The Asset Building News Week is a weekly Friday feature on The Ladder, the Asset Building Program blog, designed to help readers keep up with news and developments in the asset building field. This week's topics include public assistance, asset limits, poverty, the achievement gap, and homelessness.
Public Assistance and Asset Limits
After adjusting for inflation, the purchasing power of TANF benefits is below 1996 levels for 99 percent of TANF recipients, reports Ife Floyd and Liz Schott of the Center on Budget and Policy Priorities. On the same note, Kate McDonough of Salon writes that from 1996 to present day the number of families with children living in deep poverty has increased 130 percent while funding for TANF’s block grant has not seen any increases. Of equal if not greater concern, Michael Hiltzik of the Los Angeles Times writes that, by pure inaction, Congress is set to impose a $5 billion cut to SNAP benefits next week for this fiscal year alone. More severe than the Senate proposal to cut $400 million and the House’s cut of $4 billion, this significant cut will adversely affect 47 million Americans and would mean the loss of 21 meals a month for a family of 4 on SNAP.
On a more optimistic note, Aleta Sprague writes about the decision of Pennsylvania’s new Secretary of Public Welfare, Beverly Mackereth, to “rethink” SNAP asset tests. Despite very low rates of fraud, Pennsylvania’s previous Secretary, Gary Alexander, enacted an asset test that saw some 4,000 Pennsylvanian households kicked off the program and an additional 100,000+ households denied benefits due to a lack of “proper” asset verification documents. "The asset test adds unnecessary red tape," Julie Zaebst, policy manager for the Greater Philadelphia Coalition Against Hunger, told the Philadelphia Inquirer who first reported the story. This is hopefully the beginning of a new trend, as Reid Wilson of the Washington Post reports on Illinois and Hawaii both recently eliminating their TANF asset caps and Nevada looking to increase the flexibility of what is considered an asset – exempting 529 plans from TANF caps, for example. More information on asset limits can be found here.
Poverty and the Achievement Gap
Bryce Covert of Think Progress writes that low-income toddlers can fall behind their wealthier peers in learning language as early as 18 months old, according to Stanford researchers led by Anne Fernald. “By 2 years of age, these disparities are equivalent to a six-month gap between infants from rich and poor families in both language processing skills and vocabulary knowledge,” Fernald said. Similarly, Connecticut-based publication, The Day, reports on racial and economic achievement gaps among elementary school students in the state. A new report found that white students in Connecticut are about four times more likely to earn advanced scores on academic achievement tests than minorities. In addition, affluent students in Connecticut outpaced those getting free or reduced-price lunches by a nearly 5-1 ratio in terms of high test scores. Such achievement gaps are further exacerbated by the structure of elite higher education. Josh Freedman writes in Forbes about George Washington University’s policy that rejects prospective students if they are too poor. Prospective GW students could be shifted from “admitted” to “not admitted” if they required too much financial aid.
The number of homeless people who are part of a family climbed 1.4 percent in January 2012 from the prior year, even as total homeless numbers declined, writes Jeanna Smialek in Bloomberg. Additionally, the number of children without a home increased by an estimated 2 percent, according to a report by the National Alliance to End Homelessness (NAEH), a Washington-based non-profit focused on policy and research on the needs of homeless people. For households with children, Smialek notes that issues such as rising housing costs, elevated unemployment, and stagnant earnings are increasingly placing rent beyond reach and adding to rates of homelessness. In MarketWired, the Institute for Children and Poverty reports on the low approval rating – 23 percent – for New York City Mayor Bloomberg regarding his policies toward the homeless. New York City has over 50,000 homeless people, of which over 21,000 are children. In The New Yorker, Ian Frazier offers a thorough analysis of the scope, severity, and politics of homelessness in New York City, including personal accounts from homeless families and individuals. In Washington, DC, the Department of Human Services is altering its view on providing shelter for homeless children during the winter. Preliminary data cited by the Washington Legal Clinic for the Homeless indicate that at least 150 children were turned away during a three-month period, including two months of last year’s official winter season.
Fidelity Investments promotes financial literacy for low-income students through financial education grants.
Walter Hamilton of the Los Angeles Times writes about student-loan debt and its effect on retirement ages for the millennial generation.
Tom Feltner of US News and World Report warns about the continuing dangers of payday loans and online lending.