On Getting More Bang for the Buck

As I have highlighted in previous posts of this blog, there’s a lot of data showing a deterioration in a number of major social indicators over the last forty years, despite massive increases in public spending and a huge proliferation of not-for-profit organizations. Overall, the dominant approaches that have been taken during the past several decades have not reduced a lot of our social problems. One could even argue that some of those approaches have actually made matters worse.

Fortunately, there are some steps being taken that might eventually result in more effective use of public and philanthropic dollars to alleviate social problems. According to the Coalition for Evidence-based Policy,” the Office of Management and Budget (OMB) has launched a major new push for the development and use of rigorous evidence in budget, management and policy decisions across the federal government…”

The kind of rigorous evidence to which OMB is referring is the kind that Nurse-Family Partnership (NFP) has been able to demonstrate over a long period of time. NFP is, to use language of the Coalition for Evidence-based Policy, an intervention “shown in well-conducted randomized controlled trials… to produce sizeable, sustained benefits to participants and/or society.”

NFP is a nurse-led home visitation program for first-time moms in low income households who voluntarily enroll no later than the 28th week of pregnancy. A registered nurse makes frequent home visits to help improve pregnancy outcomes, help parents learn how to provide responsible and competent care for their children, and help improve the economic self-sufficiency of the family. Regular visits by the nurse continue until the children are two years old.

Goodwill worked for three years to bring NFP to Indiana, and we have begun implementing the program in Indianapolis. At capacity, our registered nurses will be working with 600 moms at a time.

Thirty years of randomized controlled trials have produced evidence of the incredible long term benefits of NFP. For example:

    48% reduction in child abuse and neglect through child age 15
    56% fewer doctor and hospital visits due to childhood injuries through child age 2
    67% fewer behavioral and intellectual problems in children at age 6
    69% fewer convictions of nurse-visited children at age 15
    72% fewer convictions of mothers when children are at age 15
    83% increase in workforce participation by low-income, unmarried mothers by the time their child is four years old

The Rand Corporation calculated that every dollar invested in NFP results in a $5.70 return to society.

Some people don’t want to invest public dollars in programs such as these because, they emphasize, parents are responsible for giving their child a strong, healthy start. I agree that it’s the parent’s responsibility. However, when a parent is unable–for whatever reason–to exercise that responsibility well, the rest of us have a choice. We can invest up front to help prevent problems and develop human potential – or we can do as we’re now doing and continue to pay much more downstream for public assistance, remedial education, rehabilitation, incarceration, and in all the insidious ways we all pay when we have a poorly educated, under-skilled workforce.

It’s also important to remember that no child has any choice about the circumstances into which he or she is born.

If we really want more bang for our buck, we will begin shifting support from programs with marginal return to those that can demonstrate high, long-term benefits. Doing so will upset some people, but will result in a wiser, more effective use of the dollars that are available. The potential long-term benefits are enormous.

Goodwill’s Directions

Over the past decade, Goodwill in central Indiana has developed and now operates several small high schools. More recently, we have launched services for very young children and their moms. These are not areas in which Goodwill Industries around the country have typically been directly involved, and I am occasionally asked why we have moved in those directions.

At Goodwill, we have an overriding desire to help improve lives and communities and, as best we can, help solve serious social problems. We generally prefer to:

  • Strive for long term impact
  • Take a holistic approach with individuals and, in many cases, with their families
  • Enhance education levels and the attainment of credentials that will improve an individual’s employability and earning potential
  • Prevent problems and develop potential rather than engage in remediation

Strategic planning in our organization has morphed from a discrete event we used to do every few years into a strategic thinking process that is continuous. Changes in our environment are occurring at a very rapid rate, and we find ourselves with more new opportunities than ever before.

Every major step we have taken over the past twenty years has been a result of (1) what we have learned from previous experiences, (2) what we know about the communities in which we operate, and (3) how we believe we can have the greatest possible impact in the lives of people and in the larger community.

