It’s Time for Welfare Reform Again

By
Democratic Presidential Candidates Hillary Clinton And Bernie Sanders Debate In Durham, New Hampshire
Photo: Justin Sullivan/Getty Images

In 1992, Bill Clinton ran for president promising to “end welfare as we know it.” In 2016, Hillary Clinton and Bernie Sanders should promise to bring welfare back.

Thus far, they are doing no such thing. Neither Clinton nor Sanders has a welfare-reform proposal, despite the raft of options they have floated for helping lower-income families. Neither Clinton nor Sanders brings up welfare when discussing what good they would do for the poor. Neither campaign even bothered to get back to me when I requested comment for this piece. But our broken welfare program has left hundreds of thousands of people in extreme poverty, living on less than $2 a day per person. A battle between a fiercely progressive presidential candidate and an only slightly less fiercely progressive presidential candidate has somehow managed to overlook and avoid confronting the ragged hole at the very bottom of our safety net. This is a policy outrage and a moral blight.

Granted, fixing welfare is not popular politics. The program’s beneficiaries are not a powerful voting bloc, being as many of them are poor children. Its adult recipients are deeply, deeply stigmatized. And the 1996 reform bill that created the Temporary Assistance for Needy Families program has been widely heralded as a bipartisan success, acclaimed by everyone from Ted Cruz to Clinton herself. For seemingly good reason: After the Bill Clinton reforms two decades ago, there were unprecedented increases in the number of single mothers working, and unprecedented drops in the number of families receiving cash benefits, as the Center on Budget and Policy Priorities notes.

Would that it were an actual success. To be sure, welfare reform did remove the incentive for individuals to stay on the dole, and it did nudge many parents into working. But welfare reform has also utterly and completely failed millions. And it is time for progressives to fix it, whether it would be popular or not.

To understand how the program has failed, it helps to understand the mechanics of the 1996 law. Prior to TANF, there was the New Deal–era Aid to Dependent Children program, aimed at helping the Great Depression’s widows and the children in their care. But by the 1990s, the archetypal recipients of what was then called Aid to Families With Dependent Children were not widows but unwed mothers, many of whom would lose their welfare if they started working. (Remember the mythical Welfare Queen and her Cadillac?) Clinton campaigned on fixing welfare. He twice vetoed Republican reform proposals for being too punitive. But in 1996 he grudgingly signed legislation that put a 60-month lifetime cap on benefits and required welfare recipients to find a job after seeking aid, among other changes.

What followed looked like a huge success. The program’s rolls shrank. More women started working while raising their families. Washington killed the Welfare Queen, it seemed. But the extremely strong economy of the late 1990s along with other policy changes made during the Clinton administration — among them a boost to the minimum wage and an expansion of the earned-income tax credit — helped move families into work and off of welfare, too. And in time it became clear that the program’s rolls shrank not because fewer families needed welfare, but because fewer families could access it. In 1996 68 percent of poor families received welfare. As of 2013 it was just 26 percent. The average monthly caseload fell from nearly 5 million to less than 2 million, even as the number of families living in poverty climbed and the number of children living in extreme poverty doubled.

“Welfare reform plus a strong economy plus EITC got a lot more people working,” says Kathryn Edin, the Johns Hopkins professor and co-author of $2.00 a Day, along with Luke Shaefer. “We don’t want to say that didn’t happen. However, there’s a pretty large segment of the population that got left behind in ways we should be worried about.”

Why did they get left behind? Well, TANF functions as a block grant, meaning that the federal government disburses a fixed amount of money to the states, which have a significant amount of leeway in determining how to get it out to poor families. That block grant has never increased in size — not once in the past 20 years, meaning that inflation and population growth have steadily eroded its $16.5 billion in value. (To give a sense of how small that number is, the federal SNAP, or food stamp, program spent $84 billion in 2015.) In not a single state does TANF provide benefits equivalent to half the federal poverty level for a family of three. Even if you are getting TANF — and odds are you are not — it is not going to be enough to get you out of poverty.

