Child support decision theory has taken a leap in development; finally providing a sound theoretical formula that can be used to consistently produce “just and appropriate†awards. The following comments provide an quick summary of guideline history and briefly state the character and significance of the breakthrough. A link to further information is included at the end.
When Congress decided to force states to develop and use child support guidelines in the 1980s, state of the art consisted of formula built to correspond to existing state laws. The use and selection of such formulae had previously been left to judicial discretion and a variety of guidelines had been developed by state bar associations, judges, and individuals. Several efforts were quite worthy of note in the unfolding national history of the science of guideline development.
A 1981 formula created by Maurice Franks and a later effort by Judge Melson in Delaware both received widespread attention. Franks’ creation was extremely well documented in an article providing case citations and commentary as its basis. (How to Calculate Child Support, Case & Comment, January-February, 1981) This led to greater uniformity, not only within states, but across state lines, as laws on determining child support awards of many states were quite similar; based on “the needs of children and relative ability of parents to pay.†Therefore, it was therefore possible to apply the same formula in many states. This provided a sense that requiring the application of such a formula could consistently produce just and appropriate awards; and would reduce the variations in outcome in similar cases. It was after all, a mathematical model that was easy to apply. Because it was constructed to specifications of existing law, it also shared the accumulated wisdom of the entire legal history of child support decision theory both in the United States and earlier in Great Britain.
Criticism of Franks’ and similar formulae focused on custodial households at and below poverty level. The “cost sharing†approach taken by Franks’ and others was based primarily on sharing costs in the context of the standard of living in the custodial household. This resulted in poor custodial households maintaining a poor standard of living while much wealthier non-custodial parents were not ordered to improve the situation. In some cases, this could shift the burden of support to the state.
When Congress authorized spending to create technical guidance for states in creating new guidelines (Child Support Enforcement Amendments of 1984), the HHS Office of Child Support Enforcement turned to economist Robert Williams, founder of Policy Studies, Inc. Williams’ recommendations for amounts averaging 250% higher than awarded under existing state laws created the controversy that continues to surround guideline results today. (Development of Guidelines for Child Support Orders, OCSE 1987) Nonetheless, a majority of states adopted Williams’ “Income Shares†guideline model.
Although turning to economists for child support calculations seemed a reasonable course, it was, at least in hindsight, a baseless choice. A mathematical theory of child support decisions had never been developed within the field of economics. Rather than focusing on existing legal theory, Williams work more closely followed the work of another economist, Thomas Espanshade. Espanshade had written a book presenting his estimates of the cost of raising children. (Investing in Children: New Estimates of Parental Expenditures, Urban Institute Press, 1984)
Espenshade’s particular purpose was more focused on pressing for increased government support for poor families. The statistical estimates themselves were scientifically unsound; based primarily on the arbitrarily selected parameter values and manipulations of his estimating formula rather than on family spending data. The USDA had undertaken similar studies and determined that statistical calculation of the total cost of raising children was impossible using data on family spending. As once stated by a Chicago judge, “Both mother and child live from the same sugar bowl.â€Â
Those particularly interested in keeping up with events in this area may recall a national controversy that stemmed from the USDA’s work. Keen to do the best they could to characterize the nutritional needs of families, they constructed low, medium, and higher cost “meal plans†in place of a statistically based formula estimating family spending patterns on food. This led to a negative public reaction based on the suggestion that the government was attempting to micro-manage family life. The USDA eventually yielded to political pressure and began producing Espenshade style cost estimates of its own.
The fact that “just and appropriate†child support award levels cannot be statistically determined from family spending data did not deter dependence on them for development of state guidelines. In fact, it seemed that a cottage industry developed in which a few economists spent a significant amount of time re-processing the estimates and writing reports for state guideline committees. Rather than leading to greater uniformity, these efforts produced widely varying results in different states and at different times, as conclusions from the “experts†seemed nearly always to agree with whatever local committee leaders and politicians had in mind. This confirmed in practice what was already understood in theory: The approach that has been taken for development and maintenance of mandatory guidelines is not scientifically sound.
