Reducing Generational Poverty – Some Thoughts

During the last decade of my career we learned a lot about generational poverty and the various social problems that are associated with it. As a result of our hands-on experiences and what we have learned from others – including a lot of people in low income households, here are some of my conclusions:

  • We must greatly increase access to affordable, high quality early childhood development opportunities for children in low income households. Because of the way the brain develops, the years 0-3 are even more important than ages 3-5. Society will get an enormous return on its investments in such services.
  • We must remember that no child chooses the circumstances he/she was born into. And nearly every mom – regardless of income level – wants what is best for her children. Where there’s a lack of knowledge among young parents about ways to prevent problems and help young children develop, we need to try to help close the gap.
  • Where there’s enough good data, we should increase the use of pay-for-success financing mechanisms to scale high impact services and make more effective use of public resources. While few programs or services have enough solid data of long term impact and a high return on investment, Nurse-Family Partnership and a few other high quality early childhood development programs do.
  • We must continue working to improve education attainment levels, but we must do a lot more to ensure that at every step of the way we are doing a good job preparing students for the next step. In other words, every child who completes 3rd grade should be ready for 4th, etc. And there is simply no excuse for students who receive a high school diploma to require remedial work when they enroll in a community college.
  • We must do as much as possible to ensure that everyone earns some credential beyond a high school diploma that will enable them to be employable. It could be an industry-recognized certificate, an associate’s degree, or a four-year college degree. A high school diploma is not enough.
  • Young people in high poverty situations need to be exposed at an early age to career opportunities they might not even know exist. We need to broaden their horizons and help them raise their aspirations.
  • The non-cognitive is just as important as the cognitive. The more we do to help children develop good character, habits of persistence, social and emotional strengths, etc., the greater their likelihood of being successful in school, work, and life. The earlier we start, the better.
  • Every child needs a positive, long term relationship with at least one responsible adult.
  • There is sometimes a big disconnect between the ideas of many “thought leaders,” including some policy makers, and the realities of individuals living in high poverty situations. Too many well-meaning people do not have enough direct hands-on exposure to really understand the problems they are trying to solve. This is one reason a lot of their solutions don’t work as intended.
  • Fragmented and “silo” approaches will never solve our most serious social problems. Poverty, low education levels, crime rates, births to young unwed mothers in low income households, and a host of health issues are all inter-related. They reinforce and compound each other. But we don’t tend to treat them as if they were. The public sector operates through large bureaucratic silos, and the not-for-profit sector is incredibly fragmented. There are a lot of organizations doing a good job addressing some of the pieces, but we are not connecting the pieces well enough to solve the big problems. We must do much more to bring some of the good services and resources together – within and across the various sectors – in complementary, holistic, two-generation approaches that can be sustained over multiple years. This will work.
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The War on Poverty

In January 1964, President Johnson declared war on poverty. During the days leading up to and immediately following the 50-year observation of that declaration, many have commented on the progress, lack of progress, or outright failure of that “war.”

In the January 7, 2014 Wall Street Journal, Robert Rector of the Heritage Foundation noted that in the U.S., living standards among the poor are much improved over those of 50 years ago. He also pointed out that the “collapse of marriage in low income communities has played a substantial role in the declining capacity for self support.”

In the January 5, 2014 New York Times, Ron Haskins of the Brookings Institution also emphasized that “Children in single-parent families are more likely to be poor, fail in school, have mental health issues and be idle as young adults, all of which reduce self-sufficiency.” Haskins concluded his piece by stating that “we don’t need another war on poverty as much as we need to improve the programs we already have and create the conditions for more personal responsibility regarding education, work, marriage, and child bearing.”

In the same issue of the New York Times, Scott Winship of the Manhattan Institute emphasized that “expanding opportunity for poor kids will require that we ‘incentivize’ the right behaviors, attitudes, and values, through economic carrots and sticks. Culture, not just economics, must be a front in the war on immobility.”

And in the January 9 New York Times, Nicholas Kristoff emphasized the importance of early interventions including parent coaching to get pregnant women to drink and smoke less and to encourage at-risk moms to talk to their children more. Among the successful programs he mentioned is Nurse-Family Partnership, which Goodwill is implementing in Indianapolis.

Kristoff also emphasized the importance of programs that encourage jobs for the most at-risk groups, and both he and Rector mentioned the earned income tax credit as a benefit to the working poor and for society. On a related note, Harvard’s Gregory Mankiw wrote in the January 5 New York Times that in efforts to help those struggling at the bottom of the economic ladder, the most effective solution would be to increase the skills of those low-wage workers.

