Benefits Cliffs. Anti-poverty benefits should be support towards a fulfilling future not a trap.

What are benefits cliffs?  Simply put sometimes Americans reliant on anti-poverty benefits can't afford a raise or a better job.  Incremental increases in income can make them suddenly and disproportionately ineligible for multiple benefits.

Benefits are a safety net not a trap that creates a disincentive to self-improvement.

 Can government address the benefits cliffs by providing a softer landing towards fulfilling work and economic freedom instead of a hard fall?  There's a new tool available to policy makers which allows them to identify the problem in order to formulate a solution.

Ryan's guests are Kelsey Underwood, Product Manager at Georgia Center for Opportunity and Erik Randolph, Director of Research there.

Policy makers can go to https://benefitscliffs.org/ and see if their state is currently available for analysis. 

To learn more and see how AFP-Arkansas can help you or your organization increase your impact in our state, email us at infoar@afphq.org or visit us at believeinar.com.

Transcript

ANNCR: 0:03

Welcome to Believe in Arkansas, where we believe free people are capable of extraordinary things. Now, here's the host of believing Arkansas, Ryan Norris.

Ryan Norris: 0:19

Good afternoon, everyone. Thank you for joining us for another segment of Believe in Arkansas, where we believe that free people are capable of extraordinary things. You know, Arkansas one of the things I like about our state is that it is underestimated in all kinds of ways. We have great people here we have people that are overachievers in their areas of industry or education, we have a lot to really be excited about as a state. But we also know that we have things that we have to work on one of those areas is poverty. We we know that Arkansas is ranked number six in the nation on poverty and many, many programs have been designed to try to help people out of poverty. There are been nonprofit work, there have been businesses that have contributed to try and to help solve the problem of poverty. But would you be surprised if I told you that sometimes the systems that are designed to help actually keep people in a cycle of poverty, and they cease to be safety nets, and they become traps to individuals trying to improve themselves. And so to talk about the issue of poverty and benefits, particularly the issue of benefits cliffs, we have with us from the Georgia center of opportunity, Kelsey Underwood, who is the product manager, and Erik Randolph, Director of Research for the Georgia Center for Opportunity. Kelsey. Erik, thank you for joining us here on Believe In Arkansas.

Kelsey Underwood: 1:44

Thanks so much for having us, Ryan, we're excited to talk about it.

Ryan Norris: 1:48

Well, I'm excited about this tool, Erik, you know, this is a really, really interesting, interesting tool. And I know you've done the research on it. And Kelsey, you've done the, you have kind of told me about how we were going to be able to use this product. But the first thing we're going to need to ask guys is what is the benefits cliff?

Kelsey Underwood: 2:07

Absolutely. So random benefits cliff is essentially when someone is receiving welfare or benefits from the government. And they hit an earnings rate or an hourly payment rate that can drop them off of those benefits programs. That's when they experienced the benefits cliffs. So in a lot of states that's in the teens region that between, you know, 13 to 17. And it just depends on what the family construct is, how many children people have things of that sort. But essentially, what happens is there comes a point at which if someone earns just slightly more money, they lose a lot more in benefits, which makes it an economically unreasonable decision for them to continue progressing within that job or continuing to receive raises or promotions, because they can't compensate for the loss of the benefits.

Ryan Norris: 3:01

Yes, and you hear about this about individuals that that, you know, they make just a little too much money, and they're knocked out of food assistance, or child care or health benefits. So, so thank you for giving us that that definition. You know, Erik, I know you'd have something to probably add to that.

Erik Randolph: 3:18

I do, you mind if I just add to Kelsey to Kelsey's comment. So it's not just always earning, you know, like a higher wage. It's also when people might be working part time, or they might be offered to work overtime. And they might refuse it because we have a lot of employers come up to us, for example, and they say, Hey, you know, I can't get people to come and work overtime, or someone's only working 30 hours a week, and they don't want to work 40 hours a week. And sometimes what that is, is the is what we call the safety nets benefits clip. Because because they don't want to be pushed over that amount that they're earning where they would lose benefits. So it's not just earning more money, it's also working more hours that's impacted.

