urban institute nonprofit social and economic policy research

What Works

Poverty

WHAT WORKS?

What works for fighting poverty? Our researchers study the effects of welfare reform, tax subsidies, Social Security, workforce development policies, and other anti-poverty programs. What could help? Social Security lifts many older adults out of poverty, but it needs an updated minimum benefit sufficient to raise all long-career, low-wage workers out of poverty. Public program rules that discourage poor families from saving and run counter to poverty reduction should be changed.

Read more on Reducing Poverty Among Retirees

KEY PUBLICATIONS

Fifteen Years After Welfare Reform Took Hold, How Well Does the Program Work?

URBAN INSTITUTE

Eight briefs examine barriers to employment among parents on TANF, the circumstances of single mothers with no earnings or cash welfare, reasons for the high share of child-only TANF cases, how TANF connects to the broader safety net, how state TANF programs meet federal work requirements, how employment and earnings can be improved for TANF recipients, how state programs can link TANF clients to education and training, and TANF's changing caseloads.
Publication Date: May 16, 2012

Welfare Reform What Have We Learned in Fifteen Years?

SHEILA R. ZEDLEWSKI

Welfare has changed dramatically since Temporary Assistance for Needy Families replaced Aid to Families with Dependent Children in 1996. TANF can be characterized by shrinking real benefits, strategies that divert families from enrolling, and sanctions that penalize families. Data show high rates of employment barriers among adults on TANF, and a large share of TANF cases provide benefits only for the children. While evidence is scarce on strategies that move families to self-sufficiency. TANF can draw lessons from 15 years of research to improve program design.
Publication Date: May 14, 2012

Six States Experiment with New Tactics and Tools to Streamline Low-Income Families' Access to Work Support Benefits

URBAN INSTITUTE

Fragile households seeking solid footing in a weak economy will receive reinvigorated support as Colorado, Idaho, Illinois, North Carolina, Rhode Island, and South Carolina take up the challenge of streamlining services aiding low-income working families. The six states have been awarded three-year grants to test and implement easy-to-navigate, quick-to-deliver public benefit systems. The grants, the centerpiece of the Work Support Strategies: Streamlining Access, Strengthening Families (WSS) initiative, average about $460,000 per state for each year.
Publication Date: April 25, 2012

WIC Participants and Their Growing Need for Coverage

MICHAEL MARTINEZ-SCHIFERL

The Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) provides low-income pregnant women, postpartum mothers, infants, and children up to age 5 with select foods, nutrition education, and health care and government service referrals. WIC aims to improve the health of participants and prevent later health problems. This brief summarizes key features of the WIC program, including eligibility rules, participation, benefits, and administration. It presents the 2009 estimates of WIC eligibility and coverage for the nation and the states. Also summarized are recent improvements in WIC administrative practices and nutrition outcomes.
Publication Date: April 25, 2012

Streamlining Access to Work Supports: A National Issue for Low-Income Families

OLIVIA GOLDEN, HEATHER SANDSTROM

States can both save money and serve low-income families better if they create integrated eligibility systems for all the support programs they administer, propose Olivia Golden and Heather Sandstrom in this commentary for Spotlight on Poverty and Opportunity.
Publication Date: February 20, 2012

A Bibliography of Studies Using Temporary Assistance for Needy Families (TANF) Linked Administrative Data

PAUL JOHNSON, JAMES KAMINSKI, MOLLY M. SCOTT, ANNE WHITESELL

Since its inception in 1996, the Temporary Assistance for Needy Families (TANF) program has been subject to much study. Some of this work has involved linking TANF administrative data to other administrative data sources, either to improve program administration or to answer program and research questions. Researchers, program administrators, and policy makers considering similar linkages to address research, programmatic, and operational questions can learn from past efforts. This report describes the use of administrative data for program administration and provides a bibliography of TANF research involving linked administrative data.
Publication Date: January 31, 2012

The Impact of Mental Health Treatment on Low-Income Mothers' Work

PAMELA J. LOPREST, AUSTIN NICHOLS

This study analyzes the impact of mental health problems and mental health treatment on low-income mothers' employment, using the 2002 National Survey of America's Families. We find that all mothers, low-income mothers, and low-income single mothers in very poor mental health are significantly less likely to work. Instrumental variables regressions show that mothers receiving mental health treatment are significantly more likely to work. These findings suggest that mental health problems are an important barrier to work among low-income women and that access to treatment for these problems can substantially improve the probability of work for this group.
Publication Date: June 01, 2008

Is the Safety Net Catching Unemployed Families?

