Low-Income Working Families

Policymakers should be thinking hard about low-income families with children and the tax code. In 2010, the federal income tax system will deliver substantial assistance to these families through refundable tax credits. The Tax Policy Center estimates a third fewer children would be in poverty if tax credits were counted in a person’s available resources when measuring poverty. They are among the most potent anti-poverty programs for families with children. In 2011, some aid targeted to the poorest families will disappear as the Economic Growth and Tax Relief Reconciliation Act (EGTRRA) and the American Recovery and Reinvestment Act (ARRA).

The need for direct public job creation efforts is greater today than at any time during the past seven decades. With a national unemployment rate that recently exceeded 10 percent, a new federal initiative that puts jobless individuals immediately to work must be a central element of any strategy for restoring economic growth and responding to pressing human needs in 2010 and beyond. Public service employment and transitional jobs programs offer tested and urgently needed models for combating the current recession and advancing longer-term workforce development goals.

States help finance most antipoverty programs, but there's a major flaw in this approach: in recessions, need goes up just as state revenues go down. The resulting budget gaps often lead to significant program cutbacks, even when caseloads are on the rise. Federal assistance during the recent recession helped states meet stepped-up demand, but funding is set to expire and unemployment is expected to remain high. Federal and state governments should repair this financing hitch now to protect antipoverty programs.

The Obama administration has emphasized postsecondary education as the key to its jobs policy, continuing a long-held federal strategy while broadening its goals beyond traditional four-year schools. But disadvantaged students and working adults may still fall through the cracks—and educating college-age youth alone can't meet the nation's employment and social policy objectives. While the focus on college has gone up, federal spending on adult employment and training programs and high school career and technical education has declined. As the nation recovers from the recession, we need to pay more attention to these alternative paths and do more to link education and jobs.

Growing up poor is a challenge—and growing up in a poor neighborhood is even more challenging. Because community distress undermines individual outcomes and trajectories, place-based strategies have played a role in anti-poverty efforts. The notion that we need to think of distressed neighborhoods in a broader metropolitan context, is relatively new. We argue that this approach—considering place in metropolitan context, seeing neighborhoods as a platform for mobility, and understanding the critical role of organizing—could move the needle on poverty. The new administration understands this framework, but applying it across agencies and programs requires conscious effort and commitment.