Family dynamics drive poverty, income inequality

A recent book by Harvard professor Robert Putnam is causing quite a stir among online scribblers. His book tells a familiar story, similar to one told by MIT economist David Autor and that of Charles Murray of the American Enterprise Institute.

To faithful readers of this column it is not a new story, nor does it stretch common sense or the accumulated wisdom of the ages. In fact, the need for this story to be told convincingly through statistical research is a damning indictment of popular culture and fashionable thinking.

The fundamental observation is that, over the past half-century, the collapse of the American family has generated terrible economic and social consequences that have profoundly negative effects on future generations. While the research is more nuanced than that, and the authors do not agree in remedies, the ultimate implications are clear. Three of these research findings will dominate American political, economic and social discourse over the next century.

First, two-parent families are, on average, far more successful in raising successful kids (by almost any measure) than any other arrangement. Second, most pathologies of poverty and its immediate causes can be linked to bearing children outside a stable, two-parent family. Third, social mobility among children (especially boys) is terribly stunted in single-parent households.

Most folks will implicitly understand these truths. To do so is evidence that your intellect has not been drained by the vagaries of modern social science research. It is high treason in academic conferences to suppose that bad economic outcomes may be the consequence of poor personal choices. These folks look elsewhere for an explanation, and neo-Marxist class conflict theory is far more pliable and warming. But how bad is the situation?

Sometime this decade, most children in America will be born into households without a father around. On average, these children will graduate high school but not step foot in college, resulting in incomes far below average. Kids born to married couples, even if they later separate, have far better outcomes. They will, on average, go to college and graduate, earn above-average incomes and, importantly, marry before having their own kids. The effect of single parenting is a dismal, self-perpetuating dichotomy.

Reading this, some folks will argue that marriage is harder now than before. They might argue that single-parent households stem from too many men being incarcerated or from poor women lacking unequal access to birth control. They may argue that poor teens are steered toward childbearing as opposed to the drudgery of low-wage work because of a lack of economic advantage. I disagree with these sentiments.

In the economic catastrophe of the 1930s, out-of-wedlock births were lower than they were in the 1970s. In the racially unequal 1950s, out-of-wedlock births by black women occurred at lower rates than those among white women. Although divorce has led to a reduction of spouses trapped in abusive relationships, the general trend of family dynamics today is not that two-parent families are forming and dissolving, it’s that two-parent families are failing to form at all.

We hear a great deal about criminal reform, income inequality and other problems. These are actually symptoms. Until family dynamics improve, we can expect poverty, income equality and social mobility to get worse.

Michael J. Hicks is the director of the Center for Business and Economic Research and an associate professor of economics in the Miller College of Business at Ball State University.