The Cash-for-Kids Study: Misread and Misrepresented

You might have heard recently that a years-long poverty study “found” that giving $333 monthly to kids with poor parents didn’t make a difference. But here's why that’s the wrong takeaway: The "Baby's First Years" study wasn't designed to test cash payments. It is multi-year, ongoing scientific research into how poverty affects child development. Researchers found "selective impacts on preschoolers' brain activity with possibly different impacts across brain frequency bands" — which roughly translates to "this is incredibly complicated and we're still figuring it out," not "money is useless." And yet this rigorous research got reduced to a talking point amid an ongoing policy debate on child tax credits and what it means to lift kids out of poverty.

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Speaker 00

  Mitt Romney and Ted Kennedy were about as different as two politicians could be. The lanky businessman and the stout old senator, the conservative darling and the liberal icon. But did you know they once teamed up to tackle an elusive challenge: universal healthcare?

• 0:16Speaker 01

  This is a politician's dream.

• 0:18Speaker 00

  In season four of the Big Dig podcast, we tell the story of Romney Care and the odd couple alliance behind it. Find Mitt and Ted wherever you listen.

• 0:30Speaker 02

  Well, you are a vegetarian, though, right?

• 0:32Robin Rauzi?

  No, I'm just a lesbian vegetarian.

• 0:38Speaker 02

  It's so hard to keep track.

• 0:41Robin Rauzi?

  I know. I know.

• 0:51Speaker 02

  Hello and welcome to Optimist Economy. I'm Catherine.

• 0:54Robin Rauzi?

  I'm Robin.

• 0:55Speaker 02

  On this show, we believe the US economy can be better, and we talk about how to get there, one problem and solution at a time.

• 1:08Robin Rauzi?

  We do have some announcements.

• 1:10Speaker 02

  Hard to beat last week.

• 1:11Robin Rauzi?

  Hard to beat last week. If you missed last week, ha, go back. The other things we need to say are that we are going to record a Q and A episode. We'll be recording that in, probably in about a week by the time you hear this one. So if you have a question for, probably for Catherine, you could ask me things about, I don't know, editing cats and growing avocados. You can email those to us at [email protected], or you can call us at 202-643-0295. We're also collecting audio reviews to put together a promo for the show. So we love the reviews you've left for us, and we would love to have audio versions

• 1:54Robin Rauzi?

  of those or brand new creative ones. In fact, this week, we got a great review on Apple Podcasts that said, "I have Catherine and Robin to thank for making consuming leisure part of my everyday vocabulary." And I want you to know, I have Catherine to thank for making it part of mine.

• 2:09Speaker 02

  Ruining conversation, one bit of vocabulary at a time.

• 2:12Robin Rauzi?

  Exactly. One bit of econ jargon at a time. One more quick announcement. We also have two spiritual sponsors this week: Michael Hart from East Windsor, New Jersey, and Mason from New York City. Thanks to both of you for supporting Optimist Economy. Next up is Retcon.

• 2:30Speaker 02

  Wait, what's 23 Reasons?

• 2:32Robin Rauzi?

  Oh, right. Sorry. I read this, I read this article over the weekend called 23 Reasons I Hate Your Podcast. It was not about us. And, but I was pretty relieved that I think we only were doing like five of them.

• 2:43Speaker 02

  Okay.

• 2:44Robin Rauzi?

  But one of them was, we're supposed to identify who we are at the top of the show. So you would say like, you're Catherine, you're an economist. And I thought, yeah, but what would I say? I'd be like, I'm Robin. Sidekick. I'm Robin. Editor. And then I began to think, I could do so many just random descriptions of who I am.

• 3:03Speaker 02

  We could change it. I mean,

• 3:04Robin Rauzi?

  We could change it weekly. It would be hilarious. But only to me.

• 3:08Speaker 02

  That guy wrote that article for professionals, not us.

• 3:11Robin Rauzi?

  Not us.

• 3:13Speaker 02

  Well, now let's get to our typically me doing the worst segment, Retcon. Two very quick Retcons. First, that's on our YouTube channel. One of the comments was a soldier who said that he didn't love that I referred to soldiers as army bots. He brought up that there's a big civilian military divide and, you know, this is a way, a further way to alienate people from soldiers. And I, I mean, I really appreciate that comment. And I can say that the genesis of me calling both army bots and worker bots does come from Kent Brockman on The Simpsons. And that's an adaptation of a Kent Brockman quote, of why I put bots at the end.

• 3:53Speaker 01

  Tonight on Eye on Springfield, just miles from your doorstep, hundreds of men are given weapons and trained to kill. The government calls it the army. But a more alarmist name would be the Killbot Factory.

• 4:06Speaker 02

  A second Retcon is that I still get emails and messages from people about the Boys and Men episode, and how much people appreciated kind of our position and our take to really turn down the temperature on the Boys and Men crisis. And this one message I got this past week said, I wish y'all would have said more about the irony that in all the attention being thrown at Boys and Men, it's still erasing the people who are basically the most vulnerable within that group. And it's a real ironic attention. So those comments really fill my cup, as it were. So, thank you.

• 4:47Robin Rauzi?

  So my retcon is that we mentioned very quickly in passing during the school lunch episode that there had been some adjustments to free meals during the pandemic. So I went back to try to look that up. And during the pandemic, indeed, Congress authorized the USDA to give free meals to every public school child in the country. Long story short, it did not get extended. But part of the reason that there is such a school meal debt problem is that basically everyone was given free meals and then it was taken away. And there have been two bills introduced, including one this year, to eliminate that school meal debt. Senator Fetterman led the introduction of the School Lunch Debt Cancellation Act

• 5:26Robin Rauzi?

  in March of this year. Also, Peter Welch of Vermont and Richard Blumenthal of Connecticut also introduced the legislation.

• 5:36Speaker 02

  Great. Terms and conditions?

• 5:39Robin Rauzi?

  Terms and conditions. What did you look up this week? This is generally what we call, what did you look up this week?

