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Backgrounder #967 on Welfare and Welfare Spending

December 17, 1993

President Clinton's Commitment to Welfare Reform: The Disturbing Record So Far

By

(Archived document, may contain errors)

967 December11.1993 INTRODUCTION York City, has even shown that long-term welfare dependence reduces a child's intellec tual ability by one-third when compared with nearly identical low-income children not on welfare.

Single-parent families also impose staggerin g social costs on the communities around them. Young black men raised without fathers on average commit twice as much crime as youn black men raised in similar low-income families with both a father and mother present.,The,threat of.viole thatlnakes~st.am eric~~~r~.to walk at night in major U.S. cities is a direct result of family disintegration engendered by the welfare state.

It is indeed, as the President maintains, vital to end welfare as we know it. The center piece of President Clinton's reform propos al does give the appearance of changing the system, at least in part. The President proposes to require those parents in the AFDC pro gram who have received welfare for over two years to perform community service work workfare) in exchange for continued A F DC benefits. However, despite the conservative rhetoric the actions of the Clinton Administration during its first year in office have gone in exactly the opposite direction. The Clinton Administration has in fact sought to expand conventional welfare pro g rams and to undermine existing work requirements for welfare recipients 1 s Specifically, the Clinton Administration thus far has Proposed a huge increase in conventional welfare spending. After promising to end wel fare, the Clinton Administration in its first budget proposal asked for $1 10 billion over five years in expanded spending for existing welfare programs, such as Food Stamps, the Women, Infants and Children Food Program (WIC public housing, and energy assistance Ignored funding for workfare. De s pite its pleas for an additional $1 10 billion for conven tional welfare spending, Clinton's proposed budget did not seek one extra dime for ex panding workfare programs. But all experts agree that if the government is to require welfare recipients to wor k in exchange for benefits, extra funds must be provided to administer such work programs.

Postponed long-term work requirements. By avoiding any real commitment to expanding workfare up to the present time, the Clinton Administration has ensured that its efforts to "end welfare as we know it'' cannot even commence until fiscal year 19

95. This very late start makes it unlikely that more than four or five percent of all parents en rolled in the AFDC program actually will be required to work in exchange for welfare benefits by the time President Clinton seeks re-election in 1996 3 1 M.Anne Hill and June ONeill TheTransmission of Cognitive Achievement Across Three Generations paper prepared for the RAND Conference on Economic and Demographic Aspects of Inter generational Relations, Santa Monica California, March 1992.

M.Anne Hill and June ONeill, Underclass Behaviors in the United States: Measurement and Analysis of Determinants August 1993, research funded by Grant No. 88ASPE201A, U.S. Department of Health an d Human Services Requiring large numbers of welfare recipients to perform community service work may reduce total welfare costs by encouraging welfare recipients to leave the rolls. However, even if this occurs, the amount of money specifically devoted to operating the work programs must be increased 2 3 Attempted to reduce current work requirements. Far from promoting workfare programs the Clinton Administration has spent most of 1993 seeking to undermine the few work requirements in existing law. It has even gone so far as to advise states to violate the current law in order to reduce the amount of work that welfare recipients would be required to perform.

The history of welfare is littered with the rhetoric of politicians who have claimed they were, over hauling .thesystem while little or.nothing was-changed. The Clinton Adminis tration is perfectly poised to join in this venerable tradition. Even worse, despite passing references in a few speeches, Clinton seems determined to avoid serious policies deali n g with the core welfare problem: how to reduce illegitimacy and encourage marriage LESSONS FROM THE PAST: THE LEGACY OF BOGUS REFORM The history of the U.S. welfare system is marked by a complete disconnect between political rhetoric and public policy rea lity. For instance in launching the War on Poverty President Lyndon Johnson confidently declared the days of the dole are numbered. But then he greatly expanded the number of welfare programs and the number of Americans receiving welfare.

