Paul Ryan Wants To Expand Your Opportunity

GOP caucus

Well, at least if you receive public assistance he does. Callie Gable outlines the main features of the anti-poverty plan Paul Ryan released yesterday, the centerpiece of which is the “Opportunity Grant”:

The Opportunity Grant would consolidate several existing aid programs into one funding stream to states, which states would then be required to offer to recipients of means-tested welfare benefits as part of a consolidated recovery and mobility plan. Disadvantaged Americans would each be [paired] with an individual case worker, with whom they would agree on personalized short and long-term goals (e.g., apply for child support or begin drug counseling) set out in “contracts.” Most important, Ryan is building on the success of the 1990s welfare-reform laws here: A key element of the contracts would be encouraging work, which, currently, only cash welfare requires. Food stamps, federal housing aid, utilities assistance, and more don’t have work requirements — this would essentially mandate that states opting for the Opportunity Grant implement work requirements.

Tyler Cowen is skeptical:

I’m not crazy about the complicated plan to monitor the lives of the poor in more detail (“…work with families to design a customized life plan to provide a structured roadmap out of poverty.”)  And my biggest conceptual objection is the heavy stress on block grants and letting the states figure things out. I’m not opposed to that in principle, and I might even favor it, but I think it’s often the lazy man’s way of avoiding talk about difficult trade-offs.

I’d like to see a possible plan for just a single state, or better yet two or three, that is supposed to represent an improvement.  That shouldn’t be too hard to do, or if it is maybe the states can’t do it either. It’s not as if fifty states are giving us a market-based discovery process, as the rhetoric sometimes implies.  Furthermore we have a bunch of large states with ongoing bad governance, such as CA, NY, and IL, and maybe the federal government really can do better for those places.

Other critics are less charitable. “Oh goodness,” Annie Lowrey exclaims, “let’s run through the ways that this is condescending and wrongheaded”:

First, it presupposes that the poor somehow want to be poor; that they don’t have the skills to plan and achieve and grow their way out of poverty. The truth is that many do have the skills, and what they lack are resources — say, enough money to pay for a decent daycare for your infant so you can work a full-time job, or cash to get your car fixed so you don’t have to take the bus to your overnight gig at Walmart. Ryan is not putting more resources on the table, as far as I can tell, and thus for many families he will not be addressing the root problem.

Second, it isolates the poor. Middle-class families don’t need to justify and prostrate themselves for tax credits. Businesses aren’t required to submit an “action plan” to let the government know when they’ll stop sucking the oxygen provided by federal grant programs. The old don’t need to show receipts demonstrating their attendance at water aerobics in order to get Medicare. Nope, it’s just the poor who need to answer for their poverty. That strikes me as flatly wrong.

To be fair, she adds, there’s “a lot for liberals to like in here, and there is a significant amount of evidentiary backing for some of his policy proposals”:

Ryan proposes a number of common-sense reforms with broad bipartisan appeal: reducing licensing requirements, getting rid of kinks in anti-poverty programs and the tax code that create a disincentive for families to earn more; prison and sentencing reform, as well as recidivism reduction; supporting evidence-based policies; moving to a system that addresses poverty individually and comprehensively. I especially like the idea of providing more aid to the poor in the form of cash. (Money is more valuable when it’s fungible, and the poor can decide how best to use it.)

Emily Badger expands on Lowrey’s criticism:

An incentive system like this assumes that end goals such as employment are entirely within the control of a poor people if they would just try hard enough. This notion fails to recognize that, while personal responsibility is important, so too are structural obstacles in the economy, in the education system, in the housing market. We can hardly expect personal effort alone to overcome poverty without systemic investment on society’s part on the fronts beyond a poor person’s control.