• 5:46Speaker 02

  What did you look up this week? Well, related to our centerpiece, I looked up the word pathologize, which means to view or characterize as medically or psychologically abnormal. I mean, the only context I have ever heard this is people like to pathologize the poor and decide that poor people are different from us psychologically and that that is a kind of a constant challenge when it comes to designing and advocating for anti-poverty policy is that there is the, I was trying to find out if pathologization was a noun. And then I was like, doesn't matter, I wouldn't be able to say it anyway.

• 6:24Robin Rauzi?

  Too many syllables in that.

• 6:26Speaker 02

  What I was surprised that the way that it came up more frequently was kind of of the vibe of one flew over the cuckoo's nest or a girl interrupted of the way that otherness and differentness and social nonconformity was treated and pathologized in the 50s and 60s.

• 6:46Robin Rauzi?

  You know, it's interesting because I never realized it was really specifically about being abnormal. But I guess that makes sense because we talked, we actually used this word on the show when we talked about Stockholm syndrome and how the people in that original case were pathologized. Good look up.

• 7:00Speaker 02

  Yeah, spoiler, we're going to talk about poor people again.

• 7:04Robin Rauzi?

  Spoiler alert.

• 7:05Speaker 02

  Spoiler alert, which we actually have spoilers because it takes us so damn long to get there, apparently.

• 7:13Robin Rauzi?

  I looked up the four stages of competence, which my new choir director introduced in my in choir rehearsal two nights ago. And I thought he was just sort of making this up or this was a choir thing. But apparently it comes out of psychology and specifically used a lot in business psychology about how people learn things. So the first one is unconscious incompetence. You don't know, and you don't know that you don't know. And then there is conscious incompetence, where you you are suddenly aware that you don't know something. And then there is

• 7:47Speaker 02

  Conscious competence.

• 7:48Robin Rauzi?

  Conscious competence. And I think you and I are kind of like on the bubble between those two things in podcasting. But we have definitely not reached unconscious competence.

• 8:00Speaker 02

  Sure.

• 8:01Robin Rauzi?

  Which is like, you don't even have to think about it. You just do it. You do it from muscle memory.

• 8:05Speaker 02

  How's this? I can confidently say I'm consciously competent. As a soccer viewer. I'm not unconsciously competent.

• 8:13Robin Rauzi?

  I mean, it suddenly applies to so many things.

• 8:16Speaker 02

  That's I mean, I think that's a good goal for how we're doing in podcasting.

• 8:19Robin Rauzi?

  It's true. It's, you know, it's not a term. It's a it's a condition. And our condition is on the verge of

• 8:26Speaker 02

  Conscious competence.

• 8:27Robin Rauzi?

  Conscious competence.

• 8:29Speaker 02

  Love it. So with that kind of lead in to us explaining something in an authoritative way.

• 8:38Speaker 02

  Just want to flag real quick that we're barely competent.

• 8:44Speaker 02

  Let's talk about economics.

• 8:46Robin Rauzi?

  Someone here is competent on that. So.

• 8:50Speaker 02

  Today, we for the big pill crow.

• 8:52Robin Rauzi?

  We need to explain to people what the pill crow is, too.

• 8:55Speaker 02

  Yeah, if you haven't, if this is a new episode for you.

• 8:58Robin Rauzi?

  I'm sorry.

• 8:59Speaker 02

  So sorry.

• 9:02Speaker 02

  Circling back to barely competent, I need a podcast. We have kind of segments of the show, but we like to call them chapters or sometimes sections. But then a pill crow is a typographical mark that's used a lot in editing that Robin loves. And so now we started to call the segments pillcrows. And it was originally a joke about how aloof we are. And then we just adopted it. And apparently, we are aloof. And you can be too, by listening to Optimistic Economy Podcast.

• 9:33Robin Rauzi?

  A pill crow is the paragraph mark, the paragraph sign.

• 9:37Speaker 02

  The backwards P that's filled in.

• 9:38Robin Rauzi?

  It's like a backward P with an extra slash. And it means a new idea.

• 9:41Speaker 02

  Right.

• 9:42Robin Rauzi?

  So here we are, a new idea.

• 9:44Speaker 02

  Our centerpiece, the biggest pill crow of them all, is to talk about giving cash to poor people. And the reason why I wanted to talk about this is because you might have read in the New York Times that there was a big study on cash that went to poor people and it didn't do anything, like the cash didn't do anything. More likely, you heard about it when this story was incorporated into the New York Times Daily podcast, which went out to however many millions of people who listen, that characterized the study as giving cash to poor people didn't do anything.

• 10:22Robin Rauzi?

  At the time that we were recording, the headline on the story was, "Study May Undercut Idea That Cash Payments to Poor Families Help Child Development."

• 10:31Speaker 02

  And then this made the rounds on conservative talking points of like, see, cash that we've given to children in the United States historically was welfare, aid to families with dependent children. And then more recently, it was the expanded child tax credits.

• 10:47Robin Rauzi?

  Can we just take a second and unpack that for people? Because I think, first of all, I think tax credits are really confusing to people.

• 10:53Speaker 02

  Well, it's really confusing because it's part of our tax system, which is really confusing. And as we said in an earlier episode, has been morphed into a complex rewards mechanism for Congress to give out money to people they like through either a credit or a deduction. They do it on the deduction side, which lowers the income subject to a tax. And then they do it on the credit side, which lowers the actual tax bill. So credits are money. I mean, credits are a dollar-for-dollar reduction in the amount of money you have to pay the federal government. You owe $20,000 in taxes, you get a $2,000 credit, you now owe 18. For six months in 2021, Congress amended a part of the tax code that had already been in place,

• 11:35Speaker 02

  but expanded it so that it was used to deliver monthly cash benefits to virtually every kid in the US. It really only phased out when you got to $400,000 of household income. And this money was delivered monthly into the parent's bank account. It was about $250 a month if your kid was six and over. And it was around $300 a month if your kid was under six. And we had that in place for six months in 2021. And you can think of it as a child allowance, a basic income or welfare for kids. And a lot of people want to get it back. Because during that six months, we saw tremendous number of kids no longer in poverty with that extra income.