Just five years ago, Americans were told that the welfare system had been dramatically overhauled with the passage of the Family Support Act of 19

88. The public was told that most welfare recipients would be required to work in exchange for benefits. Senator Pat rick Moy nihan D-NY) declared of the reforms, which he championed, For 50 years the welfare system has been a maintenance program. It has now become a jobs program.A Welfare spending, supporters said, would be dramatically trimmed as child support pay ments from a bsent fathers replaced government-funded welfare benefits for most single mothers.The claim was eerily similar to todays declarations.

The 1988 reforms, it was alleged, would require millions of welfare mothers with young children to work. This claim had r amifications in other areas.of public policy; over the next two years, it gave a major impetus to efforts to fund a national government day care system through the Act for Better Childcare. Proponents of this legislation argued that the 1988 welfare refor m s demonstrated that the idea of mothers in general caring for children in the home was passe. Thus, a new government day care infrastructure would be required not only for the children of welfare mothers who would allegedly be sent to work, but also for c h ildren of the general population But in the five years since the 1988 welfare overhaul, the only noticeable change in the welfare system has been a dramatic surge in spending. Welfare spending by federal state, and local governments in 1988 was $217 billi on-by 1992, spending had surged to 305 billion (both figures are in constant 1992 dollars 4 Bureau of National Affairs, Inc. Daily Labor Report, March 21,1988 3

4 While Americans were told that the 1988 reforms required most welfare recipients to work for benefits, by 1992 only one percent of all AFDC parents were actually required to perform community service work (workfare) in exchange for welfare assistance5 A slightly greater number were required to search for a job or undertake training. Overall as t a ble 1 shows, during the average month in 1992, only 6.9 percent of AFDC parents were required to work, search for a job, or participate in education and training for more than 20 hours per week When pressed to explain the dismal results of the 1988 legisl a tion, the conventional excuse is a shortage of funding for the Job Opportunities and Basic Skills (JOBS) pro gram contained in the Act. Under the provisions of the legislation, this program operates workfare, job search, and training activities for welfar e recipients. This convenient expla nation is misleading, however. The real problem of the 1988 reforms was that very few AFDC recipients were in fact required to participate in any JOBS activity. Since the Act required only six percent of the AFDC caseloa d to participate in job search, training, or community service work, most states met these requirements using only part of the allo cated federal JOBS funds6 There was a shortage of requirements, not a shortage of money.

Significantly, Congress poured bill ions of dollars into expandin the coverage of con ventional welfare programs after passing the Family Support Act. Since 1988, expan sions in Medicaid and housing programs alone would have been far more than sufficient to fund work programs for all AFDC p a rents. The simple fact is that Congress, after tell ing the American public that it was going to require welfare recipients to work for their benefits, did everything but that. What Congress actually did was to limit workfare pro grams while expanding con ventional welfare dramatically.

Congress has followed the traditional pattern in welfare policy over the last five years Lawmakers talk tough about workfare, but Congress keeps the actual number of recipi ents who are required to work as low as possible, a nd expands spending on conventional welfare programs. Unfortunately, during its first year in office, the Clinton Administra tion has shown every indication that it intends to follow this well-worn path Clintons Reform Rhetoric As candidate and as Preside n t, Bill Clinton has spoken often about the need to reform welfare. At times his rhetoric has been stirring in Putting People First: How We Can All Change America, Clinton pledged to honor and reward people who work hard and play by the rules. Welfare refo r m, and more specifically his pledge to end welfare as we know it was invoked often and with great effect during the campaign, and played a key role in Clintons strategy of portraying himself as a New Democrat B 5 6 7 These figures represent the total numb er of AFDC recipients who were required to work in a given month, not merely the additional number who were required to work as a result of the 1988 act.

There is a specific cap for federal JOBS funding for each state; below this cap, federal funds equal a percentage of the states spending on JOBS.

