Professor Jane Waldfogel Analyzes the Divide Between Rich and Poor

At the Republican presidential debates, the recent Occupy Wall Street protests and kitchen tables across the nation, Americans are debating the impct of government, taxes and programs on the the rich and the poor. For two questions in particular—exactly who are the poor and how much does policy have an on impact them?— Jane Waldfogel made a career searching for answers.

A one-time social worker, Waldfogel is now a professor at the School of Social Work and researches issues of poverty, inequality and social mobility. She is particularly focused on how public policies affect a parent’s work scheduling and child care arrangements, and how those, in turn, affect children and families. “I’ve been interested in that question for as long as I can remember,” she said.

Before earning her Ph.D. in public policy from Harvard’s Kennedy School of Government, she spent a decade as a child protective services worker and then a policy analyst for the Massachusetts Department of Social Services. “I saw over and over again families facing the same issues, challenges around housing and around employment,” she said. “I realized there’s only so much you can do case-by-case without changing the larger structural framework in which families live.”

Today, Waldfogel is a principal investigator with the National Institute of Child Health and Human Development, part of the National Institutes of Health. At the behest of the Robin Hood Foundation, she has also worked as part of a team designing a survey that will create a broader measure of poverty and well-being in New York City.

Waldfogel spoke to The Record about her research, as well as the U.S. Census Bureau’s new supplemental poverty measure.

When I was in graduate school in the early 1990s, there was a lot of attention on income inequality, the growing gap between the high income and low income. The one bright light at that time was the narrowing gender gap in pay between women and men. Yet it flew in the face of everything I knew about pay for women. It occurred to me that if I looked just at women with children—mothers—I would find that their wages were as low as they’d ever been. And that in fact turned out to be the case. Women who don’t have children earn 90 to 95 percent of men’s pay, but women with children still lag very far behind, earning 70 to 75 percent of men’s pay.

Q. Your last book, Britain’s War on Poverty, showed that it’s possible to reduce child poverty. How did the Brits do it, and what lessons can the U.S. learn from their experience?

The U.S. and Britain both have high levels of income inequality and recent increases of that inequality, as well as very high rates of child poverty compared to other advanced industrialized countries. Two years after the Labor government came into office in 1997, Prime Minister Tony Blair made an unbelievable announcement—that his government was committed to ending child poverty in a generation and cutting it in half in 10 years. Although they did not achieve all their goals, they did cut child poverty in half in 10 years as measured in absolute terms as we do in the U.S. It’s a remarkable achievement and shows that if you make that kind of commitment, you can do it. They made work pay, as we did under welfare reform. They raised incomes for families with children even if parents were not working, which is not what we do in this country. And they made a bunch of investments in children: universal preschool for 3- and 4-year-olds; increased spending on education; doubling the length of paid maternity leave; paid paternity leave. If you’re a parent with young children, you can request to switch to part-time or flexible hours without jeopardizing your employment.

Q. Does the new U.S. Census Bureau method of measuring poverty (a revised formula announced in early November) make sense to you?

The new census measure, the supplemental poverty measure, is a great improvement. It sets the poverty line based on families’ expenditures on food, shelter, clothing and utilities (rather than just food as the old measure does), and uses a more complete definition of income, including taxes and transfers. The overall poverty rate doesn’t change too much, but what changes is who is poor, and that’s as it should be. What I really like about the new measure is that we can see the effect of government programs. We can see in the new numbers that were released that if we didn’t have the Earned Income Tax Credit at the levels that we have now, poverty among children would be 4 percentage points higher—22 percent instead of 18 percent. So yes, it’s a great improvement. Even so, there are other things to measure. Are families having a hard time putting enough food on the table‘ Paying their rent? Are they behind on their utility bills? Are they forgoing medical care? Are children in good health? Are they coming to kindergarten ready for school and, at the other end of childhood, are they graduating from school with the skills they need? Should we be measuring those things’ Absolutely. If we’re ultimately interested in what government can do to improve child and family well-being, then it’s not just about income, it’s also about material hardship and other aspects of well-being.

Q. Why has it been so difficult to change the poverty measure, and why has it only now happened?

A few years ago, there was a wonderful West Wing episode about whether to move to a new measure under which you’d find slightly higher poverty. The political operatives killed it, because nobody wants to be president the year that poverty goes up simply because the measurement has changed. The other barrier has been that the official poverty line is used in many government programs to set eligibility for benefits. So it’s been difficult to get Congress to shift to a new measure. What the Obama administration realized was that they could simply release the supplemental measure alongside the official one.

Q. There’s a widely held view that government has done more for the elderly than for children. Does the supplemental poverty measure change that view?

Elderly poverty actually goes up quite a bit under the supplemental measure compared to the official measure. It’s still lower than child poverty, so children are poorer as a group. Some of this is because we got rid of the assumption [in the official measure] that the elderly need to eat less than everybody else, but quite a bit of it has to do with taking into account medical out-of-pocket expenditures. That one change alone raises the elderly poverty rate from 9 percent to 16 percent. But medical out-of-pocket expenditures are important for families with children, too. So I take away from the new numbers not that we need to spend more on the elderly, but that we need to get health care costs under control for everyone.

Q. In your 2006 book, What Children Need, you recommend a wide range of policies such as more flexibility for parents to take care of family responsibilities and expanded paid parental leave. Are these goals even possible given our current economic and political state?

Absolutely. Several of the things that you mentioned don’t cost government anything including the right to request flexible or part-time employment. Take paid parental leave; I think we assume in this country that we’re talking about employers paying employees while they’re out on maternity or paternity leave. But that’s not how it works in virtually all advanced industrialized countries. There is a social insurance fund, like a disability or unemployment insurance fund. Employers and employees pay into it and when an employee is out on parental leave, they’re paid through that social insurance fund.

Q. You have also suggested changing the school calendar. In what way and why?

We have a school calendar that dates back to agricultural times. Not that many American schoolchildren are working on family farms bringing in the harvest these days. We’re lagging badly behind other countries in educational achievement and especially in the gaps between low-income kids and higher-income kids. If we want our kids to be learning more, and especially low-income kids who don’t have so many resources outside of school, we need to have them in school longer hours and more days.

Q. Your research last year showing that mothers who return to work are not putting their children’s well-being at risk made headlines around the world. Can you explain why?

There have been studies for years, including my own, that showed negative effects on kids’ cognitive or behavioral development of moms working in the first year. The recent study that I did with Jeanne Brooks-Gunn and Wen-Jui Han used a different analytic method that takes into account the various factors that change with employment. If the mother is working full-time, that’s going to put the family on a path toward higher income and lots of things that might benefit kids. Kids might actually go to higher-quality child care; the mom might be happier and in better mental health. But the downside might be that the child might be entering child care earlier, and there might be more stress and strain. Our models took these effects into account. Once we did that, there was no overall significant effect of working full-time in the first year on kids’ later development.

Q. What are the most important things that policymakers can or should be doing to reduce poverty and improve well-being?

The British case shows us that it’s possible to achieve substantial reductions in poverty. And, whether it’s paid parental leave, universal preschool or giving parents the right to more flexibility at work, there are a host of things that we need to be doing to improve child well-being, and we’re just not there. But this raises the political question: How do we generate the political will to seriously tackle child poverty and make the kind of investments in children that we should be making? I hope that with a better measurement of poverty, we can show more clearly who is poor and also what role current policies are playing in reducing poverty. That can only help.

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