Contemporary Family Policy: An Alternative Vision

PROPOSED ACTIONS THAT IMPACT FAMILIES

Foremost, the current disposition in the Republican Congress and the Democratic White House is to eliminate or reduce federal programs and move them to the states through block grants. The argument is that the programs will be administered more efficiently by those officials closer to the people served than from a distant federal bureaucracy. This devolution trend will have the effect of making benefits very uneven as some states will be relatively generous while others will be less so—some very much less so. For example, the Medicaid-financed home health-care program is run by the states, with New York spending in 1992 some $1,180 per person 65 and older at the high end and Mississippi spending $29 for each old person at the low end (Berger, 1996). Similar disparities, although not always this stark, are found for such state-run programs as Aid to Families with Dependent Children (AFDC), Medicaid, and per-pupil school spending. Beyond the monetary differences by state, the serious questions regarding devolution are: Will all the states provide an adequate social safety net? Will all the states protect the powerless? Will all the states promote racial justice against local bigotry? Will 50 state agencies be less wasteful and more efficient than a single federal agency? (Shanker, 1995).

A second major thrust of Congress is an attack on the American welfare state. The goal of the Republican majority is to kill the welfare state and the Democrats seem more or less willing to at least reduce it significantly.

Just what is it that they are killing off? What will its death mean for families and for society? The American welfare state emerged in the 1930s as a reaction to the instability of the Great Depression and capitalism run amuck. According to Moberg (1995), "Motivated by a fear of radical unrest by the disadvantaged and disaffected and the need to save capitalism from its own self-destructive tendencies (economic instability, rape of the environment, worker exploitation, lack of worker and consumer safety), the creators of the New Deal under Roosevelt and the Great Society under Johnson instituted Social Security, the minimum wage, federal aid to education, health programs, nutrition, subsidized housing, and other services" (pp. 22-24).

These programs are now under severe attack. The irony is that the United States has the weakest social safety net of any industrialized country. Yet even these minimal programs are too much for the conservatives. From the progressive point of view—in sharp contrast—government programs do work and we need to spend more to help the disadvantaged. Since Lyndon Johnson's War on Poverty (because it was not an all out war, some have called it Johnson's Skirmish on Poverty) began, for example, the poverty rate has been reduced by 20% and the rate of elderly poverty cut by one-half.

The Republican Party is now downright hostile to the New Deal legacy of big government giveaways to what they consider the "undeserving poor," and to the high tax burden. In effect, they mean to challenge the governing assumptions of the past 60 years.

The prevailing ideology of the conservatives has two postulates. First, the unequal distribution of economic rewards is none of the government's business. We value individualism, the argument goes, and a market economy. The obvious result is inequality—which is good because competition motivates people to compete and it weeds out the weak. This laissez-faire approach, consistent with Social Darwinism, is guaranteed to increase the degree of inequality and lead to what economists Robert Frank and Philip Cook have called a "winner-take-all" society (Frank & Cook, 1995).

The second postulate of the contemporary conservative creed is that social disinvestments from the lives of the poor—in the long run—will improve their lot and hence strengthen the social fabric. Conservatives believe that the poor suffer from a poverty of values and their deteriorating family values are said to produce not only poverty but also illegitimacy, divorce, unemployment, crime, and other social pathologies. Taking their cue from Charles Murray, they believe that only when poor people are confronted with a "sink or swim" world will they ever really develop the will and the skill to stay afloat (Murray, 1984).

Belief in these two postulates presents an obvious solution—do away with the welfare state and the quicker the better. This leads to a fundamental question: Will dismantling the welfare state be beneficial to families or will it create chaos for them and society? Put another way, will reducing or eliminating the safety net to the economically disadvantaged save them or hurt them? Will it make society safer or more dangerous? Are we on the right track when we eliminate all AFDC payments to mothers under age 18? Will the children of the poor and the near poor have a better chance of becoming productive and self reliant if they no longer receive Head Start and other compensatory education programs and if their schools are consistently underfunded? Will poverty be reduced when the pool of unskilled workers is expanded as welfare recipients lose their benefits after a specified period yet there is no effort to create jobs for them, subsidize day care for their children, or to provide a reasonable minimum wage? Will those on the economic margins feel more integrated in a society that pulls away the social safety net from them?

What about the more than one fourth of our children under age 6 who live in poor families? What is their future? Comparatively, poor American children don't do very well. In a study of 18 industrialized nations, our poor children ranked 16th in living standards (Rainwater & Smeeding, 1995).