Part of the apparent shortage of state funding after 1988 was due to the vast amounts of state money required to pay for the expansions in Medicaid coverage mandated by the federal government 5 8 Governor Bill Clinton and Senator AI Gore, Puffing People F i rst: How We Can All Change America (USA Times Books 1992 p 165 9 William J. Clinton, Remarks to the National Governors Association, February 2, 1993, Weekly Compilation of Presidential Documents, Monday February 8, 1993, Volume 29-Number 5, pp. 125-128 10 In a speech on November 13, 1993, in Memphis,Tennessee, President Clinton finally did acknowledge that family disintegration was a major cause of crime in the inner city. However, the President made no linkage between illegitimacy and welfare, and his spe e ch, while containing many policy proposals, contained none to reduce illegitimacy or promote marriage 11 One surprising side effect of serious work requirements for single AFDC mothers is that the policy would, perhaps unintentionally, reduce the number o f illegitimate births. Welfare serves as an alternative to work and marriage; placing work requirements on single mothers on AFDC reduces the economic utility of welfare. Thus serious work requirements would encourage women to sidestep the trap of welfare d ependence by avoiding having children out of wedlock in the first place. Work requirements would also increase the marriage rate of those on welfare. However. work requirements are not a sufficient strategy for reducing illegitimacy. And it is clear that t he Clinton Administration has not developed its workfare The centerpiece of President Clintons reform proposal is to end welfare as a long-term one-way hand-out. Adult welfare recipients in the AFJX program would receive normal welfare for only two years. If they remained on welfare for over two years they would be required to perform community service work in exchange for benefits. In Putting People First, which laid the foundation for recent policy pronouncements, Clinton states the gov ernment should Af t er tNo years, requke.those.wha,$,m. work to go..to work, either in the private sector or in community service the government should] provide placement assistance to help everyone find a job, and give the peo le who cant find one a dignified and meaningful community service job. B With this statement, Clinton adopted rhetorically the workfare policy advocated by Ronald Reagan and other conservatives for over twenty years, but opposed by liberal ma jorities in Congress Yet Clintons proposal was not limited t o creating new responsibilities for welfare re cipients. In addition to the stick of required work, he proposed new carrots or incen tives to honor and reward those who work hard and play by the rules. These incentives include an expansion of the Earned In c ome Tax Credit (EITC) and government-funded health care for low-income working parents his carrots and sticks theme of welfare reform. We must provide people on welfare with more opportunities for job training, he declared, with the assurance that they wi l l receive the health care and child care they need when they go to work, and with all the opportunities they need to become self-sufficient. But then we have to ask them to make the most of these opportunities and to take a job.9 While Clintons rhetorical commitment to requiring welfare recipients towork and to rewarding families who strive to be self-sufficient is commendable, it is also strangely limited. Despite having an entire chapter devoted to children and another to the family Purring People First n ever mentions illegitimacy or marriage. By ignoring the need to reduce illegitimacy and to promote marriage Clinton evades the core problem of the wel fare state and the root of many of Americas social problems l Insisting that welfare Earlier this year, i n an address to the National Governors Association, Clinton repeated 6 mothers work at community service jobs will do little to reduce welfare costs or to im prove society as long as the illegitimate birth rate remains at 30 percent and rising THE CLINTON RECORD TO DATE As disturbing as the lack of commitment to tackling illegitimacy is the widening chasm between Clintons welfare reform rhetoric and his actions. The record thus far sug gests hat BillClinton intends to deliver onall ofthe &rots of welfare r e form, such as expanding the Earned Income Tax Credit, and providing government-funded health care to millions of Americans, but deliver on few or none of the sticks, such as work and personal accountability A Disturbing Appointment In his first concrete a c tion on the welfare reform front, President Clinton appointed Donna Shalala as head of the Department of Health and Human Services (HHS). The choice was odd because Shalala had served for years on the Board of Directors of the Childrens Defense Fund, a Wa s hington-based organization which has taken the lead in opposing work requirements for welfare recipients. Shalala actually served at the Childrens Defense Fund during a period when the organization opposed the minuscule work and job search requirements in the 1988 Family Support Act. In her lengthy confir mation testimony Shalala mentioned welfare reform in only one vague sentence. Up braided by Senator Moynihan for her lack of interest in reform, Shalala promised merely to create yet another task force to look into reform Revealing Budget Proposals fare was the Presidents proposed budget submitted in the spring of 19

93. The Presidents budget asked for $1 10 billion in expanded welfare spending over the next five years. Welfare spending was already project ed to grow at a baseline rate of roughly 50 percent over five years, before the proposed spending increases. Thus Clinton was pro posing $1 10 billion in new spending above an already rapidly expanding baseline.