Ryan Norris: 4:01

Yeah, I think that that that's a very good point, because that's gets brought up but sometimes really good employees because of that difference between what they would lose in a benefit and what they would make work in the extra hours. They ought not to work, and they're really good employees, they just won't take that financial trade off. They're

Unknown: 4:19

exactly, I just want to add something really quick to that. We actually have research by a PhD candidate who just did some econometric study and all preliminary results, but he's actually coming up with empirical evidence that it's just not employers coming to people and complaining that there's actually there's actually data that supports that this is happening.

Ryan Norris: 4:45

Well, that brings me to the question of how, how do benefits cliffs impac, you know, in general, we're talking about that but are there ways that you know, we can talk about that in terms of Arkansas? You know, what are what are some thoughts around that,

Unknown: 5:02

in terms of impact on individuals exactly where they would need it. So the one the one thing about benefits cliffs that gets a little bit confusing is it really depends on the family structure. So it comes down to how many children do you have, you know, what are the ages? Exactly what county Do you live in? And then the actual benefit clauses for those situations change? So it's, it's not that it's not that you would have one, you know, like answer across the board, it would be for you know, in Little Rock, what would be your benefits cliff, if you are a single mom with two kids. And and the other thing that makes it a little bit confusing, is that it's also when I just got it, I blanked out. Another thing, that's another thing that's confusing is, it's not just one cliff. That what you find is if you look over the total range of earnings that someone might earn, there's multiple places where you have cliffs, because for example, there might be a cliff, when you know, they come off of subsidized childcare, they might be another cliff, when they lose their food stamps, they might be even a third cliff, if they're in housing or another cliff, if they're coming off of Medicaid. So what you're finding is that, that over for a particular family over a range of earnings, there's probably four or five different benefit clips they might run into.

Ryan Norris: 6:36

Yeah, that's a very good point. It's not just one, there's several on the way. So each time, they're having to weigh that trade off of the extra hours, the extra money be made by a promotion, the extra time to work, etc. So very, very interesting. For an example, Kelsey, I think there was a in the notes, we talked about, you know, points of close for most people, and there was a little bit of an example with like a single mother with two kids. Can you kind of talk through that example with us to humanize this a little bit?

Kelsey Underwood: 7:13

Absolutely. And this is one of the really critical things about or I guess the really important tools and functions of the calculator that we created is that you can, as Eric was saying, and put all of that information to understand what that looks like for different people. But a lot of times, the individuals that we deal with on a day to day basis, and some of our programs and just the community are the single mothers with two or three children. So specifically in the state of Arkansas, if you run our model, a single mother with two children who's not married, and I think Eric can talk about marriage penalties when it comes to cliffs as well, because that is a contributing factor along with, you know, pay rate and number of hours and total income, but single mother of two kids, she's really hitting that cliff and about $17 an hour, which seems relatively high, but the problem is $17 an hour, she's taking home, if she's taking home all of our benefits, it's about $88,000. But we're looking at, you know, top line payment of 34,000 a year 88 Is her total take home with benefits. And if you think about how much money she would have to earn in order to recoup that total take home, it's going to be in the you know, the 40 to$50 an hour range, which is quite a big jump from $17. So it's really understanding how we're bridging that gap. Or, if you will, kind of creating a bridge between these cliffs or these these income points.

Ryan Norris: 8:42

Right. Right. And so, you know, she's taking home, you know, in the 30s, or she's she's making in the 32nd, home probably in the 20s. And then on top of that, though, the benefits runner up to about$88,000 roughly a year. And so that's, that's a lot of money. So she would need to make a equivalent of 88,000 to stay, you know, to the good. Yeah.

Kelsey Underwood: 9:09

If she's receiving all the benefits, then yeah, absolutely.

Ryan Norris: 9:12

And so we can talk about in a little while, I definitely want to get down to the idea of concepts of some of the reforms can happen to where she can, you know, that most single mother was still be able to maintain benefits as she works towards that 88,000. The question that would have fallen, but there's the, you know, Georgia center for opportunities come up with a tool to kind of show where these benefits cliffs are, and also has a smoothing tool to where it kind of shows what the performance could potentially do. But how is this tool different from others that are on the market?

