medication and, their sicknesses flaring, lost jobs. This is a reminder that work requirements are often a camouflaged and mean-spirited move to kick people out of the safety net. Meanwhile, from 2007 to 2016, the state granted subsidies of $156 million to corporations, including HP and Caterpillar, under an “economic development” program that researchers found had almost no correlation to increased employment.”
“Chen, a professor at Virginia Commonwealth University, spent weeks talking to autoworkers laid off by General Motors and Ford in Detroit and also in Windsor, Ontario, its sister city just across the border. Global economic forces had disrupted auto plants in both countries, but Chen found that laid-off autoworkers fared worse in Detroit. That’s partly because of a better Canadian safety net, including a national health-care system, and partly because of a vigorous Canadian effort to cushion the blow. Within twenty-four hours of a big layoff on the Canadian side, the government set up an “action center” to help with job searches, government benefits and access to focused retraining programs. Peer aides would help with preparing résumés and finding solutions. When Ford laid off workers in Windsor, some of them hoped to study nursing, but the local college program was oversubscribed. So the action center convinced the college to start a new nursing program immediately.”
“As a fraction of GDP, the United States spends on job-training and assistance programs barely one-fifth as much as the average among industrialized countries.”
“Poor parts of the country had been catching up with the rich parts for much of the twentieth century. Mississippi went from 30 percent of the per capita income in Massachusetts in the 1930s to almost 70 percent by 1975, and similar trends were apparent in other southern states. But that trend slowed and then reversed, so that Mississippi is now down to 55 percent of the Massachusetts per capita income.”
“Working-class voters are not uniformly conservative in their views. Polls show that they favor higher taxes on the rich, paid family leave and a higher minimum wage. But the working poor are disdainful of government benefits, even though they sometimes rely on them, partly because they often see firsthand how neighbors abuse those benefits; there’s far more anger at perceived welfare abuses than at larger subsidies for private jets. The resentment is more visceral when it is people around them who are bending rules and benefiting unfairly.”
Drugs
“IN THE 1980S AND 1990S, Portugal also had a terrible drug problem, one of the worst in Europe, and lawmakers there, too, debated how to respond. In the end, the two countries took precisely opposite paths. The United States doubled down on the war on drugs and “zero tolerance” criminal justice approaches. In contrast, Portugal convened a commission and ended up adopting — under then prime minister António Guterres, now the secretary general of the United Nations — a public health approach instead. Portugal treated drug addiction like a disease, rather than a crime. It decriminalized possession of all drugs, even heroin and cocaine, and focused on prevention through public education, as well as treatment of those with addictions to try to wean them off substance abuse.
Many people around the world were horrified that a major nation like Portugal was abandoning the war on drugs and decriminalizing drug use. There was legitimate concern that this would lead to soaring use of hard drugs. We now have almost two decades of experience with these two diametrically opposite approaches, and it’s clear which worked better.
In the United States, drug use and fatalities have soared, thanks partly to street fentanyl. There were 6,100 deaths from illegal drugs in 1980, compared to 68,000 in 2018. Every fifteen minutes in America, another child is born with an opioid dependency. In contrast, Portugal’s experiment proved a huge success. The number of people with addictions has fallen by about two-thirds, and its rate of drug-related deaths is now the lowest in Western Europe. In Portugal, 6 persons die of drug-related causes per million people between the ages of fifteen and sixty-four. In the United States, the figure is 348.”
“The year after Mark’s death, Baltimore began a pilot program called LEAD — Law Enforcement Assisted Diversion — that attempts to address these barriers. LEAD responds to drug users not with arrest and imprisonment but with social services, working with users rather than handcuffing them. LEAD started in Seattle, where it led to a 60 percent drop in recidivism, and it has now been copied in many cities around the country. It marks a step away from the traditional American approach toward a Portugal-style decriminalization of narcotics, and it is long overdue. We followed Steve as he made the rounds, looking for people on the streets with addictions, not to arrest them but to guide them toward LEAD counselors.”
