Where's the plan to address central city unemployment?

As reported earlier this week in the Milwaukee Journal Sentinel, the UWM Center for Economic Development's latest report on race and employment paints a devastating picture of the depth of joblessness in Milwaukee's central city. According to the study, only 44.7% of African-American males in the City of Milwaukee between the ages of 16 and 64 were employed in 2010. That's the lowest rate ever recorded by CED, and a substantial drop from the already anemic 52.9% rate recorded just before the recession.

A brief review of the comments posted by readers of the newspaper's coverage shows predictable responses from the left and right. It's either Walker's or Obama's fault, or the problem is caused by the personal failings of the unemployed individuals or the greed of corporate robber barons who have moved jobs overseas.

From the perspective of the Public Policy Forum, the issue is not one of politics, but of commitment. The German heritage of this town should dictate that when a problem grows to such an alarming magnitude and festers for two decades without meaningful improvement, then it's time to roll up our sleeves, develop a plan, and pursue it with discipline and gusto.

And therein may lie the problem. As we put it in "Assembling the Parts," our recent report on Milwaukee's economic development landscape: "Milwaukee’s elected, business, academic and civic leaders have taken several important and impressive steps in recent years to add both strength and focus to the city’s economic development efforts, but those efforts still could benefit from enhanced precision, cohesion and accountability."

In other words, it's not enough to have city government and private economic development organizations working on their own worthwhile projects and in their own important niches. We need a true economic development plan that establishes concrete goals (the foremost of which would have to be job creation for our unemployed), formulates specific strategies designed to achieve those goals, and develops performance objectives and accountabilities to accompany those strategies. Ideally, the plan would be updated annually, with all the parties focused with laser-like precision on the overall goals, and with strategies being adjusted as performance and new developments dictate.

Obviously, a problem as deeply-rooted and complex as central city unemployment will not be solved simply by developing a plan. But isn't it time for city and economic development leaders to spell out precisely how they aim to tackle this problem and how they plan to assess their progress?

Income Inequality in Metro Milwaukee

The Occupy Wall Street demonstrations have sparked a public debate over income inequality that has spread across the nation and beyond. In Milwaukee, where the city’s poverty rate has ranked among the nation’s highest for several years, the issue of income inequality is a familiar one. Could it be, however, that the Milwaukee metropolitan area actually has slightly less income inequality than the U.S. as a whole, and if so, what does that mean?

A new report from the U.S. Census Bureau analyzes and ranks states, metro areas, and even neighborhoods in terms of how evenly income is divided among the population. The method used to rank each place, called the Gini measure, is a scale from zero to one in which a measure of zero means incomes are totally equal throughout a population, and a measure of one means 100% of that population’s income is concentrated in one household. Notably, while the Gini measure captures how income is distributed, it does not take into account factors such as the relative wealth of a population or the cost of living of each place.

According to the Census Bureau study, Wisconsin has one of the lowest levels of income inequality among U.S. states. The level of inequality within the Milwaukee metropolitan statistical area (MSA), which includes the counties of Milwaukee, Ozaukee, Washington, and Waukesha, is below that of the nation as a whole and in the middle of the pack when compared with the 50 other metro areas in the U.S. with populations of at least one million. Below is a breakdown of select metro areas on the list, including those at the extremes and Milwaukee’s regional peers. Each metro area’s poverty rate and percentage of households earning at least $200,000 are also included on the chart.

Income inequality in U.S. metro areas with populations over one million, 2005-2009 (51 total)

It’s difficult to determine how to interpret the Gini measures by themselves. Because of the small difference in Gini measures found between metro areas at the extreme ends of the scale, for example, metro Milwaukee does not appear to be much different from the New York or Salt Lake City metro areas. Indeed, all of the metro areas measured fall within what appears to be a relatively narrow range.

