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Expanding Opportunity in America: A Summary of AEI's Forum with Paul Ryan

July 29, 2014 10:00 AM

Last Thursday at the American Enterprise Institute (AEI) in Washington, DC, Congressman Paul Ryan (R-WI) unveiled his new antipoverty proposal that reforms public assistance programs for low-income Americans. This plan encourages state and local policy innovation and encourages  rigorous program evaluations. Ryan, Chairman of the House Budget Committee, put forth the plan as he seeks to reconnect struggling Americans with their communities while providing social services programs greater flexibility to better serve individual needs. After the Congressman’s remarks, a panel comprised of Stuart Butler, Heritage Foundation; Ron Haskins, Brookings Institution and APPAM Policy Council member; Bob Woodson, Center for Neighborhood Enterprise; and Ryan discussed the plan’s policy implications. The panel was moderated by Robert Doar, AEI.

“We spend $800 billion each year on 92 programs at the federal level just to fight poverty,” said Ryan in his opening remarks. “And yet, we have the highest poverty rate in a generation. Deep poverty is near record highs. When you take a step back and look at all of this you’ve got to think, we can do better than this.”

The Congressman’s pilot program reconceives the role of the federal government as a supporter of local and state-based initiatives. Through coordination and collaboration among public, private, and charitable sectors, the initiative would consolidate up to 11 means-tested programs into a single funding stream that participating states would have control of, if they abided under specific conditions.

“Today, federal aid is fragmented and formulaic. Washington looks at each person’s needs in isolation, like food, housing, or energy,” Ryan said. “It doesn’t see how their needs interact. And what’s worse, Washington looks at each person in isolation. It doesn’t see how people need to interact. The secret to our country’s success is collaboration – people working together, people learning together, people building together of their own free will.”

Ryan’s pilot program would consolidate 11 federal programs into one funding stream. The purpose would be to let states try different ways of providing aid and testing results. Under Ryan’s plan, each state wishing to participate would submit a plan to the federal government, laying out in detail their proposed alternative stream. If granted, states can combine various programs such as food stamps, housing assistance, child care, and others. This new funding stream would be called the Opportunity Grant and be budget neutral.

The Congressman also voiced support for several other ideas that combat poverty. He recommended increasing the Earned Income Tax Credit (EITC) for childless workers to $1,000 and lower eligibility to 21 years of age. He suggested paying for the program by eliminating programs and corporate welfare such as energy company subsidies. He also gave his support to accreditation reform to give students more options and competition to the colleges, and recommended common sense criminal justice reform.

Ryan stressed that he hopes to create a commission on evidence-based policymaking, which would look at the possibility of creating a national clearinghouse for program and survey data.

During the panel discussion, Haskins called Ryan’s proposal sweeping and worthy of a think tank. “And I would emphasize sweeping: opportunity grants, EITC for childless workers, education at all levels, criminal sentencing and other prisoner reforms, regulatory reform, and program evaluation. I have not seen anything like this from an individual member in many years introduced in Congress.” He especially emphasized the results-driven research aspect of the proposal. “We are, at last, learning that our programs don’t work and that they can be evaluated, and you can use the evaluation to improve them.”

Butler pointed out that the Opportunity Grant idea is good but relies heavily on innovation. “It is absolutely critical, if you’re going to see innovative public policy in this country,” said Butler, “to give incentives to states and to localities and to non-government organizations to try out ideas, to be innovative, and to learn from them. And that’s the heart of the opportunity grant proposal.” He echoed Haskin’s remarks about evaluations, noting that the country has had many policies that sound good but actually do nothing or very little. “Building in systematic evaluations is essential to see if innovations are true and enable the key elements to be exported elsewhere.”

Woodson agreed. “It’s critically important that we have a dialogue that goes beyond money. For the past 40 years, the anti-poverty expenditure has been $15 trillion,” he said.  “Seventy cents of every dollar spent on poor people goes not to the poor, but to those who serve poor people. These professional providers ask not which problems are solvable, but which ones are fundable.” He noted that if the government at all levels invested wisely in creative, community-based “poverty warriors,” that more people can be helped at lower cost with expanded opportunity.

Ryan closed by noting that the federal government is displacing and crowding out private charity in several ways. His proposal is aimed to stop that competition and “respect the good works that are being done by people on the ground, the experimentation that’s occurring.” The federal government is capable of providing resources for these programs. “What private charities, what public charities, what nonprofit, for profit – what they can do is provide expertise, boots on the ground, and customization,” he concluded. “I think we can integrate the roles, so that they work better at the end of the day. And that to me is what we ought to do if we want to truly get everybody working in the same direction and focused on an outcome-based, results-based policy.”


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