September 8, 2014 | Commentary on Economy, Welfare and Welfare Spending

Why is dependency rising, and can it be reversed?

Often during an economic recovery, welfare caseloads fall as jobs return. In this recovery, welfare caseloads kept climbing through 2012. That’s the message of a new Census Bureau report released last week, which found that, at the end of 2012, the number of Americans in households collecting “means tested” welfare assistance was officially 109 million.

That’s close to the number of people huddled around TV sets to watch the Super Bowl.

It’s also 35 percent of all households that receive at least one form of public assistance – food stamps, Medicaid, supplemental security income, nutrition programs for kids, housing aid, and so on. Many tens of millions receive multiple forms of aid.

This number does not include those on disability and unemployment insurance. That’s millions more. Social Security and Medicare are earned programs, so they are not included.

When 109 million Americans are on some form of welfare assistance, we have to wonder whether we have reached some kind of welfare tipping point.

Have we reached a welfare tipping point? No. I disagree that the trend of dependency is irreversible.

We succeeded in reducing government dependency in the 1990s, when governors like Tommy Thompson of Wisconsin and John Engler of Michigan began to experiment with work and educational requirements, time limits and so on, to encourage work over welfare. Then the feds enacted a landmark welfare reform bill in 1996, which adopted many of these reforms on a national level. These reforms – coupled with an economy that was creating millions of new jobs – helped reduce cash welfare caseloads by more than half in five years.

Why is dependency again on the rise? Today many of those reforms are gone. Only 5 percent of the welfare today is through the old cash assistance program. Now the new welfare is food stamps, disability, and unemployment insurance, to name a few. President Obama repealed the limited work requirements for these programs. Last year when Republicans dared insert even modest work requirements for food stamps applied only to nondisabled adults without children, they were accused of being cruel.

The Left has encouraged more welfare participation. President Obama boasts that Obamacare has already added 3 million people to Medicaid rolls, as if more welfare caseloads is a policy triumph. Nancy Pelosi has called food stamps and unemployment insurance one of the most effective economic stimulus programs.

Welfare caseloads aren’t falling in part because this administration doesn’t want them to. Times sure have changed. Bill Clinton boasted about the reduction in welfare caseloads in the 1990s.

What’s most important as a first step toward restoring self-reliance is to at least acknowledge as a nation that when there are 109 million Americans collecting some form of welfare, we have a crisis on our hands. It’s partly the economy, but partly cultural. The poverty lobby has worked hard to erase any negative stigma attached to welfare benefits. In some cities in America food stamps are like a parallel currency. By the way, in 2012 there were 51 million Americans on food stamps.

One possible approach has been suggested by Rep. Paul Ryan. He would turn many of the welfare programs, like food stamps, back to the states so they can find ways to expeditiously move people swiftly back into work.

What is for sure is that the feds have failed in replacing welfare with the dignity of work. Or worse, they haven’t even tried.

 - Stephen Moore is chief economist at the Heritage Foundation.

About the Author

Stephen Moore Distinguished Visiting Fellow
Project for Economic Growth

Originally appeared in the Orange County Register