U.S. Sen. Mitt Romney’s ‘One Door’ bill would allow states to integrate social safety net with workforce development

by David Bass | Feb 29, 2024

U.S. Sen. Mitt Romney’s ‘One Door’ bill would allow states to integrate social safety net with workforce development

PEACHTREE CORNERS, GA—U.S. Sen. Mitt Romney, R-Utah, has introduced a bill that would free up the 50 states to implement a “One Door” safety-net reform strategy similar to the very successful model created in Utah. As part of the Alliance for Opportunity, a coalition of groups seeking to drive state-level change in the safety-net system, the Georgia Center for Opportunity is in full support of the bill.

U.S. Rep. Burgess Owens, R-Utah, has previously introduced a “One Door” bill in the House, a version of which passed out of the House Committee on Education and the Workforce in December.

Despite a historically low unemployment rate across the country, states are still facing a workforce crisis with millions of able-bodied Americans on the economic sidelines. Our nation’s workforce participation rate has not fully recovered from the COVID-19 pandemic. By the end of 2023, 41 million Americans relied on food stamps to make ends meet and nearly 90 million Americans were enrolled in Medicaid.

Many of these Americans remain stuck in a safety-net system that simply doesn’t work. The One Door to Work Act, introduced by Sen. Romney on Feb. 28, would allow states the flexibility to implement Utah’s consolidation of federal workforce development and social safety-net programs into a single state entity. The end goal is to help work-capable recipients reintegrate more quickly into the workforce, empowering them to achieve the independence, stability, and purpose that are crucial to human well-being.

“Every state should have the flexibility to design an integrated workforce and safety-net model that enables people to succeed,” said Randy Hicks, president and CEO of the Georgia Center for Opportunity. “Every hour a safety-net recipient spends finding their way through the system is an hour they can’t spend working their way into opportunity. The One Door to Work Act allows states to create a system that works for people.”

The dozens of programs that make up the system have different and, at times, competing goals, inconsistent rules, and overlapping groups of recipients. Often, recipients must resubmit the same information multiple times for multiple programs with the aid of multiple caseworkers. This disconnect fosters despair and keeps recipients in a cycle of poverty—as every hour spent navigating the system is an hour not spent pursuing a path out of it.

What’s more, there is often a disconnect between safety-net programs and welfare-to-work initiatives. The end result is that people stay mired in generational poverty rather than receiving a helping hand to live a better life. The One Door to Work Act would free up state governments to explore ways to create a safety net that works for all citizens and doesn’t cause generational poverty.

“There are 8.7 million open jobs in this country, and the workforce participation rate has not fully recovered from the COVID-19 pandemic. States need the flexibility in the One Door to Work Act to use our workforce dollars to move our people off the sidelines,” said Greg Sindelar, executive director and chief operating officer of the Texas Public Policy Foundation, which is a member of the Alliance for Opportunity.

“A robust workforce is not only integral to a thriving state economy, but also to its social fabric,” added Daniel Erspamer, CEO of the Pelican Institute for Public Policy, also a member of the Alliance. “When a person is unemployed for longer than six months, it is associated with decreased well-being, even measurably affecting mortality. The One Door to Work Act gives workers, employers, and taxpayers the system that they deserve.”

Learn more about the “One Door” policy here.

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Georgia Center for Opportunity (GCO) is independent, non-partisan, and solutions-focused. Our team is dedicated to creating opportunities for a quality education, fulfilling work, and a healthy family life for all Georgians. To achieve our mission, we research ways to help remove barriers to opportunity in each of these pathways, promote our solutions to policymakers and the public, and help effective and innovative social enterprises deliver results in their communities.

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Ask Dr. E: What should national leaders do to rescue America from an economic trainwreck?

by Eric Cochling | Dec 13, 2023

Georgia news, in the news, current events, Georgia happenings, GA happenings

Ask Dr. E: What should national leaders do to rescue America from an economic trainwreck?

OPINION:

Dear Dr. E: The American economy is a mess. Few could argue otherwise, at least with a straight face. Inflation is out of control. Our national debt is unsustainable. Social Security is teetering on bankruptcy. Homeownership is out of the question for millions of young people. Credit card debt is unbelievable. The list could go on and on. Is there any one specific thing you believe our national leaders should do that would rescue America from the economic trainwreck that seems inevitable? — REALISTIC AND WORRIED WORKING MAN FROM ALABAMA

Many of our socioeconomic issues are directly linked to the health of the family structure. Suppose the family structure falls in any civilization. In that case, the number of married couples decreases, economic mobility decreases, median family income decreases, child poverty increases, racial tension increases, and educational tensions increase. The success of an economy is directly related to the stability of the family structure. You cannot have one without the other. Eric Cochling of the Georgia Center for Opportunity says, “To reinvigorate opportunity in America, we must start by restoring the health and vitality of the American family. Nothing less will do.” If the family falls, so does the economy.

