The System and the Cliff

Review

Welcome to Module 4 of Engaging Poverty 101, The System and The Cliff. First, let’s review where we’ve been.

In Module 1, we each stepped on the scale — financially. We looked at how we compare to the rest of the world, explored what could happen if we each gave our share, and asked the harder question: could we ensure those resources actually reach the people who need them most?

In Module 2, we moved beyond the assumptions most of us carry about people in poverty — and let the data do the talking. Many of us had to reconsider what we thought we knew. The homeless, the poor, the struggling — they are not the lazy, drug-addicted, uneducated criminals many were conditioned to imagine. The data told a very different story.

Module 3 took a deeper look at why people remain in poverty, drawing on the groundbreaking work of Dr. Ruby Payne. We explored her framework of 8 resources that define a person’s ability to navigate life — only one of them financial. The other seven — emotional, mental, spiritual, physical, support systems, relationships, and knowledge of hidden rules — are the ones most often missing, and the ones that matter most because of their impact on the financial aspect of poverty.

We also examined ACEs — Adverse Childhood Experiences — a form of unrelenting trauma that functions like a lifetime of PTSD. And we saw, through the data, how those experiences erode the very resources Dr. Payne identifies — trapping many people in a cycle of poverty that has nothing to do with effort or desire, and everything to do with what was done to them before they ever had a choice.

Now we move into an issue that stirs the blood of many who consider poverty from a distance –

Maybe you believe people should pull themselves up by their bootstraps rather than seek assistance? Perhaps that is your own story.

But let me ask — have you ever had a season where things got hard? A job loss, a medical crisis, a divorce, a moment of real uncertainty where you needed someone to step in? Most of us have. And most of us had somewhere to turn — family, friends, savings, a network. It may not have been the help we would have liked to have received, but it was some. People in poverty have none of that.

Which is why the church — and religious institutions broadly — become so critical to those in need. Many of us believe if someone needs help, they should reach out to their local religious institution, who should fill the gap. And yet the statistics tell us the same story across every tradition: the cost of maintaining buildings and paying staff consumes the majority of available resources. Whether it is a church, a mosque, a synagogue, or a temple — no major religious institution has solved this problem at scale enough to close that gap. They are doing good work. But without additional support, better focus and accountability, they too fall short of satisfying the role many expect them to play in their community —which is why government assistance or the system, is necessary. In fact, it is the last option standing between a family and the street and why a discussion about the Benefits Cliff is so important.

The System

Although implied, the system we are talking about is the collection of federal and state programs designed to help low-income families meet basic needs. Food assistance. Health insurance. Housing vouchers. Childcare subsidies. Utility help. Cash assistance. Programs that address real needs. But these programs were not designed together. They were created at different times, by different agencies, with different rules and different income thresholds. No single office is responsible for how they interact with each other and no one is watching the combined effect.

In essence, it is a collection of well-intentioned programs that, taken together, accidentally create a trap because no one is looking at the whole picture and no one understands the importance of all the parts working together like a well functioning machine. That is the result of a huge corporation — the government — attempting to understand issues on a micro scale, but without the ability to do so because of its size and how far removed it becomes from the very people it is trying to help.

But it’s not their fault. The people designing these programs — writing the rules, setting the thresholds, deciding who qualifies and who doesn’t — are sitting in offices in Washington D.C. or a state capital, often thousands of miles and dozens of layers removed from the family sitting at a kitchen table trying to figure out how to pay rent this month.

And each of these programs — housing vouchers, cash assistance, utility help, childcare subsidies, food assistance, health insurance — was created by a different agency, at a different time, with a different mission. They do not talk to each other. No single agency looks at the whole picture of what a family actually needs to survive and move forward. Each one solves one piece of the puzzle — in isolation — without ever seeing the full puzzle. So a family might qualify for housing assistance but lose childcare support the moment their income ticks up. They might have food covered but no way to pay the electric bill. Each agency is doing its job. But no one is doing the job of seeing the whole person.

The government is not indifferent. It is just too big to be precise. And precision is exactly what people in poverty need.

That is the system. And that is why this is not a partisan issue. The Benefits Cliff has existed through Republican administrations and Democratic ones. It is not a political OR PERSONAL failure. It is a structural one — and it will take more than an election to fix it.

