Ending Policies That Trap People in Poverty
Representative Stephen Bloom
By Pennsylvania State Reps. Stephen Bloom and Tom Murt
Imagine you’re a single mom or dad working and struggling to lift your family out of a tough financial situation. One day, your boss offers you a small raise. You accept gratefully, excited at your family’s progress toward financial independence. But now, imagine you discover some very bad news. By accepting the small raise, you have just disqualified your family for desperately needed human service benefits worth far more than the amount of the raise. Your kids suddenly risk losing child care, nutrition and a safe place to live, because you simply can’t afford these things without the help you were getting. Your choices are stark: Reject the raise (and all hope of escaping the dependency cycle) to keep the benefits, or accept the raise and put your family in even worse peril. What would you do?
Regardless of how you would answer, this is a very real – but very avoidable – dilemma facing thousands of Pennsylvania families every year: a benefits cliff.
In its attempt to help families in need, government too often crafts laws that have unintended consequences. The "benefits cliff" is an example of such an unintended consequence. This misguided approach of state government creates powerful incentives that discourage low-income, working families who receive state-funded benefits from accepting raises or working more hours, inadvertently forcing parents to limit their own earning potential and stay trapped in cycles of government dependency.
Under the direction of Majority Leader Rep. Dave Reed (R-Indiana), the House Majority Policy Committee recently crisscrossed Pennsylvania, studying the barriers in place for individuals and families attempting to reach self-sufficiency. The committee reported its recommendations for implementing the best principles to combat poverty in the Commonwealth, which included ending benefits cliffs. One of the most prevalent benefits cliffs is the one that adversely impacts families receiving child care subsidies.
As committee members who share a desire to help citizens break free from government-created cycles of dependency, we drafted House Bill 1164 to smooth out the child care benefits cliff. Instead of a sharp and unaffordable loss of all benefits, our legislation gradually reduces child care benefits over time as a parent earns additional income. This way, we reward and encourage economic success, instead of penalizing it. Government should never hold people back from working toward self-sufficiency.
Our next challenge was to shepherd this proposal through the legislative process in the midst of a sea of rancor and partisanship. With state budget disagreements and a divided Capitol, the task initially seemed daunting. We began working with the Wolf administration and legislative colleagues in a bipartisan manner to draft the bill and move it through the General Assembly. A diverse set of right- and left-leaning community and nonprofit organizations around the state joined in support of our efforts. In the end, we attracted overwhelming support for our bill in the House and Senate, and it was signed it into law as Act 92 of 2015 in December.
While news headlines focused on controversy and partisan squabbling may have created the impression that there was nothing of merit accomplished in Harrisburg in 2015, we were actually able to buck the trend and take a very important, bipartisan first step toward eliminating unnecessary government obstacles faced by families who want to rise out of poverty.
And there are more steps now being taken. Our successful approach is serving as a model for many other initiatives needed to address areas of our welfare system where benefits cliffs still exist. The era of government policies that keep people trapped in poverty should have been over long ago. With the enactment of Act 92, we are leading the way in the fight to finally end the dependency-driven, all-or-nothing system of human service benefits that discourage working Pennsylvanians from fulfilling their own "American Dream."
Rep. Stephen Bloom represents the 199th Legislative District in Cumberland County, and Rep. Tom Murt represents the 152nd Legislative District in Montgomery and Philadelphia Counties in the Pennsylvania State House.