The outlook for poor children is grim. Because they were born to disadvantaged parents they are denied—for the most part—adequate nutrition, decent medical and dental care, and a safe and secure environment. As a result, by age 5 or so they are less alert, less curious, and less effective at interacting with their peers than more privileged children. Thus, they begin school already behind. And, then, most likely, they attend the most poorly staffed, overcrowded, and ill-equipped schools. Poor children, in short, are more likely than more advantaged children to have health problems, to not do well in school, to be in trouble with the law, and, as adults to be unemployed and on welfare.

Progressives argue that unless society intervenes with meaningful programs and adequate support, many of these poor children will always be a problem—and a very costly problem—for society. But we are choosing the opposite approach: to curtail supports for this already fragile group. Especially hard hit will be children of color who are disproportionately poor. The proposed welfare cuts, for example, will force at least 2 million African American children off welfare (Children's Defense Fund, cited in Wickham, 1994). Moreover, the cuts in programs will condemn an additional 1.2 million children of all races to poverty ("Look Ma," 1995).

Two examples show how society is not meeting the needs of these children. First, less than five percent of the federal budget goes to programs that benefit children. This is in sharp contrast to those federal programs for those 65 and older, which receive five times more. And, second, since 1980 the Federal government has slowly decreased the funds for programs aimed at helping disadvantaged children. For example, now only about 40% of those who qualify for Head Start receive it. Now the government wants to reduce Head Start and other programs for poor children even more.

Conservatives view this safety net for the poor as the problem since they believe it destroys incentives to work and encourages illegitimacy. They argue that welfare is the problem. Thus, various social pathologies will worsen if we are more generous to the poor; they will get better if less is spent on them. This logic accomplishes three conservative goals: By spending less on the poor, money is saved, government is reduced, and the lot of the poor improves.

Using this reasoning, subsidies for compensatory education programs for poor children—such as Head Start for preschool children and Chapter 1 for elementary school children—have been slashed. Various welfare programs have been reduced by more than a quarter in the past 20 years. The Contract With America proposes to reduce welfare further by eliminating the earned income tax credit for the near poor; denying AFDC to unmarried mothers under 18; reducing Supplemental Security Income, food stamps, subsidized housing and other forms of public assistance to noncitizens; and capping the number of years to receive welfare benefits without providing job training, jobs, decent minimum wage, or child care. In effect, the conservative agenda will weaken an already fragile safety net. The following statement by Holly Sklar shows how weak the safety net was before the new cuts:

From the progressive standpoint, the poor have fared badly because of a decline in their labor market opportunities, not because of an erosion of their work ethic (Danziger & Gottschalk, 1995). In other words, the economy has rejected most welfare recipients—not the other way around (Carville, 1996).

For progressives, rising illegitimacy is the result of epochal changes in sexual and family mores, and not the result of AFDC. Out-of-wedlock births are increasing in all strata of society, not just among welfare recipients or potential welfare recipients. Moreover, illegitimate births are increasing in all Western countries (Piven, 1995). Clearly, illegitimacy among the poor is also a consequence of the changing economy. When the mother or father has a good job, the couple tends to get married (Wilson, 1987). But with jobs leaving the inner cities for the suburbs, leaving for the nonunionized states, and leaving for the low-wage economies overseas during the last two decades, illegitimate births have risen dramatically. This argument runs counter to the conservative one which says that unmarried women are having additional children to increase their AFDC payments. The progressives challenge this prevailing myth with the following empirical facts:

• Since 1972, the value of the average AFDC check has withered by 40%, yet the ratio of out-of-wedlock births has risen in the same period by 140%.
• States that have lower welfare benefits usually have more out-of-wedlock births than states with higher benefits.
• The teen out-of-wedlock birth rate in the United States is much higher than the rates in countries where welfare benefits are much more generous (Carville, 1996).

WHAT THE CURRENT POLITICAL AGENDA DOES NOT ADDRESS

There are a number of critical areas that are not considered in the current political climate—yet they are crucial for families and societal stability. We will focus on three: (a) the consequences of the economic transformation; (b) supports for parents in the labor force; and (c) universal health care delivery.

Consequences of the economic transformation. After World War II, the United States entered a 30-year period of unprecedented economic growth where each segment of the population, from the top 20% to the poorest 20% and everyone in between saw their incomes double. But following the Vietnam War, the economy began slowing down. In short order, global competition began heating up and technological innovations changed the work place forever. In the ensuing years, we have seen accelerated changes involving deindustrialization, capital flight as companies merged, moved their operations to low wage economies overseas or to low-wage regions within the U. S., corporate downsizing, declining union membership, and the replacement of permanent workers by temporaries or independent contractors. In such a climate, downward mobility became more prevalent than upward mobility, poverty became more difficult to overcome, and the U. S. moved inexorably toward a two-tiered society (Eitzen & Baca Zinn, 1989).