• 12:18Speaker 02

  And we also saw families spend it on basic needs, you know, shelter, utilities, food, as well as stuff for their children. The key part of the expansion is that, not just that it got larger, but that who could claim it was made to be almost everyone in the population. Because the way that the credit exists now, you can only get the full size of the credit if you have a positive tax liability, which a lot of people who are very poor do not have a positive tax liability because we have a progressive tax system. So that credit still exists, but the way that it was juiced in this special year, that's gone. It was just increased in the one big beautiful bill to $2,200. But the reason why it was so special wasn't just that it was allotted monthly for a period of time,

• 13:03Speaker 02

  but that the tax credit itself Isn't fully refundable, which means that if you don't have a positive tax liability, you don't get it. So there's been, both before and after this expansion, a lot of advocates who want this back in place.

• 13:17Robin Rauzi?

  Yeah.

• 13:18Speaker 02

  Who want money, who want basically a permanent minimum income for children that stabilizes their family incomes at some like really small level.

• 13:28Robin Rauzi?

  Right.

• 13:29Speaker 02

  Two thousand bucks is not, no one's living on that.

• 13:32Robin Rauzi?

  Two thousand bucks a year.

• 13:33Speaker 02

  A year, no one's living on this, but just cushion money for families related to children.

• 13:38Robin Rauzi?

  Yeah.

• 13:39Speaker 02

  And it has almost no conservative support, although I think Mitt Romney actually did like it.

• 13:45Robin Rauzi?

  Yeah.

• 13:46Speaker 02

  So it's, it was a very heartbreaking evolution of the Biden administration that this six-month period in which families were given what is essentially a universal basic income for children, or guaranteed income for children, over three million children were lifted out of poverty, and then come January 2022, they were all just dumped back in.

• 14:11Robin Rauzi?

  Yeah.

• 14:12Speaker 02

  That is the policy, and that is the question, like, should the US spend a lot of money to have cash for children? Traditionally, conservatives do not like giving money to all children, because many people in the US, not just their Republican elected representatives, don't like supporting single parenthood.

• 14:27Robin Rauzi?

  And they're the ones who are most likely to be poor.

• 14:29Speaker 02

  Yeah, because if you only have one income, you're much more likely to be poor as a single parent, because you don't have the secondary earner in the household, so they have higher poverty rates.

• 14:39Robin Rauzi?

  So there's this moral judgment attached.

• 14:41Speaker 02

  And then there's also the work judgment attached of like, if I give someone money and I don't make them work, then they'll all quit their jobs. You go back to these almost like century-long critiques that women who need it aren't as good, and that's...

• 14:56Speaker 02

  They'll work less because they're shiftless takers, chislers, whatever you want to call them, that this is just, you can't give money to people who don't deserve it. And that, basically, the problem with the child tax credit is you're giving a lot of money to people who don't deserve it. That gets harder to say after, after millions of people have benefited from this.

• 15:16Robin Rauzi?

  Those are little people who can't vote.

• 15:17Speaker 02

  Little people who can't vote.

• 15:18Robin Rauzi?

  So that's the context that is going on when this New York Times story comes out and says, basically, oh, there was this really great random controlled trial study that says money doesn't make any difference to kids.

• 15:33Speaker 02

  This is all context of part one of like, there are people out there that are vehemently opposed to giving money to poor children. And like, now they have a new talking point that came from the study. But like, y'all, like, let's like, tuck in and take out your notebook, because like, we are going through the study, because it is, it did not say what they are saying it said.

• 15:51Robin Rauzi?

  Seatbelt on.

• 15:52Speaker 02

  Seatbelt on. Okay, so, child tax credit, that expansion, like, put it to one side, that's all in the policy world, right? That's just how to make better public policy for children. Now you gotta like, really remove yourself from that conversation and enter this researcher mindset.

• 16:14Robin Rauzi?

  Okay.

• 16:15Speaker 02

  How does poverty affect children?

• 16:17Robin Rauzi?

  Right.

• 16:18Speaker 02

  We know lots of things are predicted by the income you have when you're a child. We don't know how they take effect.

• 16:26Robin Rauzi?

  You mean, we know like, the income of your family or your household correlates to certain things, but we don't know exactly what the mechanism is?

• 16:32Speaker 02

  No. And it can show up in early childhood, it shows up in later childhood, parents.

• 16:37Robin Rauzi?

  Can you give me an example?

• 16:38Speaker 02

  Uh, yes. So, this is from the background to the study in question called Babies First Years. "A growing body of small-scale studies documents that the cognitive and brain development of low-income children differs from that of children in higher-income families." Now, that's not a fact, that's a prior finding, that some people would call more tenuous than others. But there is this concern that it's not just low income, something happens to kids growing up in poverty that will affect them through... Child achievements, school performance, behaviors like attention and self-regulation. And we know that there's a correlation between these things and income.

• 17:22Speaker 02

  How are they causally related?

• 17:24Robin Rauzi?

  Was this what the researchers were trying to find out?

• 17:26Speaker 02

  Yeah, so the baby's first years study is like in the history of economic studies, it has a lot of precedent. So this one is kind of like a new version of something that we've done before. But now they want to look at specifically if there's income effects on these types of developmental issues in addition to a lot of other things. So they started in 2018. They recruited around 1,000 women in four cities and they randomized them into getting either $20 a month or $333 a month on a Visa gift card that was replenished. And then moved heaven and earth to get all of the permissions for all of the tests that

• 18:10Speaker 02

  they were going to collect on these families, get them to sign up, fill out surveys and study poverty. And I, I think when I-

• 18:18Robin Rauzi?

  And they could follow what people were spending the money on.

