Social Security’s ‘Chained COLA’ not ready for prime time

Social Security’s cost of living adjustments (COLA) are designed to protect against the erosion of retiree purchasing power when prices go up, as measured by the Consumer Price Index (CPI). “Now Social Security self-styled ‘reformers’ seek to lower COLA every year based on their claim that COLA overstates inflation,” says Merton C. Bernstein, LLB, a nationally recognized expert on Social Security. The proposed substitute for the current CPI formula, ‘Chained COLA,’ is based on the assumption that benefit recipients substitute lower-priced goods as prices go up. “This the assumption is unrealistic for those millions who only have access to convenience stores that typically offer fewer choice and higher prices,” says Bernstein, the Walter D. Coles Professor Emeritus at Washington University in St. Louis School of Law. “And, further, it is not reasonable to assume that most consumers can outwit the wiles of merchandising experts.”

Impact of Assets and the Poor grows 20 years after its release

Michael Sherraden’s book, Assets and the Poor: A New American Welfare Policy, broke new ground on social policy in 1991. Twenty years later, its impact still is being felt around the world. In Assets and the Poor, Sherraden, PhD, the Benjamin E. Youngdahl Professor of Social Development at the Brown School at Washington University in St. Louis, writes that asset accumulation is structured and subsidized for many non-poor households, primarily via retirement accounts and home ownership. He argues that these opportunities should be available to all and proposes establishing individual savings accounts for the poor — also known as Individual Development Accounts (IDAs). Since Sherraden first proposed IDAs, they have been adopted in federal legislation and in more than 40 states.

New insured numbers show tug-of-war between economy and health care reform

The estimates of the population without health insurance in the U.S. remained unchanged in 2010, as compared to 2009, reflecting the counteracting effects of not only the sluggish economic recovery but also the preliminary benefits of the Affordable Care Act (ACA), says Timothy McBride, PhD, leading health economist and associate dean of public health at the Brown School at Washington University in St. Louis.

New index measures financial stability

What does it take for a family in the U.S. to have long-term economic security and not just “get by”? This question inspired the creation of the Basic Economic Security Tables Index (BEST), a joint effort of Wider Opportunities for Women (WOW) and the Center for Social Development (CSD) at the Brown School at Washington University in St. Louis. The BEST is different from other ‘living wage’ indexes in that it aims to capture what is needed for household stability and development rather than focusing on subsistence. Findings suggest that families’ largest economic security challenges are rent and utilities, transportation, and childcare. The report calls the high cost of quality childcare “the greatest threat to many families’ security.” Childcare is so expensive that income needs for a one-parent family with two preschoolers are equivalent to those of a one-parent family with five teenagers.

Reasons other than racism factor into disproportionality in child abuse reporting

Black children are involved in reported cases of child abuse at approximately twice the rate of white children. Until now, this has generally been attributed to racial bias in the child welfare system. But in a new study published in the journal Pediatrics, F. Brett Drake, PhD, professor at the Brown School at Washington University in St. Louis, finds that much, if not most, of the overrepresentation of black children in maltreatment reporting is due to increased exposure to risk factors such as poverty.

Nearly half of all elderly Americans will experience poverty

Nearly half of all Americans between the ages of 60 and 90 will encounter at least one year of poverty or near poverty, says a recent study by Mark R. Rank, PhD, professor at the Brown School at Washington University in St. Louis. The findings are published in the current issue of Families in Society: The Journal of Contemporary Social Services.

Expert available: Census figures reveal broad reach of poverty in the United States

Current census figures show that one in seven Americans is living below the poverty level, a rate that nears the record poverty levels of 1960. “The latest rise in the poverty rate illustrates how many more Americans are at risk of poverty and economic insecurity in this country,” says Mark R. Rank, PhD, poverty expert and the Herbert S. Hadley Professor of Social Welfare at the Brown School at Washington University in St. Louis. 

Nearly half of all U.S. children will use food stamps, says poverty expert

Holidays and tables full of delicious food usually go hand in hand, but for nearly half of the children in the United States, this is not guaranteed. “49 percent of all U.S. children will be in a household that uses food stamps at some point during their childhood,” says Mark R. Rank, Ph.D., poverty expert at the George Warren Brown School of Social Work at Washington University in St. Louis. “Food stamp use is a clear sign of poverty and food insecurity, two of the most detrimental economic conditions affecting a child’s health.” Rank’s study, “Estimating the Risk of Food Stamp Use and Impoverishment During Childhood,” is published in the current issue of the Archives of Pediatrics & Adolescent Medicine. Video available.

Widening racial gap exists in key factors for economic well-being, according to new study

“With President Obama now approaching six months in office, some have suggested that we have gone beyond race as a major dividing line in society. Yet nothing could be further from the truth,” says Mark R. Rank, Ph.D., professor of social work at Washington University in St. Louis. “One of the fundamental fault lines in American society continues to be the ongoing racial disparities in economic well-being.” Using 30 years of data, Rank examined three key factors in attaining economic well-being: owning a home and building equity; attaining affluence and avoiding poverty; and possessing enough assets to survive economic turmoil, or a “rainy day fund.” “The results indicate that within each area, the economic racial divide across the American life course is immense,” Rank says.