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A Universal Child Allowance: A Plan to Reduce Poverty and Income Instability Among Children in the United States
H Luke Shaefer1, Sophie Collyer1, Greg Duncan1
1is associate professor of social work and public policy and director of Poverty Solutions at the University of Michigan. is a research analyst at the Center on Poverty and Social Policy at the Columbia University School of Social Work. is distinguished professor in the School of Education at University of California, Irvine. is Bloomberg Distinguished Professor at the Zanvyl Krieger School and Bloomberg School of Public Health at Johns Hopkins University. is Mitchell I. Ginsberg Professor of Contemporary Urban Problems and interim dean of the Columbia University School of Social Work. is president of Children's Research and Education Institute and an associate of the Columbia Population Research Center. is Lee Rainwater Distinguished Professor of Public Affairs and Economics at the University of Wisconsin-Madison. is Compton Foundation Centennial Professor for the Prevention of Children's and Youth Problems at Columbia University School of Social Work. is co-director of the Center on Poverty and Social Policy at the Columbia University School of Social Work. is Courtney Sale Ross Professor of Globalization and Education and professor at New York University.
Insights
A universal, monthly child allowance could significantly cut child poverty in the US. This policy aims to reduce poverty and income instability for families with children.
Area of Science:
- Social Policy
- Poverty Reduction
- Economics
Background:
- Child poverty and income instability remain significant challenges for families in the United States.
- Existing policies like the Child Tax Credit have limitations in fully addressing these issues.
- A need exists for more comprehensive and effective strategies to support families with children.
Purpose of the Study:
- To propose a universal, monthly child allowance policy.
- To analyze the potential impact of this policy on child poverty rates.
- To outline key design principles for an effective child allowance.
Main Methods:
- Analysis of 2015 Current Population Survey data.
- Modeling the effects of a proposed universal, monthly child allowance.
- Estimation of potential reductions in child poverty and deep child poverty.
Main Results:
- The proposed child allowance could reduce overall child poverty by approximately 40%.
- Deep child poverty could be reduced by nearly half.
- Extreme child poverty among families with children could be effectively eliminated.
Conclusions:
- A universal, monthly child allowance is a viable policy to drastically reduce child poverty in the US.
- Key design principles include universality, accessibility, adequate payments, and prioritizing young children.
- Policymakers should consider economies of scale when determining benefit levels for multiple children.
Abstract:
To reduce child poverty and income instability, and eliminate extreme poverty among families with children in the United States, we propose converting the Child Tax Credit and child tax exemption into a universal, monthly child allowance. Our proposal is based on principles we argue should undergird the design of such policies: universality, accessibility, adequate payment levels, and more generous support for young children. Whether benefits should decline with additional children to reflect economies of scale is a question policymakers should consider. Analyzing 2015 Current Population Survey data, we estimate our proposed child allowance would reduce child poverty by about 40 percent, deep child poverty by nearly half, and would effectively eliminate extreme child poverty. Annual net cost estimates range from $66 billion to $105 billion.
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