Cash With a Catch
By BOB HERBERT
A program that has shown promise in changing the behavior of desperately poor people in Brazil, Colombia, Mexico and Nicaragua is about to get a tryout in New York City, a place that has always had deep rivers of poverty flowing beneath its glittering surface.
New York has eight million people, and 1.5 million of them are poor. One-third of all children under 5 in the city are poor.
The federal government’s attitude toward the poor in recent years has ranged from indifferent to hostile. Poor kids can be useful as campaign props at election time, but otherwise are expected to remain silent and invisible.
Municipal governments are hardly equipped to deal with a problem as enormous and deeply embedded as poverty. But to his credit, the mayor of New York, Michael Bloomberg, has directed his aides to roll up their sleeves and do whatever it takes to develop a workable plan for reducing poverty in the city.
He has said, “Until we marshal the best efforts of our public and private sectors to help more of [the poor] transform their lives, this will not be the city it can be, or that we want it to be.”
One of the programs in the works, known as conditional cash transfers, is new to the United States. Hard cash is given by the government to poor families, but the transfers are contingent upon improvements in certain kinds of behavior. Where it has been tried in other countries, families with children would typically agree to enroll the youngsters in school, or improve their attendance, or take them for regular medical checkups.
The goal of the transfers is to provide immediate cash assistance to the poor while at the same time countering the self-defeating notions and activities that tend to hold people in poverty, sometimes for generations.
The amount of money involved varies from program to program. But some of the poorest families have been able to double their incomes with the transfers. Studies looking back over the past few years have shown solid evidence that the transfers have led to significant improvements in the habits and decision-making of participants.
“There’s often a requirement that mothers go to workshops that cover a range of issues — for example, health and hygiene and child care,” said Laura Rawlings, a senior specialist at the World Bank, who compiled an extensive report on the transfers. “One of the aims of these programs is to make long-term investments that benefit future generations.”
The question facing the Bloomberg administration, as it develops a pilot project, is how to craft a variation that is suitable for a family in New York that is poor but is not facing the subsistence-level crises that might confront, say, a rural household in Colombia.
Where young children are involved, the primary concerns here, as elsewhere, will center on the parents’ attitudes and behavior with regard to schooling and health. But Linda Gibbs, the deputy mayor for health and human services, said the city would also be looking to see if this system of cash rewards could be used to encourage adolescents to remain in school, and to bolster work habits and the development of employable skills among the working poor.
The longest-running large-scale cash transfer programs are in Mexico, which established a system of cash rewards in 1997. Ms. Gibbs said studies of the Mexican experience have shown that constructive changes in the behavior of participants far outlasted the receipt of money from the programs.
However worthy an experiment, there remains the matter of how to pay for this. Mayor Bloomberg is planning to raise all of the money for the pilot project from private sources — foundations, corporations, private donors and so on. If the pilot project is successful, the start-up costs for a full-scale program would be formidable, and would require public funding.
Last month, when he announced the findings of his Commission for Economic Opportunity, Mr. Bloomberg said:
“For too long, this widespread poverty has been regarded as a troubling but inevitable condition of life in our city. But time and again — in reducing crime, reforming our schools, reviving our economy, and in other areas — New Yorkers have shown that we can devise realistic solutions to even the toughest problems.”
We haven’t much to lose. In an era of almost criminal indifference to the plight of the have-nots, the mayor’s antipoverty efforts are, at the very least, a sign that the forces in support of the poor have not been completely routed.