AUSTIN NICHOLS, SHEILA R. ZEDLEWSKI

The vast majority of unemployed families received some help from core safety net programs in 2009. Among those experiencing unemployment, receipt of unemployment benefits doubled between 2005 and 2009. Enrollment in the Supplemental Nutritional Assistance Program (SNAP) also increased. Public Assistance played a limited role in unemployed families' lives. About 15 percent of low-work, unemployed families got no help from the safety net. The American Recovery and Reinvestment Act (ARRA) of 2009 clearly helped to strengthen the safety net. This extra help has mostly ended, leaving many families to contend with high unemployment and a frayed safety net.
Publication Date: September 13, 2011

How Do States' Safety Net Policies Affect Poverty?

LAURA WHEATON, LINDA GIANNARELLI, MICHAEL MARTINEZ-SCHIFERL, SHEILA R. ZEDLEWSKI

Safety net policies can dramatically reduce poverty. A full assessment requires use of a Supplemental Poverty Measure (SPM) that adds near-cash benefits and tax credits to cash income, deducts necessary expenses, and uses up-to-date, geographically-sensitive poverty thresholds. This analysis implements the SPM in Georgia, Illinois, and Massachusetts to examine the effects of the key safety net programs on poverty. The results show that safety net policies in these three states have substantially different effects on poverty, but federal programs narrow the differences across the states.
Publication Date: September 13, 2011

The Effects of the Safety Net on Child Poverty in Three States

LAURA WHEATON, LINDA GIANNARELLI, MICHAEL MARTINEZ-SCHIFERL, SHEILA R. ZEDLEWSKI

In 2008, safety net programs cut child poverty in half in Georgia, Illinois, and Massachusetts. Federal programs that provide the same benefit across the country reduce poverty more in lower housing cost states such as Georgia than in higher cost states such as Massachusetts. Massachusetts's generous TANF policy has a greater impact on child poverty than the TANF policies in the other two states. Estimates are produced using the Supplemental Poverty Measure.
Publication Date: July 01, 2011

Is Poverty Incompatible with Asset Accumulation?

SIGNE-MARY MCKERNAN, CAROLINE RATCLIFFE, TRINA WILLIAMS SHANK

Is poverty incompatible with asset accumulation? We examine whether the poor can and do save and whether they are able to build up assets over time. Data are presented from household surveys, as well as from programs targeted at helping families accumulate assets. Presenting and evaluating the state of knowledge provides a new lens on whether the current income-based safety net could better serve poor families by having an asset building component. Conventional thinking is that families that are income poor cannot save. This chapter shows that this thinking is inaccurate; poverty does not have to be incompatible with asset accumulation.
Publication Date: June 01, 2011

What Role is Welfare Playing in this Period of High Unemployment?

SHEILA R. ZEDLEWSKI, PAMELA J. LOPREST, ERIKA HUBER

Temporary Assistance for Needy Families (TANF), the nation's cash assistance program for poor families with children, has not played much of a countercyclical role during the current recession. As unemployment has risen, TANF caseloads nationally have grown much more slowly and state TANF caseloads have not tracked state unemployment growth. Program rules and financing structures limit the responsiveness of TANF in a downturn. As TANF reauthorization is considered, this brief details some relatively small changes that could improve the program's effectiveness in future recessions.
Publication Date: August 17, 2011

Private Transfers, Race, and Wealth

SIGNE-MARY MCKERNAN, CAROLINE RATCLIFFE, MARGARET SIMMS, SISI ZHANG

How do private transfers differ by race and ethnicity and do such differences explain the racial and ethnic disparity in wealth? Using the Panel Study of Income Dynamics, this study examines private transfers by race and ethnicity and explores a causal relationship between private transfers and wealth. We examine private transfers in the form of financial support received and given from extended families and friends, as well as large gifts and inheritances. Our findings highlight important differences in private transfers by race and ethnicity: African Americans and Hispanics (both immigrant and nonimmigrant) receive less in private transfers than non-Hispanic whites.
Publication Date: August 08, 2011