The idea of a contract with punitive benchmarks also ignores lessons that researchers have learned about the effects of poverty on cognition. Princeton psychologist Eldar Shfair and Harvard economist Sendhil Mullainathan have argued that the stress of living in poverty sucks up mental bandwidth the rest of us take for granted. That mental tax means that a mom may forget to take her medication, or to pay a utility bill on time, with each mistake yielding a cascade of other problems. This means that living in poverty is like living without room for error. It also means that we should design anti-poverty programs that are flexible and forgiving, not punitive and deadline-oriented.

But Reihan defends Ryan’s paternalistic approach:

But wait a second, you might say—Social Security beneficiaries aren’t required to present a plan! Why should poor people be treated differently than workers who’ve been making Social Security contributions for decades, and who are collecting benefits at the end of a long working life? There’s actually a pretty straightforward reason: Social Security is designed for old people. No two old people are the same, to be sure, but they all have the same basic problem: They are too old to work, or to work very long hours. That’s a problem we can deal with.

People with low or no earnings, in contrast, face diverse obstacles. Some need short-term help to, say, fix their car, which will allow them to commute to work, or to make a deposit on a rental apartment. Others don’t have the skills they need to earn enough to support themselves and, for whatever reason, will have a very hard time acquiring them. Sure, you could give both kinds of people food stamps and call it a day. Or you could recognize that one-size-fits-all programs don’t do justice to the ways in which individual circumstances vary.

Waldman’s beef, meanwhile, is with the concept of block-granting welfare funds:

This sounds reasonable until you start to think about how it would play out. In practice, it’s likely that the states most eager to sign on would be precisely those that aren’t too happy about the ways the federal government provides benefits now. The devil would be in the details; what if a state decided to take its entire block grant and devote it to giving lectures to poor people on why they should get married? There could be a lot of needs going unmet while states implement their ideologically-driven visions of how poverty ought to be addressed.

Drum also has his doubts:

Overall, my initial reaction is that I like the idea of more rigorously testing different anti-poverty approaches, but I’m pretty skeptical of Ryan’s obvious preference for eventually eliminating most federal anti-poverty programs and simply sending the money to the states as block grants. This is a longtime conservative hobbyhorse, and not because states are models of efficiency. They like it because it restricts spending, especially during recessions when federal entitlement programs automatically increase but block grants don’t. That may please the tea party set, but it’s bad for poor people and it’s bad for the economy, which benefits from countercyclical spending during economic downturns.

Dylan Matthews voxplains the other main component of the plan, which entails an expansion of the earned income tax credit. In another post on the subject, Reihan comments on this aspect:

Ryan has not only embraced expanding the EITC for childless workers — he has largely embraced President Obama’s proposal for doing so, the difference being that he favors funding it via different means, the details of which will (of course) have to be fleshed out in the future. The EITC is not a perfect program, and there is an ongoing debate over how exactly it impacts the labor market. There is room to reform the EITC. Yet it is hard to deny that for workers with modest skills who’ve found that the market value of their labor has been under severe pressure, it has been a lifeline. Ryan has, in this discussion draft at least, chosen to accept the EITC’s flaws for now and to expand it. When asked to put up or shut up on raising the returns to work for low-wage workers, he has decided to put up. That strikes me as a pretty big deal. Where Ryan leads, let’s hope other GOP lawmakers will follow.

Highlighting a less prominent feature of the plan, Sullum cheers Ryan’s embrace of sentencing reform:

Under current law, Ryan notes in the paper outlining his proposals, “a single gram of crack cocaine could be all that separates a convict from a less-than-five-year sentence and a 40-year sentence. Rigid and excessive mandatory sentences for low-level drug offenders, like these, may add to an already over-crowded prison system without appreciably enhancing public safety.” Ryan also endorsed the Public Safety Enhancement Act, which would let nonviolent offenders leave prison early if they complete evidence-based reintegration programs. “Here’s the point,” he said in his speech. “Nonviolent, low-risk offenders—don’t lock them up and throw away the key. Get them in counseling; get them in job training; help them rejoin and contribute to our society.”

(Photo: By Douglas Graham/CQ Roll Call via Getty)