New York City is starting a new anti-poverty program that will reward good behavior with cash. Supporters of the so-called "Opportunity NYC" program say it will help lift people out of poverty. Detractors say giving cash for basic responsibilities does not address the root causes of poverty. Victoria Cavaliere reports from VOA's New York bureau that similar programs have also been instituted in Mexico and Brazil.
The two year pilot program is an initiative of New York Mayor Michael Bloomberg. It will kick-off in September with about 14,000 participants from some of New York's poorest communities. The program is being privately funded by foundations and by Bloomberg himself. If the pilot is deemed successful there are plans to roll it out as a tax-supported government program.
According to Bloomberg, the program is aimed at alleviating some of the financial setbacks poor families can face, such as foregoing a wage to take a sick child to the doctor. Under the program, the parent could receive up to $50 for taking his or her child in for medical care.
Students who improve their scores on standardized tests will be rewarded with up to $350. Adults who maintain a full time job can earn up to $150 per month. All told, the awards could add up to between $3,000 and $6,000 per year.
Currently, the poverty line in the United States is at just over $17,000 per year for a family of three.
Linda Gibbs, New York City's deputy mayor for health and human services, says the pilot program will test whether cash awards can help people trapped in a cycle of repeated financial difficulties.
"Does the cash incentive change people's behavior? Families are sometimes holding down two jobs or raising three of four kids. The choice whether to go to that extra school meeting could often be a choice about leaving a child without attendance or whether or not go to a job where you earn an hourly wage. It very much is trying to change the dynamic of each of those decisions," she said.
Cash awards would be paid for keeping up with routine medical care. Families can earn $25 to $50 per month for making sure their children attend school 95 percent of the time. Adults who complete job training or new courses will receive a $400 reward.
All these cash bonuses have their critics. Some detractors say the program does not address the root causes of poverty or inequities in the U.S. social structure, such as a lack of health care or benefits for full time workers.
Heather Mac Donald, a fellow at the Manhattan Institue of Policy Research, says she does not think the program will change behavior. Just the opposite. "I think it could end up being the most destructive welfare system ever devised because it tries to pay people for behavior that should be part of the ordinary repertoire of responsible behavior towards one's self and one's children," she said.
Bloomberg's camp points out that New York is not the first place to use cash awards to fight poverty.
In April, Bloomberg traveled to Mexico to study a similar program called "Oportunidades." Five million Mexican households now participate in the program, which began as a small, rural initiative in 1997.
"Oportunidades" is credited with decreasing poverty and improving health and education in regions where it has been instituted.
Similar cash awards programs also exist in Brazil, Turkey, Honduras and Malawi.
Gibbs says the pilot program in New York will take on a unique structure. "It's not just a question of whether the incentives change behavior today. It's also the question about whether that incentive can change behaviors over the long term and adopt the practices and outcomes that we know are related to reducing the poverty that is handed down from generation to generation," she said.
To measure the effectiveness of the New York City program, a control group will not be paid but will be studied by participating in regular surveys, interviews and reviews.