Supplemental Nutrition Assistance Counters High Unemployment

SHEILA R. ZEDLEWSKI

Supplemental Nutrition Assistance (SNAP) provides assistance to millions of families in the US. This fact sheet describes how, as unemployment rates have climbed, so have the rates of SNAP receipt — among older families, families with children, and single adults.
Publication Date: July 21, 2011

Kids' Share 2011

JULIA ISAACS, HEATHER HAHN, STEPHANIE RENNANE, C. EUGENE STEUERLE, TRACY VERNICKER

Kids' Share 2011: Report on Federal Expenditures on Children through 2010, a fifth annual report, looks comprehensively at trends over the past 50 years in federal spending and tax expenditures on children. Key findings suggest that the size and composition of expenditures on children have changed considerably, but children have not been a budget priority. Federal expenditures on children in 2010, were 11 percent of the federal budget, slightly higher than in 2009. This increase is temporary, however, with the children's share of the budget expected to shrink to less than 8 percent by the end of the next decade.
Publication Date: July 21, 2011

Stepping Stones Research Briefing

URBAN INSTITUTE

The Women's Foundation and the Urban Institute co-sponsored a Stepping Stones Research Briefing, featuring two panels touching on issues of affordability, homeownership, and rental assistance through the continuing housing crisis and the role of training, work, earnings and savings in building economic security for low-income, women-headed families.
Publication Date: May 20, 2011

Partnering with Employers to Promote Job Advancement for Low-Skill Individuals

KARIN MARTINSON

This paper explores the reasons why employer partnerships are important for improving economic outcomes for both low-skill workers and businesses. It identifies the factors that have hindered the growth of these partnerships as well as promising approaches-incumbent worker training and sectoral training-to build partnerships. It concludes with a discussion of policy considerations for creating and sustaining partnerships with employers to provide skill development opportunities.
Publication Date: September 01, 2010

Assessing the Evidence about Work Support Benefits and Low-Income Families

GREGORY B. MILLS, JESSICA F. COMPTON, OLIVIA GOLDEN

For low-income working parents, benefits received through the Supplemental Nutrition Assistance Program, Medicaid, and child care subsidies provide vital work support. Access to these programs has been restricted, however, by barriers relating to federal and state funding, program policy, and administrative process, complicating program enrollment and benefit retention. As a result, many low-income working families do not receive the multi-program benefits for which they are eligible. This paper provides a strong rationale for the Work Support Strategies demonstration, enabling selected states to design, implement, and evaluate modernization strategies to dramatically improve families' access to a package of work support benefits.
Publication Date: February 24, 2011

How Should the Safety Net Be Retooled to Work in Times of High Unemployment

URBAN INSTITUTE

In the third installment of a special series on “The New Unemployment and What to Do About It,” a panel of experts will examine how safety net programs -- such as welfare, food stamps, disability insurance, and child support -- have worked generally and for these subgroups when jobs are scarce. They will also explore how to retool the safety net before the next economic downturn.
Publication Date: February 23, 2011

Can Savings Help Overcome Income Instability?

GREGORY B. MILLS, JOE AMICK

Savings can help low-income households cope with income Instability and unexpected expenses, according to new evidence presented here. For households with nonelderly heads in the lowest income quintile, modest holdings of liquid assets (amounts up to $1,999) can significantly reduce the probability of hardships with health care, housing payments, food security, utility and phone bills, and basic consumption. Programs to promote saving can help low-income households protect themselves from economic shocks, as income variability, in addition to low income, increases risk of such hardships.
Publication Date: December 01, 2010

Child Support Plays an Increasingly Important Role for Poor Custodial Families

ELAINE SORENSEN

The child support program has become a critical public program for children, serving 17 million children, representing nearly one in four children in the United States. Among social welfare programs, only the Medicaid program serves more children. It is also an important source of income for poor families, lifting a million people from poverty in 2008. This brief describes the role of child support in reducing poverty and shows how poor custodial families have become more reliant upon child support.
Publication Date: December 01, 2010

Swimming Upstream: Improving Access to Indigent Health Care in the Midst of Major Economic Challenges

