Dads Against the Divorce IndustryDA*DI is devoted to reinstating the societal valuation of Marriage and the traditional, nuclear American Family, with particular emphasis on the essential role of FATHERS. DA*DI offers contemporary reports and commentary on culture; its aberrations and its heroes. |
"Divorced Dads: Shattering the Myths"
|
Basic responsibility for administering the program is left to
States, but the Federal Government plays a major role in: dictating
the major design features of State programs; funding, monitoring and
evaluating State programs; providing technical assistance; and
giving direct assistance to States in locating absent parents and
obtaining support payments. The program requires the provision of
child support enforcement services for both AFDC and non-AFDC
families and requires States to publicize frequently, through public
service announcements, the availability of child support enforcement
services, together with information about the application fee and a
telephone number or address to obtain additional information. Local
family and domestic courts and administrative agencies handle the
actual establishment and enforcement of child support obligations
according to Federal, State, and local laws.
With minor exceptions, the child support program does not provide
services aimed at other issues between parents, such as property
settlement, custody, and access to children. These issues are
handled by local courts with the help of private attorneys. ...
Clearly, although the IV-D program has been growing steadily
since 1978, and although its performance on many measures of child
support has been improving, the improvement appears to have had only
modest impact on the national picture. How can these two trends be
reconciled?
The last panel of table 9-9 suggests an answer. This panel shows
collections by the Federal-State program as a percentage of overall
national child support payments. In 1978, less than one-fourth of
child support payments were collected through the IV-D program. This
percentage, however, has increased every year since 1978. By 1991,
more than 60 percent of all child support payments were made through
the IV-D program. The implication of this trend is that the IV-D
program may be recruiting more and more cases from the private
sector, bringing them into the public sector, providing them with
subsidized services (or substituting Federal spending for State
spending), but not greatly improving child support collections.
Whatever the explanation, it seems that improved effectiveness of
the IV-D program has not led to significant improvement of the
Nation's child support performance.
As measured either by expenditures or total collections, the
Federal-State program has grown about tenfold since 1978.
When Congress enacted the child support program in 1975, the
floor debate shows that members of the House and Senate supported
the program primarily because retaining AFDC collections would help
offset AFDC expenditures.
The point here is that although AFDC collections are growing,
non-AFDC collections are growing much faster. And since the State
and Federal Governments receive virtually no direct reimbursement
for non-AFDC expenditures, the child support program loses more and
more money every year.
As shown in table 9-1 above, AFDC collections have in fact been
rising every year since 1978, growing from less than $0.5 billion in
that year to nearly $2.7 billion in 1995. Equally important, the
child support agencies collected a level of payments on behalf of
AFDC parents that equalled 13.6 percent of all AFDC benefits in
1995.
Of course, it will be recalled that despite this impressive rise
in AFDC collections and cost offset, the overall impact of the child
support program on taxpayers is negative. As shown in table 9-5,
taxpayers lost over $0.8 billion on the program in 1995 and the loss
has increased every year since 1988.
By 1989 the overall ``savings'' in the combined program went
negative. For the first time that year, Federal losses exceeded
State gains--by $77 million. The net losses have increased almost
every year, reaching $826 million in 1995.
The point here is that although AFDC collections are growing,
non-AFDC collections are growing much faster. And since the State
and Federal Governments receive virtually no direct reimbursement
for non-AFDC expenditures, the child support program loses more and
more money every year. Why, then, critics ask, should the Federal
Government encourage greater expenditures by providing incentives
for non-AFDC collections. Ignoring for the moment possible social
benefits from the non-AFDC Program and based entirely on a public
finance perspective, some critics argue that non-AFDC incentives
encourage inefficiency.
(NOTE:) Although the number of families with a mother who has
divorced has tripled since 1970, the number with a mother who has
never married has increased fifteenfold from 248,000 to 3,829,000.
Another good measure of child support performance is the impact
of collections on poverty. In 1991, 1.26 million (24 percent) of the
5.3 million women and men rearing children alone who were supposed
to receive child support payments had incomes below the poverty
level. If full payment had been made to these custodial parents and
if none of these families had received welfare payments, only
140,000 of them would have received enough income from child support
payments to put them above the poverty level (U.S. Bureau of the
Census, 1995, pp. 7 & 26). Thus, the potential of child support
to greatly reduce poverty appears to be modest.
Defenders of child support financing respond by pointing out that
allowing States to profit from the program makes it very popular
with State policymakers who control funding of the State share of
expenditures. Without financing arrangements favorable to State
interests, according to this view, the child support program would
not have posted the impressive gains that have characterized the
program since its inception in 1975.
The method of financing child support enforcement has received
considerable attention in recent years. Perhaps the most important
issue is that States have little incentive to control their
administrative spending. The last column of table 9-4 presents a
measure of State program efficiency obtained by dividing total
collections by total administrative expenses. The table shows the
dramatic differences among States in how much child support is
collected for each dollar of administrative expenditure--a crude
measure of efficiency-- ranging from only $1.78 in Arizona to $8.58
in Pennsylvania. And yet, most States, including those that spend up
to three or four times as much per dollar of collections as more
efficient States, still make a profit on the program.
Table 9-5 shows one consequence of child support's financing
system. The first two columns of the table show the net impact of
program financing on the Federal and State governments respectively.
The Federal Government has lost money on child support every year
since 1979, and the losses have grown every year since 1984.
Overall, losses have jumped sharply from $43 million in 1979 to
$1.257 billion in 1995.
State governments by contrast have made a profit on the
program every year. In 1979, the first year for which data are
available, States cleared $244 million on child support. By 1995,
States cleared $431 million. As Federal losses have mounted, State
profits have increased. |