Read the full article here

Are Food Stamp Benefits Too Little?

by Erik Randolph | Dec 8, 2023

Are Food Stamp Benefits Too Little?

Key Points

Research Indicating SNAP Benefits Are Too Low: Urban Institute tool suggests that the average cost of a meal exceeds the maximum SNAP benefit, emphasizing the potential inadequacy of the program.
Concerns About Research Methodology: Emphasizes that SNAP is meant to supplement, not replace, food purchases, and spending habits should be expected to exceed the lowest-cost food budget when households have income.
Drawbacks of Raising SNAP Maximum Benefits: Highlights the fiscal irresponsibility of increasing SNAP benefits amidst a large federal deficit and national debt, which could contribute to inflation and rising price levels.

Recent studies are raising concerns about whether the help provided by the Food Stamp program, now known as the Supplemental Nutrition Assistance Program (SNAP), is sufficient. This program, which served 41.2 million people in the Fiscal Year 2022, is the biggest food assistance initiative in the United States.

But before you call your congressperson, let’s take a closer look at the research that suggests SNAP benefits might be too low.

The Research Findings

The Urban Institute has developed a tool indicating the average cost of a “modestly-priced” meal often exceeds the maximum SNAP benefit allotted for a meal. For instance, in the last quarter of 2022, the average “modestly-priced” meal cost was $3.14, surpassing the calculated maximum SNAP benefit of $2.74 for a meal in the 48 contiguous states.

To make matters more complicated, food prices vary across the country. The tool allows users to see how the maximum food benefit falls short in different counties. According to the Urban Institute, the maximum SNAP benefit covered the cost of a modestly- priced meal in only 27 out of 3,143 counties, or just 1 percent of the total.

Other organizations, such as the Brookings Institute, share similar concerns about the adequacy of SNAP benefits, putting pressure on Congress to consider increasing the program’s maximum benefit.

Are We Comparing Apples and Oranges?

It’s essential to be cautious, though, as the research might be comparing different things. The maximum SNAP benefit is based on the Thrifty Food Plan, intended to be the lowest-cost food budget while still providing necessary nutrition for a family. In fact, it is the lowest cost budget produced by the U.S. Department of Agriculture, which begs the question of how the Urban Institute is defining a modestly priced meal.

The Urban Institute’s calculation of a “modestly priced meal” is based on the spending habits of households at or below 130 percent of the official poverty level, but who were also considered to be “food secure.”

It should be expected The Thrifty Food Plan is lower than the actual expenditures of this demographic group because, as the name suggests (the Supplemental Nutrition Assistance Program), SNAP is meant to supplement, not replace, food purchases. As households earn income, it’s expected they will spend more on food than what the minimum budget allows.

Why Is There Still Food Insecurity?

Food insecurity is determined by using answers to the Current Population Survey, but the determination doesn’t specifically address the adequacy of the SNAP maximum benefit. Other factors, like spending habits, diets, and dealing with the stress of poverty, also play a role. It’s important to note that the U.S. faces an obesity problem, even among SNAP participants, suggesting that the issue may not be too few calories but rather poor eating habits.

However, the obesity problem probably has more to do with more nutrition education, better eating habits, and improved financial literacy for participants rather than the program itself.

The Solution: Congress should reform the Supplemental Nutrition Assistance Program (SNAP) so that more households can easily overcome benefits cliffs through steady work and typical pay raises and achieve self-sufficiency faster.

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SNAP, TANF, welfare, benefits, benefits cliffs

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Negatives of Increasing Benefits

While some might think increasing SNAP benefits is harmless, there are negative consequences to consider. It can affect upward economic mobility for participants ready to leave the program, making it more costly with unwanted economic side effects.

A recent study highlighted a benefit cliff problem in SNAP, where households lose more total income than gained from increased earnings. The study identifies the importance of controlling the maximum benefit to solve benefit cliffs and marriage penalties.

Benefit cliffs are a big problem for households trying to stop relying on safety-net assistance programs. They face an unfair choice between being worse off financially and giving up their long-term goals of moving up economically through steady work. After vulnerable people get help from the safety net, government assistance should help them move forward, not hold them back.