While there is general agreement that more needs to be done to reduce poverty, there is certainly no consensus on what should be added, increased, modified, or eliminated. Bringing this closer to home, though, reading these and numerous other commentaries has reinforced my belief that the directions we have taken at Goodwill are on target. The older youth and adults who enroll in our Excel Centers represent “low hanging fruit” in efforts to raise education attainment levels. In addition, our emphasis on continuing to support our graduates until they earn post-secondary credentials and become established in the workforce is likely to play a major role not only in helping our graduates become economically self-sufficient, but also in ensuring a quick economic return to society for its investment in our schools.

Nurse-Family Partnership is part of a long-term solution to generational poverty that also has a strongly positive economic return to society. In addition to improving pregnancy outcomes, NFP helps parents learn how to provide competent care that will enhance the health and development of their children. NFP also helps parents improve their economic self-sufficiency by developing plans for their future, continuing their education, and finding work.

Everything we do at Goodwill ultimately plays a part in helping individuals and families increase their economic self-sufficiency. Cumulatively, these efforts can – at least in our small corner of the world – begin to reduce generational poverty and the various social problems that accompany it.

Networks – Part II

In my February 15, 2013 post, I wrote about Goodwill’s implementation of Nurse-Family Partnership as an example of a “network” approach to better align and leverage resources to improve lives and help break a cycle of generational poverty. It is a holistic, whole family approach that teaches and reinforces good parenting skills, helps improve pregnancy outcomes and the health of the child, and results in changes in parental behaviors and the environment in the home in ways that are highly conducive to the proper nurturing and development of the child.

Goodwill and other members of the Nurse-Family Partnership network also offer education and employment opportunities for the parents and provide assistance in dealing with housing, transportation, and other issues that are common in low income households. Overall, this approach is helping build stronger families and preventing a lot of social problems from developing later.

The network we have developed that supports and enhances Nurse-Family Partnership’s effectiveness in central Indiana is one of several networks Goodwill has been developing in recent years. In fact, our organization is evolving into a network of networks that are supported by and often linked by shared services.

We have a business development/employment network that includes a number of companies that contract with Goodwill for services that are performed in large part by Goodwill employees with disabilities, criminal histories, and/or low education levels – people who, in many cases, have few vocational options. We also have relationships with companies that hire individuals who are prepared and want to move into situations elsewhere that might offer better long term opportunities for them.

In addition, we are developing two new networks that will further enhance education options for young people and adults. One of those is a network of organizations in other communities and states that will operate Excel Centers under a licensing arrangement with us. The Excel Center model is unique, and those that become part of the Excel Center Network will have access to a lot of materials and services we have been developing over the past three years. They also will be able to shorten their learning curves and become effective more quickly as a result of our experiences.

Finally, we have recently launched the Indiana Network of Independent Schools (INIS) to offer services to other schools that do not currently have access to the level of academic, data analysis, and back office support services we have at Goodwill. By using services offered by INIS, the staff of those schools will be able to utilize their time more effectively to help children succeed.

Supporting all of these networks is an infrastructure that has developed to support Goodwill’s retail operations, commercial services, community-based initiatives for individuals and families, and the growing number of schools we operate.

This development of this “network of networks” is largely a result of two factors. One is the number and quality of relationships we have with many organizations in the public, private, and not-for-profit sectors. The other is a lot of talented staff who see how the resources and capabilities of others can be

combined or leveraged, sometimes in very creative ways, with our in-house resources and capabilities to substantially increase our overall effectiveness and impact and make better use of the total resources available in the communities in which we operate.

Networks – a way to reduce social problems

Poverty, low education levels, crime rates, teen pregnancy, and a host of health issues are all interrelated. They tend to reinforce and compound each other. Yet, as a society, we don’t treat them as if they’re related.

The public sector consists of a lot of large silos – among them are health, education, social services, workforce development, law enforcement, housing, transportation – that don’t often communicate well, if at all, with each other. There are even silos within the silos that don’t communicate well with each other. Meanwhile, the not-for-profit sector is incredibly fragmented, consisting of hundreds of thousands of mostly small organizations that do good work, but that are typically focused on one problem or one target population or one often tiny geographic area. They have great difficulty aggregating capital or talent to replicate what works and achieve scale.

Neither sector is structured to deal effectively with complex social problems. Perhaps this is a major reason why so many social indicators have worsened over the last forty years, despite massive increases in public spending and a huge proliferation of not-for-profit organizations.

It is unrealistic to think we can remake either sector. And experience indicates that if add another layer of bureaucracy in an attempt to better coordinate the activities of various silos, we will most likely accomplish nothing significant other than to further increase costs.

