When parents go to work but fail to make extra money, their kids do no better or worse than they would have otherwise.
On one level, the report confirms what is almost a truism: Having more money is usually better than having less. But as policy makers work to improve the lives of the poor and to help kids do better in school, the study offers the first concrete data to suggest that spending tax dollars to increase family income translates into school improvement.
"Welfare was originally about children, but in recent years we've really become more and more concerned about cutting the caseload and moving people off the rolls," said Gordon Berlin of Manpower Research Demonstration Corp., which conducted the study being released Tuesday. "We don't have any evidence that simply going to work benefits children."
The report paid for by private foundations raises important questions for Congress as it begins to consider changes to the welfare overhaul law approved in 1996, which must be renewed by next year.
Specifically, it suggests lawmakers might look for new ways to increase income for people moving off the rolls, said Ron Haskins, who was a lead House GOP staffer involved in writing the 1996 law.
"Now we ought to have a debate over what is the best way to maintain this level of total income," said Haskins, now at Brookings Institution.
The report examined earlier research on 11 different state programs that began in the early 1990s. Using a variety of rules and incentives, all of them increased the number of hours that parents worked.
In some cases, programs simply required welfare recipients to get jobs, punishing them if they didn't. These programs got people to work, but as a group, they didn't make more money than they would have without the new rules.
But in four of the programs studied, there was a carrot as well as a stick. One program gave participants extra money if they worked full time. Others let welfare recipients keep some of their welfare benefits even after they began working. Under the old welfare rules, recipients lost $1 for every $1 they earned on a job.
In each of these four programs, school achievement improved for elementary school children, a striking finding that makes researchers confident the improvement is real.
In some cases, achievement was measured through testing. Researchers found children on average moved from the 25th percentile meaning that 75 percent of children did better to the 30th percentile.
In other programs, child achievement was measured through interviews with teachers and parents. Those results found similar mprovements.
That's comparable to improvements found in some programs aimed directly at the children, such as reducing class size, researchers said.
In addition, some of the programs reduced behavior problems such as hitting or bullying other kids, and one of the four improved children's health.
Hoping to encourage work, almost every state has adopted rules that allow welfare recipients to keep part of their welfare check when they begin to work.
But the 1996 overhaul imposed new time limits that bar anybody from collecting welfare for more than five years. In some states, it's less. With the clock ticking, many caseworkers encourage participants to "bank" their time in case they need it later and drop off welfare altogether when they get a job.
"As long as that's the case, we're probably not going to get the kinds of effects we see here," Berlin said. He suggested that Congress might want to allow states to "stop the clock" when someone begins working full time, allowing them to continue to collect a supplement to their paycheck.
Lawmakers could also increase the Earned Income Tax Credit, a $32 billion program that aids some 20 million low-income taxpayers each year. Another key is making sure that people who come off welfare get the food stamps they are entitled to, said Haskins. He said Congress should also consider other direct supplements.
"If we can help the parents put their lives on a firmer basis and make them like other citizens, earning their way, working on a regular basis, giving back to society, their kids do better," Haskins said. "It's a great picture."
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