By: AIF STAFF
Salt Lake City, UT – Earlier this month, Speaker Paul Ryan visited the Sorenson Impact Center to discuss its ongoing work to use data, public policy, investment, and community engagement to encourage positive social change. The Sorenson Impact Center has been instrumental in identifying and supporting promising developments in Opportunity Zones around the country and, like the American Idea Foundation, believes that evidence-based public policies and community involvement can yield positive outcomes so individuals can achieve their version of the American Dream.
While touring the Center and meeting with its leadership and staff, Speaker Ryan sat down for a conversation with CEO Geoff Davis and students from the University of Utah to discuss his experiences developing public policies rooted in evidence and data.
The full conversation, which primarily focused on the development of Opportunity Zones, effectively fighting poverty, and Social Impact Bonds, is accessible here and some highlights of Ryan’s remarks, (edited lightly for clarity), follow.
A Post-Elected Focus on Fighting Poverty, Scaling Proven Models of Success
“I spent most of my discretionary policymaking time focused on poverty and upper mobility. From my early days as House Budget Chair, as the Ways and Means Chair, and as Speaker, I worked on poverty policies at the macro-policymaking level and at the grassroots-level that focused on reigniting upward mobility, fighting poverty, and addressing root causes of poverty. And that was one of the most enjoyable policy things I ever did.
“When I retired, I wanted to make sure that the recent laws we passed: Opportunity Zones, Social Impact Bonds, and the Evidence-Based Policymaking Act, were well executed and I just really enjoyed my time working on poverty issues from what I would call a center-right perspective.
“The American Idea Foundation is my [non-profit] foundation that focuses on these issues. It focuses on research in this area and on executing these laws properly. I [also] teach Economics at Notre Dame and I’m on the Board of the Laboratory for Economic Opportunity at Notre Dame. I work with Notre Dame economists at LEO, along with my foundation, to really push these ideas out and get them into the mainstream and out of the periphery. The American Idea Foundation is focused on attacking poverty, highlighting new poverty solutions, and helping scale these ideas and deploy these successful ideas and models nationwide.”
Ensuring Community Development, not just Profit, is a Goal for Opportunity Zone Investors:
“I think the Left would like nothing more — and I don’t mean to be partisan but I think there’s an ideological issue here, but there’s nothing more than they would like to say than: “This is just a tax abuse shelter. Let’s get rid of the idea.” I really believe more transparency and reporting gets you more accountability. And again, that’s a part that we wanted to have in law but we couldn’t because of something called the Byrd rule.
“This is why we’re working on some accountability tools to rate and measure opportunity zones, so that they mind the mission. The mission here in Opportunity Zones, from the person who put it in the tax code, is not to identify communities and push the poor out. It is to revitalize communities. It is to bring jobs. It is to bring solutions. It is to re-integrate civil society so that the people in these blighted neighborhoods or communities in both rural and inner-city America are actually rising out of poverty. And so, we want to make sure that the funds and the Opportunity Zones themselves understand the totality of the mission. We want people to make money. We want people to invest, but we also want them to understand the reason this law exists in the first place. In my opinion, transparency and reporting brings you more accountability about the best zones to invest in that are worth copying and replicating.”
Infusing New Ideas and Solutions into Poverty-Fighting Efforts
“Just like we’ve seen wonderful disruption in the technology space that has brought amazing innovations, new technologies and brought people closer together, I believe we can do the same in the poverty space. And so, I think the challenge for social impact bonds and the challenge for the poverty space is that we are disrupting a government monopoly of fighting poverty, and that [monopoly] is sort of wedded to the status quo. My friend Bob Woodson calls it the “poverty industrial complex,” which is that they’ve been doing the same thing for so long and it’s been funded, but unfortunately, it’s not producing the kinds of results that we need.
“We should be disrupting the poverty-solution space with the kind of private sector disruptions that have made technology and other aspects so lean, so efficient, so effective, and that needs to be brought to the poverty space. But you’re going to be facing a bureaucracy and entrenched interests. You’re being disruptive to the status quo and so, that just takes a lot of perseverance. It takes people coming together, and, frankly, [it takes] the private sector with private money and with solutions, disrupting this space.
“As a Catholic, I know most of you are LDS at Utah, but we call it “subsidiarity” as a Catholic. It’s a principle that basically believes, bringing people together with their various talents and skills, locally. Those closest to this problem bring the best solution. And so, this sense of civil society, where people are working together to solve problems gets you the best outcome. [It’s better] than phoning it in and having some big, macro, Washington, one size fits all approach.”
