GAO Involved in Public-Private Partnership Scandal - Child Support - Roger Gay

On March 29th the United States General Accounting Office (GAO) released another in a series of sensational reports on the child support enforcement program. They report that collections as a percentage of the amount due has dropped to an all time low of 17 percent and that $89 billion is "owed but unpaid." They recommend further guidance from the Office of Child Support Enforcement (OCSE) on allowing private collection companies access to huge databases of personal information. To see a copy of the report, click here.

Their new report, as with past reports was prepared from "data" conclusions, interpretations, and recommendations provided to it by the subject, the Office of Child Support Enforcement. Corroborative interviews were conducted with a handful of select state child support enforcement bureaucrats. To this writer's knowledge, the OCSE has never been subjected to a reality check by any serious auditor. As Arthur Andersen did with Enron, the GAO is playing the dual role of auditor and policy consultant and supporting an untenable position.

Congress created the OCSE in 1975 with the goal of "forcing fathers to pay" as a measure to reduce welfare spending. States and counties were already collecting child support in welfare cases and enforcing orders through state courts. No credible analysis indicated a sufficient potential gain in payments to offset the cost of an additional enforcement program. Huge increases in federal "investment" in child support enforcement have since been authorized based on information from the OCSE, private collection agencies, and other special interest groups. As much as $4 billion per year in annual federal funding created a groundswell of support from state politicians.

In the 1980s, Congress expanded the welfare system far beyond the concept of assistance to needy families to include the child support cases of all divorced and never married parents and their children. This led to a dramatic increase in "collections" by including higher income fathers with no payment problems. The amounts that fathers were ordered to pay were increased arbitrarily, further increasing the total "collected" and also increasing debt. (See The Beginning of the End of Child Support Reform.) More and higher payments automatically increased federal funding. Increased debt led to windfall profits for private collection agencies.

The federal government began replacing state and local automated child support tracking systems with its own in the early 1990s at a cost totaling around $4 billion. (See Too Late to Stop National ID.) The first experiments with the automated system confirmed what Congress already knew. Fathers had a good record of paying court ordered child support. (Solomon, Carmen D., 1989, The Child Support Enforcement Program: Policy and Practice, Congressional Research Service Report for Congress, Dec 8, 1989, 1-3.) The most prevalent cause of non-payment of court ordered child support is unemployment. (See Bibliography.)

The difference between the special interest version of a need for a huge and expensive child support enforcement system and reality was not subtle. A representative of the New Jersey child support enforcement unit explained the results of using the new automated system in a national conference held in Dallas in 1992. ("Child Support Technology" session, Third National Court Technology Conference, organized by the National Center for State Courts. Ray Rainville presenting.)

They started with the most egregious cases in the database, those showing a debt in excess of $50,000. They expected little response to form letters sent to "deadbeat dads" who would likely scurry underground to avoid punishment. Instead, the response was more than their office could handle. They responded in droves. They called, sent letters, telegrams and post cards, and came into the office if they lived nearby.

A typical respondent had a son previously supported under court order who was by that time 35 years old, had a masters degree largely at his father's expense, was married and had two children of his own. Few individuals would be stupid enough to try to enforce an outdated order. The new child support enforcement system had presumed that every order on file was still "open," and with no payment records had merely imagined accumulating arrearages.

In response to a question about the apparent unfairness of arbitrarily high award levels he responded that no one involved with the child support system understood what fairness meant and they had no interest in trying to find out.

Yet another study showed that fully employed divorced fathers had a perfect record of paying the child support they owed. Overall, historically fathers paid about 80 percent and divorced fathers 90 percent of what is due under court order. (Read Divorced Dads: Shattering the Myths for a detailed look at results of a large study of divorced fathers.)

The $89 billion debt figure provided in the GAO report is the OCSE's estimate of accumulated debt over a 26 year period, averaging $3.4 billion annually according to that estimate. Real payment problems, as opposed to those merely imagined by enforcement program advocates are typically related to ability to pay. The appropriate solution is to adjust court orders to actual economic circumstances and children's needs. Increasing government surveillance and providing private companies with access to masses of personal information lies nowhere on the list of legitimate government functions.

By 1990, the OCSE was 15 years old. Its irresponsible promotion built child support enforcement into a national political obsession. Despite the finding in New Jersey and elsewhere, there was no "Oops, sorry!" In response to grim confirmation that the program was a huge multi-billion dollar mistake the propaganda campaign intensified to a level probably unequaled by any non-military campaign. By 1995, the child support enforcement system was a bureaucratic Goliath with an annual budget of around $4 billion and approximately 60,000 employees nationwide. Private agencies were using the same propaganda to entice investors.

The GAO report got a few things right. There has not been a corresponding improvement in the percent of what is ordered that is paid. They also report correctly that fathers have had income inappropriately withheld from their paychecks. People outside of government already know that this is a result of inappropriate practices by government and private collection agencies coupled with unconstitutional child support laws. (See The Beginning of the End of Child Support Reform.)

The GAO also reports a key motivation behind the propaganda and intentional human rights violations; "private firms charged all of their client’s fees that averaged 29 percent of the child support collected, and half of the private firms charged additional fees." In the cases that they handle, somewhere around one third of the money fathers pay in court ordered child support never reaches the custodial parent household.

If there is any way to extract an additional $89 billion from parents, it could mean as much as $26 billion more in income for the industry. There are people in our country who would commit mass murder for that much money, let alone violate constitutional rights and steal from people. Whether that potential actually exists or not is incidental. The mere mention of that kind of money will attract the worst element, inside and outside of government, and lead to horrendous acts.

Ten months of report preparation by the GAO on top of years of previous experience has produced a series of sensational phrases that express the incredible while ignoring transgression. This will likely give rise to even more dubious aggrandizement in this year's election speeches and congressional hearings. It will also feed the propaganda machines of special interest groups. For a preview, see The General Accounting Office Report on Child Support Enforcement 2002, by the chair of the American Bar Association's child support committee Laura Morgan. Unlike Andersen, the GAO will likely have very few papers to shred. No publicly available report indicates that they have ever obtained credible information about OCSE operations or their expansionist agenda.

The GAO report on child support enforcement was requested by Representative Lloyd Doggett (D-TX).

Bibliography

Young, 1975, Arthur Young & Company, Detailed Summary of Findings: Absent Parent Child Support: Cost-Benefit Analysis, Washington, DC: Department of Health, Education and Welfare, Social and Rehabilitation Service, 44-46,62-64.

Chambers, D., 1979, Making Fathers Pay: The Enforcement of Child Support, Chicago, University of Chicago Press.

Wallerstein, J.S., and D.S. Huntington, 1983, Bread and Roses: Nonfinancial Issues Related to Fathers' Economic Support of their Children Following Divorce, In J. Cassetty (Ed.), The parental child- support obligation, Lexington, MA: Lexington Books.

Pearson, J., and N. Thoennes, 1986, Will this divorced woman receive child support?, Minnesota Family Law Journal.

Sonenstein, F.L. and C.A. Calhoun, 1988, Survey of Absent Parents: Pilot Results, Paper presented at the Western Economic Association, Los Angeles.

Braver, Sanford, Pamela J. Fitzpatrick, and R. Curtis Bay, 1988 , Non-Custodial Parent's Report of Child Support Payments, presented at the Symposium "Adaptation of the Non-Custodial Parent: Patterns Over Time" at the American Psychological Association Convention, Atlanta, GA, August, 1988.

Roger F. Gay, 1992, A Brief History of Prevailing Child Support Doctrine, in Proceedings of the Sixth Annual Conference of the National Council for Children's Rights, Arlington, VA, March 19-22.