Could we cut child poverty in half? Why, yes.


March 1, 2019

Could the U.S. cut child poverty in half over the next ten years? Yes – and on Thursday, Feb. 28, a panel of experts explained how.

The experts, convened by the National Academies of Sciences, Engineering, and Medicine at the request of Congress, spent two years studying child poverty in the U.S. and identifying evidence-based programs and policies to reduce the number of children in poverty.

On Thursday, the panel released a comprehensive report, A Roadmap to Reducing Child Poverty. The report identifies two packages of policies and programs, either of which could reduce child poverty by half within 10 years:

A means-tested supports and work package. This package would combine expansions of the Earned Income Tax Credit (EITC) and the Child and Dependent Care Tax Credit with expansions of two existing income support programs: the Supplemental Nutrition Assistance Program (SNAP) and housing voucher programs. The report estimates this package of programs would cost $90.7 billion per year.

A universal supports and work package. This package is designed to enhance income security and stability while also rewarding work and promoting social inclusion. The cornerstone of this package is a child allowance, which would replace and improve upon the current Child Tax Credit, but the package also includes a new child support assurance program, an expansion of the EITC and Child and Dependent Care Tax Credit, an increase in the minimum wage, and elimination of the immigrant eligibility restrictions imposed by the 1996 welfare changes. The report estimates this package of programs would cost $108.8 billion per year.

But could the U.S. really cut child poverty in half over ten years? Yes, explains Greg Duncan, a professor of education at the University of California at Irvine, who chaired the committee that researched and wrote the report. In fact, it’s happened before. The U.S. saw its child poverty rate cut in half, according to the Supplemental Poverty Measure, between the years of 1967 and 2016. More recently, Britain cut its child poverty rate in half between 2001 and 2008. And Canada a few years ago approved its Child Benefit program, which is expected to have a similar outcome.

Although spending $90 billion to $108 billion a year to fight poverty sounds expensive, cutting child poverty in half actually would save the U.S. a considerable sum of money. The report cites studies that child poverty costs the nation roughly between $800 billion and $1.1 trillion each year in terms of lost adult productivity, the increased costs of crime, and increased health expenditures. Seen in that light, a comprehensive, well-funded plan to significantly lower poverty levels would result in significant savings.

The report found that in 2015, 13 percent of the nation’s children lived in poverty. The poverty rate was 18 percent for black children, 22 percent for Hispanic children and 8 percent for non-Hispanic white children. These rates are based on the Census Bureau’s Supplemental Poverty Measure, which takes into account more accurate income and expense estimates than the official poverty measure.

And it could have been worse, but for a number of anti-poverty programs. The report found that increases in the EITC program have improved child educational and health outcomes. SNAP has improved birth outcomes as well as child and adult health outcomes. Expansions of public health insurance for pregnant women, infants and children have led to substantial improvements in child and adult health, educational attainment, employment, and earnings. Young children whose families used housing vouchers to move to low-poverty neighborhoods did better in school and had higher earnings than children whose families did not receive this benefit.

These federal programs have kept the child poverty rate lower than it would have been without them. For example, the report found that without two refundable tax credits – the EITC and the refundable portion of the Child Tax Credit – child poverty would have increased from 13 percent to 18.9 percent. Without SNAP, the rate would have grown from 13 percent to 18.2 percent.

By showing alternative approaches to substantial child poverty reduction, the report demonstrates that (1) a combination of policies is needed, rather than trying to rely on just one program, and (2) there are multiple, practical poverty solutions. Policy-makers have many options that would improve the lives of millions of children and strengthen the economy by adding hundreds of thousands of additional workers.

A Roadmap to Reducing Child Poverty is available online and may be downloaded here. (Note that you can download a PDF of the report for free, but you must create an account.)

child poverty
Earned Income Tax Credit