• 18:20Speaker 02

  They followed what the people were spending money on. They gave the kids, I mean, they gave the kids EEGs. They gave them cameras and told them to take photos of what you purchased. Like it's, it's not a policy evaluation. It is a scientific inquiry into poverty in the United States. And something I think people might not appreciate about poverty as it relates to research is that it is a moving target. There's not a ton about poverty in 1955 that is applicable today.

• 18:45Robin Rauzi?

  Or even 1998, yeah.

• 18:48Speaker 02

  Or even 2005. I mean, so much has changed in our economy, in our public policy and how that affects poverty. That's always evolving. So this, this is truly a study to try and understand the mechanisms of disadvantage and how they accumulate in children. So they have produced like 50 working papers so far. The kids are six now. So in the middle of their study, there's the pandemic. Right, which is, I mean, it's, it's, you know, I think-

• 19:18Robin Rauzi?

  Yeah, how they didn't just unplug and just, you know?

• 19:22Speaker 02

  I don't have the exact statistics, but it was a pretty close, like 70% of the people in their study lost income in the pandemic, but then 70% also got extra income from the federal government.

• 19:32Robin Rauzi?

  Right.

• 19:33Speaker 02

  So, in the middle of this scientific study that has a ton of things that they're trying to look at related to child poverty and understanding how poverty affects children, the pandemic happens, and their mechanism of giving out a certain amount of cash every month gets clouded by both the economic detriment that the pandemic presented, as well as all of the support that the government sent out. But they kept the study going. So, the results that got a bunch of attention at the four-year mark were that they looked at a certain number of cognitive measures for the kids and didn't find that the high-money group and the low-money group, one getting $333, one getting $20, they didn't find

• 20:16Speaker 02

  statistical significance on these child development markers at age four.

• 20:20Robin Rauzi?

  At age four?

• 20:21Speaker 02

  At age four.

• 20:23Robin Rauzi?

  Okay, I mean-

• 20:24Speaker 02

  Which would have been 2022 to 2023. So, I'm gonna read a sentence from this report, and then we can go back to the conclusion made by people from like AEI saying like, "Cash won't help." So, quote, "Taken together, the EEG findings suggest that monthly unconditional cash transfers may have selective impacts on preschoolers' brain activity with possibly different impacts across brain frequency bands throughout early childhood, i.e. impacts on beta and gamma power in infancy and impacts on alpha power in the preschool years." You don't know what that means. Nobody knows what that means, because they're looking at the brains of children as they get 300 bucks, and their conclusion is not, "It does

• 21:07Speaker 02

  nothing and we don't give them cash." I think that was the part that just like, I felt personally wounded by, is that you would take a scientific study and just use it to say we shouldn't help children, and it says more about you that the conclusion would be, "Oh, we don't have to give cash to poor kids," as opposed to, "Man, we don't know how poverty affects children." Like, how can you really, like, you listen to that sentence and your conclusion is, "We don't gotta help them," as opposed to like- Man, there's a lot of shit going on when kids are young and we don't know how poverty affects it and we should probably find out more. And they talked about like all the reasons why they thought it wouldn't be, you know, why the results were null. I mean, one of them was it's hard to give a three-year-old

• 21:52Speaker 02

  test. Exactly. They were like, well, like, we could have massive measurement error because giving an attention test to a four-year-old is quite tough.

• 22:02Robin Rauzi?

  Yeah. And I think the other thing that was pretty infuriating, the second quote in the story is from Robert Dorr, president of the conservative AEI, who supports imposing work rules on aid.

• 22:15Speaker 02

  It was such a prominent, like, quote, too, of like-

• 22:18Robin Rauzi?

  Yeah, it was really prominent in the story. And when you put a quote like that in a story like that, in that placement like that, it serves a role in the narrative that you're building.

• 22:27Speaker 02

  And it primes people, too.

• 22:28Robin Rauzi?

  It primes people to read everything after that through that lens. I mean, the quote is, "It shows that money alone won't lead to better outcomes for children." That's what he said. And that is way more easy to understand than that thing that you read from the actual working paper.

• 22:44Speaker 02

  And also not true. He said, "Money alone won't lead to better outcomes," is categorically not an accurate description of what this study found in one paper.

• 22:54Robin Rauzi?

  Yeah.

• 22:55Speaker 02

  To counter that point, this study has found some pretty interesting, I mean, first off, it's not done. So that's one thing to note.

• 23:03Robin Rauzi?

  It's still going.

• 23:04Speaker 02

  It's not finished. They're still collecting data and putting out research and have lots of questions. So one of their more consistent findings, they tested a ton of outcomes. This is one of many outcomes that didn't have a large result. But what they have found very consistently is that parents spend this money on the kits. They've found increase in spending on books, on toys. It's led to slightly, like, some increases on how much time is spent playing with children because you've bought toys for them. They talk about the things that they've bought for their children, or what they use this monthly $333 for, and it's like a lot of Christmas trees.

• 23:43Robin Rauzi?

  Things that you would go without.

• 23:45Speaker 02

  Things that you would go without, like child's mattresses that are on a bed instead of a floor. Or a kid who has an actual winter coat in the Twin Cities or in Omaha instead of wearing four layers of sweatshirts. We don't know what that does. I don't know what that does. They don't know what that does. We don't know what it means to have a way for children who grow up in poverty to have some type of normalization of what is in their life. We don't know what that means. I don't know that that doesn't have an effect. I don't know if that effect isn't worth the tax investment of Americans to have kids in America have a normal, non-stigmatized life. And to make such a conclusion as that was so...

• 24:30Robin Rauzi?

  And for the conclusion not to be, turns out $330 isn't enough.

• 24:34Speaker 02

  Yeah, turns out $333 isn't enough. So that's, I wanted to make sure that like that study got its due, that we are in this age of attacking experts. And I wouldn't want anyone to have the reaction like, how bad are these people at their jobs that they're not finding cash helps families? Like, I wanted to give these people the respect that they deserve for the study that they put in that is still in the field. And to remind listeners that people will jump on what they can to push something that they were arguing to push anyway.