SARAH BENATAR, DANA HUGHES, EMBRY M. HOWELL

An evaluation of San Mateo County's comprehensive health system redesign initiative finds notable improvements in access to high quality patient care for formerly uninsured adults. For example, the percent of such individuals having a usual source of care rose from 42.5 to 91.2 percent with the initiative. The initiative met with success despite mounting fiscal challenges associated with the economic recession and state budget crisis – threatening the county's ability to support these innovations. The county's efforts offer lessons for local and national policymakers, program administrators, and providers about how progress is possible despite severe financial obstacles.
Publication Date: December 08, 2010

Emergency Food Assistance Helps Many Low-Income Hispanic Children

MICHAEL MARTINEZ-SCHIFERL, SHEILA R. ZEDLEWSKI

In 2009, nearly 1 in every 5 children in the United States lived in families that used emergency food assistance through Feeding America, the nation's largest organization of emergency food providers. Higher shares of Hispanic and black children used emergency food assistance than white children, reflecting their higher rates of poverty. While the majority of families using emergency food assistance also accessed at least one of the federal nutrition assistance programs, only one in four received food stamps. The high demand for private food assistance demonstrates the extreme need in 2009 caused by high unemployment and poverty.
Publication Date: October 05, 2010

Low-Income Hispanic Children Need both Private and Public Food Assistance

MICHAEL MARTINEZ-SCHIFERL, SHEILA R. ZEDLEWSKI

Families that use emergency food assistance often also get help from federal nutrition programs. Hispanic families less often receive help through the Supplemental Nutrition Assistance Program (SNAP, formerly called food stamps) than families of other racial/ethnic groups placing them at greater nutritional risk. Families that do not receive SNAP benefits often think that their income, assets or citizenship status makes them ineligible. The broad use of food banks and pantries among low-income families with children demonstrates unmet nutritional needs and confirms that enhancements to the federal nutrition safety net are needed.
Publication Date: October 05, 2010

Help Children Born into Poverty

CAROLINE RATCLIFFE, SIGNE-MARY MCKERNAN

In this commentary for Spotlight on Poverty, the authors address the issue that poverty often starts at birth, leading to unstable housing, schooling, and nutrition. As young adults, these children are more likely to drop out of school, have a child as a teen, and be underemployed. Taking action before the consequences of poverty accumulate is imperative. Health reform provides an opportunity for hospitals to connect poor families to insurance when a child is born. The United States can invest in poor children through social services as we invest in higher-income children through tax subsidies for homeownership and college.
Publication Date: September 16, 2010

Reducing Poverty and Economic Distress after ARRA: Next Steps for Short-Term Recovery and Long-Term Economic Security

PETER EDELMAN, OLIVIA GOLDEN, HARRY HOLZER

As unemployment in this recession holds near 10 percent and a growing number of Americans becomes impoverished, much work remains to reduce and respond to poverty and economic distress. In part, this work can build on the provisions of the American Recovery and Reinvestment Act (ARRA), better known as the stimulus package, which has moderated the effects of the recession but will soon phase out. This brief provides a framework and recommendations for next steps, directly related to the stimulus package and driven by other lessons learned from the recession and its aftermath.
Publication Date: July 15, 2010

Measuring Poverty at the State Level

SHEILA R. ZEDLEWSKI, LINDA GIANNARELLI, LAURA WHEATON, JOYCE MORTON

This study implements the modern poverty measure for Minnesota using the American Community Survey (ACS) and simulates the potential effects of alternative safety net policies on poverty. The analysis uses the TRIM3 microsimulation model to correct for survey underreporting and to add information required for this poverty measure, including near-cash benefits, taxes and nondiscretionary expenses. The alternative simulations apply new program rules and behavioral assumptions to recalculate family resources and poverty. The results show the importance of the modern poverty measure for analyzing state policies and also highlight the numerous decisions and imputations required to implement the new measure.
Publication Date: March 01, 2010

Measuring Poverty

LAURA WHEATON, JAMYANG TASHI

Many agree that the official measure of poverty in the United States is flawed. Experts have recommended an alternative measure of poverty that includes all family resources net of taxes and nondiscretionary expenses and updates the thresholds to reflect current spending patterns. This fact sheet describes the official poverty measure and an alternative measure developed by the National Academy of Sciences, and uses data from the 2006 American Community Survey to estimate the extent of poverty in Minnesota under the official and alternative measure.
Publication Date: February 15, 2010