One of the major consequences of the economic transformation is the increasing gap between the "haves" and the "have-nots" in the United States. We already have the most unfair distribution of wealth and income in the industrialized world and the rate of growth in inequality is faster than in any other industrialized country (Bradsher, 1995b).

The facts concerning inequality include:

• In 1960, the average CEO earned about as much as 41 factory workers. In 1992 that CEO makes as much as 157 factory workers (Sklar, 1995a).
• The top fifth of households in 1994 got 49.1% of the total income while the bottom fifth received just 3.6% (Sklar, 1995b).
• In a 15-year period ending in 1993, the richest one percent almost doubled their income and had their tax rates cut by 23%. In sharp contrast, the poorest one fifth saw their tax rates go up and their incomes go down (Steinmo, 1993).
• Between 1977 and 1992, America's most prosperous fifth gained 28% in real income. The middle 60% held its own (mostly because of wives entering the workforce), while the poorest fifth became 17% poorer (Quinn, 1996).
• The median hourly wage of production workers (adjusted for inflation) has fallen about 13% since 1973 (Herman, 1995).
• The real value (adjusted for inflation) of a standard welfare benefit package has declined by some 26% since 1972 (Herman, 1995).
• From 1967 to 1979 a full-time, year-round worker paid the minimum wage earned above the official poverty line for a family of three. Now a worker earning the minimum wage of $4.25 earns $8,840 annually, which is $3,427 below the 1995 poverty line for a family of three (Sklar, 1996).
• A longitudinal study conducted by University of Michigan researchers tracked a nationally representative sample of 5,000 families since 1969. Among the findings: Adjusted for inflation, men in the bottom fifth of wage-earners saw their wages decrease by 34% during the 1980s, while the wages of men in the top fifth grew by 56% (Bernstein, 1996).
• Recent Labor Department data reveal that (a) about 3.4 million jobs are lost each year; and (b) only 35% of the workers laid off by this downsizing end up in jobs that pay the same or better (reported in Uchitelle & Kleinfield, 1996). In other words, two-thirds are downwardly mobile.

What does an ever-widening gap between the "haves" and the "have nots" mean? Among other things it means an ever greater proportion living on the economic margins; it means greater family instability (Cherlin, 1992); it means higher rates of street crime (DeKeseredy & Schwartz, 1996); and it means increased social unrest (Piven & Cloward, 1971). To counter these potential problems, historically we have had a modified social welfare society but we are now retreating from that strategy. The consequences, as economist Lester Thurow points out, are serious:

Given the threats to individuals, families, and society that are part of the income/wealth inequality package, what are our policy makers doing to reduce it? Central to the conservative credo is the belief that the government must not interfere with the market. To the degree that this happens, income and wealth inequality will continue to increase.

One strand of conservative thought that runs counter to their belief in laissez-faire economics is their faith in "trickle-down economics." President Reagan's use of supply-side economics, for example, was based on the notion that by reducing the tax burden on the wealthy, more wealth would be available for investment—which would lead to economic growth, more jobs, prosperity across-the-board, and increased tax revenues. The result, however, was a reduced tax burden on the affluent, an increased tax burden on the middle class, and a lower average annual job growth rate than occurred under Presidents Johnson, Carter, Clinton, Kennedy, and Nixon (Carville, 1996). Also, tax revenues fell very short of expectations, which—coupled with high defense spending—caused a burgeoning federal debt that burdens us today. Overall, the evidence is clear that supply-side policies increase inequality in society.

Despite the poor showing of "trickle-down" policies during the Reagan presidency, they are being resurrected again under the Republican "Contract with America" (Gillespie & Schellhaus, 1994). Under this proposal, families with annual incomes up to $200,000 would receive a $500-per-child tax credit; capital gains taxes would be reduced by 50%; the value of investment depreciation would be increased; and small businesses would be allowed to deduct the first $25,000 worth of investment each year.

The current proposal to balance the budget by 2002 calls for unequal sacrifice—a one percent or $30 billion decline in corporate welfare and a 17% or about a $300 billion cut in social programs. This proposal is class warfare with the powerless bearing the burden ("Budget Scam," 1996) and the gap between the affluent and the poor widening further.

A possible policy that has caught the imagination of some conservative politicians is the flat tax. This plan actually increases the maldistribution of wealth because, by definition, it is regressive. As a result, taxes are raised for the working and middle classes, while taxes are reduced significantly for the affluent.

Another plan to eliminate the Internal Revenue Service bureaucracy that is gaining in acceptance is the substitute of a consumption tax (sales tax) for the income tax. This regressive tax would disproportionately take money from the less affluent. If the U. S. were to eliminate the income tax, it would be the only industrialized nation to do so.

