Last Thursday, the Obama Administration quietly issued new bureaucratic rules that overturned the popular welfare reform law of 1996. This was an illegal move, and it completely undoes years of progress that helped millions of Americans.
What Welfare Reform Accomplished
The 1996 reform replaced the old Aid to Families with Dependent Children (AFDC) program with a new program called Temporary Assistance to Needy Families (TANF). At the core of the TANF program were new federal work standards that required able-bodied welfare recipients to work, prepare for work, or at least look for work as a condition for receiving aid. Welfare reform turned “welfare” into “workfare.”
Under the old, pre-reform AFDC program, welfare was a one-way handout: Government mailed checks to recipients who did nothing in return. Reform changed that. The new TANF program was based on fairness and reciprocal responsibility: Taxpayers continued to provide aid, but beneficiaries were required, in exchange, to engage in constructive behavior to increase self-sufficiency and reduce dependence.
The TANF work requirements were not onerous. Under the law, some 40 percent of adult TANF recipients in a state were required to engage in “work activities,” which is defined as unsubsidized employment, subsidized employment, on-the-job training, attending high school or a GED program, vocational education, community service work, job search, or job readiness training. Participation was part-time, 20 hours per week for mothers with children under six and 30 hours for mothers with older children.
This drove liberals to apoplexy. They denounced the reform as an “awful” policy that would do “serious injury to American children.” According to them, reform was “blaming the victim” and workfare was “slavefare.”
Prior to welfare reform, the AFDC caseload had not declined significantly at any time since World War II. After welfare reform, the caseload promptly dropped by 50 percent. As the caseloads plummeted, employment and earnings experienced an unprecedented surge upward.
As welfare dependence fell and employment increased, child poverty among the affected groups fell dramatically. For a quarter century before the reform, poverty among black children and single mothers had remained frozen at high levels. Immediately after the reform, poverty for both groups experienced dramatic and unprecedented drops, quickly reaching all-time lows.
None of this reduced the left’s antipathy for welfare reform. The left had strongly opposed work requirements in welfare in 1996. When TANF faced reauthorization in 2001, they again aggressively sought to repeal federal work standards; they repeated the attack in 2006. For the most part, they lost those battles. But they were not done.
The Obama Administration Rewinds Progress
Having lost repeated legislative battles to abolish workfare, the left has now gone backdoor, using an arcane bureaucratic device called a section 1115 waiver to declare the actual work standards written in the TANF law null and void and grant federal bureaucrats carte blanche authority to devise new replacement standards.
This legal maneuver clearly violates the letter and intent of the TANF law. The Administration cannot use a section 1115 waiver to modify or weaken TANF’s work requirements.
How will this power grab be used? In the past, state welfare bureaucrats have attempted to define “personal care activities,” “massage,” “motivational reading,” “journaling,” attending Weight Watchers, and “helping a friend or relative with household tasks” as work activities. Expect far more of this in the future as one-way handouts again displace workfare.
Clearly, the real welfare-to-work provisions of the TANF law should be restored. But we should also remember that TANF is only one small program in a much larger welfare state. The federal government operates more than 80 means-tested welfare programs to provide cash, food, housing, medical care, and social services to poor and low-income people. At the beginning of last week, only two of these programs had active work requirements. With Obama’s latest order, the list is down to one.
Obama has increased federal means-tested welfare spending by a third since taking office. Last year, combined federal and state spending on means-tested welfare hit $927 billion. (Social Security and Medicare are not included in this total.)
Welfare spending amounts to $9,040 per year for each lower-income American. If converted to cash and simply given to the recipients, this spending would be more than sufficient to bring the income of every lower-income American household to 200 percent of the federal poverty level (roughly $44,000 per year for a family of four).
Remarkably, Obama plans to increase spending on means-tested welfare spending further after the current recession ends, spreading the wealth through a dramatic, permanent expansion of the welfare state. The President’s own budget calls for a permanent increase in annual means-tested spending from 4.5 percent to 6 percent of gross domestic product. Combined annual federal and state spending would reach $1.56 trillion in 2022. Overall, President Obama plans to spend $12.7 trillion on means-tested welfare over the next decade.
Our nation should take the opposite course. Welfare-to-work requirements should be restored in the TANF program. Similar work requirements should be established in parallel programs such as food stamps and public housing. Finally, when the recession ends, total welfare spending should be rolled back to pre-recession levels.