Kelsey Underwood: 9:46

Yeah, and I definitely want to give Erik a chance to talk about it because He has created this entire model. He is the brain behind this. He has done years and years of extensive studying. And one of the, as a prodouct person, as the person who's in charge of making sure that everyone can access it right? There are a couple of really interesting and unique aspects of, of what we do. One of them is that we have over 18 programs and or variables in our system, or in our model, and to my knowledge, that is the most of any other competing product out there. And that's important not because we want to add complexity, because we actually keep it a pretty streamlined process for the website. But because we want to factor in as much information as possible to empower policymakers to then be able to manipulate those different variables in order to come up with the optimal solution. Right. So that's a big piece of it. And another piece is that, you know, we're in 13 states right now, and counting. And one of the things is, you know, state by state, we really like to work with people who are encouraged and passionate about making these changes. However, a lot of these programs are federal level programs. And in order to make an impact on a national level, on a federal level, we really need to have a groundswell of states that are saying, this is a problem here. This is a problem that we need to solve, and we need to solve it together. And we need to solve it as a collective. Because we can only do so much within our states before we have to go to that, you know, federal body and say, hey, look, we have we have to change these these policies as well. Erik, do you want to add anything to that?

Erik Randolph: 11:28

Yeah, I mean, Kelsey did a really good job describing it, the one thing I want to add is we actually have a team. And we have a person on our team who, who used to work for Pennsylvania's department of public welfare. He was a person who actually worked with the eligibility systems and these actually on our team now. And it's really enabled us to, to really refine our model. So we have a fairly high level of competence, that, that we're producing good results. And, you know, some some other models out there, you might have somebody interested in the topic, or you might have some economist, but we actually have somebody that actually helped run programs. So he just has a wealth of knowledge. And probably there isn't a person in the country that knows more about eligibility. And we just break it down to, you know, what do the rules and regulations actually say? And then we convert that, you know, into algorithms, and then it spits out an answer to demonstrate what's actually happening.

Kelsey Underwood: 12:31

I think another important thing to just highlight really quick, Ryan, is that you know, our model currently, what we have on our website, visualizes the problem, but in a quantifiable way. So for years, we've had anecdotal evidence, and we've known that this is an issue. But this is really the first time that we've taken this many programs and this many inputs and put them into a graphical model where you can look at it and say, this is exactly where that cliff is. This is exactly where that single mother of two or three children is having to make a decision when she gets offered a raise to say, No, I can't take that, or Yes, I can. So it's important to model the problem. But I think in addition to that, one of the things that I'm most excited about are some of the solutions that we're coming up with. So you mentioned the smoothing tool. You know, Erik, again, is brilliant, and humble as well. But he and his team are coming up with a couple of tools that not only demonstrate the depth and breadth of the problem, but also can help model some of the solutions as well. So we do that not only on a mathematical and kind of graphical level. But we also do work directly with some states to provide, you know, policy recommendations and coaching and sort of suggestions around what they can leverage right now in the medium term or the short term to make changes on a local and state level.

Ryan Norris: 13:58

And so that sets us up right for the next question of, you know, how can this be used? And I know, Erik, you've got some ideas on what policymakers can potentially do and how they could use this tool to kind of see where the where the pitfalls are.

Erik Randolph: 14:12

Yeah, so the tool that we've developed actually shows where the problems are. So you know, the best way thinking about it, it's a computational model. So basically, what we're doing is we're calculating, you know, there's literally millions of calculations to take place, and we spit out the answer. But the next step, and this is what we're currently, you know, in progress, right? We're working on this, we have a smoothing tool. We it's not yet available on the website. We were working to get that up. But we also are working on what are the solutions. In fact, we testified before Kentucky, they have their legislature has a taskforce on on welfare cliffs and we testified giving them a number of ideas of solutions. And I'm kind of the mind that if you're going to come up with solution, you have to test it with the calculations. It's not it's not good enough to just kind of list, you know, this is a solution. And without actually going through and calculating how's that going to change the model? You know how we need to put in the model? And then see, oh, this is what it would mean for individual families. So did that idea actually smooth out the curves? Or? Or does it still exist? Or does it show up in another place? And and if you don't actually do the calculations, you're not going to get the answer.