“Treatment must be available to all 21 million Americans who need it, and this should include both psychosocial counseling and medication-assisted treatment. An astonishing one in seven young adults, ages eighteen to twenty-five, need treatment, the government estimates. Back in 1971, President Nixon ordered that treatment be made available for all people with drug addictions, without fear of criminal sanction, and obtained substantial funding from Congress to provide that treatment. For a time there was real progress against heroin, but, sadly, in the decades afterward, treatment actually became less available. Barely one in ten Americans with substance abuse disorders now receive any treatment. That is an astonishing failure of our government and health-care system.”
“The Affordable Care Act included mental-health care and treatment of drug-use disorders as essential health benefits, but reimbursements for addiction treatment and mental health are very low and many users have no health insurance at all. A much more comprehensive and better-funded national program is needed. We’ve spoken to people who tried to get into rehab but were told that their addictions weren’t yet serious enough to qualify; in effect, they were told to wait, deteriorate and try again. That’s obviously shortsighted, particularly because researchers find that increasing access to drug treatment pays for itself by reducing crime. Outpatient substance abuse assistance costs about $4,700 a year; incarceration costs five times as much, according to the National Institute on Drug Abuse. It says that a dollar invested in addiction treatment programs saves $12 in reduced crime and court costs, plus health-care savings. The Baltimore Station’s program that helped Daniel is an example of an effective program that could be replicated.
A second step is to make drug use less lethal for those who resist treatment. The United States has succeeded in making naloxone, an antidote for opioid overdoses, far more available so that police officers like Steve Olson now carry it with them to administer in an instant. Naloxone truly is a miracle drug: jab someone comatose from an overdose and, astonishingly, he or she will typically revive and, just minutes later, seem almost as good as new. Wen issued a city wide prescription to all 620,000 Baltimore residents for naloxone, and she worked to distribute naloxone to high-risk communities, such as the red-light district.
Promoting needle exchanges to reduce transmission of HIV and hepatitis also helps, and this is now widely accepted in the United States. More controversial are safe injection sites, where users can go to use their own heroin or other illicit narcotics, while monitored by a nurse or health aide. The injection site will supply needles, but not the drugs themselves. When users over-dose, they can receive immediate treatment, rather than dying on a park bench. There are some ninety safe injection sites in other countries, including Canada, and not a single fatal overdose has been reported despite millions of injections. Dozens of studies have found that they not only save lives from overdoses but also allow health authorities to connect with drug users and gradually reel them in for treatment. At the first safe injection site in North America, in Vancouver, British Columbia, the result was a 35 percent reduction in fatal overdoses in the area. One study estimated that a safe injection site in a U.S. city would not only save lives but also some $3.5 million.”
“In 2016, doctors wrote more opioid prescriptions in the state of Michigan than the number of people living in the state.”
Health
“It is a cruel jest to say to a bootless man that he ought to lift himself up by his bootstraps.
-DR. MARTIN LUTHER KING JR.”
“The expression originally signified the opposite of what it does today: in the early 1800s, it meant to do something impossible, for it is of course physically impossible to pull oneself up by one’s own boots.”
“The economist Alan Krueger noted that income in America is approximately as heritable as height. “The chance of a person who was born to a family in the bottom ten percent of the income distribution rising to the top ten percent as an adult is about the same as the chance that a dad who is five feet six inches tall has of having a son who grows up to be over six feet one inch tall,” Krueger observed. “It happens, but not often.””
“Once impoverished South Koreans already live to eighty-two on average, substantially longer than Americans, and demographers predict that by 2030 Mexicans will enjoy a longer lifespan as well.
Everything depends on your social stratum. Low-income American men have a life expectancy comparable to men in Sudan or Pakistan, while rich American men live longer than the average in any country in the world. The average American lifespan is falling because of people like the Greens and the Knapps — whites with a high-school education or less. Meanwhile, black life expectancy is still rising.”
“One study found that 81 percent of delinquent girls in South Carolina had experienced sexual violence, while another in Oregon found that 93 percent of girls in the juvenile justice system there had experienced sexual or physical violence. Imprisoning them risks replicating this trajectory in the next generation, for 79 percent of women in jails have children under the age of eighteen.”