• 25:07Robin Rauzi?

  Yeah.

• 25:08Speaker 02

  Now that I'm incredibly pissed off at how you would describe this study, let's do like a little bit of context for how much money these families got. The money that parents got from the baby's first years study is more than 90% of American households will get back in the one big beautiful bill.

• 25:28Speaker 02

  They got $4,000 a year allocated monthly from the baby's first year study, which you just called useless. So the less than $4,000 a year that goes to the bottom 90% of tax filing households in the one big beautiful bill, what is that supposed to do?

• 25:46Speaker 02

  That costs $4.6 trillion. What is the evidence for giving out that much money through the tax system?

• 25:51Robin Rauzi?

  Through the tax cuts, yeah.

• 25:53Speaker 02

  I mean, you're giving less through the one big beautiful bill to a family that makes $150,000 a year, and that is supposed to be worth a $4.6 trillion investment. But giving 300 bucks to kids who get Christmas trees, we can't do it. I just, the, like, the level of hypocrisy that comes from it's okay to give people small amounts of cash through the tax system as long as it doesn't go to poor children because they don't have outcomes to prove it. Make a top 10% household who's getting $13,000 back a year prove their outcome. Yeah, exactly. When was the last time you put someone who makes $400,000 a year up to an EEG and test their development? Like, the length that poor children have to go to to get assistance in this country. And like, oh, you make $400,000 a year?

• 26:37Speaker 02

  Here's a $14,000 check from the federal government. You'll get it every year for the next 10. We'll never ask you what you did with it. We'll never ask you what you spent it on. I'll never test your EEG. I won't check how much you work. I'll never look at your labor supply. You don't need to do any of that stuff. You're a rich person. I'm gonna give you three times what an experiment gave poor children and come to the conclusion that those kids don't need it. I have been assigned to write about this for Bloomberg, and I'm so fucking mad. I've written like two drafts in all caps. They're never gonna publish this. And I mean, like, the number of times I like highlight, like, "The nerve." And it's just like, that's like, the nerve of you. And that's like in size 60 font.

• 27:18Speaker 02

  And I'm like, well, this looks like something a serial killer wrote. But to be fair, the study team would be really pissed off at me if I said that because they would be like, "This is not a study to prove children are worth getting money. This is a study to understand child poverty." And I'm making the same mistake in real time right now. And I know that I would get a polite but fair email from one of the PIs who would be like, "Catherine, no, no, no, no. We are not trying to prove the worth of children. We are trying to understand poverty, and you're making the same mistake in a different direction." She was tough, I won't lie. She was, she's at Wisconsin. She was, she was tough. Exactly. An incredible mentor.

• 27:59Speaker 02

  Go Bucky.

• 28:00Robin Rauzi?

  We knew we were doing this episode. I was reading. I found so many groups, nonprofits, researchers who were doing similar studies, who had all had to defend their work from the attack on this one study that wasn't even their study. And there are programs in Flint, Michigan, working on this kind of stuff. There are programs in Chicago working on these questions. And all of a sudden, one working paper out of this one study is blown totally out of proportion. And we know this happens. I mean, it happens in all sorts of aspects of our political discourse. You may be too young to remember the thing about George Herbert Walker Bush going to

• 28:42Robin Rauzi?

  the grocery store and supposedly not knowing about what a grocery scanner was. And so it got retold and retold as if he didn't know what a barcode scanner was. But what he actually had seen was, this is again, going back a day, you would write an actual paper check for groceries and it had a scanner that would read the numbers on the bottom of the check and verify the check. And it was like physically, it would go through it and it would zip it through and read the numbers. And that's what he was talking about. And I knew a reporter who was with him in the pool that day, and she was still livid about it years later, that that he had been maligned as being so totally out of touch

• 29:27Robin Rauzi?

  with like how common people go to the grocery store and what happens there, when in fact, in this case, this was in fact, a new technology that he was encountering.

• 29:38Speaker 02

  But that's exactly right. I mean, it's so hard to interrogate. Like, why would y'all have read the working paper on the age four child development outcomes? That's talking about, I mean, who even knew that there were gamma parts of the brain? I was like, that's in my brain? There's a gamma in there? That's what they found out? And I was really, I was really tempted to email the study team specifically about that, to just be like, yo, what's a gamma power?

• 30:06Speaker 02

  But this goes back to my term and condition about the way that we pathologize the poor. Like, this article is in its own way pathologizing the poor because it's feeding into this narrative that poor people have to prove that they deserve investment in money. That's the first reason I got really mad reading that. The second reason...

• 30:24Robin Rauzi?

  But wait, there's more.

• 30:25Speaker 02

  But wait, there's more. I think the second reason is that cash can't fix everything. Like, how is $333 a month meant to fix and be adequate enough to address the constellation of economic hardships that come in the way of families like trying to have economic security? And the conclusion being cash won't help is a convenient one because probably the conclusion that's very inconvenient but more accurate is a small amount of cash can't fix market failure. $333 is getting nobody childcare. It's getting nobody housing. It's not covering food. It's certainly not paying for health insurance, although hopefully

• 31:10Speaker 02

  most of these people are on Medicaid.

• 31:12Robin Rauzi?

  Yeah, I mean, think about what, you know, in your own life, what you spend $333 on. Less than most car payments, less than most utility bills, less than, you know, it may be enough to lift people from one side to the other of a poverty threshold. But really, in this day and age, like, it's just not enough.

• 31:29Speaker 02

  Maybe just enough to buy Christmas trees. Maybe just enough to have a coat and a bed, like, and books. Coat and bed and books. The Dolly Parton agenda.

• 31:42Speaker 02

  Like, even if you were to take on face value of like, okay, I'm looking at all these results and I'm looking at everything that this study has produced over the past six years. And I'm, I'm starting to think that this amount of cash is simply insufficient to overcome the struggles of poverty. Is the conclusion, therefore, we don't help them? Therefore, we don't give them cash? Or, you know, we need to figure out what would be more helpful?

