Getting Poverty Wrong

City Journal: Getting Poverty Wrong

…Yet both candidates are largely missing the point. While they insist that strengthening labor unions or protecting homeowners from foreclosures will alleviate the hardships of the poor, the latest data from the U.S. Bureau of the Census remind us that the breakdown of the traditional two-parent, married family is a far greater contributor to poverty in America than many of the supposed shortcomings of our economy. It’s hard to imagine that America will make much more headway on reducing persistent poverty until it halts this long-term trend. …

The Census Bureau’s study on the living arrangements of American children appeared in mid-February. The data show that the number of children now living in two-parent families has dipped just below the 70 percent mark for the first time since the Census began collecting data on family formation nearly 130 years ago. After peaking in the 1950s—when about 87 percent of all children lived with two parents—the traditional family went through a rapid decline beginning in the 1970s and has continued to shrink over the last three decades, though the rate of decline has slowed somewhat. As part of this sweeping change, the percentage of children living with married parents has fallen more rapidly, down more than two full percentage points, to 66.6 percent of all kids, in the last 10 years alone. Consistent with these decreases has been a sharp rise in the number of children living with single parents and with unmarried parents.

The economic impact of this breakdown has been profound. Researchers estimate that the entire rise in poverty in America since the late 1970s can be attributed to “changes in family formation,” a euphemism for the decline of families headed by two married parents. The latest Census data illustrate the problem. Only one out of ten American kids living in two-married-parent families is in poverty—and about one-third of these families are recent immigrants whose poverty is temporary. By contrast, 37 percent of children living with single mothers are impoverished.

Marriage seems to be the defining characteristic of economically successful families. With out-of-wedlock birth rates in America soaring, so that many traditional families aren’t so much breaking up as never getting started, the percentage of children living with cohabiting parents is growing. Yet these kids are three times more likely to be in poverty than the children of married parents. The data actually demonstrate that poverty rates for families headed by two unmarried parents more closely resemble the poverty rates of single-parent families than those of two-married-parent ones….

…Something about the marriage certificate—a sense of long-term commitment, family stability, perhaps—makes an economic difference. Research shows that married workers exhibit more job stability and make greater wage gains than cohabiting parents, a sort of “marriage wage premium,” as some economists dub it. …

…Nearly nine in ten Asian children, for instance, live with two parents, as do 78 percent of white kids. By contrast, 68 percent of Hispanic children and only 38 percent of black children in America reside in two-parent families. A black child living with a single mother is nearly three times more likely to live in poverty than a black child living with two parents, the Census data show, yet 50 percent more black children are living with single mothers than in two-parent married families.

Given that a significant body of research now shows that children raised in two-parent, married families do better in school, are less likely to wind up in jail, and are less likely to end up on welfare, the startling racial divide in marriage tells us that a new generation of children, especially blacks, are growing up destined to struggle academically, in the job market, and in forming their own families. …

…Even Republican presidential nominee John McCain—whose economic agenda focuses on pro-growth policies, like corporate tax cuts—has little to say about the family, though the children of many fractured poor families will be in no position to take advantage of such tax cuts.

Related: See my earlier post that shows the impact of family formation on the poverty rate.