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Welfare to Work
There is a bitter fight brewing in Congress over work requirements for welfare recipients.
President Biden labeled “wacko” the Republican proposal in the debt ceiling bill to require able-bodied childless beneficiaries to either work, obtain job training, or do volunteer work. Our great uniter claimed, “Republicans are cutting benefits for folks they don’t seem to care much about.”
The welfare industry chimed in, saying poor people have no transportation options and job training was not available in some areas. Welfare recipients will be thrown into abject poverty if required to work, because apparently they are incapable of self-sufficiency.
Reform advocates countered that not working is a choice and most people, including low-income people, have more satisfying lives when working and providing for their families.
So which side is correct? They can’t both be, and the answer is important to get right for the future of our nation.
Wouldn’t it be wonderful if we could run an experiment mandating work requirements in welfare programs to see what happens? Good news – that’s already been done.
In the 1990s, the Newt Gingrich-led Congress passed, and President Clinton, after extensive urging, signed a comprehensive welfare reform bill. The law required able-bodied adults to work or be in a job training program to receive benefits. It also placed lifetime limits on welfare.
By the 1990s, the War on Poverty had been waged for three decades. Many Americans were becoming disillusioned as they saw that poverty was winning.
LBJ’s welfare programs to wipe out poverty had been horrendously expensive and yet poverty levels hadn’t been dented. Instead, millions of low-income Americans had adopted welfare as a way of life, to be passed on through generations.
When the reforms were implemented, welfare recipients weren’t cast into the streets, as Senator Ted Kennedy had predicted. In fact, it was a stunning policy success. Welfare caseloads declined by 60 percent. And 70 percent of those leaving began working.
There’s more. Government savings were $100 billion in today’s dollars. Best of all, the child poverty rate plummeted every year from 1994 to 2000. For people leaving the welfare plantation, income increases soon easily exceeded welfare benefits. Moreover, people with jobs enjoyed healthier lives, better marriages, and vastly improved financial futures than those stuck in welfare.
So welfare reformers declared victory and moved on, unfortunately leaving the same entrenched bureaucracy as before to manage the system. Before long, clients were again being evaluated for program eligibility, not work readiness. Workarounds were offered for those who preferred not to work.
As the bureaucracy oozed back into control, work mandates weakened. Many states quietly removed them altogether, as Arizona did for its Medicaid program.
With the onset of the Covid pandemic, the Biden administration took the opportunity to eviscerate work requirements altogether in federal welfare programs. Thankfully, grocery clerks, truck drivers, and cops stayed on the job, but not teachers or welfare recipients.
Now that the pandemic has officially ended, work requirements still have not been reinstated as promised. In fact, Biden refuses to consider such a proposal in the debt ceiling negotiations.
The ending of the pandemic and work requirements have been a boon for the welfare industry. In response to Covid, Congress also increased the Supplemental Nutrition Assistance Program (food stamps) benefit amount and banned states from removing people who were no longer eligible from the Medicaid roles.
As a result, welfare has become more pervasive than ever. Forty million people are now receiving food stamps, even though it’s common knowledge that taxpayers are funding a lot of chips and soda. Medicaid enrollment has soared to 85 million, now that it has been expanded to include working-age men above the poverty line.
There are up to 4 million employable adults not working while 10 million job openings are available. This is a great opportunity to get more Americans back to work, yet Democrats seem more interested in keeping Americans dependent on government than reducing poverty.
We should absolutely have a working safety net, but not a welfare system that keeps Americans mired in poverty. Why not learn from our own history and return again to prioritizing work over welfare?
Published in Economics
Everywhere I go people talk about not being able to hire employees. All the while, we have 4 million able body people on welfare. And yet, we have already tested this program. We know that forcing people to go back to work is a positive for the welfare recipients, their families, and, of course, society as a whole. But once again, the administrative state slings a giant middle finger at the citizens of our country as the bureaucracy does what benefits themselves and ignores the laws passed by Congress and the American people’s best interests.