• 32:09Speaker 02

  And I guess the problem I have is that this is like a nice little like get out of jail free card of like, oh, thank God, we don't have to give cash to poor kids, instead of being a motivator of like, we need better health insurance, like, we need better housing policy. We need universal school meals and paid family leave and childcare and these women should be able to drop their kid off at a high-quality early childhood site and maybe that makes the difference. Like, I think it's convenient on multiple levels.

• 32:35Robin Rauzi?

  Yeah.

• 32:36Speaker 02

  That type of conclusion.

• 32:37Robin Rauzi?

  Yeah, this was not a policy evaluation study. I just was thinking about the trade-offs that we talked about in the work requirements thing, too. It's like, what are we gaining in this trade-off?

• 32:47Speaker 02

  Yeah. Some of the first cash studies were of income maintenance experiments. In the 70s, there was, late 60s and 70s, there was support for negative income tax and family assistance plan of having something like a universal cash benefit given through the tax system or given to certain families. And they ran a series of experiments in the 70s. Denver and Seattle were the two largest. They're called SIM and DIME, the Seattle Income Maintenance Experiment and the Denver Income Maintenance Experiment, or evaluation. You know, I always get part of the acronym wrong. Like, it's four letters. I'm getting one of them wrong. It's gonna be spirit, but not letter. You can say it for everything. It's either evaluation or experiment.

• 33:30Speaker 02

  But like, in that one, you know, they did these two big experiments and they found kind of two results. One was that there was a reduction in labor supply, like, people worked less, specifically certain people worked less. And they didn't look at any, like, broader outcome of like, why they weren't working? Like, it wasn't that holistic. Like, the most of the study was to see if you gave people a negative income tax, would they work less? And they did. But then one of the other large findings was that it led to a lot of divorce.

• 34:01Robin Rauzi?

  Oh.

• 34:02Speaker 02

  It's pretty.

• 34:02Robin Rauzi?

  Turns out.

• 34:04Speaker 02

  Well, I mean, it's really funny if you think of, I mean, like, darkly funny. Like, you've got to really tap this, like, kind of dark humor of American cultural history place. But like, the, one of the things always levied against welfare, traditional cash welfare that was ended in 1996, is that it encouraged single parent families. Because if you got married, you would lose the benefit. So you just, you were just a single mom. So the negative income tax studies basically used the incentive to be married or not by giving them the same amount of money. And like, a bunch of women left their husbands.

• 34:36Robin Rauzi?

  Yeah.

• 34:36Speaker 02

  And so it kind of presented what should have been the number one research question to come out of all of these studies of like, why are so many women leaving their husbands? And like, how it relates to income? And maybe that's the reason why we have so many single parents is because they don't want to be married to these people. And even if you gave them the same amount of money to be married versus not, they chose not.

• 34:58Speaker 02

  But I, I think a lot of researchers, like, if you talk to more conservative people, they're like, oh, it didn't do anything. And if you add a whole other set of people of like, oh, the federal government's never going to fund divorce, so.

• 35:11Robin Rauzi?

  Yeah.

• 35:12Speaker 02

  A lot of people, lot of marriage disillusion as a result of giving women money in the 70s. But like, I guess it kind of speaks to like, why we need to keep doing these studies is that like, whatever happened in Denver in the 70s, it doesn't matter now.

• 35:25Robin Rauzi?

  It's not relevant to what's happening.

• 35:27Speaker 02

  Totally irrelevant to now. Like, we have to keep on researching and understanding. And that was an actual policy evaluation. So, I don't know, should I get more mad? What else you want me mad about?

• 35:37Robin Rauzi?

  No.

• 35:39Speaker 02

  Well.

• 35:40Robin Rauzi?

  I guess it's maybe worth pointing out that there are these other studies that are still doing this work. And not just this study, to try to find out how financially helping families might benefit them.

• 35:51Speaker 02

  The UBI people, like the Sam Altman AI people, they fund a lot of universal basic income studies, which I obviously decried last time as like, this is not a universal basic income study. This is a cash welfare study. They've done those as like, set up as policy evaluations. And then we have these research. I, I don't know, I suppose someone listening could be like, you know, you're kind of two-faced that you don't like Sam Altman's universal basic income study, but you do like this baby's first year study and are defending it. And I think. It comes down to me to motive and conclusion. Right? The motivation of these tech-funded UBI studies is almost distracting.

• 36:33Speaker 02

  And one, they're laden with PR and the fact that they're called universal basic income studies because they don't give them to rich people. They're just giving cash to poor people. And they're billing it as a way to like soften AI and almost justify their own wealth accumulation.

• 36:51Robin Rauzi?

  Well, yeah, and also hype. I mean, it's this insane hyping of their technology that it's going to be so powerful that we're going to get all this money and/or be this disrupted. And using, using UBI, UBI, I'm air quoting.

• 37:07Speaker 02

  Air quoting.

• 37:08Robin Rauzi?

  As a hype mechanism for your AI business is just gross. It's just gross.

• 37:13Speaker 02

  It's gross. But I should say, the people running the study are excellent researchers. The studies themselves are great. Like, they're well-designed, they're well-executed, but they're just part of this hype machine to say, we need universal basic income to soften the blow of AI. Whereas babies' first years, I mean, it's not part of a hype machine. They're not pretending like they're testing universal basic income or anything like that. It's just studying poverty and the hype machine found them. This can be really frustrating for outsiders. Like, this is how research works. Sometimes the only thing you're going to get, even from a multi-year research project, is just a better question.

• 37:49Robin Rauzi?

  If you're lucky. And you might not even get that.

• 37:51Speaker 02

  You might not even get that.

• 37:53Robin Rauzi?

  Are there other studies out there that you're keeping an eye on?

• 37:55Speaker 02

  Around this?

• 37:56Robin Rauzi?

  Yeah.