Ryan Norris: 15:34

Yeah, I love that feature. Because again, the idea behind the smoothing tool is to go into the reforms, to where when the single mother is up for a promotion or a raise or extra hours, that she would not be concerned about losing the complete benefit that possibly they set up a sliding scale, ratio that out in some way. So where she makes $50 More a paycheck, but she's not knocked out of $200 worth of safe food benefits, hypothetically.

Kelsey Underwood: 16:05

Make it a soft landing, not a hard fall.

Ryan Norris: 16:07

Yes, yes. And so not keeping her stuck in a vicious cycle of coming to the cliff and fallen going back going to the cliff coming back. There's actually a pathway by which she can self actualize herself off of the benefit. Exactly. And it's not it's not just a policy piece to and we can talk about that more. But you have more to add, Erik?

Erik Randolph: 16:32

Well, yeah, I mean, it's actually the problem is actually a little worse than we described. And there's actually a gentleman he's he's a professor of economics at a Winston State University, Winston Salem State University, and he's done research in this area as well. And what he's saying is one of the concerns is it's not just the cliff, everybody's like looking at the wow factor, like, oh, you get to the cliff, and oh, no, you fall off the cliff. But if you actually kind of look at the data, and what it's showing you, it's actually a fairly flat area normally, before you get to the cliff, so So you actually have a range of income, where there's no incentive for them to earn anything more. And so it's not like you find a whole bunch of people hanging on that the edge of the cliff, you what you find is like in that plateau, leading to the cliff, you can have a whole bunch of people kind of hanging out there, but they've losing their incentive to work more, or they're losing their incentives to earn more money. And that's just as big of a problem as as the cliff bell.

Ryan Norris: 17:37

Yes. And so policymakers can look at this tool, look at the smoothing tool, and start identifying where they can play with the math and the criteria to allow those those benefits to last, at least at lower amounts as we move up the income on the income side. But it's better than keeping someone stuck for life, you know, on that benefit, if there's no way for them to get off?

Kelsey Underwood: 18:09

Absolutely. And I think you know, a lot of people when you talk about this, especially, you know, our partners on maybe the other side of the table, assume that it means giving people less support, it doesn't always mean that sometimes it just means reallocating, or redistributing, in a way that doesn't disincentivize people from progressing in their life. And like you said, self actualizing flourishing. And that's really at the end of the day, what we're trying to accomplish with this. And what we hope others are as well is just giving people a smoother path to work their way off of dependency rather than staying in that cycle for the rest of their lives.

Ryan Norris: 18:51

Right. And I've had conversations with friends of mine who are service providers, who have a left of center approach to their politics, but they do agree that no one is happy staying in this area, that there are people who they want to increase the size of their bank accounts, their savings accounts, they want to buy cars, they want to buy houses, they want to buy all these things, they want to increase their individual, you know, wealth for their family. And these cycles, of vicious cycle of the benefits cliffs keeps them falling back and back. And so this is kind of where the seeds for generational poverty are established. Because no one no one is able to take the bet to improve themselves enough to to maintain at least a quality of life when we're talking about quality of life in the poverty area. Right. You know, they're they're not necessarily comfortable there. They just can't get out and benefits plus I think assaults are both at the policy side. But there are other ways that this tool can be used by business and SEC nonprofit that, that would again would be easy for them to use to see where the problems are with their employee? And tell us a little bit about that.