Changing Our Poverty Fighting Mindset to Focus on Results:
“The entire premise of the War on Poverty from the government’s point of view was focusing on efforts and focusing on inputs: How much money are we spending, how many programs are recreating, how much bureaucracy are we building and that was sort of the measurement of success.
“The whole philosophy behind the Sorenson Impact Center, as I understand it, and behind the American Idea Foundation is focusing on results, [focusing on] what achieves the goals of reigniting upward mobility, attacking the root causes of poverty, and getting people out of poverty. By disrupting all of this so it is focused not on inputs and not on effort, but on outcomes and results, our entire attitude and the way we approach these problems has to change. That is disruptive and that changes the status quo, for the better in my opinion but nevertheless, it is always challenging when you’re changing a generation-long status quo.
“Data driven measurable results… does de-emphasize government. The way I look at this is [the federal] government shouldn’t be manning the frontlines of the War on Poverty. It should be on the supply lines to bring resources like money and other things, but the people in the communities on the ground, learning from one another by using time-tested principles and processes are the ones who actually should actually man the frontlines of the War on Poverty and create the solutions. And that is a different kind of thinking from the government-centric approach.”
Responding to the COVID-19 Pandemic with Impactful Policies; Rethinking Civil Society’s Role:
“I think, obviously, the need is even greater because we have spiking poverty, higher unemployment, and a great need. The way I look at [social] impact bonds is it brings the best of both worlds. It brings the idea of a social public good, getting people out of poverty, and fighting unique poverty problems with private sector know-how and private sector capital.
“One of the concerns I’ve always had, and I’ve mentioned this for years, is that in 1965 when the War on Poverty was launched, there was this great, magnificent effort, and it was incredibly well intended, to have government tackle the issue of poverty. It was a really, well-intended, noble exercise.
“The downside consequence of this, in my opinion, was it pushed the private sector out of the poverty space and said, “This is government’s space.” It told the rank-and-file taxpayer, the person driving down around the suburbs to the city and driving by the projects and the blighted areas, “Don’t worry about that, that’s the government’s job. Just pay your taxes and government will fix this.” And so, we ended up marginalizing the poor. We ended up displacing the poor and not integrating the poor in our communities and our solutions….
“We need to break this notion that poverty is not your problem as a citizen. It is your problem. It is your issue. And so, let’s get off this idea that this is just government and only government’s [problem]. The private sector needs to be involved. The private sector has so much talent and know-how that can really disrupt stale institutions that aren’t producing results, which were well intended, but resulted in a sort of misguided approach to fighting poverty.”
Evidence & Data as a Way to Bridge Ideological Divides:
“I’ve seen many instances in public policy debates where if you are equipped with unassailable data and evidence, people put the boxing gloves down. They put these sharp edges of ideology down and you can have a really nice, centrist-based conversation about what works and what doesn’t. MIECHV is a perfect example. It’s a long acronym but it’s basically nurses going into homes of poor moms on a pre-natal basis and helping them get prepared from motherhood, or having an infant. [It focuses on] health and welfare.
“It was rigorously designed by the Bush administration with an evidence-based reporting focus. President Bush created it. President Obama extended it and President Trump reauthorized it because this law, which basically was about getting nurses into poor communities, had such good evidence that Presidents Bush, Obama, and Trump have supported this law and now it’s being deployed nationwide.”
Taking Opportunity Zones from an Idea to the Real World, Ensuring the Mission is Minded:
“Opportunity Zones are something that, frankly, I’ve worked on for over 20 years. I worked for Jack Kemp back in the early 1990’s working on what were then called “enterprise zones.” And so, to see that idea come to fruition, and we made sure that this was in the tax reform legislation as [we did] with social impact bonds these are things that we’ve been working on for many years. I saw, as Speaker of the House, the ability to put them into tax reform legislation because it’s something that I’d always want to see happen but we never had the ability to line up the political powers that be to get this done.
“What is exciting with Opportunity Zones is the amount of capital that has been deployed. The amount of capital that has been deployed to solve poverty problems and is being deployed in this space…. We always had an idea of having what I would call it sort of “reporting guardrails” to accompany the legislation to bring a lot of transparency to Opportunity Zones and to impact bonds, so with that transparency, you can learn as you go and you can have more accountability. We could not put that in the legislation because of the Senate rules, so that is an area where I think there’s room for improvement, which was always the intent.
“As a result, I think that’s one of the things that foundations [can do] and it’s one of the things that I work on at my Foundation. We can help take that place to bring accountability and transparency and to make sure that the mission is minded in the proper way as we always anticipated.”