Welfare and child support: Nobody wins

The collective child-support debt owed by non-custodial parents--usually fathers--is about $105 billion. That's an impressive figure, but it doesn't represent money that deserving children are losing.

Half of that money is owed not to children--but to the state and federal governments.

That is only one of the surprising facts that Daniel L. Hatcher, an assistant professor of law at the University of Baltimore School of Law, unearthed in a fascinating law review article entitled "Child Support Harming Children."

Here are others: Two-thirds of that debt is owed by fathers who make less than $10,000 per year. Fathers who owe this can have up to 65% of their income garnished. They can lose their drivers licenses, making it tougher to find a job. Even then, the wheels of enforcement grind on relentlessly, Hatcher notes: Ultimately, many debtors end up in jail. And their children get nothing.

This is more than an academic pursuit for Hatcher. Earlier in his career, he represented custodial parents, usually mothers, in court cases. "When you're a lawyer representing custodial parents, you go after the fathers hard," he said when I called to ask about his research "Drivers licenses were an issue in almost every case. And in most of the cases, a significant part of the money was not even owed to the kids."

Women who apply for welfare must sign over to the government any money owed them by their children's fathers. And they are forced to sue the fathers to get that money, Hatcher says.

Kids lose, but at least, the argument goes, state and federal governments benefit: They (and taxpayers) are supposed to get back some of the money spent on welfare.

But, as Hatcher found out, that's not what happens: The government loses money on the reimbursement program.

In 2006, state governments and the feds collected $2 billion in reimbursements. But they spent $5.6 billion in administrative costs to collect that $2 billion. (Those administrative costs also collected $22 million that was returned to families, so it's easy to justify the costs. The point here, however, is that the program does not make money for the government.)

In other words, nobody wins. Not the children, not the government, and not the taxpayers.

The one thing that is clear is that families suffer, Hatcher says.

"Early on in relationships, these young families have a somewhat decent chance," he says. "They may have a healthy relationship. There may even be a chance for a two-parent family or marriage. But then mother applies for welfare, and the first thing she has to do is sue dad."

Some fathers, unable to survive with 65 percent of their wages going to the government, turn to the underground economy, working construction for cash under-the-table, for example. They also have a strong economic incentive to turn to crime, an occupation in which their wages are not garnished, though it has other risks.

"Welfare cost recovery is a failed policy," says Hatcher. "The whole process should stop." When mothers apply for welfare, they should not be required to sign over child support to the government, he argues. Whatever money is collected should go to the children.