Kelsey Underwood: 20:07

Yeah, absolutely. So, you know, it's, it's interesting, because in the software world, a lot of times you build a product, assuming one target audience, right, that's that's kind of the goal is to stay focused on one. But what you find is that when it goes out into the world, there are actually other individuals that you maybe didn't expect, that find it really valuable. So one of those things, a couple, a couple of those groups that we discovered, are service providers and businesses. So with with our service provider, friends, we have some individuals and South Carolina's and people that are going to be using it in Utah and some other states as well, who are working face to face directly with the, you know, the populations that are impacted by these cliffs. And it's almost a tool for coaching for them or mentorship to say, look, here's where you are, here's the job that you want to take, here's how much it pays. And let's just be prepared for this because maybe in a year, you're going to be inching closer to that cliff. So what are some community resources free or low cost resources that we can provide to you that might supplement or replace the benefits that you're losing so that you don't have to make that decision? When you get to that point? Right? Let's get out in front of that, let's be proactive instead of reactive about it. So that's been a really effective thing. But I think the most interesting thing for me was the feedback that we got from a couple of significantly large employers, we're talking national level employers, of which most employ a lot of individuals at this level at this socio economic level. And one of the interesting pieces of feedback we got from one is, you know, with the market, the way that it is, we keep trying to offer people more money to take these jobs, and we're getting less applications as we offer more money. And that makes no sense to me as an economically rational person. That doesn't make sense to me. And what they found was when we ran the numbers through the model, and that state, that they were offering an hourly rate that was significantly larger than the benefits cliff, I think the clip was at $15 an hour, and they were offering $19 An hour or something like that. So sometimes the math doesn't make sense, because people aren't aware of the dynamic of the cliffs. But once we made them aware of that, they said, Oh, my gosh, if I had known that this were an issue that this was the reason that we weren't getting applicants, or this was the reason that people are quitting without explanation, or this is the reason that we can't get anybody to work overtime, we would have made different business decisions. So you know, one of the things that we're looking into is how can we use this data, this model and additional sets of data to work with employers to say, here are the number of employees that you have right now, that may or may not be approaching that cliff, here is the ROI of maybe providing in house services to those people. Child care specifically is a big one, because that's the largest deterrent for people is once they lose childcare, because it's expensive, they aren't able to work. So what's the ROI of doing that as opposed to the expense of turnover, hiring, training and doing all of that because a lot of times for these companies turnover is the largest cost center. So what's a way that we can reduce that for them, and help them not only retain but attract new employees?

Ryan Norris: 23:34

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Kelsey Underwood: 25:37

Again, you know, a lot of what is happening with our service providers, the way that they're leveraging this tool, is by working directly with people that are experiencing these potential cliffs or that are on welfare programs and are at risk of them. And so, you know, at least in the in the dynamic that we've seen it used, it's often used as a case management tool. So if you're working with an individual who is trying to get a job, and they want to look at different options, and they want to look at different, you know, pay rates, or what's the term, I'm looking for hourly rates for that job, right? Then that service provider, that individual that's working with them, can guide them through or coach them through, okay, based on what I know about you and your three kids at home. And the fact that you know, you are living at home by yourself. So there's no you know, you're not married, you don't have a partner or any other financial support. This is the point at which you might start encountering some problems. So how can we connect you with our other, you know, partners, or our community to kind of envelop you with these resources that you might lose if you decide that you want to continue progressing in that job. So that's a big one. And I think, you know, another thing that I want to touch on as far as the business application goes, is that when it comes to policy change, the more people that you can have pushing that rock up a hill, that boulder up a hill, the better, right. And when it comes to the economy, these employers are massively impactful and influential in that space. So once you make them aware that this is a problem that is affecting their bottom line, they are much more likely to get behind whatever initiative it's going to take to remove that problem. So I think that that's a really important consideration when we're looking at providing this information to employers, because really, we need them as allies. When it comes to policy change.

Ryan Norris: 27:45

Well, this is a really interesting, the way that you put that, you know, getting an employer's on in on board with this, because some of the things that happen with philanthropy, and those that are really involved in philanthropy trying to do good, the question they ask is like, Ryan, we've thrown so much money, both public and private, towards solving for poverty, why can't we make this work? I think that this is one of those unrealized bumps that we just keep assuming is, is helping, and it does to a level, but it's also limiting the number of people that can get off because again, they're just congregating up there and those plateaus that Eric was was kind of speaking about. So I think that philanthropy would be interested, they want to see their dollars go further, faster to help really help people. It's not just the concise catharsis of write the check, they really do want to solve the problem. And so I'm excited to be able to show some folks this tool that and say, Hey, here's here's where the logjam is kind of

Kelsey Underwood: 28:54

here's the point of leverage.

