The Poverty Report Card

David B. Grusky Stanford Center on Poverty and Inequality

Bldg. 370, 450 Serra MallStanford UniversityStanford, CA 94305

prepared for ...The Way Forward

Innovating Together to Cut PovertyJune 5, 2013

Agenda

The case for monitoring poverty and inequality … frequently

Introduce the Report Card

Road Map goals

Reducing poverty through targeted interventions

Evaluating the effectiveness of targeted interventions

Monitoring progress and changing the conversation about poverty

The case for monitoring

The structure of poverty changes (sometimes quickly)

Getting poverty in the news … often

Demonstrating that policies have effects

Allows for real-time response

Poverty rate is at or near highest level in last half century for children and non-elderly adults

Sheldon Danziger, Koji Chavez, and Erin Cumberworth, Recession Trends (www.recessiontrends.org),Stanford Center on Poverty and Inequality

Young adults have borne brunt of takeoff in poverty

Sheldon Danziger, Koji Chavez, and Erin Cumberworth, Recession Trends (www.recessiontrends.org),Stanford Center on Poverty and Inequality

Rising deep poverty (i.e., less than $2/day in 2011 dollars)

Source: “Rising Extreme Poverty in the United States and the Response of Federal Means-Tested Transfer Programs,” Luke Shaefer and Kathy Edin

Declining percent of poor living in families with at least one worker

Absolute deterioration in employment situation of poor

Predates recession

Source: Recession Trends initiative (www.recessiontrends.org, Sheldon Danziger, Koji Chavez, Erin Cumberworth)

Rise in poverty most prominent in high-poverty metropolitan areas

Poverty increases most in high poverty metropolitan areas

Source: Recession Trends initiative (www.recessiontrends.org, Robert Sampson and Ann Owens)

Keeping it in the news

Even if poverty were unchanging we need to keep talking about it

Create regularized events that become news in and of themselves

The planQuarterly measurementAnnual report card

Quarterly measurement

Children living in nonworking poverty families

Individuals over age 15 with family incomes below SPM threshold

20082007 2009 2010 2011 2012

Black

Hispanic

White

Asian

Tale of two measuresUnemployment measures: Once a monthPoverty measures: Once a year (and outdated at moment of release)

Policy does have effect

Sheldon Danziger, Koji Chavez, and Erin Cumberworth, Recession Trends (www.recessiontrends.org),Stanford Center on Poverty and Inequality

Not some complicated puzzle (like finding cure for cancer)

We know what to do

And it’s been done

• In the U.K.

• Even here

Counterfactuals

American Recovery and Reinvestment Act (ARRA): Would it have reduced poverty had it been applied in 2008?

Answer: By 1.3 points (via tax credit expansions, additional payments to Social Security recipients, SNAP benefit increases)

An ongoing macroeconomic response (as with unemploy- ment)?

The Report Card event

A national day of reckoning … a national scandal and shared problem

Comparisons

• Over time

• Across states and counties

The power of grading

Tie-ins

• Pathways Magazine

• Poverty and inequality briefs (see www.recessiontrends.org)

Quick response teams

Challenges

• Sample size

• Bay Area heterogenity

• Reconciling with Road Map

Qualitative measurement of poverty

Qualitative studies of poverty have been immensely important in uncovering experience of poverty

One-shot tradition of qualitative analysis makes monitoring trend impossible

Solution: Qualitative trend measurement

Measuring trends in social mobility

President Obama vowed to “build new ladders of opportunity into the middle class” in his 2013 address

Ways to move forward1. Administrative data (i.e., IRS)2. Adding intergenerational module to existing survey (e.g., ACS ,CPS, SIPP)

Developing local and regional poverty measures

The SPM revolution in poverty measurement

But we need to develop local SPM measures

A standardized, regularized protocol for monitoring labor market discrimination

The rise of experiments: Laboratory, resume, and audit studies of labor market discrim- ination have revolutionized field

But limited to one-shot studies

Need standardized protocol administered at regular intervals• Which types of discrimination are

most prominent? Race, gender, motherhood status, poverty status, criminal record, sexual orientation, credit record• Which types are becoming stronger

or weaker?

An engaged ivory tower

Major social problem of our time

Engaged ivory tower

Powerful union of science and action … a new smart war on poverty