One might logically theorize that metro areas with higher Gini measures would have higher percentages of households at the extremes – both very high-income and very low-income. Based on the data on poverty and high-income households in the chart, the Milwaukee MSA has both a lower poverty rate and a lower percentage of high-income households compared with the New York metropolitan area and the U.S. as a whole, while the State of Wisconsin has lower rates than metro Milwaukee for both categories. But perhaps most interestingly, the combined percentages of people at the extremes (poverty rate plus percentage of high-income households) follows the Gini measures almost perfectly, as shown in the chart’s final column.

While these data invoke more questions than answers, several observations can be gleaned with regard to metro Milwaukee. First, while poverty in the city of Milwaukee is unacceptably high, the poverty rate for Milwaukee’s MSA is relatively average compared with other metro areas. Thus, poverty may be less concentrated in the central city of other metro areas compared with metro Milwaukee.

Second, the Milwaukee MSA has a relatively low percentage of high-income households compared with other metro areas and the nation as a whole. In addition to the data on the above chart, a recent study by the Brookings Institution shows that metro Milwaukee is not among the 54 U.S. metro areas whose share of very high-income households (>$200,000/year) exceeds their share of all households. Some might argue that metro Milwaukee’s relatively low level of high-income households puts us at an economic disadvantage because high-income households are those most likely to create desperately-needed jobs.

Third, if income inequality is at undesirable levels in general throughout the U.S., metro Milwaukee is not significantly different. Current research has shown that the richest 20% of Americans own approximately 84% of the nation’s wealth, and that Americans across divisions of race, gender, income, and political affiliation all would prefer less inequality.

Finally, since the data used in the Census Bureau report are from 2005-2009, both pre-recession and peak recession years are included. With the economy continuing to struggle, it will be interesting to see how these numbers change over time.

Program at a crossroads

Since its establishment in 2005, the Main Street Milwaukee (MSM) Program has been a highly touted economic development program designed to promote economic growth and revitalization in six selected city neighborhoods. MSM - a partnership between the City of Milwaukee Department of City Development (DCD) and the local chapter of the Local Initiatives Support Corporation (LISC) - is a key component in the city’s overall economic and community development strategy.

In light of the program’s important role in city development, the Forum’s 2009-2010 Norman N. Gill fellow, Sandra Zupan, took a look at the MSM and its outcomes. Her report, Main Street Milwaukee: Program at a Crossroads, explores the program's public and private investment, financial sustainability, expenditures, outcomes, and governance.

The report’s key findings include:

• The total investment in the MSM program between 2005 and 2009 was $3.3 million. Although the goal was for public and private investments in the MSM Program to be equal, the public portion accounted for 64% of the overall investment, while the private portion accounted for 36%.


• While the MSM neighborhoods were originally planned to be financially self-sufficient within six years, none of the districts will meet this goal and in fact, public investment continues to be crucial for sustaining the program.


• As a result of the program, more cohesiveness and stronger working relationships have been created among stakeholders within the neighborhoods.


• When compared to the program's estimated outcomes over its first five years, the total private investment in exterior building improvements exceeded estimates by a considerable amount. However, the number of businesses created in the neighborhoods is 86% of the original estimate, while 57% of the estimated jobs have been created.

The MSM Partners Board, made up of public and private officials, recently initiated an effort to consider substantial restructuring of the MSM program. As they move forward, the report urges them to consider the following issues:

1. The MSM program goals need clarity, and may need to be revamped in order to be more suitable for Milwaukee’s low-income neighborhoods;


2. The mismatch between the intended goals of the program and the purpose of the program’s main funding source likely has contributed significantly to the program’s failure to meet initial estimates, and needs reconciliation;


3. The program structure is overly complex and coordination among the neighborhoods and partners is poor;


4. Transparency and accountability for achievement of outcomes is lacking;


5. Resources need more leverage, and the program's branding, marketing, and visibility are insufficient; and


6. More volunteers are necessary for the program to be viable.

Finally, the report points out that city officials, LISC, and the MSM Partners Board may wish to research further whether there is a tangible connection between economic development improvements in Main Street neighborhoods and the program itself. In addition, the overall question of how the city's economic and community development strategy relates to its anti-poverty strategy is ripe for future research and analysis.