Ryan Norris: 28:55

Yes. You know, Erik, we're trying to solve for for quite a few things here, in trying basically trying to create a solution that would really help that would help people you know, that there's going to keep keep that safety safety net in there would not be disincentivized them from improving their life, it does have a bit of a saving the taxpayer, you know, component that we could end up probably calculating, and maybe talk about that on the back end something. But you know, I just realized that no matter what the math is, someone that's on benefits in their 20s. And they live into their 80s Being on it full time versus they start to work that often in their 30s they're off the system that sounds like a taxpayer savings, a just, you know, in concept alone. But can you can you tell us a little bit more about you know, some of the things that are being achieved with this tool in terms of like, I understand Utah has a model that they're using, they they use this tool and said, Hey, here's what we think we can maybe do with it to improve benefits close.

Erik Randolph: 30:00

Yeah. So when you think about the problem, I could just take a step back, what we're dealing with is we're dealing with a system created over more than 50 years, where the government and the federal government is largely to blame here. They keep coming up with new ideas of how to solve poverty, you know, let's do the food stamp program, oh, let's give that to the, to the committee on agriculture. And then and then they say, well, let's have about medical, you know, problems, well, let's do Medicaid. And they give that to the committee on you know, health. And they don't necessarily talk with each other. And then they give it to different agencies and the different agencies come up with different rules, and they're not coordinated. And so what you have is you have a system where, you know, different rules, different logic, different definitions. And so, so this is kind of the mess that we have created for ourselves. And we have really no one to blame, but ourselves and public policy, or a system, that's the disjointed. And there's some that argue it's not even a system, it's kind of like a hodgepodge of different programs and policies across, you know, agencies and levels of government. So when so when you actually kind of see it all together, and that's the one thing that the model does is it kind of puts the programs together to show the impact on the person who, by the way we send on goose chases, it's like, well, if you need, if you need, you know, health care, you have to go to this agency, do you need housing, you have to go to a completely different agency, that may not even be a state agency, it could be like a public housing authority, you know, then if you want food stamps, you go to someplace else, right? So you have all these different, you know goose chases that we send these people together. And I think, you know, people seeing that, you know, when they when you put it all together, you realize, well, we really have to kind of come together in some integrated way. So what what happened in Utah, and it wasn't necessarily because of the model here, but they actually put together a structure. That's really good. And right now we we are working with a member of Congress, and I won't say who right now, because I'm not sure he's ready to release it. But he's going to drop a bill next session, where we're looking at changing some federal law that will allow states to do with Utah did now what Utah did was back in the 1990s, they actually created a system where they took all their workforce development programs, and then their safety net programs into a single agency called Department of Work for services. And it kind of views you know, like food stamps, for example, as work support. So you go into the department, and the main focus is employment connection activities. And then you know, if you need support in, let's say, food, or housing or something else, you know, it kind of it kind of comes in, you know, parallel to that as a compliment. In other words, it's like, like, this is a support service, so that it's really like a work verse policy. Now, they still struggle with everybody else with the with the benefits cliffs, but by having by having a system in place where you're really encouraging people to move on to work, they actually are doing pretty well. I mean, compared to the rest of the nation, I mean, they have the the typically the highest job recovery numbers in the in the country, you know, from the pandemic, they have the lowest people on Medicaid, even though they expanded Medicaid, they have their rate of Medicaid recipients is even lower than George's, the, their, you know, they have the second lowest number of people on food stamps. But essentially, you know, you know, I believe that a big reason, and you know, of course, it would take a fairly large economic study to prove it, but you know, empirically, but, but a big reason is they set it up with structure in a way where they can address these cliffs. And they can, they can actually, you know, encourage people to do work for so that's like one thing. But there's still a lot of work to do. Because when you take a look at, when you take a look at the cliffs that people are facing, you know, we can actually identify with the monitor, and this is what we're working on. This is a work in progress, by the way, it's not yet if you go to our website, it's not there, but we can we can put our finger on Oh, this is the problem right here in the food stamp program. This is what needs to change in this food stamp program. Oh, this is where the problems are, but the childcare program, these are the areas that need to change. So these are kind of like more micro, you know, feel down to the management of the of the programs where we can identify what the programs are But that's where are we useful information? Because then that that can tell policymakers? Oh, you know, this is where I should, this is what I should be focusing on, if we want to come up with a solution.