Considering the cost of the program is also important. In the fiscal year 2022, the federal government spent $120 billion on the Food Stamp program. However, the government had a $1.4 trillion deficit, increasing the national debt to over $32 trillion. This financial irresponsibility is a major reason for inflation and higher prices, which impact those on safety-net programs the most.

The Best Strategy Forward

Increasing the maximum SNAP benefit should be approached cautiously to balance adequate nutrition for families while controlling program costs. The Urban Institute’s definition of a reasonably priced meal falls short because they are measuring the wrong aspects when compared to the criteria set for the maximum allotment. There seems to be a methodology problem in their approach. It’s extremely important to get the number right to ensure adequate nutrition for families but in a way that is thrifty to keep program costs under control and to make it easier to fix benefit cliffs and mitigate marriage penalties.

Those concerned about low SNAP benefits should also consider that other assistance programs help participants, such as free school meals and food banks operated by non-profit organizations. Plus, state agencies that administer SNAP all have nutrition education programs to help participants know how to budget for nutritious food. The federal government also assists states in those efforts by providing tools, curricula, and a website. Ultimately, determining the adequacy of Food Stamp benefits should rely on nutrition science, consumer science, financial education, and thriftiness.

*Erik Randolph is the Director of Research for the Georgia Center for Opportunity.

*Monthly average for the fiscal year per program data tables of the Food and Nutrition Service, U.S. Department of Agriculture.

Food Stamps: New Report Outlines 5 Possible Ways To Combat SNAP ‘Benefits Cliffs’ at Federal Level — Would They Save Recipients Money?

by Erik Randolph | Nov 28, 2023

Food Stamps: New Report Outlines 5 Possible Ways To Combat SNAP ‘Benefits Cliffs’ at Federal Level — Would They Save Recipients Money?

A benefits cliff is when a household loses more in net income and benefits from governmental assistance programs — like SNAP — than it gains from additional earnings. According to a report by the Georgia Center for Opportunity, this net loss is a “perverse incentive” discouraging any desire to increase income.

“The very basic concept is that when you lose more in taxes and benefits than you receive from a gain in additional earnings, that’s how we’re defining a cliff,” Erik Randolph, GCO’s research director, told The Center Square. “Let’s say that you get a pay raise worth $2,000, but you actually lose $3,000, you’re $1,000 behind; you’re worse off financially than what you were.”

Read the full article here

Georgia report finds steps Congress should take to SNAP ‘benefits cliffs’

by Erik Randolph | Nov 28, 2023

Georgia report finds steps Congress should take to SNAP ‘benefits cliffs’

Design flaws in the federal food stamp program hinder recipients’ upward economic mobility and effectively force them into governmental dependency.

That’s the upshot of a new Georgia Center for Opportunity report exploring possible solutions for addressing the benefits cliffs in safety-net programs like the Supplemental Nutrition Assistance Program.

Erik Randolph, GCO’s research director, told The Center Square that the report — “Solving the Food Assistance (SNAP) Benefits Cliffs” — identified several steps federal authorities can take to ensure that SNAP functions as safety net programs should. In doing so, the federal government can eliminate SNAP benefit cliffs without spending more money.

“The very basic concept is that when you lose more in taxes and benefits than you receive from a gain in additional earnings, that’s how we’re defining a cliff,” Randolph said. “Let’s say that you get a pay raise worth $2,000, but you actually lose $3,000, you’re $1,000 behind; you’re worse off financially than what you were.

“The trade-off is that you can accept the pay raise but end up with less money,” Randolph added. “If someone’s acting in a rational manner, why would they do that? But in the long term, it’s going to harm them because it’s going to reduce their economic mobility. So, the system shouldn’t have that as part of it. It should be a hand up and not a handout that prevents you from making the right decision or that’s encouraging you to make the wrong decision.”

Read the full article here

Missouri is first state to pass law addressing benefits cliffs

by David Bass | Nov 15, 2023

Missouri lawmakers<br />
Senate Bill 82<br />
public assistance provisions<br />
benefits cliffs<br />
Temporary Assistance for Needy Families (TANF)<br />
Supplemental Nutrition Assistance Program (SNAP)<br />
child care subsidy programs<br />
transitional benefits program<br />
poverty level<br />
state median family income<br />
welfare programs<br />
fiscal note<br />
Medicaid<br />
self-sufficiency<br />
workforce solutions<br />
government assistance<br />
economic opportunity<br />
dependence on the government<br />
benefits cliff phenomenon<br />
social and economic opportunity

