Published November 1, 2003 | November 2003 issue
Poverty deconcentration, the focus of our cover story, is just one of many factors that determine the state of poverty in America. To learn more about issues affecting low-income people, Community Dividend spoke with Chuck Johnson, director of the Transition to Economic Stability Division at the Minnesota Department of Human Services (DHS).
Throughout his nearly 20 years in public service, Johnson has worked on issues related to supporting low-income families as they transition to employment. He has been with the DHS for 14 years and currently oversees the Minnesota Family Investment Program (MFIP)—Minnesota's welfare reform program—and the Child Care Assistance Program. He previously served as director and research coordinator of the MFIP pilot project. Johnson holds a master's degree in public affairs from the Hubert H. Humphrey Institute of Public Affairs at the University of Minnesota.
Community Dividend: Poverty rates in Minnesota declined significantly in the 1990s. In addition to strong overall economic growth during that period, what contributed to the decline?
Chuck Johnson: I think a number of policy changes and other factors interacted with the good economy to help low-income families get themselves out of poverty.
From about 1997, when welfare reform was implemented nationally, to 1999 or 2000, there were some dramatic changes with single-parent families, which is the main group that uses welfare. Incomes and work rates for those families jumped and welfare caseloads declined dramatically. There's a debate over how much of that decline was due to the economy and how much was due to welfare reform, but there's general agreement that both played a role. And it wasn't just welfare reform itself, but the supports that were expanded at the same time, like child care resources and assistance, health care availability and the federal earned income tax credit and Minnesota working family tax credit.
CD: What effect have the recession, recovery and subsequent weak employment growth had on poverty in the Twin Cities and Minnesota?
CJ: The recession and the stop-and-start, jobless recovery have definitely had an impact, and we see it in our welfare population. Our caseload increased by about 10 percent when the recession hit and it hasn't decreased at all. During the late 1990s and into 2000, it was easy to place people in jobs, because there were jobs everywhere. Now it takes longer to find jobs for the families that are trying to come off of assistance.
CD: You mentioned welfare reform. In 1997, the federal government replaced its traditional Aid to Families with Dependent Children welfare program with Temporary Assistance for Needy Families (TANF), which emphasizes incentives for working. After six years, what is your assessment of TANF? Is it meeting the needs of low-income people?
CJ: It's generally worked pretty well, but it's a work in progress. It certainly helped reduce the number of people who are on assistance. In 1994, we had 64,000 families on assistance in Minnesota, and before the recession came in 2000, we were down to about 40,000.
There are two pieces of TANF that need more work. One is ensuring that people who transition to work have the support to make it once they're off of assistance. That brings me back to child care, health care and other supports. The average wage for families leaving assistance in Minnesota is about $9 an hour. That's not a great wage for a single parent with a couple of kids to support. Those families need health care coverage if they aren't getting it through their jobs. They need child care assistance and, in some cases, child support or some other source of money. We're doing a lot to keep those pieces in place for low-income workers, but more progress can be made.
The second challenge is more difficult. Under TANF, we have an increased level of intervention with families, and we've found that there's a subset of families on assistance that have multiple problems, like disabilities or mental illnesses, often packaged with family violence and other kinds of issues. Those people can't make a transition to work easily; they need a lot of support and intervention to get there. Those are difficult situations, and we're just starting to figure out what to do with those families.
CD: How widespread are those problems?
CJ: In the last year, about 38 percent of our caseload either had a mental health treatment or took some kind of psychotropic drug. In many cases, the main problem is depression, which is very high among single mothers, or family violence. Half or more of the population we serve has experienced family violence at some point in their lifetime. And for new immigrants, who may have fled their homeland or lived in refugee camps, post-traumatic stress related to the refugee experience can be a problem.
CD: TANF is funded through a mixture of federal grants and state funds. Minnesota had a tight budget in 2003 and will again in 2004-2005. How does that affect TANF funding?
CJ: We took a number of budget reductions in the 2003 legislature, some of which reduce benefits to families. We've targeted the reductions to try to limit their impact, but some of them have been painful for those low-income families that have lost benefits. We've pulled back toward the core mission of this department, toward our more vulnerable people. As a result, the people who are at a slightly higher income level and just need a little bit of help to get out of poverty end up receiving less assistance.
But the legislature also passed a package of welfare reform proposals that the governor put forward. We think those initiatives will enable us to intervene soon with families that have multiple barriers to employment and meet more aggressive federal participation standards that we expect to come when Congress reauthorizes the TANF legislation.
CD: According to Paul Jargowsky and other researchers, the concentration of poverty declined sharply in the 1990s in inner cities and many rural areas, but less so in the suburbs—especially older, inner-ring suburbs. Did Minnesota see a similar trend?
CJ: I know the distribution of the welfare caseload is still pretty concentrated within the Twin Cities, but more and more, we're finding concentrations of poverty in the first- and even second-ring suburbs. Some areas seem to have been hit hard by the loss of manufacturing jobs in the last few years, which has resulted in a number of families who wouldn't have previously had any contact with the social services system coming in and looking for help.
CD: There is disagreement over whether policymakers should actively seek to reduce the concentration of poverty, versus reducing poverty in general. What are your thoughts on the issue?
CJ: I think if you help people get on their feet and get the income they need, it enables them to make good choices about where they should live and what's best for their families. There are broad policies that try to deconcentrate poverty by spreading out subsidized housing, so we won't have the big, concentrated projects that were built 30 or 40 years ago. That certainly makes sense, and there are obvious benefits to families if there aren't concentrations of poverty. But public policy shouldn't be rigged in a way that makes it hard for people to exercise options to move where they want, in terms of the indirect subsidies that go into housing development across a region. I'm more on the side of helping individuals, providing them with supports and letting them make their own decisions about where to live.