- Welfare spending is climbing faster than spending for education, defense, and even Social Security and Medicare.
- After adjusting for inflation, welfare spending is 13 times higher today than in 1965, when the War on Poverty started
- The average out-of-wedlock birthrate is 40%, while African-American populations see a rate of 72%. In 1965, the average was 7%.
- Under President Obama, welfare spending is projected to increase $10.3T over the next decade
- Meant to provide temporary assistance, half of all food stamp aid goes to individuals who have been in the program more than 8 years
Simply put, welfare spending, like most government spending, is on an unsustainable path.
But despite all the gloom, Rector and Bradley are clear that there is hope for reform. In 1996, welfare reform was hugely successful. As a result of those reforms, “caseloads shrank by over 60 percent, 2.8 million families moved off the rolls and into jobs, and 1.6 million fewer children were left in poverty.” Rector and Bradley make the case that these successes can be repeated again. And, moreover, they must. With exploding deficits and a soaring national debt, it is absolutely critical that America get a hold on its spending.
To that end, the paper lists five principles of reform:
- Slowing the growth of the welfare state. Unending government deficits are pushing the United States toward bankruptcy. The U.S. simply cannot afford the massive increases in welfare spending planned by President Barack Obama. Welfare spending is projected to cost taxpayers $10.3 trillion over the next 10 years. Congress needs to establish reasonable fiscal constraints within the welfare system. Once the current recession ends, aggregate welfare spending should be rolled back to pre-recession levels. After this rollback has been completed, the growth of welfare spending should be capped at the rate of inflation.
- Promoting personal responsibility and work. Able-bodied welfare recipients should be required to work or to prepare for work as a condition of receiving aid. Food stamps and housing assistance, two of the largest programs for the needy, should be aligned with the TANF program to require able-bodied adults to work or to prepare for work for a minimum of 30 hours per week.
- Providing a portion of welfare assistance as loans rather than as grants. Welfare to able-bodied adults creates a potential moral hazard because providing assistance to those in need can lead to an increase in the behaviors that generate the need for aid in the first place. If welfare assistance rewards behaviors that lead to future dependence, costs can spiral out of control. A reformed welfare policy can provide temporary assistance to those in need while reducing the moral hazard associated with welfare by treating a portion of welfare aid as a loan to be repaid by able-bodied recipients rather than as an outright grant from the taxpayer.
- Ending the welfare marriage penalty and encouraging marriage in low-income communities. The collapse of marriage is the major cause of child poverty in the U.S. today. When the War on Poverty began, 7 percent of children in the U.S. were born out of wedlock; today, the figure is over 40 percent. Most alarmingly, the out-of-wedlock birthrate among African–Americans is 72 percent. The outcomes for children raised in single, never-married homes are greatly diminished. Current means-tested welfare programs penalize low-income recipients who get married; these anti-marriage penalties should be reduced or eliminated. In addition, government should provide information on the importance of marriage to individuals in poor communities who have a high risk of having children out of wedlock. Particular emphasis should be placed on the benefits to children of a married two-parent family.
- Limit low-skill immigration. Around 15 percent ($100 billion per year) of total means-tested welfare spending goes to households headed by immigrants with high school degrees or less. One-third of all immigrants lack a high school degree. Over the next 10 years, America will spend $1.5 trillion on welfare benefits for lower-skill immigrants. Government policy should limit future immigration to those who will be net fiscal contributors, paying more in taxes than they receive in benefits. The legal immigration system should not encourage immigration of low-skill immigrants who would increase poverty in the nation and impose vast new costs on already overburdened taxpayers. In addition, the government should not provide amnesty or “earned citizenship” to illegal immigrants, which would provide illegal immigrants with full access to the U.S. welfare system. Of the 11 million to 12 million illegal immigrants in the U.S., at least 50 percent lack a high school degree. Giving this population amnesty and access to welfare would lead to a staggering increase in future welfare costs.
Please take a moment to share this video with your friends and family. Americans need to know the challenges we face and the solutions that are available.