“Some 74 million people have no dental insurance, more than twice as many as lack health insurance. “Bad teeth lead to diabetes, to heart disease, to death,” Stan noted. “People die from bad teeth in this country.””
“Life expectancy in the state or Mississippi, were it a country, would rank second to last, tied with Mexico. Children in America today are 55 percent more likely to die than kids in other affluent countries, according to a peer-reviewed study in Health Affairs.
“The U.S. is the most dangerous of wealthy, democratic countries in the world for children,” said Dr. Ashish Thakrar of the Johns Hopkins Hospital, the lead author of the study. If the United States had simply improved at the same rate as other advanced countries, 600,000 children’s lives would have been saved, Thakrar calculates. If America had the same mortality rates as the average in the rest of the rich world, 21,000 kids’ lives would be saved each year. Because we failed to modernize our health system the way our peer countries did, we lose fifty-eight children a day.”
“Many poor and less-educated people believe there are three sets of teeth: your baby teeth, which are replaced by your adult teeth, which are replaced by your grown-up teeth, which are plastic, or dentures. He once fought with a woman who had perfectly good teeth but now, at age twenty-one, she said it was time for her to get her dentures, as her mother and grandmother had done.”
“The reason we have a single-payer health-care system for the elderly (Medicare) but not for children is simple: seniors vote, and children don’t. So while American children die at 55 percent higher rates than children in other advanced countries, Americans who make it to age sixty-five and qualify for Medicare then have a remaining life expectancy similar to that of our peer countries.”
“One study published in The American Journal of Medicine found that 42 percent of Americans diagnosed with cancer between 1998 and 2014 drained all their life assets over the next two years.”
“Just eighteen states require schools to teach birth control, and only about half of American kids receive any classroom instruction in contraception before the first time they have sex, according to the Guttmacher Institute. Only 35 percent of high-school students learn how to use a condom correctly, according to the Centers for Disease Control and Prevention.”
Housing
“Everyone knows that there are government housing programs for the poor, like Section 8 (costing $30 billion annually), but few Americans realize that in recent years we have spent more than twice as much on subsidizing housing for mostly affluent homeowners ($71 billion annually through mortgage interest deductions and other benefits). In fact, the federal government has poured huge sums into mobile-home parks for low-income renters, yet the money went not to the renters but to private-equity firms. Fannie Mae, the government-sponsored lender, provided $1.3 billion to Stockbridge Capital, a huge private- equity firm, to buy existing parks — and Stockbridge then raised rents to achieve a 30 percent return, according to The Washington Post.
By some estimates, a rough doubling of the size of housing programs for the poor, to $60 billion a year, would solve much of the homelessness problem, and the total cost, as you can see, would still be less than subsidies for more affluent homeowners. The first task should be ending homelessness for children, and that is doable, if we make it a priority.”
Prisons
“In the United States, 70 percent of criminal sanctions involve incarceration; in Germany, it’s 6 percent. In Germany, the sanction is more likely to be a fine, community service or obligatory job training. There is an emphasis on supervised work that helps the criminal compensate the victim.”
“Private prisons lobby for harsher sentences to increase their occupancy rates and improve their profitability. The two largest for-profit prison companies have devoted $25 million to lobbying.
In Pennsylvania, the corruption was explicit: the owner of private juvenile detention centers paid hundreds of thousands of dollars in bribes to two judges who then found youths guilty and sentenced them to his centers. This “kids for cash” arrangement led to children being unjustly detained, including one boy, Edward Kenzakoski, who had no previous record but was held for months for supposedly possessing drug paraphernalia. That started Edward on a downward slide, and he later committed suicide.”
“The United States Sentencing Commission found that blacks get sentences 19 percent longer than whites do for the same offense, even after controlling for criminal history and other variables. The darker an African American’s complexion, the longer the sentence, researchers found. Blacks are also more likely to be found guilty and to be sentenced to death: in Louisiana, a black person is 97 percent more likely to receive the death penalty than a white person, researchers have shown.”
