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July 23, 2012

Gutting Welfare Reform: Ending Welfare as We Know It

Ends Work Requirements

  • Waives Centerpiece of Reform: On July 12, the Obama Administration issued a directive from the Department of Health and Human Services (HHS) that guts the successful welfare reform act of 1996. Obama’s new policy allows states to waive the federal work requirement, the foundation of the reform law.
  • Sidestepping the Law: Federal law does not allow HHS to waive the work requirements. When the welfare reform law was enacted in 1996, Congress specifically limited the HHS Secretary’s discretion to waiving certain state reporting requirements, which is not the heart of the reform law. The Obama Administration’s insistence that Congress actually authorized the Secretary to waive the principal reform is not credible, nor is it a fair reading of the statute.
  • The End of Work Requirements: Work requirements have been watered down over the years, as liberals in Congress refused to reauthorize the law and states found loopholes to get around the requirements. The Obama Administration’s directive aims to weaken work requirements much further—to the point that they are essentially meaningless.
  • Americans Favor Work Requirements: The most recent polling data show that the vast majority—83 percent—of Americans favor work requirements be included in welfare.

Successes of Welfare Reform

  • 1996 Reform Effort: In 1996, Congress reformed the largest federal cash assistance program, Aid to Families with Dependent Children. The new law instituted work requirements for the first time and renamed the program Temporary Assistance for Needy Families (TANF). As a result of the changes, welfare rolls decreased dramatically, as did child poverty rates.
  • Recipients Leave Welfare for Work: Prior to welfare reform, the welfare caseload had not declined significantly at any time since World War II. After welfare reform, the caseload dropped by 50 percent. As the caseloads decreased, employment and earnings experienced an unprecedented surge upward.
  • Child Poverty Plummets: 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 children in single-mother homes had remained frozen at high levels. Immediately after the reform, poverty for both groups experienced dramatic and unprecedented drops, quickly reaching all-time lows.

Welfare State Must Be Fixed

  • Government Dependence Boosted: Today, the federal government operates nearly 80 welfare programs at a total cost to state and local governments that is approaching $1 trillion annually. Now the Obama Administration is attempting to boost government dependence by removing work requirements from one of only two welfare programs that include work requirements.
  • Strengthen Work Requirements: The Obama Administration’s directive strangles welfare reform and threatens the principle of personal responsibility. Instead of rolling back welfare reform, work requirements should be strengthened in TANF and added to programs like food stamps and public housing to help those in need become self-reliant and free from government dependence.

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