For the full report, please visit the Forum's website.

Special thanks to the Gill family for their generous support of this project through the Norman N. Gill Fellowship.

Useful strategies but no easy answers in ending homelessness

A new study from the U.S. Housing and Urban Development Department (HUD) examines the costs of serving homeless individuals and families and explores cost-saving possibilities in differentiating services according to individual characteristics.

HUD finds that different types of first-time homeless individuals and families use system resources differently, so some opportunities exist to improve outcomes by developing tailored strategies to meet the needs of each type of individual and family. For example, the report describes how African American families are often homeless primarily due to poverty rather than mental illness or substance abuse, and therefore need permanent housing but not substantial supportive services. Similarly, childless single women have different needs than families.

Despite HUD’s support for tailored services, its cost analysis revealed that there are no loopholes or easy answers when it comes to cost savings. The study found that significant cost reductions are only achievable when targeting the few individuals and families with high levels of involvement in mainstream systems prior to homelessness. Accordingly, while narrowly targeted initiatives aimed at this group will yield the greatest savings-per-person, such initiatives would only be appropriate for a small number of people.

HUD's study was released as Milwaukee is considering its new ten-year plan to end homelessness. The County Board has already endorsed the plan, and so has a Common Council committee. If fully adopted, Milwaukee will join more than 800 cities and counties that have partnered in implementing at least 355 ten-year plans to end homelessness.

Milwaukee’s plan was developed by the Continuum of Care (a conglomeration of social service agencies that address issues facing the homeless) as well as other local participants. Among other things, it calls for both earmarked state funds and reapportioned federal and local expenditures to fund services for the homeless. It targets a number of key issues raised in the HUD study, including prevention, employment, behavioral health, and permanent housing. The plan also calls for revamping methods of discharge planning for those transitioning out of foster care, hospitals, mental health care and jails.

Milwaukee’s plan appears to meet the National Alliance to End Homelessness recommendations for successful planning by possessing four elements: identifying a person or body responsible for implementation; setting numeric outcomes; identifying a funding source; and setting a clear implementation timeline.

According to the U.S. Interagency Council on Homelessness, taking a 10-year plan from “good to great” requires extensive engagement of public officials and community champions, as well as the ability to sustain momentum for implementation through changes in political leadership and priorities. With changes in political leadership likely on the horizon here in Milwaukee, it would appear that momentum-building will need to be a top priority for plan supporters.

The implications of redefining poverty

How to define and measure poverty in the U.S. has long been an issue of debate. This is not an esoteric argument--most federal and state entitlement and benefit programs tie eligibility to need using the official measure of poverty. Any move to change the definition will have an effect on these programs and the families participating in them.

This week the Commerce Department announced the development of a new measure of poverty designed to be more nuanced than the existing measure. By including factors such as housing, child care, and health care costs, it is argued to be more representative of the actual pressures faced by today's families. However, this new measure has been rolled out as a "supplemental" measure and will not replace the existing poverty definition, which is based solely on food costs. Thus, the new measure will not have an impact on the eligibility rules for the thousands of federal and state programs aimed at low-income families.

What it might do, though, is illuminate just how well those programs are doing at meeting the goal of eradicating poverty. While the Commerce Department does not offer an opinion on whether the new measure will result in more or fewer families being defined as impoverished, a similar supplemental measure used in New York has resulted in higher poverty estimates in that city. Therefore, the new federal measure may well show that despite the passage of nearly 50 years since an American President first declared war on poverty, our poverty-alleviation policies have a larger target than we had assumed.

Increasing the visibility of the gap between who the state and federal governments will serve and who is truly in need might affect local governments in different ways. It might increase the pressure on local governments to fill that gap with locally-funded programs and services, which few local governments are in a position to do in the current budget climate. On the other hand, it might make it easier for the private and non-profit sectors to coordinate efforts with local government. Having a uniform definition of those in need, yet ineligible for certain government benefits, could allow charities and philanthropies to be more confident about stepping in where the need is greatest, without risk of supplanting public funds. A better picture of the gap may also allow for more efficient grant-making.