Key factors that have heavily influenced our recent directions include:

  • A recognition that many major social indicators have become worse over the last 30-40 years, despite massive increases in public spending and a huge proliferation of not-for-profit organizations. Many existing systems have not adapted well to changes that have taken place in our society. The silo structure of the public sector and the fragmented structure of the not-for-profit sector are part of the problem. Fragmented approaches have not worked and will not work to solve complex social problems, regardless of how much money is made available. Neither will highly bureaucratic, overly prescriptive approaches. One size does not fit all.
  • A belief that there are no quick fixes to many of our society’s problems, and we must not allow ourselves to be satisfied with gradual, incremental progress. We need long term thinking and long term solutions. We also need a strong sense of urgency.
  • A recognition that many of the pieces needed to solve societal problems exist, but in relative isolation from other pieces that could also be part of a long term solution.

I believe that two of the most important elements necessary to reduce generational poverty and its accompanying social problems are:

  • Raise the education levels of children, youth, and adults in low income households. This is why we developed and operate the Indianapolis Metropolitan High School and The Excel Centers.
  • Ensure that children are behaviorally and cognitively ready when it is time for them to enroll in kindergarten. There is powerful evidence of the enormous positive long term impact of high quality early childhood development programs for children in low income households. We must greatly increase the availability of such opportunities – and there must be a strong sense of urgency to do so. Goodwill has taken a major step in this direction by launching Nurse-Family Partnership in Marion County.

It’s also important to emphasize that on all of these initiatives we are working with a lot of other organizations that have compatible interests and complementary resources. In some cases, those relationships are evolving into networks that I believe will play an increasingly important role in developing human potential and reducing serious social problems.

Early childhood development – a key to reducing a lot of social problems

Throughout Goodwill’s history, we have worked primarily with older youth and adults. Yet, the more experience we have and the more we learn, the more I have become convinced that if we are to substantially reduce the incidence of poverty in the U.S., we must dramatically increase our investment in children from the womb to kindergarten.

There is a large body of evidence illustrating the positive return to society of investments in high quality early childhood development programs for children in low-income households. For example, Nurse-Family Partnership (www.nursefamilypartnership.org) is a nurse-led, evidence-based home visitation program that works with expectant mothers from pregnancy until the child is two years old. Three decades of randomized controlled trials have shown incredibly positive long term impact, including:

  • 67% reduction in behavioral and intellectual problems in children at age 6
  • 59% reduction in arrests of children at age 15
  • 72% fewer convictions of mothers when children are at age 15
  • The Rand Corporation found a net return to society of $5.70 per dollar invested in Nurse-Family Partnership

More evidence comes from extensive research done by Professor James Heckman (www.heckmanequation.org), a Nobel laureate economist at University of Chicago. His work has confirmed high returns to society from investments in high quality early childhood development programs for children living in poverty. Professor Heckman emphasizes that many of America’s major economic and social problems – crime, teenage pregnancy, high school dropout rates, adverse health conditions – could be reduced as a result of early nurturing, learning experiences, and physical health from birth to age five – the most economically efficient time to develop cognitive and social skills, both of which are essential for success.

It’s sometimes useful to remind ourselves that no child had any choice about the circumstances into which he or she was born. Some were luckier than others. For children born into situations that lack advantageous educational and developmental resources, we can pay up front to help prevent problems and develop human potential or we can continue to pay much more downstream for public assistance, remedial education, rehabilitation, incarceration, and in all the insidious ways we all pay when economic growth is stymied by a poorly educated, under-skilled workforce.

Some say we have no money to do this. I say we can’t afford not to. Because there’s not enough to pay for everything everyone would like to do, we need to begin shifting more support from programs with marginal return to programs with demonstrated high long term benefits. Doing so will upset some people, but will result in a wiser, more effective use of the dollars that are available. The potential long term benefits are enormous.