Child Support Policy
and Robert Williams

page seven

The BLS publishes a list of "Frequently Asked Questions" regarding the CES. Number 15 specifically asks and answers:

"What are some of the Limitations of the Data?"
"The Interview and Diary Surveys are sample surveys and are subject to two types of errors, nonsampling and sampling. Nonsampling errors can be attributed to many sources, such as differences in the interpretation of questions, inability or unwillingness of the respondent to provide correct information, mistakes in recording or coding the data obtained, and other errors of collection, response, processing, coverage, and estimation for missing data. THE FULL EXTENT OF NONSAMPLING ERROR IS UNKNOWN. (All caps added for emphasis) Sampling errors occur because the survey data are collected from a sample and not from the entire population. Tables with coefficients of variation and other reliability statistics are available on request. However, because the statistics are shown at the detailed item level, the tables are extensive."

"CAUTION SHOULD BE USED IN INTERPRETING THE EXPENDITURE DATA, ESPECIALLY WHEN RELATING AVERAGES TO INDIVIDUAL CIRCUMSTANCES. (All caps added for emphasis) The data shown in the published tables are averages for demographic groups of consumer units. Expenditures by individual consumer units may differ from the average even if the characteristics of the group are similar to the individual consumer unit. Income, family size, age of family members, geographic location, and individual tastes and preferences all influence expenditures."

Along these same lines, Kansas Guidelines review committee economist Dr. Walter Terrell admitted to me in a letter in April 1998 in response to a request for a detailed break out of expenditure areas at various income levels, that:
     "Given the same total level of spending due to children, the component parts will vary from family to family. That is, families, say, with a focus on dental and health care might show above average child spending on these items, and below average spending on children's clothing. This applies to the USDA (United States Department of Agriculture) estimated components as well, i.e., no measures of variation are presented for the component parts."
     "In short, if the total amount of child support that is supposed to be spent due to children is in fact spent for that purpose, then the component parts are irrelevant. Further, about 75 to 80 per cent of expenditures on children involve jointly consumed goods, e.g., home, auto, utilities, etc This further complicates the question of how much is spent (on average) for each spending class."
The application of this generalized data currently utilized in Kansas and most other states, both from the federal government agency gathering the baseline data, as well as a committees economist, shows no direct relationship with specific circumstances around individual child support scenarios in the state. The BLS explicitly discourages such application of data potentially riddled with nonsampling errors, and an "expert" economist admits that such detail necessary in order to potentially rebut, is not discernible from the model. What is also being pointed out is that there are absolute limits to what can be derived from the CES. Most state guidelines currently in use, stake their entire logic on inferences from the CES. But the CES itself has no way of telling us what the right redistribution of income actually is. It is necessary to supplement the statistical work with what the OCSE report has pointed out is missing in state reviews, the fundamental logic of the guidelines must also be further developed.<\P>

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Continuing, the Income Shares model incorporates the CES data as repackaged by the United States Department of Agriculture (USDA) in their report, "Expenditure of Children By Families" which is published each year. From the 5,000 household quarterly CES data, the USDA culls it down based on the following qualifiers:
1) One child of own, 17 years of age or younger in the household
2) Six or fewer children
3) No other related/unrelated people present in the household
4) Complete income reporters (earn taxable wages)
16,245 Total Survey-Households qualified for 1997 sample
(12,850 Husband and Wife households/3,395 Single-parent households)
Only intact husband/wife households are utilized due to sample size limitations
There is a two child assumption per Husband-Wife household.

The country is then divided into regions; West/Northeast/South/Midwest, and a general US Rural category. (Kansas for instance, is part of their Midwest Region which also includes: Illinois, Indiana, Iowa, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, South Dakota, and Wisconsin. According to the USDA, among the regions, the Midwest is the lowest for child-rearing expenses)