The first use of the new, supplemental poverty measure will be with the 2010 Census. Wisconsin's local governments would be wise to plan now for the potential impact to their budgets.

Despite article, some areas in the region lack banks

From the sound of this week’s Journal Sentinel article entitled, “Bank branches proliferate in state,” our community streets are being practically taken over by bank branches. The president of Community Bankers of Wisconsin is quoted as saying “There’s no doubt Wisconsin is very bank-heavy.” But count the banks in certain areas of Milwaukee, and you get a decidedly different story.

A report released just two weeks ago highlights the marked lack of banking options in northwest Milwaukee. The Federal Reserve and Brookings Institution report, “The Enduring Challenge of Concentrated Poverty in America,” includes case studies from 16 high-poverty communities across the country, each chosen to illustrate different facets of the poverty story.

The boundaries of the Milwaukee area they studied were based on Census data tracts. With a poverty rate nearly five times that of the rest of Milwaukee’s Metropolitan Statistical Area (MSA), the area includes all or part of the Sherman Park, Metcalfe Park, Uptown, Washington Park, Walnut Hill, Midtown, Martin Drive, and Cold Spring Park neighborhoods, covering parts of the zip codes 53205, 53206, 53208, 53210, and 53233.

This northwest area of Milwaukee, with over 23,000 residents, has just two bank branches (three banks lie just over borders of the study area). The area, however, is heavily populated with nontraditional financial service providers such as currency exchanges, check cashing, pawnshops, and payday lenders.

The report explains that an absence of basic banking services is linked to higher costs for financial transactions for working class and minority communities. While traditional financial institutions provide residents with access to cash, savings and capital, conducting financial transactions through nontraditional providers not only costs more, the report claims, but offers fewer ways to save money and plan for long-term financial management.

Residents in northwest Milwaukee are also likely to pay more for credit: In 2005, 65% of the area’s mortgages originated as sub-prime or other high-cost loans, compared to 26% in Milwaukee’s MSA.

The report identifies the myriad challenges related to concentrated poverty facing northwest Milwaukee, including high rates of returning ex-offenders, unemployment, and jobs that disappeared or moved to the suburbs. Local nonprofit programs working to improve the area are also highlighted along with some noteworthy successes.

While the newspaper quotes a Franklin resident exclaiming “Not another bank!,” the article’s juxtaposition with the recent Brookings Institution report underscores one of the many differences between inner city Milwaukee and other areas of southeastern Wisconsin.

Worth the risk for some female small business owners

The Women’s Initiative for Self-Employment, a nonprofit program in California that helps low-income women start their own businesses, presented findings at this month's Summit on Economic Justice for Women in Atlanta showing microenterprise to be a successful strategy for increasing household income and wealth.

It seems that starting a small business would be even riskier for low-income women with no prior business experience, but some evidence shows the growth in business equity could be a worthwhile strategy to break the cycle of intergenerational poverty.

While many anti-poverty efforts focus on increasing income, emphasis on building asset ownership and wealth could prevent "asset poverty" and provide a safety net for long-term self-sufficiency. Business ownerhip is an important route to increasing assets: as a share of overall household wealth, business equity ranks second to homeownership.

Research cited by the Small Business Association is grim, showing that over half of new small businesses do not survive four years. Despite the risky environment, Women’s Initiative clients, all of whom are low-income at program entry and 78% of whom are women of color, are doing well. Seventy percent of program graduates are in business within a year of training, and 133 graduates report businesses grossing a combined $2.9 million, with net profits of $1.3 million. Annual household income for participants entering the business training program is just $14,000, but two years after training, average income is $37,000.