Missouri is first state to pass law addressing benefits cliffs

Key Points

Missouri Leads the Way: The enactment of Senate Bill 82 establishes Missouri as the first state in the nation to address public assistance provisions, breaking ground in reforming safety-net benefits and combating the cycle of dependence on government support.
Benefits Cliff Challenge: The legislation acknowledges the pervasive issue of benefits cliffs, where individuals and families face a sudden loss of government assistance as their income increases. The law aims to mitigate this challenge by introducing transitional benefits programs in TANF, SNAP, and childcare subsidy programs.
Incomplete Solution: While the Missouri law is a commendable first step, there are concerns about its comprehensive effectiveness. The legislation, utilizing new funds, creates a supplemental program to ease the loss of benefits but doesn’t address underlying program variables contributing to benefits cliffs. Additionally, potential underfunding and the absence of Medicaid in the scope raise questions about the long-term sustainability and impact of the solution.

Missouri lawmakers recently took an important step toward helping poor and working-class residents escape safety-net benefits cliffs and experience the dignity and opportunity of work. By enacting Senate Bill 82, the Show Me State is now the first in the nation to address public assistance provisions that often entrap program participants by punishing work and perpetuating dependence on the government.

It’s no secret that many Americans rely on government assistance programs to make ends meet. But they often get caught in a Catch-22 situation—a benefits cliff—which disincentivizes them from looking for more meaningful work and gaining independence.

These benefits cliffs occur when an individual, family, or household experiences a sudden, steep loss of government assistance as income increases. Perversely, this net loss undermines the natural desire to earn more income because it takes a huge pay bump to overcome the cliff. The unintended consequences of a benefits cliff can be devastating—trapping individuals and families in a cycle of poverty.

How the new law works

This new Missouri law modifies benefits cliffs to enable residents to more easily earn additional income and experience the fulfillment and belonging that comes with social and economic opportunity. It does so by easing the loss of benefits in the Temporary Assistance for Needy Families (TANF), Supplemental Nutrition Assistance Program (SNAP) and child care subsidy programs for families that lose income eligibility for these programs.

Specifically, this law establishes a transitional benefits program for TANF and SNAP—subject to funding from the state legislature—to help the transition off of benefits and reduce the impact of the program cliffs. The benefit is stepped down on a one-to-one basis as income increases.

It also helps to alleviate the loss of benefits from the child care subsidy program by creating a transitional benefits program using a sliding scale that steps down transitional benefits until the household reaches 300 percent of the poverty level or 85 percent of the state median family income.

When funded and implemented, this law will positively impact all individuals and families on the SNAP and childcare subsidy programs whose income exceeds program limits—but remain under income limits for the transitional benefits. It would not, however, impact TANF recipients because the program’s cash assistance tampers to zero, which means there would be no transitional benefits.

And building upon the foundation laid in Missouri, other states should similarly experiment with creative solutions to the cliffs problem.

The next step

While the new Missouri law is a commendable first step by a state to correct design flaws in benefit cliffs, there is still more work to do. For example, this legislation fails to address the variables in each program that drive the benefits cliff phenomenon in the first place. Instead, it uses new money to create a bridge that eases the loss of benefits when coming off designated programs.

Precisely because it uses new money, this solution represents a potentially huge and expensive expansion of welfare programs in Missouri. Indeed, the fiscal note accompanying the legislation estimates a cost of around $200 million per year in state revenue.

So rather than a comprehensive and holistic resolution to the benefits cliff problem, this new law essentially creates a supplemental program at risk of being underfunded in years when the legislature fails to fully fund at levels to meet demand—creating challenges for state agencies charged with program implementation. Moreover, the law doesn’t address Medicaid at all—the biggest driver of benefit cliffs in terms of dollar impact to families.

Despite these limitations, this new law recognizes that benefits cliffs are a real problem in need of a solution. And it attempts to address design flaws in two of the biggest-offending programs—SNAP and childcare. Finally, it recognizes the need to step down benefits in ways that eliminate cliffs as people earn additional income and learn to stand on their own with increasingly less dependence on the government.

In tackling the challenge of benefits cliffs, Missouri lawmakers have set the bar for other states to consider solutions to welfare systems that prevent people from becoming self-sufficient by holding them back from working as much as they could or should.

And building upon the foundation laid in Missouri, other states should similarly experiment with creative solutions to the cliffs problem. This includes waivers and other steps to address systemic program flaws. It also includes pilot projects to demonstrate how to eliminate cliffs with a net positive impact on those who work more, earn additional income and become self-sufficient faster than would otherwise be possible.