January 24 2014
Rachel DiCarlo Currie
America’s ongoing debate over poverty, inequality, and mobility has been jolted by a pair of studies from economists at Harvard and UC-Berkeley.
The first study -- conducted by Raj Chetty, Nathaniel Hendren, Patrick Kline, and Emmanuel Saez -- examined geographic disparities in intergenerational income mobility across the United States. “The strongest predictors of upward mobility,” it concluded, “are measures of family structure such as the fraction of single parents in the area.” Indeed, family structure matters at both the individual level and the community level: “Children of married parents also have higher rates of upward mobility if they live in communities with fewer single parents.”
The second study -- in which the aforementioned authors were joined by Treasury Department economist Nicholas Turner -- found that “rank-based measures of social mobility have remained stable over the second half of the twentieth century in the United States,” despite rising income inequality. In other words, if the income scale were a ladder, then we might say that “the rungs of the ladder have grown further apart . . . but children’s chances of climbing from lower to higher rungs have not changed.”
What about the “Great Gatsby Curve” popularized by former White House chief economist Alan Krueger? Doesn’t it suggest that (in Krueger’s words) “as inequality rises, the prospects for intergenerational mobility fall”? Yes, it does -- but the connection between inequality and mobility remains hotly disputed, as Manhattan Institute scholar Scott Winship and others have shown. Here’s how Chetty, Hendren, Kline, Saez, and Turner explain their findings: “Much of the increase in inequality has come from the extreme upper tail (e.g., the top 1%) in recent decades, and top 1% income shares are not strongly associated with mobility across countries or across metro areas within the U.S.”
At the same time, the authors remind us that “intergenerational mobility is significantly lower in the U.S. than in most other developed countries,” particularly in Rust Belt cities and the Southeast. But when we compare U.S. mobility rates with those of Western Europe, Canada, Australia, and New Zealand, we must remember the crucially important issue of family breakdown. “By 2010,” writes AEI scholar Nick Eberstadt, “a child was more likely to grow up in a broken home in America than in practically any other Western society.” That grim fact is inseparable from cross-country variations in mobility.
It’s also inseparable from America’s long-running War on Poverty, which turned 50 this month. Right from the start, the War on Poverty exacerbated -- and thus was undermined by -- the rising trend of nonmarital childbearing. Between 1940 and 1964, the proportion of all U.S. births occurring outside marriage increased by 3.1 percentage points, jumping from 3.8 percent to 6.9 percent. Over the next 24 years -- between 1964 and 1988 -- the nonmarital-birth ratio grew by 18.8 points, to reach 25.7 percent. And over the most recent 24-year time span for which we have data -- 1988 to 2012 -- the ratio grew by another 15 points, to hit 40.7 percent.
To be sure, Western European countries have high levels of nonmarital childbearing as well. Yet as Jim Manzi has explained in National Affairs: “The estimated percentage of 15-year-olds living with both of their biological parents is far lower in the United States than in Western Europe, because unmarried European parents are much more likely to raise children together.” Indeed, writes Manzi, “The level of family disruption in America is enormous compared to almost every other country in the developed world.”
Last week I mentioned that cutting the U.S. nonmarital-birth ratio in half would mean returning approximately to the level that prevailed in 1983 (20.3 percent). Cutting it by one-third would bring us back to the 1989 level (27.1 percent). Cutting it by a quarter would put us slightly below the 1993 level (31 percent). The extreme unlikelihood of achieving even this last goal (a one-quarter reduction) anytime in the near future indicates just how deeply entrenched nonmarital childbearing has become.
The demographics of marriage and out-of-wedlock births highlight widening socioeconomic gaps. For example: According to a 2012 report published by the National Marriage Project (NMP) and the Institute for American Values (IAV), the nonmarital-birth ratio among moderately educated women aged 15 to 44 spiked from 13 percent in 1982 to 44 percent in 2006–08. Over that same period, the ratio among America’s least-educated women climbed from 33 percent to 54 percent, while the ratio among highly-educated women went from 2 percent to 6 percent. The NMP-IAV report included a series of recommendations for encouraging and strengthening marriage among lower- and middle-income Americans, such as (1) ending the marriage penalties in Temporary Assistance for Needy Families (TANF), Medicaid, and other government welfare programs, (2) expanding the Child Tax Credit, (3) promoting workplace apprenticeships, (4) funding and studying marriage- and relationship-education initiatives, and (5) having the U.S. surgeon general spearhead a nationwide, “community-oriented” pro-marriage campaign similar to past campaigns against smoking, drunk driving, and teen pregnancy.
More specifically, authors Elizabeth Marquardt, David Blankenhorn, Robert Lerman, Linda Malone-Colón, and Brad Wilcox said that Washington might want to “give low-income couples a refundable tax credit for the exact amount of their marriage penalty for the first years of their marriage”; they suggested tripling the Child Tax Credit for kids below the age of three; and they proposed that states allocate anywhere from 1 percent to 2 percent of their TANF block-grant money “to preventative efforts to help at-risk individuals and couples form and sustain healthy marriages and relationships with the goal of improving child well-being.”
Such policy reforms are worthy of serious consideration. And yet, we should not exaggerate their likely impact on marriage and childbearing. As University of Pennsylvania law professor Amy Wax noted in her brilliant 2009 book, Race, Wrongs, and Remedies: “In general, governments have so far proven more effective in undermining informal social institutions than in strengthening those that have disintegrated.” An ingrained cultural problem ultimately requires a cultural solution, which cannot be imposed by government or created by mere economic forces.
In that spirit, I’ll end with the sobering observation that Brookings Institution scholar Isabel Sawhill made in the Washington Post on the 20th anniversary of Dan Quayle’s famous Murphy Brown speech: “Unless the media, parents and other influential leaders celebrate marriage as the best environment for raising children, the new trend -- bringing up baby alone -- may be irreversible.”
Rachel DiCarlo Currie is a senior fellow at the Independent Women’s Forum.