Testimony on Income and Poverty in the United States: 2008 Before the Joint Economic Committee of the United States Congress

HARRY HOLZER

Between 2007 and 2008, real incomes fell and poverty rose in the United States, Institute Fellow Harry Holzer testified before the Joint Economic Committee of Congress. Even if the recession ends this year, rising unemployment will mean that real income keeps falling while poverty increases for a few more years — and almost certainly by much more than occurred between 2007 and 2008. It will likely take several years beyond 2010 before real income and poverty fully recover from the effects of the downturn.
Publication Date: February 15, 2010

Economic Modeling of Child Poverty and Prevention Council Initiatives

LINDA GIANNARELLI, SHEILA R. ZEDLEWSKI

This report presents estimates of the potential effects of numerous proposals designed to reduce child poverty in the state of Connecticut (CT). The results show the effects of initiatives to increase adult education, expand and improve the safety net, and strengthen families through increased child support and post-welfare case management. The results show the effects using two measures of poverty (the official measure and a modernized measure that includes all family resources and updated poverty thresholds) as well as the sensitivity to assumptions about the effects of initiatives on employment and earnings.
Publication Date: August 6, 2009

A National Commitment to Ending Homelessness among Veterans - Why Affordable Housing Programs Matter: Testimony before the U.S. House Committee on Veterans' Affairs (Testimony)

MARY K. CUNNINGHAM  

In this testimony, Mary Cunningham discusses different housing-based interventions that policymakers could adopt to end homelessness among veterans. Increasing HUD-VASH vouchers and tightly targeting them to high need veterans, as well as increasing rapid rehousing programs and affordable housing programs for low-income veterans who are homeless primarily for economic reasons are discussed.
Publication Date: June 10, 2009

Reject Proposal to End Welfare

OLIVIA GOLDEN, SHEILA R. ZEDLEWSKI

In this commentary for The Press-Enterprise (Riverside, Calif.), Olivia Golden and Sheila Zedlewski advise states to grab the federal dollars offered by the economic stimulus package to help pay for recession-driven increases in the demand for welfare.
Publication Date: June 14, 2009

The Stimulus and Poverty: A Role for Foundations in Seizing the Moment
How Foundations Can Help the Stimulus Reach Low-Income Families

OLIVIA GOLDEN

In this commentary for SpotlightOnPoverty.org, Institute Fellow Olivia Golden lays out five strategic investments foundations can make to sustain the economic stimulus package's positive outcomes for low-income families.
Publication Date: May 13, 2009

Tailoring Assistance: How Antipoverty Policy Can Address Diverse Needs within the Poverty Population

MARGARET SIMMS

It has been said that we are entering a new era of government policy. If so, it could be an opportune time to belatedly heed the call of Dr. Martin Luther King and revamp our policies toward the poor. Over the past decade we have moved from a set of policies that provided cash assistance (mostly inadequate) to people who were in need (by standards set by the government) to one in which those who can work are expected to do so. In the process, we have ignored the fact that the poor are not a homogenous group of people, all of whom can and will work if they have no other means of support. They are, in fact, quite diverse. Recognizing this diversity is a necessary prerequisite for developing effective antipoverty policies.
Publication Date: January 19, 2009

Workforce Development as an Antipoverty Strategy: What Do We Know? What Should We Do?

HARRY HOLZER

In this paper I note the basic paradox of workforce development policy: that, in an era in which skills are more important than ever as determinants of labor market earnings, we spend fewer and fewer public (federal) dollars on workforce development over time. I present trends in funding and how the major federal programs at the Department of Labor and other agencies have evolved over time, noting the dramatic declines in funding (with the exception of Pell grants). I then review what we know about the cost-effectiveness of programs for adults and youth from the evaluation literature. I consider some other possible reasons for funding declines, such as the notion that other approaches (like supplementing the low earnings of workers with tax credits or early childhood programs) are more effective and address more serious problems. I review some newer developments in workforce policy, mostly at the state and local levels, and then conclude with some policy recommendations.
Publication Date: October 30, 2008