Now — we are going to look at how the Benefits Cliff plays out in people’s lives.

The Benefits Cliff

Consider this. If your employer offered you a raise — more money, same job — would you take it?

It sounds like a rhetorical question – of course you would. That’s what we’re all taught. Work hard, earn more, get ahead. It’s what we WANT. But for millions of Americans living in poverty, that question is not simple. And the answer is not always yes.

The Benefits Cliff — sometimes called the “cliff effect” — is what happens when a person’s income rises above a certain threshold — even by a small amount — triggering a sudden, sharp loss of government benefits, leaving a family financially worse off than they were before the job or raise. We’re talking about SNAP, which most people know as food stamps. Medicaid. Housing assistance. Childcare subsidies. Energy assistance. These are programs that, together, can be worth tens of thousands of dollars a year to a family, and programs that have a hard cutoff. Get a job ensuring an income, but at the wrong amount, you may lose the benefit. Not a portion of it. All of it. Have a job and get a raise and move one dollar over the limit — you may lose the benefit too. Sometimes all of it.

Haley left an abusive relationship. She was in addiction recovery, having an overwhelming number of accrued ACEs from her past. She had children to feed. And she did exactly what we tell people in poverty to do — get off the drugs and get a job. She started working as a house cleaner, earning $14 an hour. Not a lot, but a start. For the first time in a long time, she felt stable.

Then she got a letter.

Because she reported her new income to the benefits office — as she was required to do by law — her SNAP (Supplemental Nutrition Assistance Program) food assistance and her TANF (Temporary Assistance for Needy Families) assistance were immediately slashed. The government had decided through its harsh threshold levels, that she was now making too much to qualify for the same level of help. Her income went up. Her total resources went down. That is the Benefits Cliff.

And before you slight her for her addiction or the children she is raising, please remember the discussion in Module 2 about ACEs. The more traumatic experiences you accrue growing up, the more troubled your life will be – statistically. The point is “had you or I walked in Haley’s shoes” we would likely find ourself in her situation, despite our best efforts.

While each benefit program has its own income threshold. Its own eligibility rules. Its own cliff. And since they don’t coordinate with each other, a family can hit four or five different cliffs at different income levels — meaning every raise, every promotion, every extra shift is a potential trap.

Statistically, the most dangerous income range is roughly $25,000 to $45,000 a year, depending on family size and the state you live in. Researchers call this the benefits desert — the zone where your income is too high to qualify for full benefits, but too low to absorb the loss of them.

There is one more piece of information that we need to understand — most employers have no idea this “benefits cliff” is happening. So, when an employee refuses a raise, turns down a promotion, or asks to keep their hours below a certain level — the employer almost always reads that as a lack of ambition. A lack of drive. A lack of gratitude.

What it actually is, in many cases, is a completely rational financial decision made by someone who has done the math and knows that accepting the raise will cost their family more than it gains.

This is not laziness. This is not a character flaw. This is a person navigating a system that was not designed to help them succeed. Which brings us back to us: our part. We need to spend less time judging those without and more time caring for them as we care for ourselves, by supporting the organizations doing the work, financially and with our time. And the organizations doing the actual work need to be above board with their money so that we can hold them accountable when they forget the cause they serve. We cannot control what the government does, but we can control what we do.

We have spent time looking at the Benefits Cliff—what happens when a family tries to move forward and discovers that the system is not coordinated enough to see the full picture. Different agencies can be trying to help the same family, yet each one sees only one part of the need. The result can be confusion, frustration, and decisions that leave a family worse off.

But the problem is not only within large systems. It also shows up whenever people try to help one another. We can have the right intention, the right information, and even the right resources—and still fail to connect with the person in front of us.

Why? Because communication is rarely as simple as we think it is. What we say is not always what another person hears. What we mean is not always what they understand. And every experience, fear, assumption, and difference in background can add noise to the message.

That is where the Shannon-Weaver Communication Model becomes important. It helps us understand why a message can be sent with good intentions and still be received in a completely different way. If we want to help people move forward, we have to learn not only how to provide resources—but how to communicate in a way that can actually be heard. That is the topic of Module 5. I hope you will join us.