As I recall, Clinton vetoed it the first time. Republicans made a few adjustments and passed it again with more votes. Clinton vetoed again. Republicans tweaked the bill some more and picked up more votes, enough so that they could override a veto. Seeing that this ship was going to sail with out without him, Bill Clinton made an astute political move and signed that one. If the program hadn’t worked, he could have said it was going to pass with or without him, so his signature made no difference, therefore it’s not his fault. He was shanghaied! But if it worked out, he could claim to have been the captain of this voyage and deserves all the credit. It was a success and of course Clinton took the credit.
Where to go from here? This won’t happen, but I’d say we should get the federal government out of welfare entirely and leave it to the states. If North Dakota wants to give money only to those who just cannot make a living, that up to North Dakotans to decide. If California wants to give each beach bum more money than they could get by working forty hours a week, it’s none of my concern.
It’s OK. Nancy Pelosi told me those people at home are all writing poetry.
It looks like, from each according to his ability, isn’t as popular as, to each according to his need.
That is a gold star comment.
I do agree with the benefits of welfare reform, but the analysis based on the 1990s is a bit simplistic.
I remember the 1990s. It was probably the best decade of my life for the American economy, though the 1980s was a good decade, too. Conservatives have a tendency to attribute this to Reagan’s economic policies, along with better monetary management by the Fed, and I think that there is some truth to this.
But it’s also true that the enormous Baby Boom generation entered their peak earning years in the 1980s and 1990s. Even in good economic times, those years were tough on the American working class, with stagnant real wages, particularly for working class men.
As a result, at least part of the decline in welfare spending, and in child poverty, was probably not caused by welfare reform, but rather was the result of some improvement in policies under Reagan (lower policies and less regulation), and of more favorable demographics.
It would require a much more detailed empirical analysis to determine the effect, if any, of welfare reform.
The OP also claims that “there are up to 4 million employable adults not working while 10 million job openings are available.” I’m not sure of the source of these figures.
If there are really 4 million employable adults not working, we should ask why that would be. Excessive welfare payments could be a plausible reason. So could drug addiction, or a lack of marketable skills, or perhaps worse of all, a lack of requisite cognitive capacity.
I’ve pointed this out before, and it’s unpleasant. By the definition of the IQ distribution, about 16% of people will have an IQ of 85 or below. That is right around the threshold for a person being unable to perform any useful work, at least in a modern economy. The military’s cutoff is an IQ of 83, apparently written into US law. (I got this detail from Jordan Peterson).
But it’s worse than that, when you look at the military. The military has an IQ test called the AFQT, but instead of expressing the result in the IQ scale (average of 100, standard deviation of 15), the AFQT simply uses the percentile score. So if you’re of average IQ, 100, your AFQT score is 50, because you’re at the 50th percentile. If your IQ is 85, your AFQT is 16.
The actual AFQT requirements for recruiting into the services are:
Those correspond to IQs of 93-94.
These are unpleasant facts for everybody. For conservatives, they undermine the argument that everyone can earn a decent living. It just ain’t so, Joe.
I do think that it would be better policy to direct welfare funds less to those who are not working at all, and more to supplement the low earnings of people of very limited ability. This would probably have to be coupled with a reduction or elimination of the minimum wage, which makes it economically unattractive to employ such people.
I do have one more issue to raise about welfare reform. I care much, much more about reforming welfare so that it does not subsidize illegitimacy and single motherhood, and less about work requirements.
I think that we should reduce and phase out welfare for the mothers of illegitimate children. Ever since we’ve adopted this policy, we’ve been awash in what we used to call bastards. It ain’t a good thing.
I do understand the objection to use of the term bastard. It ain’t the kids’ fault, either. It’s the parents’ fault — but most particularly, it’s the mother’s fault. She’s the goalie, folks.
Feminism is such a disaster.