HOW TO AVOID POVERTY AND ENTER THE AMERICAN MIDDLE CLASS

November 6, 2009

The conventional wisdom says that if we want to increase opportunities for children, we should give their families more income.  Of course money is a factor in upward mobility, but it isn't the only one; it may not even be the most important, says the Brookings Institution.

According to Brookings:

  • If you want to avoid poverty and join the middle class in the United States, you need to do three things: Complete high school (at a minimum), work full time and marry before you have children.
  • If you do all three, your chances of being poor fall from 12 percent to 2 percent, and your chances of joining the middle class or above rise from 56 to 74 percent.
  • Brookings defines middle class as having an income of at least $50,000 a year for a family of three.

Many American families need supplements to their incomes in the form of food stamps, affordable housing and welfare payments.  But such aid should not be given unconditionally, says Brookings:

  • The public is concerned that unconditional assistance will end up supporting those who are not trying to help themselves.
  • New research in economics and psychology has shown that individuals frequently behave in ways that undermine their long-term welfare and can benefit from a government nudge in the right direction.

Policies with strings attached have had considerable success, says Brookings.  One example is the 1996 welfare reform law, which required most adult recipients to get jobs, and dramatically increased employment and lowered overall child poverty.  In the midst of a recession, we can't expect everyone to work.  But social policies will be more successful if they encourage people to do things that bring longer-term success.

Source: Isabel V. Sawhill and Ron Haskins, "Five Myths About Our Land of Opportunity," Brookings Institute, November 1, 2009.

For text:

http://www.brookings.edu/opinions/2009/1101_opportunity_sawhill_haskins.aspx 

 

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