THE WAR ON POVERTY: MEASUREMENT,TRENDS, AND POLICY

We present a 50‐year historical perspective of the nation's antipoverty efforts, describing the evolution of policy during four key periods since 1965. Over this half‐century, the initial heavy reliance on cash income support to poor families has eroded; increases in public support came largely in the form of in‐kind (e.g., Food Stamps) and tax‐related (e.g., the Earned Income Tax Credit) benefits. Work support and the supplementation of earnings substituted for direct support. These shifts eroded the safety net for the most disadvantaged in American society. Three poverty‐related analytical developments are also described. The rise of the Supplemental Poverty Measure (SPM)—taking account of noncash and tax‐related benefits—has corrected some of the serious weaknesses of the official poverty measure (OPM). The SPM measure indicates that the poverty rate has declined over time, rather than being essentially flat as the OPM implies. We also present snapshots of the composition of the poor population in the United States using both the OPM and the SPM, showing progress in reducing poverty overall and among specific socioeconomic subgroups since the beginning of the War on Poverty. Finally, we document the expenditure levels of numerous antipoverty programs that have accompanied the several phases of poverty policy and describe the effect of these efforts on the level of poverty. Although the effectiveness of government antipoverty transfers is debated, our findings indicate that the growth of antipoverty policies has reduced the overall level of poverty, with substantial reductions among the elderly, disabled, and blacks. However, the poverty rates for children, especially those living in single‐parent families, and families headed by a low‐skill, low‐education person, have increased. Rates of deep poverty (families living with less than one‐half of the poverty line) for the nonelderly population have not decreased, reflecting both the increasing labor market difficulties faced by the low‐skill population and the tilt of means‐tested benefits away from the poorest of the poor.     

Partnering and Parenting in Poverty: A Qualitative Analysis of a Relationship Skills Program for Low‐Income,Unmarried Families

Since the mid‐1990s, the federal government has funded numerous relationship skills programs, including some specifically targeting low‐income, unmarried parents, in an effort to strengthen couples’ relationships and increase family stability. The previous research on the effectiveness of these interventions has revealed mixed results about whether such programs can improve the relationships of lower income couples who tend to experience lower relationship quality, lower marriage rates, and higher rates of relationship dissolution. This article draws on in‐depth qualitative data collected during an 18‐month ethnographic study of one federally funded relationship skills program for unmarried, low‐income couples expecting a new baby. Overall, though parents found the financial management lessons included in the classes only minimally useful, if at all, they found other aspects of the program particularly useful for three main reasons: (1) classes allowed parents to focus exclusively on their couple relationships in ways they rarely did otherwise; (2) program incentives helped parents make financial ends meet that month; and (3) parents learned that the challenges they personally experienced were often endemic to the romantic and co‐parenting relationships of unmarried parents who have few resources and experience more challenges that tend to undermine relationship quality, such as financial stress and relational ambiguity. Engaging with other couples around shared challenges normalized couples’ relationship problems and lessened the resentment and animosity that typically characterized their partner interactions. These findings have important implications for healthy marriage and relationship policy. Program developers should avoid lessons that imply low‐income, unmarried parents’ spending habits and family‐formation decisions are deficient. Interventions should instead encourage couples to discuss their shared challenges and minimize their tendency to individualize relational and financial strain.     

Social capital and the revitalization of New York City's distressed inner‐city housing

Abstract

This article presents evidence that social capital can be an effective component of locally sponsored low‐income housing programs. It provides a model for measuring social capital at the building level, where it may be most effective in improving housing quality and security. The study compares five programs in New York City that house the city's poorest, mostly minority residents. The surveys from 487 buildings in Brooklyn, NY, were analyzed to compare the success of programs in maintaining and revitalizing landlord‐abandoned buildings taken by the city in lieu of taxes.

Results of the analysis demonstrate that the positive effects of tenant ownership were largely mediated by the higher levels of social capital found in these buildings. These levels have implications for the survival and economic advancement of poor households and civic participation in poor communities. The study suggests the value of alternative homeownership programs.     

Can child care assistance in welfare and employment programs support the employment of low‐income families?

Policymakers have long recognized child care as a key ingredient in low‐income parents' employability. We examine the effects of expansions in child care policies that were bundled with a mix of employment‐related policies and implemented as part of several random assignment studies on families' child care access and cost. Almost all of these welfare and employment programs increased employment and led to concomitant increases in the use of child care, especially paid child care. Only the programs that also expanded access or affordability of child care consistently increased the use of child care subsidies and reduced out‐of‐pocket costs to parents, allowing parents to purchase center‐based care. With one exception, such programs had small effects on employment‐related child care problems, suggesting that broader and more generous targeting of child care assistance may be important for achieving the goal of enhancing the stability of employment among low‐income families. © 2004 by the Association for Public Policy Analysis and Management.     

