Whilst it might earn candidates political points, “bashing” the “one percenters” is not always the best recipe for helping those living desperately poor lives at the bottom of the ladder. Nothing demonstrates this more than a study released last month in an unlikely source, the New England Medical Journal. For those who stay awake at night worrying more about poverty than they do inequality, it makes for gloomy reading.
There is good reason to believe that poverty in the U.S. is set to increase, and not as a result of growing incomes at the top but as a result of something much more basic: a crackdown on family planning services which is feeding through to increase the birth rates of the poorest women.
Early twentieth century birth-control campaigners such as Margaret Sanger had little doubt that women’s access to affordable contraception was vital to reducing poverty rates, something which evidence has borne out. The expansion of federally funded family planning services in the U.S. in the 1960s and early 1970s reduced the number of births to poorer women by 20-30% and reduced the child poverty rate by 4.2%. Whilst we tend to assume that poverty reduction is the result of either capitalism or the welfare state, the ability for women to control their own fertility is just as important.
In fact, family planning is needed now more than ever. In an era in which the age of marriage has been rising, young women are at increasing risk of sleepwalking into life as a single-parent. As the economist and former Bill Clinton adviser, Isabel Sawhill, pointed out in her book Generation Unbound, 60% of births to young unmarried women in the U.S. result from unplanned pregnancies.
This has left America with a particularly dangerous cocktail when it comes to poverty rates. Whilst the percentage of children living in single parent households has risen across the OECD (to around 15%), in the U.S. it is now 26%. Not only is the U.S. home to many more such single-parent households, these households are also much more likely to live in poverty than in other rich economies (figure below).
Source: L. Maldonado and R. Nieuwenhuis, “Single-parent Family Poverty in 24 OECD countries: a focus on market and redistribution strategies” (October 2015, p.3, Figure 1):
Trying to mitigate the effects through the welfare system has proven costly. Estimates suggest that if the percentage of children growing up in single parent homes had remained the same as in 1970, by 2012 the child poverty rate would have been 15% as opposed to 21%. According to Sawhill, the rise in single parenthood has “completely offset the poverty reducing effects of the growth of cash assistance programs over the past four decades or so”. In fact, “for every child kept out of poverty by the earned income tax credit or some other programme, another child is about to be born into poverty because of the wholesale breakdown of the American Family”. Welfare programs have been fighting a losing battle, making the US poverty rate remarkably stubborn.
Given that many of the births to young unmarried women are unplanned, there is an obvious way forward. Never mind the usual offerings of greater handouts or “incentivizing” marriage, increased rather than reduced access to affordable contraception is what is needed. Children are expensive which means that women cannot afford to be left vulnerable to “accidents” and, with it, a lifetime in poverty. If we were talking about any other costly risk to which an adult was exposed, action would surely be taken to assuage that risk – especially if, as with state funded family planning services, that action is cost-effective. Every $1 spent on averting pregnancy using the most modern contraceptives generates a public saving of $7. It should be a no-brainer.
The good news is that whilst the U.S. is behind other rich economies in terms of its uptake of the most effective modern day contraceptives (such as contraceptive implants and IUDs), this has been improving over the last decade, with programmes in St Louis and Colorado having marked effects on birth rates. However, recent attacks on family planning services are now undoing the good work. The study published just last month found that since 2013, the birth rate for Texan women who lost access to Planned Parenthood services has risen by 27%. Given the number of other states that have followed in the footsteps of Texas, including Arkansas, Alabama, New Hampshire, Louisiana, North Carolina and Utah, this should be ringing alarm bells for anyone concerned about poverty.
Welfare policy needs to be proactive not reactive, limiting the number of people who fall into poverty rather than simply responding once they do. This requires giving women both the freedom and resources they need to control their own fertility. Whatever the outcome of the upcoming election, unless the new President acts quickly to reverse the war on birth control, they will face a serious headache of rising poverty rates and increasing welfare bills in the years ahead. Neither Democrat nor Republican should be happy with that.