Ryan Norris: 35:13

See, I like that a lot. The idea being, again, that we're trying to not necessarily reduce the benefits for those that need them, but as to reduce the dependence on those benefits, I think that that's, that's the key, I mean, people become accustomed to it. And no one's thought to go in and, and change it up. For example, individual calls me, you know, an anecdote, works in the service area, had a lady that was trying to leave an abusive relationship, but made just a little too much money to where she couldn't get a housing voucher, not much, I'm talking like 10s of dollars. And the truth is the truth, you know, you can't, you can't lie on those intake forms for the income, then another who works in foster care and was working with a lady trying to get her children back as the court or was working through what she'd be able to provide the children, she made a little too much money that her employer had get had given her the, you know, bonuses and additional salary because of inflation. And it kicked her out of health care benefits for her kids. And so that put her into a really crazy spot of getting my kids back, but having to come up with another solution for health care. So these benefits, cliffs cover all kinds of financial impacts, they have family impacts, getting this worked out to where there again, isn't a disincentive to improving just sounds like the way that we need to go here in the state of Arkansas.

Erik Randolph: 36:48

And you put it really well, I mean, just think of the consequences. And earlier, we're talking about the productivity issues, right. So the impact on the families, the horrible things that happen to families that get this where they can lose the benefits, and they put in a really bad decision, the impact on you know, businesses not getting the labor, that they need, the productivity in the economy that comes out, you know, so So when you have, that there's less well, to go around less, you know, the economy does worse, more people are struggling, and then even the long term impact of a person, if someone gives up a pay raise, or, or the ability to earn more money early on, they're not saving as much for their retirement, that means that they will stay more longer in poverty, the chances that their children would be in poverty increases. So really, it's it's a it probably a crisis, I would say, I mean, with with what we're dealing with.

Ryan Norris: 37:46

Everywhere that I've, I've spoken to individuals about this, they have that light go on in their eyes, like, Ah, I get this, I get this concept. I see where the problem is. So we're trying to, to look at Arkansas and see what those benefits cliffs look like we have a tool for that. Now we're working on again, on the smoothing tool to show what those reforms can potentially do. We need to build as much of a groundswell as possible, because many of these benefits are tied to federal criteria. And so we need to change some of those. So lots of lots of work to get done in this space. You know, Kelsey, how can individuals learn more about benefits cliffs, and maybe get involved in trying to get this problem solved our country and also for our state?

Kelsey Underwood: 38:33

Yeah, we would love that. So anyone can go to our website, it is benefits cliffs dot org. So that's benefits with an S cliffs with an s dot org. And from there, there's a couple of different options. So you can sign up for a demo account, see how the model works, run a couple of scenarios, just sort of, you know, play around with that. And if there are any policymakers or decision makers that want full access, so they can get access to Arkansas specific data, they can always contact us directly. So there's a contact page on there, I'll get that personally, so I can know who needs access to the detailed data. And we also have a page on there with some reports that Erik has done some white papers and other more detailed studies that talk through some potential solutions and things of that sort. We'll also link those to the notes for this podcast. So we'll put all this information there so that everybody has it easily accessible. But there's a ton of free resources on that site that we welcome you to use. At the end of the day, we just want as many people exploring the data and really using that to leverage policy change initiatives in their in their states and on a federal level. So yeah, we definitely look forward to having you guys come check the site out.

Ryan Norris: 39:48

And, you know, I always leave my guests with the opportunity to kind of leave some of their final thoughts. And so, you know, Erik, I'll go to you first. You know, what, if you were to succinctly put in into words like hey, Here's what this tool is, here's what it does. And here's why it's important. Let us know what your thought is on it.