True, some $26 billion of this new welfare spending was to expand the Earned Income Tax Credit. By supplementing the earnings of low-wage working parents, the EITC does help to make work pay relative to welfare. It is one of Clintons carrots to reward constructive behavior and should be considered part of his welfare reform package. But the other spending increases sought by Clinton were largely for conventional welfare pro grams invented in the earlier years of the War on Poverty: Food Stamps, public housing energy aid, community development grant s, and Head Start, among others. A complete list of Clintons proposed welfare spending increases is included in the Appendix.

Some might attempt to justify this expansion of conventional welfare programs on the grounds that welfare was cut back during the Reagan and Bush years. In reality, federal state, and local welfare spending (measured in constant 1992 dollars) grew by more than 50 percent in the Reagan-Bush period, rising from $195 billion in 1980 to $305 billion in An even greater disappointment to those who trusted in Clintons promise to end wel proposals with this objective in mind 7 19

92. And as a per centage of GIW, wel fare spending climbed from 4.2 per cent when Ronald Reagan took office ta 5.2 percent when GeorgeBushle3t S6 the claimed reduc tion of funding dur ing this period can not justify Clintons proposed increases U.S. Welfare Spending: 1929-1 992 350 300 250 200 I50 I 00 50 3illions of I992 Dollars I I I I I I I I I I I I I I I I I I I I I I I I I I No Workfare Funding Still, the drama t ic spending increases for conventional wel fare proposed by Clinton are only part of the picture. The most devastating fact about Clintons bud get is that the $1 10 billion in proposed new welfare spend ing did not contain one thin dime for ex panding wor k fare. If large numbers of wel fare recipients are to be required to work, total welfare costs may fall as recipients leave the rolls, but the amount of money specifically devoted to operating work programs must be greatly increased. The funds for administ ering workfare for welfare recipients are cur rently included under the JOBS program created by the Family Support Act of 19

88. In his address to the National Governors Association in February, Clinton said that the JOBS program had been highly successful but had been hampered by a lack of funds.

However, his budget released a few weeks later contained no increase in JOBS/workfare funding iource: Heritage calculations based on US. government data, Heritage Datacham Some might argue that Clinton could not increase workfare funding until all the details of his welfare reform could be worked out. But when Clinton ultimately unveils his re form, it will contain work programs similar to the workfare program (Community Work Experience program) which exists in c u rrent law and is already operated on a small scale as part of JOBS. If the intent is to end welfare as we know it the Clinton Administra tion should have begun by vastly increasing as soon as possible the number of recipients required to participate in ex i sting workfare programs. It was not necessary to wait until every detail of its final workfare plan had been developed. It is also worth noting that the 8 Clinton budget contained emergency funding requests for other initiatives such as Na tional Service, even though the details of those programs had not been worked out If the Clinton Administration was serious in its plan to require workfare, it would have asked for supplemental appropriations for workfare in 1993 and, say, a quadrupling of JOBS funding f or 19

94. Instead Clinton sought aggressively to expand conventional wel fare not workfare. The money for the proposed expansion of the Food Stamp program alonecauld have quadrupled futUre,funding.for J.QBS/workfwe.'2 By procrastinating on its commitment t o workfare, the Clinton Administration ensured that its campaign to end welfare would not even begin until Fiscal Year 1995 While not all the President's spending initiatives were approved by Congress, the pro posed budget presents a dramatic statement of presidential priorities. The message is clear. The President has promised a welfare reform of both carrots (positive incentives for constructive behavior) and sticks (sanctions or limits on negative behavior). Follow ing the pattern which has become almos t habitual, the carrots have appeared promptly but the stick is nowhere in sight.

The Administration's budget story has a final hypocritical twist. A few months after Clinton proposed $1 10 billion in increased spending, mainly for conventional welfare pro grams, Clinton political appointees at HHS began suggesting that it might be neces sary to scale back Clinton's welfare reform plan because the government lacked funds to pay for it.13 Thus Clinton appointees sought to build a case for reneging on Clinton ' s workfare policy by citing a lack of funds at the same time the Administration was propos ing vast increases in conventional welfare spending The War Against Workfare The Clinton Administration has not merely ignored its commitment to workfare; it has ac tually spent most of 1993 attempting to roll back existing work requirements.

