In a recent article, the Atlantic's Debby Bielak and Jim Shelton explore how $1 billion of targeted private funding can start to move the needle of decreasing poverty. We have all heard of the 'American Dream': everyone has an equal opportunity to a career and wealth. However, we are finding that this promise is impossible for some Americans. Nearly 70 percent of children born to parents in the bottom 40 percent of incomes remain in poverty—regardless of whether they "work hard and play by the rules," as so many have been taught. The Bridgespan Group, a nonprofit philanthropic advisory group, has found that investing in targeted, on-the-ground innovations has the best results and can pave the way to social mobility for millions of poor Americans.
Since the mid-1960s, public and private institutions have invested billions of dollars creating economic opportunity for every American with programs like the War on Poverty and No Child Left Behind. However, the data shows the United States is far from achieving equal economic opportunity for all. Bridgespan has identified 15 investments, or bets, where $1 billion of philanthropic capital could improve mobility for large numbers of people currently trapped at the bottom of the income ladder. These investments could build pathways to careers that will generate $7.3 to $14.7 billion in increased lifetime earnings. It starts with programs that teach children to read, develop math skills, etc. and takes them all the way to through adulthood. The calculations show that the best investments are in programs and tools that help low-income individuals (1) build skills that will propel them to the middle class, (2) remove obstacles that hold them back, and (3) provide opportunities to transform high-poverty communities. But what is surprising is that, in addition to creating a high probability of increasing people's lifetime earnings, these programs and tools potentially yield aggregate returns of at least $3, and as much as $15, for every $1 invested. A worthy return on investment.