Supports for parents in the workforce. Both parents in the majority of U. S. families are employed in the labor force. Over half of families with preschoolers have an employed mother. Among the many problems facing working parents, three are critical: (a) obtaining job-protected leaves (with at least partial pay) for family emergencies including birth; (b) finding and funding satisfactory care for their children while they are at work; and (c) gender equity. In all three instances, the policies of the federal and state governments lag far behind the supportive policies for working parents of other Western nations.

The prevailing mood of politicians has been to ignore the needs of working parents. This is ironic, since the conservatives claim to be pro-family. The conservative belief that women really belong at home and should not be encouraged by government or their employers to have children and be in the work force is pro-traditional family—which is defined as being married in a life-long monogamous relationship, with the husband as economic provider while the wife is a homemaker in charge of raising the children. This view ignores the economic realities of the past 20 years, where families require two workers in the labor force to maintain a satisfactory standard of living or where so many women are the sole earners in their families.

Universal health care delivery. Because medicine in the United States is a market commodity, it is dispensed unequally to the people who can afford it. Thus health care in the United States is rationed on the basis of ability to pay; that is, the system works for people who can afford it and falls woefully short for those who cannot. For the affluent, the best physicians, surgeons, hospital care, and the latest technology are available. The poor also are much more likely than the more affluent to receive inferior services from physicians, clinics, and hospitals. The poor often are served by under-staffed clinics and hospitals, which means that their visits often require long waits and hurried attention by overworked health practitioners. Also, there are disproportionately fewer physicians in poor urban and poor rural areas than in affluent urban and suburban areas (a consequence of physicians tending to cluster where their practices will be the most lucrative).

There are two government health programs: Medicare for the elderly and Medicaid for the very poor. Virtually all of the elderly population have at least some health care coverage through Medicare, but they still, on average, pay 23% of their incomes for uncovered services. Medicaid, the program for the very poor, is funded by the federal government and each state. There are three major problems with Medicaid. First, since each state administers its version of Medicaid with few federal guidelines, Medicaid services vary from state to state in quality, eligibility of patients, coverage, and the adequacy of fees for the services of physicians and hospitals. Second, many physicians refuse to treat Medicaid patients because they feel that the payments are inadequate. Third, the health care that many Medicaid patients receive is from public hospital emergency rooms, where they cannot be turned away, overburdens hospitals and postpones treatment as patients must wait many hours before being seen by a physician. Often the examination is superficial and the treatment careless because the attending physicians are overwhelmed by the numbers of patients.

For those who are not old or poor, health care is dependent on some form of medical insurance. Medical insurance is usually employer-based. The problem is that many people work at jobs that do not provide health insurance (low-wage jobs, temporary employment, self-employed). The result is that in 1995 some 43 million people younger than age 65 had no medical insurance, including more than 10 million children and an estimated 500,000 pregnant women (Bradsher, 1995a). Another 50 million were underinsured, which leaves them exposed to large financial risks or excludes coverage for certain medical problems. This lack means that those with fewer economic resources will be less likely to receive preventive care and early treatment. Poor pregnant women (26% of women of childbearing age have no maternity coverage) often do not receive prenatal and postnatal health care. The consequences are a relatively high maternal death rate and a relatively high infant mortality rate. Among the industrialized nations, the U. S. ranks near the highest in infant mortality and is the highest in percentage of low birth weight babies. With the continuing disintegration of employer-based health insurance coverage, it is estimated that less than half of the nation's children will be covered through a family member's job by the year 2000. The working poor are the hardest hit because the restrictive eligibility requirements for Medicaid eliminate them from benefits and their jobs rarely include health benefits. In 1993, for example, 52% of uninsured families were households with a head who worked full-time, year round (Baumann, 1994). In sum, "Only the United States and South Africa among industrialized nations make health care a privilege, not a right" (Sklar, 1992, p. 13).

President Clinton tried to put together a comprehensive health care program, but it was not accepted by Congress. His plan, after changes made to appease insurance companies, did not attack the problems of health care delivery and cost efficiency as does the Canadian single-payer plan. Moreover, the threatened medical establishment engaged in a successful public relations effort to discredit the plan as socialism and as a government power grab to take decision making away from individuals.

Since Clinton's abortive effort, no plan has been offered by either political party. Rather, the Republicans have insisted on lowering Medicare benefits by not indexing the plan—which means that future inflation would increase the cost of medical care to the elderly. The Republican plan would also provide block grants to the states so that they could have more control over Medicaid.

In sum, by acts of commission and omission, Republicans with the consent of Democrats, are enacting the most shortsighted, uncaring legislation of the past 60 years. This political agenda exacerbates the wide gulf between current economic realities and the policies needed for the well being of families throughout society. The destructive consequences of the policies will be felt disproportionately by the young, the poor, women, racial minorities, and the elderly ("Shall the Elite," 1996).