The Effect of Specific Welfare Policies on Poverty

SIGNE-MARY MCKERNAN, CAROLINE RATCLIFFE

Poverty rates in the United States fell from a 25-year high of 15.1 percent in 1993 to near record lows of 11.3 percent in 2000 and have since increased steadily to 12.7 percent in 2004 (U.S. Census Bureau 2004a). The poverty rates for children and for people in single female-headed families followed a similar pattern, although at considerably higher rates—17.8 percent and 30.5 percent in 2004, respectively (U.S. Census Bureau 2004a, 2004b). Many political leaders pointed to poverty rate declines along with increases in employment and falling welfare caseloads that occurred in the late 1990s as evidence that the 1996 federal welfare reform had been a success (Kaus 2001). During the late 1990s, however, there was concern that welfare reform was leading to increases in deep poverty (living below 50 percent of the poverty threshold) (e.g., Sherman et al. 1998, as cited in Haskins 2001), as deep poverty rates increased in 1996 and were unchanged in 1997 (U.S. Census Bureau 2004c). Deep poverty rates subsequently fell, however.
Publication Date: May 23, 2006

Five Questions: Signe-Mary McKernan and Caroline Ratcliffe on the intersection between welfare policy changes and poverty trends

SIGNE-MARY MCKERNAN, CAROLINE RATCLIFFE

Signe-Mary McKernan and Caroline Ratcliffe, both senior research associates in the Urban Institute's Center on Labor, Human Services, and Population, study the intersection between welfare policy changes and poverty trends. Their recent report, The Effect of Specific Welfare Policies on Poverty, shows how some welfare policies boosted families' economic well-being-while others pushed mothers and children deeper into poverty.
Publication Date: August 23, 2006

Estimating the Anti-Poverty Effects of Changes in Taxes and Benefits with TRIM3

LINDA GIANNARELLI, LAURA WHEATON, JOYCE MORTON

This report presents an analysis of policies recommended by the Center for American Progress Task Force on Poverty. The analysis uses the TRIM3 microsimulation model. The policies include increasing the minimum wage, expanding the EITC and other tax credits, expanding the child care subsidy system, increasing participation in the Food Stamp Program, rescinding restrictions on legal aliens' eligibility for benefits, and increasing the number of housing vouchers. The analysis focuses on the policies' impacts on poverty, using a broad definition of income—after taxes and child care expenses and including the value of food and housing aid.
Publication Date: April 25, 2007

Extreme Poverty Rising, Existing Government Programs Could Do More

SHEILA R. ZEDLEWSKI, LINDA GIANNARELLI, JOYCE MORTON, LAURA WHEATON

Many have heralded welfare reform as an unqualified success. More single parents are working, and welfare caseloads have plummeted. The official poverty rate decreased from 13.7 percent in 1996 to 11.8 percent in 1999. While many commentators debate the causes of these improvements—citing the strong economy, federal and state policies designed to "make work pay," and welfare reform—few dispute the strong positive outcomes.
Publication Date: April 01, 2002

Poor Dads Who Don't Pay Child Support
Deadbeats or Disadvantaged?

ELAINE SORENSEN, CHAVA ZIBMAN

Nearly 11 million fathers in the United States do not live with their children. Two-thirds of these fathers do not pay formal child support. Society is rightly concerned about the widespread failure of absent fathers to contribute to their children's support. And a variety of recent policy initiatives are strengthening the enforcement tools necessary to ensure that "deadbeat dads" are identified and required to fulfill their child support responsibilities.
Publication Date: April 01, 2001

Reducing Poverty Among Retirees

A New Minimum Benefit for Low Lifetime Earners

MELISSA FAVREAULT

Despite working hard and playing by the rules over long periods, many workers end up poor in retirement. We propose an enhanced minimum benefit for Social Security that targets long-career workers with low lifetime earnings along with a modest credit that compensates workers for up to three years out of the labor market due to caregiving, unemployment, or poor health. By combining these elements, the proposal provides work incentives, yet recognizes realities facing low-wage workers, many of whom have had intermittent work careers. We show that these proposed enhancements would allow more adults to retire with a secure financial foothold.
Publication Date: March 20, 2009

Are There Opportunities to Increase Social Security Progressivity despite Underfunding?

