As described by Dylan Matthews at Vox, a team of researchers at Columbia University’s Center on Poverty and Social Policy analyzed five bills recently proposed by Democratic presidential hopefuls or likely hopefuls to see which bills would reduce poverty most efficiently. The team found that the bills expanding rental assistance are the most efficient, dollar-for-dollar, in reducing poverty.
Of the five bills, two would greatly expand the Earned Income Tax Credit: “The LIFT Act” by Senator Kamala Harris (D-CA) and “The GAIN Act” by Senator Sherrod Brown (D-OH) and Representative Ro Khanna (D-CA). “The American Family Act” by Senators Brown and Michael Bennet (D-CO) would establish a child allowance, providing parents regular stipends for each child. “The Rent Relief Act” by Senator Harris and “The HOME Act” by Senator Cory Booker (D-NJ) would significantly expand rental assistance through renters’ tax credits.
Researchers found that all five bills would lift millions out of poverty. Each of the five bills vary in size and incur different costs, however, so the researchers dug deeper to explore how the bills compared if they all cost the same. They found that the rental assistance bills proved most efficient in reducing poverty.
As Columbia’s Sara Kimberlin explained in the Vox article, housing and utilities “generally make up the largest share of total basic needs expenses for most families.” It is not surprising, then, that greater rental assistance would have a large impact on poverty reduction.
The Vox article also suggests that this type of expansion of rental assistance would likely increase the overall demand for housing. Thus, any comprehensive strategy to tackle the housing affordability crisis should also include “supply-side” solutions to expand the overall stock of affordable housing. It is worth noting that the researchers did not analyze “The American Housing and Economic Mobility Act” introduced by presidential hopeful Senator Elizabeth Warren (D-MA), which would dramatically increase the supply of deeply affordable housing through major investments in the national Housing Trust Fund.
The Vox article, “5 anti-poverty plans from 2020 Democratic presidential contenders, explained,” is at: https://bit.ly/2RXvcnq
On January 24, the Opportunity Starts at Home multi-sector affordable homes campaign released Within Reach, a policy agenda that articulates a bold plan for both demand-side and supply-side federal solutions.