Families
“Richard Reeves of the Brookings Institution has shown that when children are born in the bottom wealth quintile to parents who stay married throughout their childhood, they do well: only 17 percent remain at the bottom, while 19 percent achieve the top wealth quintile in adulthood. But for kids born in the bottom quintile to parents who never marry, 50 percent remain at the bottom as adults, and only 5 percent rise to the top quintile.”
“Many child-welfare advocates agree with them that the authorities are too hasty to take children from low-income families and put them into foster care, saying that kids do best with parents or other relatives, sometimes with intensive coaching, supervision or support. Foster care costs about $26,000 per child per year, yet outcomes tend to be poor: only 58 percent graduate from high school. One-quarter are incarcerated within two years of graduating from foster care at age eighteen, and they are about six times more likely to end up homeless as to end up with a college degree.”
“Almost one-fifth of children born in West Virginia have been exposed in the womb to drugs or alcohol, and research, while not conclusive, suggests that later in life they will be much more susceptible to substance abuse. We now have a term for these childhood traumas and toxic stresses: adverse childhood experiences, or ACEs. An ACE can be physical abuse, a parental divorce or living with an alcoholic. Many adults have one, and one in eight has four or more. Even though the ACEs occur in childhood, they correlate to problems in adulthood: with four ACEs, a person has a 460 percent increased risk of adult depression and a 1,220 percent increased chance of adult suicide.”
“Several studies have found that child poverty costs the United States about $1 trillion each year in increased health, crime, prison and welfare spending as well as in reduced earnings. That’s about $8,000 per household annually. Most researchers find that each dollar invested in reducing child disadvantage would save the country at least $7.
Crime is a particularly expensive consequence of child neglect: researchers calculate that the economic cost of a single murder is $3 million or more. Half of America’s crime is caused by 5 percent of the population, so a small number of dysfunctional and neglected youth impose a large financial and emotional cost on society.”
“One simple program is Reach Out and Read, in which pediatricians “prescribe” reading during doctor visits and hand out free children’s books. It’s exceptionally cheap, at $20 per child per year, and many parents end up reading significantly more to their children. Unfortunately, while other countries are building up their early childhood initiatives, America is a laggard. Of thirty-six advanced OECD countries, the United States ranks thirty-fourth in the share of four-year-olds in early childhood programs.”
“It’s perhaps telling that the US was, embarrassingly, the only country in the world besides Somalia and South Sudan that had not ratified the Convention on the Rights of the Child. That has now changed: the United States is the only nation that hasn’t bothered to ratify it.”
Solutions
“A monthly child allowance. Research shows that a government payment of about $250 a month to each household with a child would give poorer children a better start in life. A child allowance has been used successfully in Canada, Australia and nearly every European country — it is a major factor in the reduction of poverty in Canada — and research by H. Luke Shaefer, a welfare policy specialist at the University of Michigan, and others suggests that the allowance would virtually eliminate children living in extreme poverty in the United States.”
“Baby bonds to help build savings. At birth, every American should be able to get an account with $2,000 that can be withdrawn only for education, to buy a home, to invest in a business or to retire. For low-income families, subsequent contributions to the account would be matched by the government to promote a savings habit. The idea is to help people build a productive nest egg. Various studies have calculated that baby bonds could reduce the black-white wealth divide by 80–90 percent. One variant of baby bonds is the individual development account, or IDA, and a condition for accessing the funds is completion of a financial literacy class. These seem to be very successful in increasing savings and should become part of school curriculums. In one randomized trial in the late 1990s and early 2000s, people with IDAs who lived on just $9,000 a year still managed to save 8 percent of their incomes by scrimping on coffee, alcohol, cigarettes and eating out; they also worked more hours. After ten years, the families with the accounts were much more likely to own their homes and have retirement accounts. But in 2017, Congress pulled the plug on funding for an IDA program.”
“Another smart step is wage insurance, to subsidize laid-off workers who accept lower-paying jobs rather than waiting for a job to come along that paid what the last one did. In experiments with wage insurance, both the United States and Canada have found that it results in workers becoming more likely to accept jobs that they otherwise would have scorned. That’s better for those individuals and for the American economy as a whole.”
“Britain under Tony Blair made a concerted effort to cut child poverty, and in just five years it cut the rate almost in half, so it can be done.”