Under the 1988 Family Support Act, only one group of welfare recipients was actually required to work in exchange for benefits. That group was fathers in two-parent families rece iving benefits from the Aid to Families with Dependent Children-Unemployed Par ent (AFDC-UP) program. According to the Family Support Act, fathers in AFDC-UP families would be required to work in community service programs for sixteen hours per week. Cong ress limited this requirement to only 40 percent of AFDC-UP fathers and postponed the effective date of the work requirement until FY 19

94. Note the minimal nature of this requirement: two-parent AFDC-UP families are 9 percent of the AFDC caseload, so 40 percent of 9 percent means only 3.6 percent of the total AFDC caseload faced a real work requirement. Even that requirement to work for a few hours per week was delayed until FY 1994, six years after the Act's passage 12 Federal JOBS funding in future yea r s is capped at roughly one billion per annum under current law. Clinton's proposed expansions to the Food Stamp program were $2 billion in FY1995 and $3 billion in each subsequent year. JOBS funding totals are from Congressional Budget Office, August 1993 Baseline, p. 2

90. Figures on the proposed Food Stamp expansion are provided in Executive Office of the President. A Vision of Change for America, February 17,1993, p.137 13 Jason DeParle, "Clinton Aides See Problem withvow to Limit Welfare The New York T imes, June 21, 1993, p. Al 9 The Clinton Administration's actions with regard to this minimal work requirement have been unequivocal-it has repeatedly attacked it. During the debate on the Omnibus Budget Reconciliation Act, the Clinton Administration sou ht to postpone the AFDC-UP work requirement effective date from FY 1994 to FY 19

96. Since all the work provis ions of the AFDC program undoubtedly will be completely rewritten before 1996, the Clinton Administration effectively was proposing to kill the o nly real work provision in existing law l5 The Administration claimed lamely that it was trying to postpone work re quimnents o AFDCiWP fathex3 because there were no funds to operate such workfare programs. Even assuming this dubious argument is correct, there were no funds to imple ment these workfare programs in FY 1994 precisely because the Clinton Administration requested none.

While the House of Representatives went along with Clinton's plan to roll back the AFDC-UP work requirements during the congressional debate on the budget, the Senate rebelled at this effort to gut the only work requirement in existing law. Led by Senator Moynihan, the Senate rejected the Clinton plan. The Senate then prevailed over the House in conference and the modest AFDC-UP work requirements were maintained un changed.

