Improving Children's Lives

First published in 1996. For the last three decades, the public income transfer system for families with children in the United States has been criticized for being overly targeted on extremely poor families headed by single mothers. Most criticism has focused on two features of the system: its categorical nature and its reliance on income-tested benefits. Categorical requirements for eligibility, which limit benefits mainly to single-parent families, have been criticized as unfair to two-parent families and as discouraging marriage. Income-tested benefits have been reprimanded because they discourage work in that they reduce benefits by extremely high rates as earnings increase. To remedy these shortcomings of the over-targeted system, the author discusses three policy proposals, all providing universal benefits: (1) a refundable tax credit for children; (2) universal health care coverage; and (3) a child support assurance system.