Refugees: The security dimension

In the 1990s doors have been closing in the Western world against refugee claimants. Although there are multiple causes for declining generosity towards refugees, arguments that refugees pose security problems to host nations have been particularly prominent. An historical analysis reveals that the so‐called ‘golden age’ of postwar refugee settlement from the 1940s to the mid‐1970s was a by‐product of Cold War security and propaganda considerations. The end of the Cold War and the pressures of refugee movements generated by Third World and former Communist bloc conflicts has restructured Western refugee discourse. Refugees now tend to be seen as importers of external political conflicts into the West. At the same time growing European and North American resentment of ‘foreigners’ competing for declining job opportunities and reduced social services have encouraged anti‐immigrant political movements. By tightening barriers and controls over refugees on security grounds, Western governments are able to respond in part to these pressures. The Cold War policing and security alliance in Europe has been retooled to form the basis of a new post‐Cold War cooperation over immigration and refugee security, without the necessity of creating a new framework of supranational institutions.     

Lessons for the Study of Policy Implementation: Project Renewal in Israel

This article attempts to clarify some of the issues in the debate over the study of policy implementation, in particular the disagreements between proponents of the top-down versus bottom-up approaches. It proposes use of a modified top-down perspective which bridges the assumed dichotomy between policy formulation, enactment, and an implementation process and addresses many of the concerns of the bottom-up research strategy. This new perspective portrays implementation as part of a single ongoing process in which policy is formulated, enacted and continually readjusted and adapted before and after implementation at the local level. The article is based on an analysis of the findings of a case study of the implementation of Israel's Project Renewal, a comprehensive community renewal and development program – a hybrid resembling the American Urban Renewal, Model Cities and the War on Poverty programs. Rather than evaluate the success of this Israeli program, the intent here is to ask what the research findings teach about the study of policy implementation.     

The Impact of Tax Revenue from Capital Gains Realizations on State Income Tax Revenue and Budget Conditions

We explore the effect of the rapid increase in capital gains realizations on state income tax revenue during the 1990s and 2000s, and the effect that this had on state fiscal decisions regarding the use of these revenue. We find wide variation in the growth of capital gains realizations across states and that the growth in capital gains had a significant effect on state income tax revenue for many states. We find that states used a sizable portion of the additional revenue from capital gains to fund reserves in the year the revenue was generated, and that capital gains revenue lead to some reductions in taxes but not to increases in expenditures. The evidence suggests that states were conservative in their use of capital gains related revenues.     

Cream‐Skimming,Parking and Other Intended and Unintended Effects of High‐Powered,Performance‐Based Contracts

As performance‐based contracting in social welfare services continues to expand, concerns about potential unintended effects are also growing. We analyze the incentive effects of high‐powered, performance‐based contracts and their implications for program outcomes using panel data on Dutch cohorts of unemployed and disabled workers that were assigned to private social welfare providers in 2002 to 2005. We employ a difference‐in‐differences design that takes advantage of the fact that contracts gradually moved from partial performance‐contingent pay to full (100 percent) performance‐contingent contracting schemes. We develop explicit measures of selection into the programs and find evidence of cream skimming and other gaming activities on the part of providers, but little impact of these activities on program outcomes. Moving to a system with contract payments fully contingent on performance appears to increase job placements, but not job duration, for more readily employable workers.     

Whose shortage of affordable housing?

Abstract

Shortfalls of low‐rent units are repeatedly cited as the rationale for programs to expand the supply of affordable housing. But the poverty‐level rents studied fall well below those of major supply programs. To reassess whether HOME and the low‐income housing tax credit (LIHTC) address actual shortfalls, this article compares numbers of units with renters by measuring both affordability and incomes with the median‐income‐based metric used for all federal rental programs.

During the 1980s, there were growing surpluses of units affordable to renters with incomes between 50 and 80 percent of their area's median income, a “low‐income” range that includes most HOME and LIHTC rents. By contrast, shortages were severe and growing only at rents affordable to households with incomes below 30 percent of area median. Examination of these shortfalls and the problems they create implies that programs to expand supply are not widely needed.     

