Multiple reports of welfare abuse have hit the headlines in recent weeks, from a million-dollar lottery winner receiving food stamps to a Massachusetts drug dealer attempting to use welfare cash to post bail and an Alabama nightclub advertising a “Food Stamp Friday” party.
These examples highlight the need to reform a welfare system that is contributing to a culture of entitlement. A crucial element of reform is tackling the ballooning costs of the welfare state, which has become the fastest growing part of government spending.
In a hearing on Tuesday headed by House Budget Committee chairman Paul Ryan (R–WI), Heritage senior fellow Robert Rector discussed the major growth in welfare costs and how to get spending under control.
First, Rector dispelled the myth that the 1996 welfare reforms ended “welfare as we know it.” In fact, he noted, since 1996 the U.S “spends 50 percent more on means-tested cash, food and housing than it did when Bill Clinton entered office on a promise to ‘end welfare as we know it.’”
The reforms have been significantly watered down over the last several years, and as Rector explained on Tuesday, they touched only one of dozens of federal welfare programs:
The public is almost totally unaware of the size and scope of government spending on the poor. This is because Congress and the mainstream media always discuss welfare in a fragmented, piecemeal basis. Each of the 79 programs is debated in isolation as if it were the only program affecting the poor. This piecemeal approach to welfare spending perpetuates the myth that spending on the poor is meager and grows little, if at all.
In reality, welfare programs are costing taxpayers hundreds of billions of dollars each year. In fiscal year 2011, total welfare costs equaled $927 billion ($717 billion from the federal government and $210 billion from states).
From a historical perspective, since the War on Poverty began in the 1960s, the government has spent $19.8 trillion (inflation-adjusted) to fund a growing list of welfare programs. As Rector points out, this is nearly three times “the cost of all military wars in U.S. history from the Revolutionary War through the current war in Afghanistan.”
Yet, despite current annual welfare costs already twice the amount necessary “to lift all Americans out of poverty,” as Rector noted, President Obama plans to increase welfare spending. Welfare costs have already grown by a third since he came to office in 2009. And this isn’t temporary spending due to the recession. President Obama plans to grow welfare such that by 2022 costs will reach $1.56 trillion. Based on President Obama’s plan, in the next decade U.S. taxpayers will fork out roughly $12.7 trillion on welfare.
To control the burgeoning costs, Rector explained that Congress must put a cap on aggregate welfare spending. Once the current recession ends or by 2013 at the latest, welfare funding should be rolled back to pre-recession levels (adjusted for inflation) and then allowed to grow thereafter only at the rate of inflation. This would save U.S. taxpayers more than $2.7 trillion over 10 years. In addition to the spending cap, Congress should tackle the causes of poverty by promoting self-reliance through work requirements and time limits as well as efforts to strengthen marriage in low-income communities.
Pouring more federal dollars into welfare is creating a burden on taxpayers and promoting a system of government dependence. Reforming welfare by getting costs under control and promoting personal responsibility is an approach that not only respects American taxpayers but also benefits individuals in need.