After the Clinton Administration failed in its legislative efforts to eliminate wor k re quirements for AFDC-UP fathers, it adopted a back-door strategy: If it could not wipe out the law, the Administration proposed to neuter it by permitting and encouraging an open violation of the law by state governments. This September, a few days be f ore the AFDC work requirements were to take effect, Clinton's HHS issued a new regulation which greatly weakened the requirernents.l6 Whereas the law requires participating AFDC-UP fathers to perform community service work at least sixteen hours per week t he Clinton regulations cut this to only eight hours per week. l7 Since these proposed regulations deliberately and clearly violated the law, they drew a firestorm of protest. Among the critics, Senator Alfonse D' Amato (R-NY) declared Now that they can't d elay any longer, the Administration is trying to water down these requirements. It is clear that this Administration is evading welfare reform Faced 54 14 David E. Rosenbaum Delay Sought in Law Meant toTrim Welfare Rolls The New York Times, May 5, 1993, p . B9 15 The Clinton Administration has attempted to justify its attempts to weaken the AFDC-UP work requirement by arguing that the number of AFDC-UP parents who were required to work was technically a subset of the total number of welfare parents (both AF D C and AFDC-UP) who were required to participate in the JOBS program.Thus even if the AFDC-UP work requirements were abolished, the combined total of AFDC and AFDC-UP parents who would be required to participate in the JOBS program would not be affected. B u t the JOBS program is not a work program state governments have the option to put JOBS participants in less demanding training and "job search" activities. As a result few participants in JOBS actually work for benefits. By contrast the AFDC-UP work progr a m, which the Clinton administration sought to abolish, actually requires, for the first time, a definite number welfare parents to work for their benefits. By "postponing the AFDC-UP work requirement, the Clinton administration would have permitted states to put recipients in much less demanding "job search programs rather than real work programs. The bottom line is simple: the Clinton administration sought to do away with the only provision in current law that makes even a tiny number of welfare recipient s actually work 16 The AFDC-UP work requirements were scheduled to take effect at the beginning of fiscal year 1994, which commenced October 1, 1993 17 "Clinton Backs Away from Plan to Weaken Welfare Work Rules The Wall Street Journal, September 27, 1993 1 0 with vocal opposition in the Senate and press articles calling attention to the contradic tion between Clintons rhetoric and policy, HHS quickly rescinded its regulations State Experimentation and Waivers The only area of the Clinton record that suggests even the slightest momentum toward genuine reform has been waivers granted to state governments In keeping with his New Democrat theme, President Clinton has acknowledged that all wisdom may not reside in Washirigton;-D.C Hefiaszhus proposWWFosterstate eX p erimentation in welfare policy by granting state governments waivers from federal law in operating some welfare pro grams. paign pledge to promote state experimentation 19 In addressing the National Governors Association , President Clinton repeated his c a m We need to encourage experimentation in the states I do not want the Federal Government, in pushing welfare reforms based on [my] general principles, to rob [state governors] of the ability to do more, to do different things M view is that we ought to g i ve you more elbow room to Clinton explained that serious support for experimentation must permit the states to un experiment. IO dertake initiatives which go beyond federal reform policies and do things which he, the President, might not personally approv e of. In order to foster experimentation, he pledged to approve waivers of experiments that I did not necessarily agree with If we didnt disagree on anything, what would be the need for experiments? That is the nature of the experiment, is that one person has an idea different from another person.921 However, to date, few of the waiver requests submitted to the Clinton Administration have proposed significant reforms.

The key exception was the waiver request submitted by Wisconsin Governor Tommy Thompson fo r an experiment in two counties. In those counties, the Governor planned to convert the AFDC program into a program of tempo rary aid. AFDC recipients could receive benefits for two years, after which their AFDC benefits would be terminated.

In contrast t o President Clintons national reform proposal Thompsons experimental plan did not guarantee community service jobs to those who stayed on welfare over two years pledge to grant waivers for policies he did not fully agree with HHS attempted to crush the Wi s consin waiver request. HHS demanded that the Governor eviscerate his proposal by guaranteeing all AFDC recipients who remained on AFDC over two years the right to The response of Clintons HHS was predictable. Despite the Presidents explicit 18 Ibid. 19 Co ntrary to common conceptions the U.S. welfare system is almost totally federal, consisting of over 75 federal programs.

State governments merely contribute funds to these federal programs and operate them subject to federal law and regulation. At the reque st of a state government. the federal government may waive federal law and regulation governing a particular welfare program within the state in order to permit policy experimentation. 20 Clinton, op. cit. 21 Ibid 11 community service jobs. This would hav e converted the Thompson proposal from a unique experiment into a mere clone of what Clinton was proposing to do nationally.

Governor Thompson refused to yield to HHS pressure. HHS then sought to cripple the proposal by requiring thewisconsin government to entangle itself in thousands of dollars of due process litigation each time an AFDC case was actually terminated. Despite months of resistance, it was HHS rather thanThompson that finally buckled, and the aiYtynx~~-st+ms. granted without clipplug dif cat ions The Wisconsin waiver will initiate a bold experiment, but its scope is limited. The ex I periment is restricted to only two counties and does not begin until January 19