One key to the Women’s Initiative’s success may be cultural competency. Training is available in Spanish, and with microenterprise, it may be easier than in a traditional corporation to maximize cultural ties as an asset rather than a barrier. For instance, women of color may choose to start businesses that relate to their cultural backgrounds or feature their non-English language skills (46 percent of Women's Initiative clients are Spanish-speaking).

Minority groups in the U.S. have larger shares of women business owners, including 31 percent of Asian American and 46 percent of African American business owners. The Women’s Initiative organization found the greatest gains from their intervention for women of color, especially from Latina clients whom, as a group, tended to begin the program in debt with an average net worth of -$5,684. African American clients reported the greatest average absolute growth in business equity, while Latinas saw the largest relative gains in business equity, growing over 300%, and the largest gains in average overall household wealth. Rates of home ownership (a key marker of asset wealth) increased most rapidly for Latina clients as well, growing from 11 percent before training to 32 percent after participation.

Nationally, women own 28 percent of non-farm U.S. firms. Only 14 percent of these firms employ workers, and almost 80 percent had receipts totaling less than $50,000 in 2002. While those dollar figures are small, Wisconsin's 104,200 women-owned small businesses generated a substantial $17.6 billion in revenue in 2002, the latest year available. A 2004 study showed that Wisconsin is a good place for African American women entrepreneurs. Wisconsin ranked among the top states in survival and employment of businesses owned by African American women. Female business owners in Wisconsin receive support from the Wisconsin Women's Business Initiative Corporation.

Some skepticism about microenterprise as a route to wealth may still be warranted, given that many Women’s Initiative clients created their ventures in fields with traditionally low profits, such as child care, housekeeping, and food service. The fact remains that female-dominated professions like child care and housekeeping tend to be less lucrative than, say, defense contracting, or financial trading. Following Women’s Initiative training, nearly 17 percent of clients still lacked health insurance, though that share is fairly low for a recently-low-income group.

While microenterprise efforts might not lead women to head firms in traditionally male-dominated, highest-net-worth arenas, low-income women can make impressive leaps in assets in the risky small business ownership environment.

Early Childhood Education as an Anti-Poverty Priority

When it comes to antipoverty strategies, efforts related to early childhood education and child care rise to the top for many researchers.

In the inaugural issue of Pathways magazine, poverty researcher Rebecca Blank features her priority list of top anti-poverty strategies. Out of her six recommendations, two relate directly to early childhood education and child care; two others address children in some way. According to Blank, many potential solutions for eliminating poverty should be implemented early in life when the chances for making a difference are greatest.

To combat poverty, Blank recommends two hallmarks of early childhood education success: a guaranteed pre-kindergarten program for all four-year-olds from low-income families, and expanded child care subsidies for low-income families.

Blank stresses broadening the EITC (Earned Income Tax Credit) subsidy for individuals not living with children, particularly for fathers of poor children. She writes, “[I]f their lives are more economically stable they will be better able to help raise their children and this will help stabilize the communities in which they live.”

In her most unconventional antipoverty recommendation, Blank encourages the government to work to provide every low-income family with low-cost Internet access so that “children are ready to live and work in an interconnected world.”

Two additional recommendations are encouraging candidates to be spokespeople for the poor, and using demonstration projects instead of new program models.

Blank’s priority list underscores how early childhood education is not just a schooling or a parenting issue; rather, it could be key to antipoverty efforts. The Public Policy Forum is continuing its multi-year research project focusing on early childhood education policy in the southeast Wisconsin region.

Wedding Bells are Tolling Less in Milwaukee: Considering the Implications and Misconceptions Related to Poverty

Milwaukee has marriage on the mind – or, the lack thereof, that is. Two February articles in the Journal Sentinel – a column by Patrick McIlheran and, most recently, a news story, have highlighted declining rates of marriage. The news story describes how, in 1980, there were 8.7 marriages for every 1,000 people state-wide. Today Milwaukee County shows 5.2 marriages per 1,000 people, and Waukesha County is only slightly higher at 5.5 marriages per 1,000 people. McIlheran notes that 58% of Milwaukee’s children live in single parent homes.

