Innovations in Poverty Policy

The Taub Center’s annual Herbert M. Singer international policy conference in 2016 was on the topic of poverty policy in Israel and abroad, new developments in the field, and an examination of Israel’s current and future approaches to combatting poverty.

Date: December 01, 2016

The Taub Center’s annual Herbert M. Singer international policy conference in 2016 was on the topic of poverty policy in Israel and abroad, new developments in the field, and an examination of Israel’s current and future approaches to combatting poverty.

The conference, attended by over 150 participants, consisted of lectures and panels on the following topics: poverty and poverty policy in Israel today, a social capital approach to poverty, child development accounts in an international context, experiments in universal basic income, and evaluating progress since the Elalouf Committee for Combatting Poverty released its recommendations two years ago.

The day-long conference kicked off with opening remarks from Col. (Res.) Miri Eisin, an esteemed member of the Taub Center Board of Directors, Mr. Jay Sandak, President of the Herbert and Nell Singer Foundation, which generously sponsors the conference, and Prof. Avi Weiss, Executive Director of the Taub Center.

Prof. John Gal, Principal Researcher and Welfare Policy Program Chair at the Taub Center, provided context for the state of poverty in Israel today. He explained that there are over 1.7 million poor individuals in the country (over 400,000 poor households), and that nearly 40% of Israelis cannot cover all of their monthly household expenses. “Another thing that should worry us” he said, “is that, when we compare ourselves to other welfare states, Israel’s poverty is greater than all other OECD countries except for Mexico.” He continued on to say that this situation must be addressed by the government because “there’s no doubt that one of the responsibilities of a modern welfare state is to deal with poverty.” Gal set the stage for the conference, stating that it would focus on new ways to combat poverty and innovative approaches to creating poverty policy.

Click here to view Prof. Gal’s full presentation.

Keynote speaker, Prof. Avner De-Shalit of the Hebrew University, addressed the audience after Prof. Gal. He stated that, to better tackle poverty, we need to be able to understand and measure it. Prof. De-Shalit proposed an approach to understanding poverty through the framework of assessing real freedoms and opportunities available to people who are poor. Prof. De-Shalit gave the example of a single mother who can only get a job that requires her to commute over an hour each way. While this single mother is employed and can physically get to her work, this is not a genuine opportunity because the distance and long hours force her to choose between working and being a mother. “Poverty and disadvantage,” De-Shalit said, “is when one’s functionings [or, ability to take action] are at risk in an involuntary manner, and disproportionally to other people’s functionings.” He emphasized the importance of consulting with people who are themselves in poverty to learn what real opportunities are most important to them.  He also added that one approach to tackling poverty is to enhance interpersonal relationships, such as friendship and social networks, which have a positive effect on factors such as employment and health.

Click here to view Prof. De-Shalit’s full presentation.

The panel that followed focused on the implementation of child development accounts around the world. The panel included three speakers from the Center for Social Development (CSD) at Washington University, who have been intimately involved in the issues of child development accounts for decades, and partnered with the Taub Center on the Center’s policy brief on the topic published in the Summer of 2016. Prof. Michael Sherraden, the George Warren Brown Distinguished University Professor and founding director of CSD, spoke about moving toward “asset-building” policies to combat poverty. Sherraden argues that these types of policies are better at combatting poverty than immediate cash transfers, as they help individuals build resources over time while having the added non-monetary benefits of encouraging saving behaviors and creating a sense of ownership among recipients.  They are even more effective, he argues, when they are distributed universally and begin as early as the birth of a child. “We often think about how to get poor people through the next month, but we need to think about investing in the future of people in poverty,” he said. Ms. Li Zou, International Director of CSD, gave an overview of child savings accounts policies that have already been implemented around the world in places like Singapore, the UK, South Korea, Hong Kong, and China. “Child development accounts are emerging worldwide,” she explained, “and have the policy potential to benefit a large population. There is also a growing body of international research on the subject.”

Click here to view Prof. Sherraden’s full presentation.

Click here to view Ms. Zou’s full presentation.

Prof. Michal Grinstein-Weiss, founding director of the Envolve Center for Health Behavior Change and associate director of CSD, presented next, on Israel’s new policy that opens a child savings account for all children under the age of 18, beginning in January 2017. Prof. Grinstein-Weiss has been involved in the development of child savings accounts in Israel for a decade and has advised the Israeli government on the matter. “The most exciting thing about implementing child development accounts in Israel is that we already have the existing infrastructure here,” she said. “The idea is to build on the already existing child allowances and education systems.” Prof. Grinstein-Weiss claimed that the new policy was able to pass in Israel now because of public perception of growing inequality in Israel, demands from ultra-Orthodox parties for an increase in child allowances, and the Finance Ministry’s interest in creating more financial literacy among Israeli citizens.

