The decline of marriage and corresponding increase of fatherless children in America over the last 60 years exists almost entirely among the poor and working class. The consequences are devastating, especially for children, yet the government continues to disincentivize marriage in its welfare programs without recognizing the pitfalls.
Fatherless children are more likely to experience poverty as adults compared with children from intact married homes, even when accounting for original differences in child poverty. Preeminent social mobility researcher Raj Chetty factored in the quality of schools, race, and ethnicity, and found that the number of married fathers in a neighborhood is a primary predictor of upward economic mobility later in life for the children in that area.
One explanation for this is that dads help their children develop valuable life skills. Nobel Prize-winning economist James Heckman found that “household structure plays a major role in shaping U.S. inequality,” because for granting soft skills, “there is an inherent difference between single-parent households and two-parent households.”
Yet the full answer is beyond the realm of economics. Kids who grow up without a father married to their mother often show signs of deep hurt, which lasts into adulthood. Fatherless children are more prone to mental health issues, including depression, as adults. Fatherless girls are more likely to engage in early sexual activity and suffer from relational instability as adults.
Boys suffering from fatherlessness often begin expressing their hurt and frustration outwardly and at a young age, and those in single-parent homes are even more likely to be diagnosed with ADHD. Controlling for parental income, boys raised without a married father are much more likely to use drugs, engage in violent or criminal behavior, go to jail, and drop out of school.
Researchers from the Massachusetts Institute of Technology and Northwestern University rejected the idea that these effects are due to dangerous neighborhoods or poor schools. Instead, neighborhoods and schools are less important than the “direct effect of family structure itself.” Two University of California researchers found that “the most critical factor affecting the prospect that a male youth will encounter the criminal justice system is the presence of his father in the home.”
Academics can argue endlessly over the causes of poorer Americans’ abandonment of marriage, but that’s like having a debate while the ship edges closer to the iceberg. What is unarguable is that poor and working-class Americans are uniquely subject to the incentives built into the social safety net. This safety net — in totality — carries substantial marriage penalties as a percent of a family’s total income, and evidence tells us these penalties affect behavior.
Recognizing Marriage Penalties
Marriage penalties are highest for working-class couples who individually earn just below the eligibility threshold for programs such as child-care assistance, about $45,000 per year. That means penalties are highest for couples with combined earnings of $50,000 to $90,000 a year, or for individuals who earn between $35,000 and $45,000 per year.
For example, a working-class man and woman living in Minnesota with one infant child, each earning $35,000 per year, face a marriage penalty of well over $15,000, not even counting Medicaid’s marriage penalties. The same couple with the same earnings faces a $9,000 marriage penalty in Georgia and more than a $6,000 penalty in Texas. That’s about 10 percent of family income, even in states with the lowest penalties.
Most young Americans without a four-year degree, which comprise a large chunk of the country, are in this income range. The average salary for those with only a high school diploma to those with an associate degree ranges from $35,000 to under $45,000, just below the eligibility threshold for child care assistance. It is frustrating that policymakers haven’t addressed this a long time ago.
A marriage penalty exists because programs, to determine eligibility, count the income of adults in a home only if they are related to the children covered by a program. For example, if child-care assistance has an eligibility threshold of making less than $45,000 per year, one adult making $35,000 per year will qualify but two adults will not. Obviously, counting two adults’ incomes means the family is almost certain to be disqualified from receiving a benefit.
Where programs require the incomes of both biological parents of the children in question to be counted, however, a live-in boyfriend — whose presence statistically makes children more at risk of abuse — is not counted. On paper, this discriminates against both biological parents living with their kids.
In practice, this is a marriage penalty because county welfare officials can easily see marriage records, so married parents can’t hide their living situation. Cohabiting biological parents, however, can hide their living situation from authorities, and evidence suggests a substantial amount of welfare recipients do this.
It is unacceptable that welfare, on paper, discriminates against children living with both biological parents and favors an unrelated partner in the home. Implicitly favoring cohabitation over marriage isn’t ideal either, as cohabitation is typically more unstable and thus often more damaging to children. Even the possibility that these incentives could be contributing to fatherlessness should cause policymakers to act.
Solving the Problems
Reforming the child-care assistance program is a good place to start. It is inherently pro-work, limited in many states (which increases the ability for experimentation in these states), and has the largest marriage penalties due to the high cost of child care.
Thinking back to the couples making $35,000 each in Minnesota, Texas, and Georgia: at least 65 percent of the overall marriage penalty in each state (excluding health-care benefits) is due to child care assistance, and the program explains most of the divergence in marriage penalties between the states, given large differences in child-care costs.
First, end the eligibility test that counts only the income of an adult related to the children and doesn’t count the live-in boyfriend’s income. Instead, use an “adults in the household” test to determine income eligibility.
Next, raise the eligibility threshold for married couples to take account of the fact that two adults in a family can more easily have higher earnings than a one-adult household. The tax code does the same thing, especially for high-earning professionals, and it is past time to give this basic consideration to working-class Americans.
For example, if the current eligibility threshold is about $45,000 in Texas for a single parent with one infant child, a married couple should have their eligibility threshold moved up by 1.4 times to about $63,000. Then, to end the existing program’s steep benefit cliff, in which marriage or earning too much can cause a large benefit to disappear overnight, the program should continue but be quickly tapered off via higher recipient copayments, up until 1.7 times the eligibility threshold for a one-adult family, or $77,000.
The family mentioned earlier, in which each spouse earns $35,000 per year, would see a marriage penalty reduction of $8,000 in Minnesota, $4,000 in Georgia, and more than $2,000 in Texas. These dollar amounts are critical for a young, working-class family trying to make ends meet.
Putting Words into Action
All this is possible at the state level. State lawmakers should couple reform with fraud-reducing measures. Next, eligible married families should have the allowance to receive only limited child care so the second spouse can work only part-time.
In other words, only one parent should have a full-time work requirement. This would save taxpayer dollars and allow families increased flexibility. Meanwhile, Congress can act to give states a greater incentive to pursue these reforms.
One roadblock, even at the state level, is our myopic political system. In this author’s experience, normal voters on both sides think such a policy a good idea, but elected Democrats are so far uninterested. This is a huge problem, considering their power in the legislative branch and now, presumably, in the executive. Elected Republicans feign interest but so far have neglected to follow up, thinking budgetary issues are much more important.
Too many people on the right complain about issues such as family breakdown without offering solutions, and too many legislators talk about a host of issues that matter to voters and only legislate on tax cuts. If traditionalist Americans are ever going to conserve anything, we’ll need politicians who take action beyond tinkering with the tax code.
To view the entire report, “Reforming Welfare To Reduce Marriage Penalties And Put Children First,” which includes more detail and calculations on this policy proposal, please visit the Archbridge Institute website.