Since marriage is associated with a variety of positive outcomes, proponents believe that policy makers should promote marriage as a solution to problems facing low-income children. Programs funded by Bush administration marriage promotion grants aim to increase and support marriage in a way that builds relationship skills, at times with added strategies to increase income. While proponents see a clear link between marriage and poverty, others find little research-based evidence that an absence of marriage is the factor causing child poverty. When it comes to marriage as a policy issue, the “association is not causation” chant from your statistics 101 class has never been more relevant. In considering marriage’s potential association with poverty, it is helpful to consider the following:

• Is it about lack of a ring, or family disruption? Do we want our public policies to encourage children to grow up in households with married people, which may mean step-parents, or do we prefer policies geared toward encouraging situations in which children grow up in households with both of their birth parents, which may mean unmarried cohabitation? Neither scenario necessarily spells success or disaster, but research by Sara McLanahan in The American Prospect in 2002 identified growing up with birth parents as more vital to positive child outcomes. Her research suggests that it is more prudent to consider family disruption rather than the low rates of marriage, and concludes, “What matters for children is not whether their parents are married when they are born, but whether their parents live together while the children are growing up.”

• What about quality? If we are to promote marriage, can we do that in a way that also dissuades people from staying in abusive marriages, and offers strategies to guard against making a bad match in the first place (i.e., programs that might end up advising “Don’t marry this one”)? Researchers Karen Edin and Joanna Reed published a study in The Future of Children in 2005 that found the quality of many (but obviously not all) romantic relationships of low-income people to be of low quality. In their study, low-income people cited domestic abuse, infidelity, and substance abuse as common reasons for break-ups. (The federal Healthy Marriage Initiative stresses that it only promotes healthy, nonabusive marriages.)

• Where’s the economic payoff? Are we fully facing the economic and social barriers to marriage for low-income people that make it more complicated than wanting to get married or valuing the institution of marriage? Edin and Reed agree that it’s not about needing to value marriage. Their research concludes that “disadvantaged men and women highly value marriage but believe they are currently unable to meet the high standards of relationship quality and financial stability they believe are necessary to sustain a marriage and avoid divorce.” Some couples must overcome unemployment or underemployment, criminal records, and complicated blended family structures.

• Association is not causation . . . but it could drain a budget. It may be a good idea to keep marriage promotion programs as one component in a multi-front assault on poverty that also contains more traditional efforts. However, we must do so with our eyes open to the limitations: there is a lack of convincing evidence that growing up in a single-parent home or with unmarried parents causes poverty. On the other hand, there is much evidence proving that other things do cause poverty. Dialogue on this issue should include the question: should our tax money go to promoting something that, when absent, is only associated with, but not necessarily causing, the poverty problem?

While marriage deserves to be on the radar screen when discussing poverty in Milwaukee and surrounding areas, the complex task of marriage promotion is easier said than done. The recent news stories on low marriage rates and the high numbers of single parent homes in Milwaukee underscore the continuing need for a host of community efforts to support healthy and stable families for children.

The middle class ticket to...nowhere?

The Forum does not advocate on behalf of anyone and generally uses a taxpayer's perspective in our analyses. However, some policies are focused on particular demographics, which require us to analyze their effectiveness from the perspective of both the intended beneficiary and the average tax-paying citizen. School choice is an example: How does the program impact the educational achievement of low-income students using vouchers and how does it effect the state's taxpayers?

Early childhood education could be another example. Most research on the effects of high quality early childhood education have found greater benefits for low-income children than for middle class children. Many states have focused their early childhood policies on low income families for that reason: to get the most bang for their buck. For a taxpayer's group like the Forum, maximizing the return on a public investment is a worthy goal.

The problem with such narrowly focused policies is that they may provide a perverse incentive for families to languish in poverty, or at minimum they may introduce unanticipated barriers to transitioning out of poverty and into self-sufficiency.

