THE SOCIETY WHERE POVERTY IS VOLITIONAL:

The Rise Of the Bottom Fifth: How to Build on the Gains Of Welfare Reform (Ron Haskins, May 29, 2007, Washington Post)

Imagine a line composed of every household with children in the United States, arranged from lowest to highest income. Now, divide the line into five equal parts. Which of the groups do you think enjoyed big increases in income since 1991? If you read the papers, you probably would assume that the bottom fifth did the worst. After all, income inequality in America is increasing, right?

Wrong. According to a Congressional Budget Office (CBO) study released this month, the bottom fifth of families with children, whose average income in 2005 was $16,800, enjoyed a larger percentage increase in income from 1991 to 2005 than all other groups except the top fifth. Despite the recession of 2001, the bottom fifth had a 35 percent increase in income (adjusted for inflation), compared with around 20 percent for the second, third and fourth fifths. (The top fifth had about a 50 percent increase.)

Even more impressive, the CBO found that households in the bottom fifth increased their incomes so much because they worked longer and earned more money in 2005 than in 1991 -- not because they received higher welfare payments. In fact, their earnings increased more in percentage terms than incomes of any of the other groups: The bottom fifth increased its earnings by 80 percent, compared with around 50 percent for the highest-income group and around 20 percent for each of the other three groups.

When considering this explosion of work among those in the bottom fifth, remember that they all had children to take care of, that more of these households were headed by single mothers than households in the four better-off groups, and that they had the least money to, say, fix their cars or tide them over if they got sick. Those who do not admire this performance should live for a year on $16,800 and see if they could increase their earnings by 80 percent.

Now imagine if the singles just married, like normal people.

Posted by Orrin Judd at May 30, 2007 7:54 AM