The conflict between those who prefer the “cost sharing†approach and those who prefer “income sharing†is a long-standing one. The differences appear in proposed formulae, and have certainly been central to debate over numerical components in guidelines. Although “cost sharing†comes closest to implementing the historical wisdom of common law, neither had been developed into a sufficiently complete mathematical theory prior to mandatory use of guidelines in the states.
The two can be characterized as follows:
- Cost sharing: dividing expenditure in the context of the standards of living of custodial parents, for the purpose of providing support specifically for children.
- Income sharing: increasing the standard of living of custodial households by transferring wealth from one parent to the other, based on an arbitrary target standard of living presented in view of the parents’ combined income.
The two views are born of entirely different definitions of “child support.†Any compromise between the two would certainly be arbitrary; scientifically unsound. The current problem, that guidelines are constantly subject to arbitrary political manipulation (and more than once the subject of corruption – i.e. a few legislators have actually gone to jail for their involvements) would not be solved.
The new theory does however, at least in some sense, provide a sound compromise; although this was not the intent, nor the approach taken in its development. There was in fact, no forethought about where on the numeric map the result should be; only a direct sustained effort to find a basic and sound mathematical theory of child support decisions. Rather than “compromise†(a political process), it is most accurate to report that a solution has been found through deeper mathematical analysis.
Development of the new theory began with a classic effort to model (mathematically) traditional child support law. Analytical steps toward refining the model were described in Rational Basis is the Key Focus in Emerging ‘Third Generation’ Child Support Technology. (in Proceedings of the Seventh Annual Conference of the Children’s Rights Council, April 28 – May 2, 1993). The plan called for repeated refinements of both the mathematics and the underlying principles upon which the model is built; a boot-strap approach in which improvements in the statement of principles would be discovered from exercising mathematical models. Clearer application of principles would in turn, serve as the basis for further mathematical development (on a sound footing).
It was determined, by direct mathematical evidence (through model validation procedures), that three basic principles are required to develop a complete and sound mathematical theory of child support:
- Purpose Principle: Child support is for the care and maintenance of children.
- Relationship (equal duty) Principle: Both parents have an equal duty to support their children.
- Context Principle: All relevant circumstantial information may effect the amount of the award.
Those familiar with traditional child support law will easily recognize the close correspondence between these principles and those established by state courts. The process of developing general principles from case trials is as familiar to scientists as it is to lawyers and judges. What the mathematical studies have added is verification that there is no where else to go for determining “just and appropriate†award levels. In addition, the studies provided a more complete; and finally a sound mathematical model.
As mentioned above, the new theory was developed through successive modeling refinements. “Refinements†are improvements in the development of sound theory to the extent they bring the model closer to reality. Reliance on unavoidable facts as modeling “assumptions†rather than arbitrarily expressions of philosophical preferences, leads to improvements. Models can be constructed on philosophical preferences; but a sound and useful theory must be based on and related to facts.
In most cases, the presumption that receipt of child support increases custodial parent income is unavoidably correct. Regardless of intent (purpose principle), child support payments are “liquid†cash dumped into the income-stream of custodial parents. They, therefore, increase the standard of living of custodial households, not just that of children, and children share in that increase. Although the philosophy underlying development of “cost sharing†models is sound, this unavoidable fact more closely corresponds to (the improperly constructed) income sharing philosophy.
By preserving the principle, that child support is for the care and maintenance of children, while treating child support income as an addition to custodial parent income in mathematical models; a new basic formula was derived. The payment of child support increases custodial parent income, thus; increases the standard of living in custodial households and the benefits children receive. Explained in relation to “cost sharing,†receipt of child support payments effectively increase the amount available for spending on children, which in turn increases the “just and appropriate” size of awards. The solution converges (the increase is not arbitrarily high), and results pass all validation tests.
There is more complete and technically detailed information about Child Support Decision Theory available on the Web; at http://isr.nu/cs/ Materials were developed over a period of years and go much farther in dealing with the practical aspects of child support determinations; for example, on deviating from the basic formula and on dealing with visitation credits and joint custody calculations. A lengthy paper is also available at the site that provides a thorough analysis of the three fundamental decision principles.
