conor williams, economic policy analyst david riemer, senior fellow julie kerksick, senior policy...
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Conor Williams, Economic Policy Analyst
David Riemer, Senior Fellow
Julie Kerksick, Senior Policy Advocate
Community Advocates Public Policy Institute
November 18th, 2015
Working Our Way Out of Poverty
Working Our Way Out of Poverty
2
Government’s Current Role
All Persons Children (<18) Adults (18-64) Seniors (65+)0%
10%
20%
30%
40%
50%
60%
21.3% 21.5%15.4%
50.3%
11.2% 13.6%10.5% 10.4%
Poverty BEFORE and AFTER Government Economic Security Programs: All Poor Persons: Wisconsin in 2008
BEFORE Government Programs: IRP Market-Income-Only Poverty RateAFTER Government Programs: IRP Disposable Income Poverty Rate
Pove
rty
Rate
Source: Institute for Research on Poverty (IRP), University of Wisconsin-Madison
Big Remaining Problem: Job Shortage
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 201561.0%
62.0%
63.0%
64.0%
65.0%
66.0%
67.0%
Labor Force Participation Rate
Source: BLS
Who is in Poverty?
27 million adults 8 million adults
16 million 8 million 3 million 4 million 4 million
5
A Five-Part “Policy Package” is Needed
6
Make Work Available
Policy 1: Create a Transitional Jobs Program:
Program:• For unemployed & underemployed, ages 18-69• Not incarcerated or receiving Social Security, SSDI, or SSI• Opportunity to work in a minimum wage TJ, up to 30 weeks• Min. 8 hours, max. 40 hours per week
7
Make Work Pay
Policy 2: Increase in the Minimum Wage:
• Raise the minimum wage to $10.10 per hour, indexed for inflation
• 39 percent increase
$7.25
$10.10
8
Make Work Pay Further
Policy 3: Reform the EITC
• $4,000 increase• Remove marriage penalty
9
Reduce Obstacles to Work
Policy 4: Strengthen Child Care Funding:
Guaranteed subsidized child care for every familybelow 150% of official poverty line
10
Help Retired Seniors and Adults with Disabilities
Policy 5: Secure Retirement and Disability Income Tax Credit:
Eligibility Criteria:• Income from Social Security, SSDI, or SSI• Age 18 or older, and not a dependent of another taxpayer
Credit:Equals = 150% of official poverty line - Sum of Social Security + SSDI + SSI + SNAP + Federal AGI (if positive)
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Stand-Alone Policies = Small Impact
Baseline Transiitonal Jobs Minimum Wage EITC Reform Secure Retirement Credit
Child Care Subsidies0%
2%
4%
6%
8%
10%
12%
14%
16%
SPM
Pov
erty
Rat
e
12
Policy Package = Dramatic Impact:Poverty Reduced by 50% +
Baseline Policy Package0%
2%
4%
6%
8%
10%
12%
14%
16%
SPM
Pov
erty
Rat
e
13
Preview: Policy Package for entire United States in 2010
All Persons Age < 18 Age 18-64 Age 65+0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
15%16%
14%15%
7%9%
7%
6%6%
7%6%
5%
BaselineCommunity Advocates Package - Low TJ Take-UpCommunity Advocates Package - High TJ Take-Up
SPM
Pov
erty
Rat
e
14
Impact of Policy Package byRace & Ethnicity
All Persons White Black Hispanic Other0%
5%
10%
15%
20%
25%
30%
15%
10%
22%
28%
16%
7%
4%
7%
15%
7%
SPM
Pov
erty
15
Other Packages, New Evidence• Other packages have found similar results
• Wisconsin - Community Advocates Wisconsin Package 1.0• Wisconsin Only – Poverty reduction of 58%
• New York City – Federation of Protestant Welfare Agencies, Catholic Charities and United Jewish Appeal
• New York City – Poverty reduction of 54%
• United States – Children’s Defense Fund• Nationwide families with children – Poverty reduction of 60%
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Lessons Learned
Poor
Adults
SSI
SSDI
SocialSecurity
Children
Unemployment Insurance
Minimum Wage
Earned Income Supplements
FoodShare
Senior and Disability Income Tax Credit
Transitional Jobs
EarningsSupplement Reform
Medicaid
K12 Education
Early Childhood Education
Increase & Index
NOT in Labor Market
IN Labor Market
Age andRetirement (65 + older)
Disability
Unemployed Full-Time
Working Full-Time
Unemployed Part-Time and Working Part-Time
ExpandedSubsidized
Child Care
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Cost in Perspective (Percent of Other Spending)
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It Sounds Like a Good Idea….
Higher Minimum Wage:• 27 states, plus the District of Columbia, have minimum wages higher than the federal level of $7.25 per hour.• 6 states will be at $10 per hour or more by 2017.• President Obama’s current budget proposal calls for a federal minimum wage of $10.10 per hour.
Expanded Earned Income Tax Credit:• 24 states, plus the District of Columbia, have state or local Earned Income Tax Credit programs, in addition to the
federal Earned Income Tax Credit.• Both President Obama and Congressman Paul Ryan, chair of the House Ways and Means Committee, have
proposed similar expansions of the federal Earned Income Tax Credit to include single adults without dependents.
Transitional Jobs Programs:• There are 22 states that have publicly or privately funded transitional jobs programs.
State Property Tax Credit/Rebate Enhancements for Seniors and Persons with Disabilities:• 28 states have tax credits or rebate programs for seniors and/or persons with disabilities.
Child Care Subsidies/Tax Credits:• Over 20 states also provide child tax credits and childcare tax credits.
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State Progress
20
State Progress
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Questions and Feedback ?Community Advocates Public Policy Institute728 North James Lovell Street, Milwaukee, WI 53233
Conor Williams, Economic Policy [email protected], 262.442.4646
David Riemer, Senior [email protected], 414.270.2943
Julie Kerksick, Economic Policy [email protected], 414.795.8566
Urban Institute2100 M St NW, Washington, DC 20037
Kye Lippold, Research [email protected], 202. 709. 6786