Here is a recent article on the subject:
http://delong.typepad.com/sdj/2012/02/w ... facts.html
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What Jonathan Gruber Meant When He Said That Although Charles Murray's "Losing Ground" Was Impressive as Rhetoric, "The Facts Were Wrong"
Sandy Jencks vs. Charles "Cross Burner" Murray:
How Poor Are the Poor?: Systematic efforts at assessing the impact of [welfare] benefits on illegitimacy rates support my version of the Harold and Phyllis story rather than Murray’s.
The level of a state’s AFDC benefits has no measurable effect on its rate of illegitimacy. In 1984, AFDC benefits for a family of four ranged from $120 a month in Mississippi to $676 a month in New York. David Ellwood and Mary Jo Bane recently completed a meticulous analysis of the way such variation affects illegitimate births.17 In general, states with high benefits have less illegitimacy than states with low ones, even after we adjust for differences in race, region, education, income, urbanization, and the like. This may be because high illegitimacy rates make legislators reluctant to raise welfare benefits.
To get around this difficulty, Ellwood and Bane asked whether a change in a state’s AFDC benefits led to a change in its illegitimacy rate. They found no consistent effect. Nor did high benefits widen the disparity in illegitimate births between women with a high probability of getting AFDC—teen-agers, nonwhites, high school dropouts—and women with a low probability of getting AFDC.
What about the fact that Phyllis can now live with Harold (or at least sleep with him) without losing her benefits? Doesn’t this discourage marriage and thus increase illegitimacy? Perhaps. But Table 2 shows that illegitimacy has risen at a steadily accelerating rate since 1950. There is no special “blip” in the late 1960s, when midnight raids stopped and the “man in the house” rule passed into history. Nor is there consistent evidence that illegitimacy increased faster among probable AFDC recipients than among women in general.
Murray’s explanation of the rise in illegitimacy thus seems to have at least three flaws. First, most mothers of illegitimate children initially live with their parents, not their lovers, so AFDC rules are not very relevant.
Second, the trend in illegitimacy is not well correlated with the trend in AFDC benefits or with rule changes. Third, illegitimacy rose among movie stars and college graduates as well as welfare mothers. All this suggests that both the rise of illegitimacy and the liberalization of AFDC reflect broader changes in attitudes toward sex, law, and privacy, and that they had little direct effect on each other.
But while AFDC does not seem to affect the number of unwed mothers, as Murray claims, it does affect family arrangements in other ways. Ellwood and Bane found, for example, that benefit levels had a dramatic effect on the living arrangements of single mothers. If benefits are low, single mothers have trouble maintaining a separate household and are likely to live with their relatives—usually their parents. If benefits rise, single mothers are more likely to maintain their own households.
Higher AFDC benefits also appear to increase the divorce rate. Ellwood and Bane’s work suggests, for example, that if the typical state had paid a family of four only $180 a month in 1980 instead of $350, the number of divorced women would have fallen by a tenth. This might be partly because divorced women remarry more hastily in states with very low benefits. But if AFDC pays enough for a woman to live on, she is also more likely to leave her husband. The Seattle–Denver “income maintenance” experiments, which Murray discusses at length, found the same pattern.
The fact that high benefits lead to high divorce rates is obviously embarrassing for liberals, since most people view divorce as undesirable. But it has no bearing on Murray’s basic thesis, which is that changes in social policy after 1965 made it “profitable for the poor to behave in the short term in ways that are destructive in the long term.” If changes in the welfare system were encouraging teen-agers to quit school, have children, and not take steady jobs, as Murray contends, he would clearly be right about the long-term costs. But if changes in the welfare system have merely encouraged women who were unhappy in their marriages to divorce their husbands, or have discouraged divorced mothers from marrying lovers about whom they feel ambivalent, what makes Murray think this is “destructive in the long term”?
Are we to suppose that Phyllis is better off in the long run married to Harold if he drinks, or beats her, or molests their teen-age daughter? Surely Phyllis is a better judge of this than we are. Or are we to suppose that Phyllis’s children will be better off if she sticks with Harold? That depends on how good a father Harold is. The children may do better in a household with two parents, even if the parents are constantly at each other’s throats, but then again they may not. Certainly Murray offers no evidence that unhappy marriages are better for children that divorces, and I know of none.
Shorn of rhetoric, then, the “empirical” case against the welfare system comes to this. First, high AFDC benefits allow single mothers to set up their own households. Second, high AFDC benefits allow mothers to end bad marriages. Third, high benefits may make divorced mothers more cautious about remarrying. All these “costs” strike me as benefits.
Consider Harold and Phyllis again, but this time imagine that they married in 1960 and that it is now 1970. They have three children. Harold still has the deadend job in a laundry that Murray describes him as having taken in 1960, and he has now taken both to drinking and to beating Phyllis. Harold still has two choices. He can leave Phyllis or he can stay. If he leaves, Phyllis can try to collect child support from him, but her chances of success are low. So Harold can do as he pleases.
Phyllis is not so fortunate. She is not the sort of person who can earn much more than the minimum wage, so she cannot support herself and three children without help. If she is lucky she can go to her parents. Otherwise, if she lives in a state with low benefits, she has two choices: stick with Harold or abandon her children. Since she has been taught to stick with her children, she has to stick with Harold. If she lives in a state with high benefits she has a third choice: she can leave Harold and take her children with her. In a sense, AFDC is the price we pay for Phyllis’s commitment to her children. At 0.6 percent of total US personal income, it does not seem a high price.
Giving Phyllis more choices has obvious political drawbacks. So long as Phyllis lives with Harold, her troubles are her own. We may shake our heads when we hear about them, but we can tell ourselves that all marriages have problems, and that that is the way of the world. If Phyllis leaves Harold—or Harold leaves Phyllis—and she comes to depend on AFDC, her problems become public instead of private. Now if she cannot pay the rent or does not feed her children milk it could be because her monthly check is too small, not because she doesn’t know or care about the benefits of milk or because Harold spends the money on drink. Taking collective responsibility for Phyllis’s problems is not a trivial price to pay for liberating her from Harold. Most of her problems will, after all, remain intractable. But our impulse to drive her back into Harold’s arms so that we no longer have to think about her is the kind of impulse decent people should resist.
The idea that Phyllis will be the loser in the long run if society gives her more choices exemplifies a habit of mind that seems as common among conservatives as among liberals. First you figure out what kind of behavior is in society’s interest. Then you define such behavior as “good.” Then you argue that good behavior, while perhaps disagreeable in the short run, is in the long-run interest of those who engage in it. Every parent will recognize this ploy: my son should take out the garbage because it is in his long-run interest to learn good work habits, not because I don’t want to take it out or don’t want to live with a shirker. The conflict between individual interests and the common interest, between selfishness and unselfishness, is thus transformed into a conflict between short-run and long-run self-interest. Unfortunately, the argument is often false...
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yrs,
rubato