95. Wel fare benefits will not be terminated for any recipients until two years la ter, in January 1997 cord on workfare has been a disaster. After campaigning on the theme of ending wel fare and requiring welfare recipients to work, Clinton has expanded conventional wel fare spending, requested no funds for workfare, and sought to abol i sh the only real work requirement in existing law. This is scarcely an auspicious start for ending welfare as we know it Reviewing the overall record of the Administration, the lesson is plain. The Clinton re I PRINCIPLES OF REAL REFORM The welfare system desperately needs reform. Real reform would convert welfare from a one way hand-out into a system of mutual responsibility in which welfare recipients would be given aid but would be expected to contribute something back to society for as sistance given. A reformed system also must strongly discourage dependency and im sponsible behavior and encourage constructive behavior. It must firmly control soaring welfare costs, which are slowly bankrupting the nation. Finally, and most important, wel fare reform mu s t seek to reduce the illegitimate birth rate in the U.S. and promote the for mation of stable two-parent families Any reform which does not dramatically reduce the illegitimate birth rate will not save money and will fail to truly help Americas chil dren a nd society ples 1 Establish serious workfare requirements With these objectives in mind, real reform must be based on the following eight princi The key to successful workfare is the number of welfare recipients who are required to participate. Following t he pattern of the 1988 reforms, it is likely that the Clinton plan will be quite complex, appearing to require large numbers of recipients to per form community service work when in reality few are. Real reform would require all fathers in the AFDC-UP pro gram to perform community service work forty hours per week in 19

94. It would also require able-bodied single persons in the Food Stamp pro gram to work. And it should require half of all single mothers on AFDC to perform community work service for benefi ts by 1996 12 2) Establish sensible workfare priorities Workfare programs should be efficient and low-cost. Workfare should be estab lished first for those persons who have the least justification for being out of the labor force. Therefore workfare requi r ements should be imposed initially on able-bodied non-elderly single persons on welfare, followed by fathers in two-parent families on welfare and absent fathers who fail to pay child support. After workfare has been put in.qgation-for.ihese ,groups, thos e .single mothers on AFDC who do not have pre school children should be required to workF2 High day care expenses mean that putting a single mother with a young child to work in a community service work program costs roughly two to three times as much as r e quiring a mother with older child to work. Because work programs inevitably op erate within fixed budgets, an emphasis on workfare participation by mothers with younger children leads to a sharp reduction in the total number of persons who will be require d to work. One little-understood aspect of the workfare debate is that liberals often attempt to focus workfare programs on mothers with very young children pre cisely because they understand this will quickly soak up available funds and thereby limit the n umber of recipients required to participate. Liberal welfare advocates also would like to undermine the general concept of workfare by showing that all workfare programs cost more than they save-so they promote the least cost-effective workfare About half of AFDC single mothers do not have any pre-school children under age five. Workfare should be imposed on single mothers with younger children under five only after most mothers with older children have been required to work. However, if an AFDC mother gav e birth to an additional child after her initial enrollment in AFDC, that child should not exempt her from work requirements This rule is needed to prevent mothers from having additional children to escape the work requirement programs (namely, those with a heavy emphasis on mothers with young children 3) limit welfare given to unwed teen mothers By paying young women to have children out of wedlock, the current welfare sys tem encourages them in a course of action that, in the long term, proves self-defeat ing to the mothers and harmful to both the children and society. Placing millions of single mothers in work and training programs will have little positive effect for society as long as the illegitimate birth rate remains over 30 percent.

Congress must go to the heart of the dependency problem by seeking to reduce the number of illegitimate births.

It has been a tragic mistake for the government to pay money to fourteen-year-old girls on the condition that they have children out of wed lock. The government should begin to address the illegitimacy problem by ending the disastrous present policy of giving AFDC cash payments to unmarried teen mothers 22 There should be no blanket two-year exemption from work requirements. Work requirements which are imposed w h en a recipient first enrolls in welfare are likely to have the strongest possible effect in reducing welfare rolls because they dissuade individuals from enrolling in welfare in the first place. Thus serious work requirements mandated at the time of initi a l welfare enrollment are likely to be the most cost-effective workfare programs 13 As Washington Post journalist Leon Dash has shown in his book When Children Want Children most unmarried teen mothers both conceive and deliver their babies deliberately ra t her than a~cidentally.2~ While young women do not bear unwanted children in order to gain a welfare income, they are very much aware of the role which welfare will play in supporting them once a child is born. Thus, the availability of welfare bolsters th e decision to become pregnant. Refusing to pay young unwed mothers direct cash benefits would certainly result in a sharp and substantial drop in teeYii.illegitimacy.