Click here to view Prof. Grinstein-Weiss’s full presentation.

The next panel discussed experiments in universal basic income. Prof. Olli Kangas from the Kela Social Insurance Institution in Finland discussed his involvement in an experiment to test this policy in his home country. As he explained, the experiment sparked many discussions in Finland about the effects of instituting such a policy, including how this type of model in Finland would fit into the context of EU legislation and whether it would incentivize more immigrants to come to Finland to receive the basic income. The study, which will provide an income of about 560€ per month to 2,000 participants in Finland, will begin in the next few months. Prof. Kangas shared some of the challenges of the study saying, “basic income is a nightmare to implement in the infrastructure of Finland and other Nordic Countries. Introducing a seemingly simple concept into a very complex social policy system is not that easy.”

Click here to view Prof. Kangas’s full presentation.

Prof. Daniel Gottlieb of the National Insurance Institute of Israel commented that, in his opinion, “the smart thing to do in response to the trend of computerization in the labor market is to be ready with a universal basic income.” In response to the challenge that universal basic income could reduce the incentive for people going out into the labor force, Prof. Gottlieb argued: “There has only been a minor decline in employment due to the implementation of basic income in places where it has been tried.” Dr. Lia Etinger of the Shaharit Institute focused her comments on the social shifts and change in lifestyle that would necessarily accompany the adoption of a universal basic income. “In order to implement basic income, we need to first build a culture that fits with a basic income model,” she said. Instead of our current model of employment where people often find little meaning and are disconnected from the work that they do, “we have to develop a different idea of what it means to contribute to society.”

The final session of the conference dealt with evaluating progress in the two years since the recommendations from the Elalouf Committee on the War Against Poverty were released. Prof. Shlomo Mor-Yosef, Director General of Israel’s National Insurance Institute, acknowledged that only 58% of the recommendations that emerged from the committee were implemented, but that indicates greater success than many other committees. He noted that “there is way more to do. But there has also been a lot of progress already since the Committee put out its recommendations.” In fact, he continued, “today is a holiday for Bituach Leumi because today 1.3 million letters were sent out to parents notifying them about the new child savings accounts program in Israel.” Prof. Michal Krumer Nevo of Ben-Gurion University talked about the difficulties in addressing poverty when a full-time social worker’s caseload is 125 families at a time, which means meeting with each family only once every couple of months. She argued that the average caseload needs to be reduced, in keeping with the Elalouf Committee’s suggestions, to 50-60 families at a time. Prof. Krumer Nevo further said that “good practice and good policy in this area need to be based on professionals in the field believing in people who are in poverty.”

Mr. Kher Albaz spoke about poverty in the Negev, particularly among the Bedouin community. In the South, about 50% of those picked up by the police are Bedouin, even though they make up a much smaller percentage of the population. “If you really want to have an impact on combatting poverty in these areas,” Albaz said, “you need the involvement of the government, the local municipalities, the business sector, the non-profit sector, and the involvement of the communities themselves. They know best where and how the community is hurting.” Ms. Ruti Yehoshua from the Forum for Fighting Poverty, who also sat on a sub-committee of the Elalouf Committee, spoke about her own experiences growing up in poverty and continuing to struggle with poverty as an adult. “We must understand that poverty has consequences in the long term and even on the following generation,” she said. “To tackle these problems, there must be collaboration with people who really experience poverty first-hand.”

Click here to view Ms. Yehoshua’s full presentation.

MK Elie Elalouf (Kulanu), who headed the Elalouf Committee between 2012 and 2014 and is currently the chairman of the Knesset Labor, Welfare and Health Committee, responded to the speakers on the panel, saying that poverty will never disappear and that we will always need to combat it. However, we must continue to try to improve the situation. For example, MK Elalouf stated: “our goal is that, by 2018, there will not be an elderly person who is living under the poverty line. I’m not talking about way in the future. I’m talking about budgets that we are discussing right now.” He continued on to discuss a more general approach for combatting poverty: “fighting poverty is cross-sectional, cross ministerial, and encompasses many parts of our life,” he said. “Benefits are not enough. Benefits alone cannot pull someone out of poverty. Only a conjoined, cross-sectional approach can do that.” MK Elalouf also commented on the Taub Center’s work as part of his remarks: “Here, I need to praise the Taub Center. Never stop doing what you are doing. You have no idea how my perspective has changed since I read your report.”

The Taub Center’s 2016 international conference was a great success, bringing Taub Center researchers, international experts, and participants from a wide array of backgrounds together to discuss an extremely important area of Israeli policy. We thank all of those who joined us to participate in this conference.