• 37:57Speaker 02

  There's a, there's a bunch in the field. I mean, after the expanded child tax credit of 2021, there was a huge motivation. And I think in some ways, the dramatic effects that the expanded child tax credit had on the number of children in poverty and the evidence, I mean, for, you know, as ephemeral as that period was, the evidence that came from that six-month period of the monthly payouts where, you know, it's It's a lot of money for like food and school supplies and utilities and housing and families were really struggling. It motivated a lot of people to understand, one, if their state or local government could do something similar and what would make it more successful. And so in some ways, what's ironic about the baby's first year study is that it is probably

• 38:40Speaker 02

  like the most aloof to that question on some levels because it's studying the science behind it as opposed to trying to figure out how to make a policy work best. But there are lots of trying to figure out how to make the policy work best.

• 38:53Robin Rauzi?

  And also like, yeah, know how the policy would work when it wasn't a crisis, right?

• 38:57Speaker 02

  Or when it wasn't temporary. I saw them present this research a couple of years ago when the study had its kind of first round of results and they were presenting what they had find at research conferences and they presented.

• 39:10Robin Rauzi?

  The child's first years research team?

• 39:12Speaker 02

  Yeah, the baby's first years research team. I saw them, fascinated to hear them talk about it. Like it's a testimony to how much the voice of the researcher was really robbed here that would be spoken of in polemic terms. The fact that I would be like, be screaming into a podcast microphone about the hypocrisy of people. Like and then if you would go back to that like relatively.

• 39:32Robin Rauzi?

  Very genteel.

• 39:33Speaker 02

  Muted seminar room of like, well, like, so this, you know, if you look at standard errors right here and like, if you think about this outcome existing on this metric, but like, you know, we weren't sure. It's just, it's like, it's so dry as it should be in a pure research context that the amount of emotions that it incites, I think it's a credit to the team that they can keep their eye on the ball.

• 39:53Robin Rauzi?

  Yeah.

• 39:54Speaker 02

  And that they are laser focused on understanding poverty among children and not co-opting it for purposes like that's, it speaks volumes for the people who are running the project.

• 40:04Robin Rauzi?

  How long is the study going to run? Do we know? I mean, I know sometimes these things get just sort of extended if there's funding. This is an expensive study to run. I mean, that's got to be, I mean, just for the cash payments, $400,000 a year?

• 40:18Speaker 02

  Yeah, right? Hold on.

• 40:21Robin Rauzi?

  Warning, journalist doing math.

• 40:24Speaker 02

  Yeah, so I would assume that these guys will keep going and that they will, you know, with funding request comes the ability to like show what you've done, what you've learned, how things need to change. And not for nothing, listeners, it's pretty hard to do a study that involves young children. You have to get a ton of permission. You can't just like halfway through be like, you know what we should do? Give them all a soda and make them run on a treadmill. Like this is not, we are not Stanford psychology professors in the 70s like locking kids in dorms and turning them into class warfare. Like this is very different. Like you cannot do anything in a study involving children without getting a lot of people's permission first because you're not supposed to mess with them. And

• 41:09Speaker 02

  so that they, I assume that when they go back for funding, they're also, they had to register every test and outcome that they were going to do before they even recruited the moms for, into the study. So, you know, it's not, it's not quite fly by the seat of your plants. Here's 20 years and go figure it out. Only like researchers in the 50s got to do that. We have an IRB now. We ask for permissions. Children have protection. So I hope it keeps going. I assume it will.

• 41:38Robin Rauzi?

  I guess what I would ask is whether there are gaps in this research that you've taken note of, that you would like to see filled. You know, if you got a couple of years to study child poverty, would you want to do it and what would you do?

• 41:54Speaker 02

  Oh man, so there's mountains of research in this space. That's, and a lot, and it's really good. I think the ones that end up really being fascinating to me are about the relationship between income volatility in the household and the effect on children. So, you know, starting even 15 years ago,

• 42:14Speaker 02

  We started to understand that how unemployment of parents really starts to affect kids. And you can see that like your dad losing his job will affect your earnings trajectory.

• 42:27Speaker 02

  And the effect of income loss from labor, from the labor market can be really devastating, depending on the nature of the job loss, the depth of income. And we have bad recessions and we have layoffs, but I think the more common experience is to have really unstable earnings in general. It's not a permanent layoff. It's just that you have some crap job that's really hard to maintain. So there's a project going on right now that's looking at shift workers. And there's separately been projects that have been looking at like lifetime exposure to poverty and childhood over this period. And so I, wherever I would be, it would be there.

• 43:02Robin Rauzi?

  Somewhere in that space.

• 43:03Speaker 02

  It would be somewhere in that space of what is the relationship between the hallmark bad things that we associate with child poverty and like the various ways the labor market delivered them.

• 43:15Robin Rauzi?

  Yeah, I think that's because volatility is its own thing. Like it was as different from just being consistently steadily poor.

• 43:22Speaker 02

  Volatility is its own thing.

• 43:23Robin Rauzi?

  Unpredictability is, is, can be traumatic.

• 43:27Speaker 02

  This is gonna make me sound like a monster, but what makes these really hard questions that parents move heaven and earth to shield their children from bad things. And so to the extent that the labor market can have massive effects, the effect on the kid can be more muted or less acute.

• 43:43Robin Rauzi?

  It says a lot about parents.

• 43:45Speaker 02

  It says a lot about parents and kind of goes back to the pathologizing of the poor that, you know, we look at things like the child, the brain of a child who grows up in poverty has slightly different markers than the brain of a kid who doesn't. And it's really easy to say like, well, poverty makes people bad parents. And I don't like that conclusion. I've never liked that conclusion. I think success can make people bad parents too. I think a surplus of money in your household can also make you a terrible parent. I don't think it's fair to pathologize poor parents that way, but I do think that whether we like it or not, kids are exposed to our economy the day that they're born. Whether they have health insurance, whether their mom had to pay out of pocket.

• 44:27Speaker 02

  If she has time off for paid family leave, what kind of early childhood experience he has. I mean, that relationship and what are the ways that we can insulate childhood from the inequality of our labor market versus not? I think I would want to be there.

