Welfare Reform Is Now 10 Years Old
Qualifying the Needy: After ten years of apparently successful welfare reform,
there are still many unanswered questions and concerns
Welfare reform, once a hotly contested issue in U.S. politics, no longer burns
with the contentious fire it used to. Now, on the tenth year anniversary of one
of the most fundamental shifts in human service policy this country has ever
seen, advocates and policymakers are looking back at the first ten years of a
multi-billion dollar aid industry.
The system in effect before the shift, Aid
to Families with Dependent Children (AFDC), was a product of Franklin Delano
Roosevelt’s New Deal, left over from 1935. Introduced during the Great
Depression when the U.S. economy was reeling from the grave stock market
collapse of 1929, and many wives had lost their husbands to the First World War
as well as to other economic and social duress, AFDC offered money to mothers in
order to support their children, without requiring them to look for work in a
job market that was practically non-existent at the time.
Fast forward 50
years from 1935, and the situation, at least in the public’s eye, was very
different. Single, unwed mothers had replaced widows as the primary recipients
of welfare, and allegations of abuse were widespread. In 1991 around 5 percent
of all welfare benefits went to mothers who didn’t qualify for them, according
to a 1994 report from the U.S. House Ways & Means Committee. In the late 1980s
Ronald Reagan gave a speech describing a “Welfare Queen” who enjoyed cruising
the streets of Chicago in her “Welfare Cadillac,” which was obtained by
allegedly milking the welfare system for over $150,000. Intrepid reporters out
to score an interview with the “Welfare Queen” found out soon after that she
never existed in the first place. But Reagan’s portentous words on the issue got
the ball rolling, and thus welfare reform became a top priority of the people,
with Clinton saying in his 1992 presidential campaign that welfare “should be a
second chance, not a way of life.” It came to a boil in 1996.
Bill Clinton,
facing a Republican Congress, worked with the conservative Senate and House to
create the Personal Responsibility and Work Opportunity Reconciliation Act of
1996 (PRWOA), a landmark piece of bipartisan politicking which would, in effect,
change the face of welfare for the first time in 60 years.
The welfare program
legislated in PRWOA, was similar to AFDC in that it still provided money to
families with children. Called Temporary Assistance to Needy Families (TANF)
because it is indeed temporary, as opposed to AFDC, five years was the limit for
how long a family could receive welfare checks, at least in most states.
Massachusetts does not have the five-year restriction, but families using its
program can receive cash assistance for 24 months out of every 60 months, or two
years out of every four.
Another change was the shifting of responsibility for
welfare implementation on to state shoulders, allowing each individual
government to determine how best to serve their most needy citizens. TANF
programs are funded by giant amounts of taxpayer money, specifically tailored to
states depending on their economic size and population density and as long as
the states are meeting the federal requirements set down by PRWOA, the money
continues to flow.
This brings us to the most important, most lauded, and
ultimately most controversial element of TANF and the mid-1990s welfare reform:
work.
The criticism usually leveled at AFDC was the program’s lack of
incentives for encouraging people to stop using it. Without a work requirement,
plus guaranteed payments until you made enough money to not qualify, there was a
great likelihood families would remain on the dole indefinitely. There was also
the chance that even if you got a job, it might pay less than your welfare check
after taxes.
TANF changed that. Often referred to as the “welfare to work”
program, it created work requirements and employment quotas that states must
meet. Mothers with children receiving welfare have to be finding work and
staying employed, even if it means working a job for no pay, in order to receive
cash assistance. (However, there are several exceptions to these rules,
specifically to allow mothers who must stay at home for certain reasons to
receive assistance without being required to work).
Welfare reform received
mostly favorable reviews from both political alignments, and was carried to even
greater heights by the economic tidal wave of the late 1990s.
Some of the
often referred to successes of welfare reform in the 1990s are the reduction of
national welfare caseloads by nearly half, the significant reduction of children
living on or below the poverty level, as well as increased employment rates
among single mothers.
“I think we’ve moved tremendously in the right
direction,” Massachusetts Health and Human Services Commissioner John Wagner
told Spare Change News, when asked to comment on the tenth anniversary of TANF.
“We’ve been getting away from just cutting checks.”
Frank Conte, director of
communications for the Beacon Hill Institute, a conservative economic policy
center at Suffolk University, also sees TANF and welfare reform as a giant
success.
“We’ve been fortunate to see the welfare caseloads drop [since TANF’s
implementation],” Conte said.
However, not everyone is in agreement about the
alleged success of the program. Sharon Parrott is director of the Welfare Reform
and Income Support Division for the Center on Budget and Policy Priorities
(CBPP), a non-partisan economic think tank specializing in research on the way
economic policy impacts middle to lower class families in North America. She
coauthored a recent study for the CBPP entitled “TANF at 10,” which aims to show
that although TANF often receives rave reviews that are backed up by seemingly
competent statistical data, these assessments often miss the bigger picture.
Parrott cites three major reasons for the apparent success of getting single
mothers employed in the 1990s: the excellent economy, work supports such as
childcare, and welfare reform.
“But, when the economy failed in 2000,
everything changed direction,” she told SCN.
Parrott came across myriad facts
that indicated some major stumbling blocks in TANF’s ability to help the most
needy of families. Although child poverty decreased in the 1990s, according to
her study the number of children living below half of the poverty line increased
by nearly a million between 2000 and 2004, while the number of children
receiving assistance through TANF declined during the same period.
She also
points out that the reduction in welfare caseloads championed by TANF’s
advocates is likely due to ever changing fiscal poverty levels and could
actually be a result of poor families qualifying out of welfare, while remaining
in poverty.
“There is a fiscal incentive for states to reduce their caseload,”
Parrott said. If a state does not spend the entirety of their TANF block grant
on welfare, it is allowed to transfer that money to other programs that fall
under Health and Human Services.
When the caseload levels dropped in the
1990s, it was heralded as a success of welfare reform. But was it the result of
an increased number of welfare recipients transferring to working lifestyles, or
was it the new federal quotas for caseload levels and stringent work
requirements that were pushing people off assistance?
“There was no
investigation of how caseload levels were reduced so significantly,” she said.
And with more stringent work requirements recently passed at the federal level,
there is a chance that further reductions will be forthcoming and not for the
best of reasons.
“I find it impossible to imagine that states won’t restrict
access in order to meet the new requirements,” Parrott said.
.Commissioner
Wagner is also worried about the new requirements, but for different reasons.
“We’re in a murky state because we no longer have the authority to run a private
program,” he told SCN. “We now have a state law that differs from the federal
law.”
The federal government, according to Wagner, is requiring compliance with
these new standards by October 1. Wagner says there’s no way they’ll meet that
deadline. “They should be giving us a bit more time,” he said.
If the state
requirements remain as they are for a significant period of time, the federal
government will charge Massachusetts a $50 million fine for non-compliance,
according to Wagner.
“We’re trying to navigate two sets of rules. That becomes
very complicated,” he said.
But still Wagner applauds TANF and dismisses its
critics. “The criticism of TANF pales in comparison with that of AFDC,” he said.
Parrott, the author of the TANF study, agrees. “I don’t know anyone who thinks
AFDC was doing a great job for poor families.”
But she also knows that states
are working hard, perhaps too hard, to meet the federal requirements and cut
spending, and, she says, “the cheapest and easiest way to do that is to restrict
access,” which means states will be meeting their federal requirements, while
those in need who don’t fit into certain categories will find themselves
forgotten.
Reprinted from Spare Change News
© Street News
Service: www.street-papers.org
A joint project of the International Network of
Street Papers and the North American Street Newspaper Association.
Paul