Erik Randolph: 40:06

Well, I'm repeating myself a little bit, you have to know what's happening now, before you can come up with solutions. And then and then once you do that, then you have to be able to display what you think the solutions are. And I just want to add one thing. I guess it was a year ago, I testified before Congress on on benefit cliffs specific to the Food Stamp Program. And one of the things that was a little disturbing is that a lot of the solutions they were talking about is going to cost us a lot more money. So I'll add one other thing you have to do. The other thing you have to do is you have to make sure whatever your solutions, you know, are that they're fiscally sound, you don't want to come up with solutions that's going to cost society a lot more money. We already spend, you know, we spent, I forget how many trillions of dollars, but we spend quite a lot of money over the past 50 years, you know, to get where we are today. And we realized that we have a deficient system. So this the solution can't be one that's going to spend another trillion dollars and leave us in a worse position.

Ryan Norris: 41:15

Yes, yes, it this will help. If you care about fiscal policy, tax and spending. This is a space in which you may be interested because many times the allocation of resources are more of the problem than the amount of resources that are available, we should be able to solve this problem with the resources available is what I find is just where's the problem really at? And how do we get the right resources to the right people the right time, you know, to where that's maximized for oil. You know, Kelsey, what, what's your final thoughts you'd like to leave listeners with regarding benefits cliffs.

Kelsey Underwood: 41:54

So there's a somewhat famous quote that says a problem understood as a problem half solved, and I think are a problem well stated as a problem half solved. And at the end of the day, we want to provide people with as many resources as possible to clearly understand the problem. So that as you said, they can efficiently and effectively use the resources that they have, to better help people. Now, I look at this not only as a financial economics issue, but also behavioral economics issues. So when we're looking at the psychology around poverty, and the way in which it perpetuates, if it's not resolved in one generation, it's not only a human issue, it is a financial issue, because as long as we continue to allow people to cycle through this poverty, we're continuing to teach children a lack of work ethic, we're also putting them in traumatic situations and difficult situations, at which point, they then become adults and relive and recreate those. And it becomes not only a psychological burden for our country, which we don't need any more of right now, but also a financial burden. And that's not to say that people are burdensome, it's to say that the system puts them in a situation that they are dependent rather than empowered. So at the end of the day, we just we want to work with people who are passionate about solving this problem, whether that's in their own state, whether that's on a regional or national level. So anyone who's really passionate about this, who really wants to create some of these solutions and solve these problems, please do reach out to us and our team. Like Eric said, we've got some some of the most brilliant minds when it comes to welfare reform on our team. And we would love to be able to let you all deploy those to make some real changes in your state.

Ryan Norris: 43:45

Eric, Kelsey, thank you so very much for the work that you're doing and for speaking to the people here in Arkansas, I love this because I can understand that you both believe in people and that people given the right opportunities and a vision of a better future, they're going to want to follow that. And benefits Cliff had been one of those areas. It's just catching people up and I think that we need to solve for it. We appreciate everybody listening today. If you'd like to connect more with us and learn more about benefits cliffs you can go to infoar@afphq.org. Email us directly, and we'll respond back. Also, you can go to believeinar.com to learn more about benefits cliffs, and there'll be the podcast will be linked in there as well. All we are asking that if you're listening, of course to follow and share and let people know that we're on your favorite podcast, streaming services, Google podcast, Spotify, Iheart etcetera, where we're all there. And then you can also follow us on Facebook at ArkansasAFP, or Twitter @AFPArkansas and learn more. There's gonna be a lot of information coming out about benefits cliffs, and I don't wBelieve In Arkansas podcast today. where we believe that free people are capable of extraordinary things.

Kelsey Underwood: 45:04

Thank you Ryan.

ANNCR: 45:06

Thank you for joining us for Believe in Arkansas, where we believe free people are capable of extraordinary things. If you believe in Arkansas and would like to help unlock our state's potential, go to www dot believe in ar.com. To learn more and join the movement today