Innovative Governance and Development in the New Ireland: Social Partnership and the Integrated Approach

Since the mid‐1980s, the economy of the Republic of Ireland has displayed a remarkable turnaround. Its Gross Domestic Product (GDP) has grown at a faster rate than any developed country in the world. The government's deficit has been cut severely and the debt‐to‐GDP ration sharply reduced. Average incomes have risen significantly, and the unemployment rate reduced dramatically. This article documents these changes. Its main purpose, however, is to provide a plausible explanation for the “Irish miracle.” While many factors have been important—support for the Economic Union's regional development programs, a favorable tax structure, locational and language advantages for attracting multinational corporations, strong education and training programs—these factors in themselves do not explain the emergence of the “Celtic tiger.” They were in place before the mid‐1980s when Ireland was suffering from a fiscal, economic, and political crisis. Instead, the article argues, it was the creative and innovative response of Irish leaders in government, industry, and labor movement and community organizations to the crisis, and the subsequent institutionalization of this response in a new form of governance, that has been the catalyst for the Irish success story. Based on the thorough background research of the Economic and Social Research Council, a farsighted group of leaders developed a strategic plan in 1987 that provided a blueprint for constructive economic and social change. This was then formally instituted for wage restraint on the part of labor in return for income tax and social supposed provisions by government. Irish social Partnership is modeled to some extent on Northern European corporatism. The article reviews corporatism as an early form of innovative governance, using classical corporatism in Sweden and competitive corporatism in the Netherlands to illustrate how this approach has evolved over the years. Dutch economic success in recent years is due in part to its new form of corporatism that has helped it become globally competitive. It is argued, however, that Irish social partnership goes beyond continental corporatism in several important ways. It is more inclusive, covering a large array of social interests; it is more strategic, with a well‐articulated integrated approach to social and economic development that is self‐corrective and articulated in a new national agreement every three years; and it is more firmly institutionalized in both government and nongovernment agencies in the country. Social partnership and the integrated approach have become part of the culture of the new Ireland. This innovative form of governance underlies the Irish turnaround and augurs well for the future. It can also serve as a model, with appropriate modification tailor‐made to each case, for other jurisdictions hoping to emulate Ireland's success.     

PLANNED INCAPACITY TO SUCCEED? POLICY-MAKING STRUCTURE AND POLICY FAILURE

Policies may fail in two analytically distinct ways: they may fail to achieve their goals, or they may fail to retain political support and be terminated. By failing to distinguish between ineffectiveness and political failure, the three most common interpretations of the War on Poverty and the Comprehensive Employment and Training Act (failure owing to central government incompetence, failure owing to pluralism, and "hidden" success) cannot adequately account for the gap between their ambiguous performance and their clear political failure. To understand these differences, one must understand the effect of America's fragmented political structure on the design and implementation of poverty and unemployment remedies. Under resource constraints and given a large degree of policy discretion, American states in the aggregate have retained their historic resistance to social policies that would increase short-term expenditures and reduce the attractiveness of their business climate. These jurisdictions and their Congressional representatives opposed new fully nationalized initiatives, insisting on policy designs that promised fiscal relief while protecting state and local policy control. National policymakers found that grant-in-aid programs offered the path of least resistance in these circumstances. Although social policy grant programs could win initial approval in Congress, these designs proved to be increasingly unwieldy, expensive, and difficult to control in practice. The programs yielded ambiguous overall results but provided unambiguous examples of waste, fraud and abuse, fueling the perception of failure and contributing to the backlash against these programs and their political failure.     

How does government funding affect nonprofits' program spending? Evidence from international development organizations

Under the new governance models, the scope of government funding of nonprofit activities in service delivery and policy implementation is extensive. There is a long‐standing concern that government funding may compromise nonprofit operations and lead to unintended consequences. This research examines the concern by exploring the effect of government funding on nonprofits' spending on programs and services. Existing theories and empirical evidence propose competing arguments concerning the relationship between government funding and nonprofits' program spending. Using a 20‐year panel dataset of international development nonprofits registered with the United States Agency for International Development, we find that nonprofits receiving more government funding spend significantly higher proportions of their organizational resources on development programs. Government funding seems to increase nonprofits' program spending and to make them more focused on their mission‐related activities.     

The reverse mortgage as an asset management tool

Abstract

Reverse mortgages are usually seen as a vehicle for increasing the income of poor, elderly households. This perspective, coupled with the relatively slow growth of reverse mortgage programs, has led some observers to question the growth potential of the reverse mortgage market. This article presents a more expansive view of reverse mortgages as a financial tool for tapping housing equity for various purposes and at various stages in the life cycle.

Three market segments for reverse mortgages are discussed: elderly persons living alone, other elderly households, and non‐elderly households. Potential uses include turning housing equity into personal human capital investment accounts, enabling children to provide care for their disabled parents, funding elderly households’ long‐term care insurance, and sustaining consumption. Recent progress in product development and availability and political pressures to find private financing for health and long‐term care suggest that the reverse mortgage market has considerable growth potential.     

Does whole‐school reform boost student performance? The case of New York City

Thousands of schools around the country have implemented whole‐school reform programs to boost student performance. This paper uses quasi‐experimental methods to estimate the impact of whole‐school reform on students' reading performance in New York City, where various reform programs were adopted in dozens of troubled elementary schools in the mid‐1990s. This paper complements studies based on random assignment by examining a broad‐based reform effort and explicitly accounting for implementation quality. Two popular reform programs—the School Development Program and Success for All—were not found to significantly increase reading scores but might have been if they had been fully implemented. The More Effective Schools program was found to boost reading scores, but this effect seems to disappear when the program “trainers” leave the school. © 2005 by the Association for Public Policy Analysis and Management.     