MELISSA FAVREAULT, GORDON MERMIN

This paper reviews why Social Security fails to lift more aged low-wage workers and people of color out of poverty. It examines the payroll tax and benefit formula and reviews literature about OASDI outcomes by race, gender, and earnings level. It describes how mortality, earnings, disability, childbearing, immigration and emigration, and marriage patterns all differ across U.S. racial/ethnic groups, and highlights the importance of these differences for program outcomes. The paper then uses the DYNASIM model to examine lifetime OASDI redistribution under current law and a trust fund-neutral reform package that would enhance system progressivity and improve outcomes for some vulnerable to retirement poverty.
Publication Date: November 25, 2008

Minimum Benefits in Social Security Could Reduce Aged Poverty

MELISSA FAVREAULT, GORDON MERMIN, C. EUGENE STEUERLE, DAN MURPHY

Despite Social Security's success at bolstering retirement security, many older Americans remain mired in poverty. Because Social Security does not guarantee a minimum benefit, many long-service, low-wage workers receive benefits that leave them below the poverty line. African Americans, Hispanics, and unmarried women are especially vulnerable. Although productivity gains are likely to reduce old-age poverty over time, Social Security's long-term financing problem makes future benefit cuts likely. This analysis explores two potential minimum-benefit designs and shows that an effective minimum benefit could help protect the highest-risk groups.
Publication Date: January 26, 2007

Five Questions: Melissa Favreault on reducing poverty through Social Security

MELISSA FAVREAULT

Melissa Favreault, a senior research associate at the Urban Institute's Income and Benefits Policy Center, uses large-scale microsimulation models to analyze wide-ranging Social Security reforms. Most recently, she simulated various ways that a Social Security minimum benefit might be designed to reduce poverty among the vulnerable elderly.
Publication Date: January 6, 2007

Would Raising the Social Security Retirement Age Harm Low-Income Groups?

GORDON MERMIN, C. EUGENE STEUERLE

Social Security's projected financial shortfall has spurred discussions about increasing the age at which workers can first receive retirement benefits. This brief examines the future distributional impacts of raising the retirement age by about three years. Raising the retirement age hits lower-income workers less hard than other groups because the disability program provides some protection. However, it still increases poverty rates. Combining the retirement age change with an enhanced minimum benefit increases lifetime benefits for the lowest earners and substantially cuts the Social Security deficit without significantly increasing poverty rates.
Publication Date: December 29, 2006

Interactions Between Social Security Reform and the Supplemental Security Income Program for the Aged

PAUL DAVIES, MELISSA FAVREAULT

Unlike most analyses of Social Security reforms, this paper explicitly considers interactions with the Supplemental Security Income (SSI) program. Using a microsimulation model, we examine reducing Social Security benefits by the percentage required to approach 75-year solvency. We then add options for attenuating the effects on low-income beneficiaries. In the simulated reforms, we compare benefit receipt patterns, poverty rates, and winners and losers in 2022. Substantial reforms are necessary for SSI to play a more effective income security role. Among the limited set of reforms we consider, Social Security minimum benefit plans would more effectively reduce poverty among low-income beneficiaries.
Publication Date: December 01, 2003

Projecting Poverty Rates in 2020 for the 62 and Older Population
What Changes Can We Expect and Why?

BARBARA BUTRICA, KAREN E. SMITH, ERIC TODER

The past 30 to 40 years have been accompanied by considerable changes in marriage patterns, earnings and work patterns, the economy, and retirement policy. While these changes will undoubtedly impact future retirees, it is difficult to know exactly how they will influence their economic well-being. The aim of this paper is to analyze the factors that may be related to increased or decreased poverty among the 62- to 89-year-old population in 2020.
Publication Date: August 23, 2002

Social Security's Additional Dollars Could Buy Less Poverty

C. EUGENE STEUERLE, ADAM CARASSO

Social Security has had great success in reducing poverty, on average, among the elderly. Today, the elderly poverty rate is less than one-third the 35 percent rate seen in 1960. Social Security also protects people from inflation and other risks (as we think it should).
The success of any program, however, cannot be judged solely by how well that program succeeds on average. To assess Social Security’s marginal success, a good measure is how much each additional dollar spent improves the lot of the population it serves. Here, we describe three pieces of evidence suggesting that Social Security’s ability to meet one of its most fundamental tenets—alleviating old-age poverty—has hit several roadblocks.
Publication Date: October 30, 2001