So what can we do?

A lot of what exists is good. But we can do a much better job of aligning and leveraging the resources and capabilities of various entities in focused ways to improve overall impact and make much more effective use of the total resources. We can do this by creating networks that bring together organizations with common interests and complementary resources to work with each other to accomplish a goal with clear, measurable objectives.

There must be a strong organization at the center of the network; the roles of each participant must be clearly defined; and the participants must trust each other. If all of these ingredients are present, a lot can be accomplished. Here is one example from our own experience.

Recently, our organization has begun operating Nurse-Family Partnership in Indianapolis. This is a highly effective nurse-led home visiting program for first-time parents in low income households that begins during pregnancy and continues until the child turns two. Implementation in other states has proven to have immense long term impact. In our community, Goodwill is the implementing organization. Funding comes from a federal grant and is administered through a contract with the Indiana State Department of Health. Referrals come from an array of sources including hospital systems, other health-related organizations, schools and social services organizations. A community advisory board includes nursing experts in prenatal and early childhood, physicians, hospitals, and social services representatives. An independent continuous quality improvement system established under the direction of the State Department of Health measures and tracks performance.

In addition, Goodwill is connecting parents who are enrolled in the program with education and employment opportunities. Goodwill also provides assistance in solving problems related to housing, transportation, and child care.

Our approach enables families to access education, employment, health-related services, training in good parenting skills, and other services through a long term relationship that we believe can substantially improve the lives of the Nurse-Family Partnership parents and their children and help break a cycle of generational poverty. It is a holistic, whole family approach that leverages existing resources to help accomplish something that otherwise probably would not be accomplished as well, if at all.

This is one example in one community. But it illustrates an approach that could be taken by many organizations in many communities to help improve overall impact and the productivity and effectiveness of both the public and the not-for-profit sectors.

Multidimensional impact

At a recent Excel Center graduation, 55 adults walked across the stage in caps and gowns to receive their high school diplomas. After the ceremony, the father of one of the graduates approached me to express his gratitude for the Excel Center. Not long after she dropped out of school, his daughter realized she had made a mistake, but was not able to find a way to return to school that would fit her life situation. Then she found out about the Excel Center. She not only earned a diploma; she also began post-secondary studies, which she is continuing at IUPUI.

Her father kept repeating to me how much he appreciated Goodwill for starting a school like the Excel Center. But then his wife entered the conversation and said that there was another reason why her family appreciated Goodwill. Over a year earlier, both she and her husband lost their jobs. They had gone through their savings and were on the verge of losing their house. Fortunately, they were also aware of Goodwill’s Outlet Stores, which sell merchandise that did not sell in Goodwill’s other stores. Most of the merchandise is sold by the pound, and the stores have been incredibly popular.

Many of the customers who frequent the Outlet Stores buy goods they then try to resell. The family of the Excel Center graduate began doing this – buying merchandise in large quantities and reselling much of it online. They were able to make enough money to keep their family fed and to make their house payments. As the mother said to me, “Goodwill helped us keep our house.”

As I thought about my conversation with the parents of that graduate, it struck me that both the Outlet Stores and the Excel Centers are relatively recent innovations at Goodwill. And while they operate in separate divisions of Goodwill, both have had a significant direct positive impact on that graduate and her family.

Another recent development at Goodwill is also beginning to have multidimensional impact. Early in 2012 we began operating Nurse-Family Partnership, a highly effective nurse-led home visitation program for first-time mothers in low income households. Registered nurses make weekly or biweekly visits with the mom and baby until the child is two years old. Their main areas of focus are on health related matters and the development of good parenting skills. Some of the moms are students in an Excel Center, and some are employed by Goodwill. Again, a multidimensional impact.

A few years ago we made a conscious decision to take a more holistic, whole family approach in our work. We also recognized the importance of long term relationships for lasting impact. Accordingly, we have made a commitment to maintain an active, supportive relationship with every graduate of our schools until he or she obtains a post-secondary credential, becomes employed, and remains in the workforce for at least one year. We have also developed a data warehouse that will help us track the progress of every graduate indefinitely. This, in turn, will help maximize positive outcomes for our graduates and help us continue to improve the effectiveness of the services we offer.

Every innovation – in fact, every major step we have taken – especially over the last twenty years – has built on what we had learned from earlier experiences. Constant learning, wonderfully talented staff, and a strong financial position made possible largely by donors of goods, retail customers, and donors of money to the Goodwill Foundation have produced a recipe that is yielding increasingly positive, often multidimensional, long term benefits for many individuals and their families and for the communities in which we operate.