Not all of that $16.5 billion is spent on basic assistance to poor families, either — in fact, only $4 billion or so is. Many states divert funds for other uses — for instance, job training, child care, prekindergarten programs, and even college scholarships. Between states, the variation in how many and how much poor families receive is enormous. Some, like California and New York, are pretty good about signing families up. Others, like Georgia, are not. As of the 2015 fiscal year, there were only 12,924 welfare cases in that state, despite there being about 650,000 children living in poverty there. Georgia does have a hardship-waiver program, recognizing that “some may never be fully self-sufficient” and that some people might need more help for longer than the 48 months that the state provides. As of 2015, not a single person in the state qualified for such a waiver. In Wyoming, just 4 percent of poor children live in a household that receives TANF.  

Moreover, the fact that welfare is a block grant means that it does not act as a countercyclical ballast. When the economy is bad — like it was during the Great Recession — it takes an act of Congress to flush additional money to welfare. That meant that while the number of Americans on food stamps, for instance, soared during the recession, the number of Americans receiving welfare only increased a bit. The proportion of eligible families receiving welfare actually decreased between 2007 and 2012 from 36 to 32 percent, whereas the proportion of eligible households receiving SNAP benefits climbed more than 20 percentage points from 66 to 87 percent.

There are now millions of people whose poverty qualifies them for welfare that do not receive it. That “pretty large segment of the population,” as Edin puts it, includes people that cannot or will not bother jumping through the hoops that states set up for welfare recipients. It includes the people who do not even know that the program exists and is there for them. (When was the last time you saw a highway billboard encouraging mothers to sign up for welfare?) It includes the many “soft diversions,” the people discouraged from signing up by state administrators. In her book, Edin describes a woman who applies for TANF, only to be told, “Honey, I’m sorry. There are just so many needy people, we just don’t have enough to go around.” Then there are the people who do not want to live with the stigma of signing up. “These are people who are hanging on to the ragged edge of work and are saying to themselves, 'I am not that kind of person!'” Edin says.

Finally, there are the people who just cannot meet the program’s strict work requirements, for whatever reason. “This is a very disadvantaged group,” says LaDonna Pavetti of the Center on Budget and Policy Priorities. “These are families with high rates of mental-health problems and lower levels of education. Some of them get jobs, but a large number of them don’t.” This leaves a gap at the very bottom of the safety net, for the very poor who are out of work or marginally attached to the labor force. And true victims here are not parents but children.

So here is my humble suggestion for the Clinton and Sanders campaigns: If you really want to help low-income families, bring back welfare. Make it easier to get and easier to keep. Rename it, rework it, and destigmatize it. Use it as a vital, instrumental tool to help all very low-income families with children, not just a last resort for some. Make reform about helping kids and ending extreme poverty rather than punishing parents.

Recognize that the economy of 2016 is not the economy of 1996. There are not enough jobs, and too many of the ones we have are not enough to get out of poverty, let alone into the middle class. If the problem was ever cultural, if the problem was ever that some adults just lack intrinsic motivation — and was that ever true? — we know that it is not today’s problem. People are desperate to work, but the jobs are not always there for them, and the system does not always work for them.

If need be, bolster the current system by providing it with additional funding and requiring states to use it better, as President Obama proposes in a little-noticed provision in his most recent budget. Or, better yet, tear down the current system entirely. Create a federal entitlement for families along with a strong jobs initiative, perhaps one modeled on the successful recession-era TANF Emergency Fund. “There should be a real safety net, and a serious job-placement effort, including child care,” says Peter Edelman, who quit the Bill Clinton administration over welfare reform and is supporting Hillary now. “Do all of that with the proper investment.”

But one way or another, Bernie and Hillary, bring welfare back. Bring it back because you love poor children more than you judge their parents for their inability to keep a job. Bring it back because you love poor children more than you hate their fathers for abandoning them, or their mothers for having an addiction. Do it because you recognize that some parents will have mental-health conditions that our public system will never adequately treat. Do it because you recognize that some adults will have disabilities that Social Security will never recognize. Do it because some children will have parents that will make terrible decisions over and over and over again, and we still — especially — need to support those kids. Do it because you realize that welfare reform was a punitive policy whose consequences were papered over by an economic expansion, during which time everybody in Washington declared victory and walked away.   

It might not be popular. But Sanders and Clinton should embrace welfare for the extraordinary good that it could be, and should hate welfare for leaving so many families adrift — and should push back on the narrative that the only deserving poor are the working poor, and the only deserving families are working families. After all, it is not really a safety net if we let the absolute most vulnerable in our society fall through the cracks.