• 44:45Robin Rauzi?

  Yeah.

• 44:46Speaker 02

  So I hope that people who did the baby's first year study would be like, "So can you guys just do it? You're so much better at me." If you guys just want to do that, if you guys just want to expand a little bit.

• 44:55Robin Rauzi?

  Just want to like add that, add that on the side.

• 44:58Speaker 02

  This project isn't all-consuming and difficult enough. Do you want to do one for me? Okay. Executive orders.

• 45:10Robin Rauzi?

  Executive orders.

• 45:12Speaker 02

  You go first.

• 45:14Robin Rauzi?

  I just was in Seattle and took a passenger ferry. The stranger in Seattle was doing a issue dedicated transit and they proposed all these additional ferry routes that they would love to have in Seattle. And when you're there, there's so many waterways, you're like, "Yes, there should be a ferry from downtown to Ballard or whatever." And the article was explaining, you know, the difficulties of that. And then I came back and there was an article in the LA Times saying that there are proposals to add ferries in Southern California, which would also be amazing. And there used to be ferries from Malibu to Santa Monica and then maybe down, further down into the South Bay. But, you know, they're saying maybe they could go to Orange County or they obviously are boats that go to...

• 45:58Speaker 02

  Sorry, can you imagine an Orange County ferry? Nicest ferry you've ever been on.

• 46:04Robin Rauzi?

  Anyway, more ferries. That's my executive order. We should have more ferries.

• 46:07Speaker 02

  We should have more ferries? Weirdly enough, that reminds me of the miracle on the Hudson. When Sully lands the plane on the Hudson, that's like longtime New Yorkers were quick to point out that like, you know, the ferries got there pretty quickly.

• 46:23Robin Rauzi?

  Yeah.

• 46:23Speaker 02

  I'm late to work. Ferries don't move that fast. Plane in the Hudson, those things actually fly.

• 46:29Robin Rauzi?

  We don't, New York didn't even have a, I mean, New York actually made a really conscious decision to add a bunch of ferries in the last 20 years, right? So it can be done. I, you know, for us, it would only benefit the Westsiders and it would probably be largely a tourist sort of thing, but still get them off the 405, put them on a ferry.

• 46:49Speaker 02

  I want you to somehow become an, like a independently wealthy person that starts a 405 billboard campaign of like, you people should be on ferries.

• 46:58Robin Rauzi?

  Get on a ferry.

• 46:59Speaker 02

  My executive order is that I would like to have separate lines in the DC metro and even New York metro of people who know what they're doing versus not.

• 47:12Robin Rauzi?

  Yeah.

• 47:13Speaker 02

  And if you-

• 47:14Robin Rauzi?

  Kind of like the TSA pre-check line. It's like, I've traveled before.

• 47:16Speaker 02

  Like I've traveled before. I'm, this is me. I need the, the DC metro needs like a commuter gates.

• 47:23Robin Rauzi?

  Express lane.

• 47:24Speaker 02

  Express lane of like, I actually know how to put down the damn card and get through the gates.

• 47:28Robin Rauzi?

  Yeah. Yes.

• 47:29Speaker 02

  We need a express lane for experienced transit riders, whether that be metro or ferry. If you know what you're doing, you get to go first and fastest.

• 47:39Robin Rauzi?

  Exactly.

• 47:40Speaker 02

  Okay. Who is your spiritual sponsor, Robin?

• 47:43Robin Rauzi?

  My spiritual sponsor this week is my fairly new pair of sunglasses, which are excellent. And they remind me of you and your, what was it? Burgundy trench coat? Yeah. That I just feel super cool when I wear them in LA. And because I live in Los Angeles, I wear them daily. And yeah, I think there's nothing quite like a great pair of sunglasses.

• 48:05Speaker 02

  Oh man, I love it. All right. Randomly enough, my spiritual sponsor this week is Tommy Lee Jones' line in The Fugitive, "I don't care."

• 48:17Robin Rauzi?

  So funny. He's so good in that.

• 48:21Speaker 02

  He's so good. It is such a good movie.

• 48:25Robin Rauzi?

  It's such a good movie.

• 48:25Speaker 02

  It's hard, like, it's just so hard to encapsulate, like, like, the mood that is, "I didn't kill my wife. I don't care."

• 48:33Robin Rauzi?

  I don't care. Yeah.

• 48:37Speaker 04

  I didn't kill my wife. I don't care.

• 48:43Speaker 02

  I can't describe it, but I know it when I'm channeling it. Like, I'm Tommy Lee Jones right now, telling you, "I don't care if you killed your wife." And I felt it earlier today, and I was interacting with someone, and I just was like, "I don't care." And I'm like, "Tommy Lee, thank you, Texas boy."

• 49:02Robin Rauzi?

  Love that movie. I saw that at Mann's Chinese, when it first came out, Mann's Chinese Theater in Hollywood. And that bus crash at the beginning of the, it was amazing. It was amazing in the theater. I still think about it. But yeah, he's, Tommy Lee Jones is so great in that.

• 49:17Robin Rauzi?

  All right, that's our show.

• 49:19Speaker 02

  This is one of our episodes that we end with, my B, y'all. We tried. We tried to be real podcasters, and now you have to fix it. Really appreciate all your time.

• 49:29Robin Rauzi?

  Twenty-three reasons I hate your podcast.

• 49:33Speaker 02

  At the end of our show, we like to thank the people that we pay to make us sound like a real show. Andy and Sophie, cannot thank you enough. Video and audio production, we would be lost without you.

• 49:46Robin Rauzi?

  Also, I should say, follow us on YouTube, especially, but to see clips of the show. And also, we're on Instagram and TikTok and maybe Blue Sky? No, not on that one.

• 50:00Speaker 02

  LinkedIn, though.

• 50:01Robin Rauzi?

  On LinkedIn. So, follow us on social media, too. Thanks.

• 50:14Robin Rauzi?

  Gonna have to work on that.