A past Forum research project called Making Work Pay found that government benefit programs with steep drop-offs of benefits at certain income levels prevented many families from moving out of poverty. In 1999 we found:

Wisconsin’s working poor face “disincentives” at certain income levels due to the tax structure and the phase-out of federal and state benefits. A single parent of two moving from an income of $17,000 to $18,000 experiences a marginal tax rate of 190% due to loss of food stamps and reduced tax credits.

New research from the Brookings Institution shows that not only can these poorly-designed policies prevent this parent from moving up in economic status, they can effect her children's eventual status as well.

Julia Isaacs asked the question: "To what extent do American families improve their incomes over a generation?" Her findings are worth noting. First, she found that 42% of children born to parents in the bottom fifth of the income distribution remain in the bottom after reaching adulthood. Also troubling, she found children of middle-income parents have a near-equal likelihood of ending up in any other quintile, "presenting equal promise and peril for those born to middle-class parents."

(Side note: The most provocative finding is the link with race:

Almost half (45 percent) of black children whose parents were solidly middle class end up falling to the bottom of the income distribution, compared to only 16 percent of white children. Achieving middle-income status does not appear to protect black children from future economic adversity the same way it protects white children.

Thus, this new research indicates the most effective policies have to not only avoid disincentives to increased income to truly raise a family's economic status, but must help families maintain the gains over future generations, as well. The hurdles to achieving this long-term effectiveness are two-fold: elected officials do not often plan beyond the next election cycle, and longitudinal studies on social policy effects are rare.

When it comes to early childhood education, there are several studies tracking children well into adulthood (see our matrix of research on early childhood outcomes). Whether the long-term benefits found in these studies outweigh the immediate political and economic costs is the focus of the Forum's current research.

Social experiments as good public policy

New York City Mayor Michael Bloomberg recently announced a new privately-funded program aimed at moving families out of poverty. The program, Opportunity NYC, is being called a conditional cash transfer program. The basic gist is that participating families will work toward a series of goals and will receive cash bimonthly for each goal they meet. After a year a family could earn up to $5,000.

It will be interesting to see how this program is received. Most of the goals are short-term (school attendance, doctor and dentist visits, job training activities), but it is long-term planning and goal setting that will be the key to truly lifting these families out of poverty, I would guess. It's not clear how many years the families will be in the program, nor how long they anticipate the funding will last. Opportunity NYC is modeled on a cash transfer program in Mexico that has been shown to be effective. Whether small cash rewards provide the same incentive in New York City as they do in Mexico is yet unknown.

The most encouraging thing about this program, however, is that it is designed with a built-in evaluation, so that its effectiveness can be analyzed scientifically. (There will be a comparable control group of families who will work toward the goals but not receive the cash.) If a government is going to try a new and innovative program, even if it is privately funded, ensuring there will be a rigorous evaluation is important. If it works and is cost-effective, great...bring it to scale. If it doesn't, it is unfortunate, but better to know than to expose even more families to it.

This is a lesson Milwaukee and Wisconsin should learn. Innovation in public policy can be desirable, but without evaluation from the get-go, we don't know whether we should invest more or try another option. It shouldn't matter whether the innovation is publicly or privately funded; taxpayers want to know they are making wise investments just as much as foundation officers do. Evaluating after several years and even more millions are spent is not good public policy. . . no matter what the results of the underlying program turn out to be.

A New Commission?

The Milwaukee Journal-Sentinel reports that Governor Doyle has appointed a Commission to Reduce the Racial Disparity in Wisconsin's Criminal Justice. The key is to figure out why Wisconsin has the third highest ratio (18:1) of incarcerated minorities to whites, and to fix it.

While the main charge of the group seems to be to look for discriminatory practices throughout the state's criminal justice system, the story said the governor wants to consider how poverty, parental involvement, education and abuse all factor into the crimes. That is certainly a laudable goal, but doesn't an examination of the root causes of crime deserve its own high-profile commission?