More Inequality,More Killings: The Maoist Insurgency in Nepal

The hypothesis of inequality as the source of violent conflict is investigated empirically in the context of killings by Nepalese Maoists in their People's War against their government during 1996–2003. The dependent variable is the total number of people killed during that period by Maoist rebels in each of 3,857 villages. Inequality is measured by the Gini, the Esteban‐Ray polarization index, and four other between‐groups indexes. Using models with district fixed effects, and instrumenting for endogeneity of the inequality measures, we find strong evidence that greater inequality escalated killings by Maoists. Poverty did not necessarily increase violence. Education moderated the effect of inequality on killing, while predominance of farmers and of Nepali speakers exacerbated it. We find evidence that more killings occurred in populous villages, lending support to the idea that violence was directed at expanding the Maoist franchise by demonstrating that opposition to the monarchy and elites in power was possible to achieve.     

A new look at creative finance

Abstract

In his seminal work, Stegman contended that creative finance is an inefficient means of financing low‐income housing production. As evidence, he cited the high transaction costs associated with the complex financing structures that make a low‐income housing development feasible. In this article, we extend Stegman's work by examining the impacts of creative finance over time. We rely on data gathered as part of an evaluation of 36 housing developments sponsored by nonprofits.

The data indicate that most of the developments in our study remained financially viable in part because of their reliance on creative finance. We find evidence supporting three positive impacts of creative finance: the establishment of long‐term partnerships, the increased community acceptance of low‐income housing developments, and the improved technical skills of organization staff. We also find that none of the long‐term negative impacts are inherent in creative finance and offer four suggestions on minimizing them.     

Social capital and crime in New York City's low‐income housing

Abstract

This article presents evidence that components of social capital can play a prospective role in preventing crime in low‐income housing. It develops a conceptual approach to crime prevention involving social capital, alternative forms of ownership, and environmental design considerations. The study compares five programs that house New York City's poorest, mostly minority residents. The effectiveness of social capital in preventing crime is assessed using data from surveys of 487 buildings in Brooklyn, NY, and crime data from the New York City Police Department.

Results of the analysis indicate that three components of social capital—basic participation in tenant associations, tenant prosocial norms, and a building's formal organization—were all related to reducing various types of crime in the buildings under study 6 to 12 months after social capital was measured. The effectiveness of social capital was related to alternative ownership structures, building characteristics, and housing policy.     

Does social capital increase public support for economic globalisation?

The dominant explanation of public attitudes vis‐à‐vis economic globalisation focuses on re‐distributional implications, with an emphasis on factor endowments and government‐sponsored safety nets (the compensation hypothesis). The empirical implication of these theoretical arguments is that in advanced economies, on which this article focuses, individuals endowed with less human and financial capital will be more likely to experience income losses. Hence they will oppose economic openness unless they are compensated by the government. It is argued here that including social capital in the analysis can fill two gaps in explanations relying on factor endowments and the compensation hypothesis. First, generalised trust – one key aspect of social capital – constitutes a personal endowment alongside human and financial capital. Second, structural social capital – another key aspect of social capital – can be regarded as a nongovernmental social safety net that can compensate for endowment‐related disadvantages of individuals. Both aspects of social capital are expected to contribute, for distinct reasons, to more positive views on economic openness. The empirical testing relies on survey data for two countries: Switzerland and the United States. For both countries, the results indicate that generalised trust has a strong, positive effect on public opinion of economic globalisation, whereas structural social capital has no effect.     

Coombs’ Bastard Child: The Troubled Life of CDEP

In the mid 1970s HC Coombs was a major promoter of the idea behind the CDEP scheme: that rather than pay lots of Aboriginal people in remote areas unemployment benefits it would be more constructive for them to be employed part‐time by local Indigenous organisations to undertake socially useful tasks. From this simple idea was born one of the most significant and, in time, one of the largest Indigenous‐specific programs Australia has seen, the Community Development Employment Projects scheme. The birth was not easy and neither has been the subsequent life of what I have called, with great licence, Coombs’ bastard child.     

Determinants of Pay‐as‐You‐Go Financing of Capital Projects: Evidence from the States

Although states have long practiced pay‐as‐you‐go in financing their capital projects as a supplement to debt, academia has paid scarce attention to pay‐go financing. This study fills in the niche by providing empirical evidence on what determines the use of pay‐go in financing capital projects. It develops a model that considers the preferences of both voters and politicians when they make capital financing decisions in a given institutional setting. The empirical results suggest that the use of pay‐go is affected by a state's income level, its economic conditions, the presence of a divided government, as well as its budgetary institutions.