Those federal AFDC funds, which currently are given directly to unwed mothers under age 2 1 should be converted into block grants to the states. State governments could use the funds to develop innovative new policies for assisting those teenagers who continue to have children out of wedlock. Such polices could include supporting the mothers i n tightly supervised group homes or promoting adoption. But federal funds could no longer be used to simply give cash welfare to teen mothers 4) Do not provide increased AFDC and Food Stamp benefits to mothers who bear additional children while already enr o lled in the AFDC program Under the current system, if a mother enrolled in AFDC bears additional children she receives an automatic increase in her AFDC and Food Stamp benefits. No other family in U.S. society receives an automatic increase in its family income if it has more children. There is no reason to provide expanded welfare benefits to single moth ers who have additional illegitimate children after they are already dependent on wel fare.

A limitation of this sort has already been put in effect in t he state of New Jersey by black Democratic Assemblyman Wayne Bryant. Although available evidence is lim ited, early data suggest that the policy will significantly reduce the number of out-of wedlock births. State officials call attention to a 16 percent d rop in births among wel fare recipients in the first two months following the change in p0licy.2 5) Require paternity establishment for children receiving AFDC 24 e e Current law requires that an AFDC mother must make a good faith effort to iden tify the father of the child in order to receive AFDC. This law is routinely ignored.

The government should require, for children born after January 1994, that the mother 23 Leon Dash, When Children Want Children: An Inside Look at the Crisis of Teenage Parenthood, Penguin Books, 1989 24 There is clear evidence that welfare affects the illegitimate birth rate. For example, Dr. June ONeill found the dollar value of monthly welfare benefits in a state has a dramatic affect on whether women will have children out of w e dlock. Holding constant a wide range of other variables such as income, parental education, and urban and neighborhood setting, 0eill found that a 50 percent increase in the monthly value of AFDC and Food Stamp benefits led to a 43 percent increase in the number of out of wedlock births over the study period. The study also found that higher welfare benefits increased the number of women who left the labor force and enrolled in welfare. A 50 percent increase in monthly AFDC and Food Stamp benefit levels le d to a 75 percent increase both in the number of women enrolling in AFDC and in the number of years spent on AFDC. In other words increases in benefits value will cause dramatic expansion in welfare caseloads.

Source: M. Anne Hill and June ONeill, Underclass Behaviors in the United States: Measurement and Analysis of Determinants, August 1993, research funded by Grant No. 88ASPE201A, U.S. Department of Health and Human Services.

Kimberly J.McLarin, Trenton Welf are Changes Being Felt, The New York Times, December 5, 1993 pp. 4936. 25 14 identify the father of the child in order to receive AFDC, public housing, or Food Stamps.26 Exceptions to this rule in a few hardship cases could be given but the excep tions sh ould not exceed 10 percent.

Modem DNA testing permits government officials to determine the childs real fa ther with absolute confidence. Once the mother has identified the father and paternity has been established, the father can be required to pay child support to offset welfare Stamps received by the mother and child, the remainder should become a debt which the father must repay at a future point.

If the father claims he cannot pay any child support because he cannot find a job the government should re quire community service work from him to fulfill his obliga tion. Experiments with this approach in Wisconsin have led to surprising im provements in the ability of absent fathers to locate private sector employment and pay child support. Moreover, the de f inite expectation among young men that they will be identified as fathers and required to pay child support for their children may put an end to the ethos in some communities where young men assert their masculinity by fathering children they have no inte ntion to support. costs, Kthe child support paid doesnot-equal half the cost of the AFDC and Food 6) Reduce welfares marriage penalty.

The current welfare system heavily penalizes marriage between a mother and a working man. This marriage penalty should be reduced by creating a tax credit for lower-income parents who are married and who are working rather than living on welfare 7) Provide increased funding for abstinence education.

Scientific experiments have shown that strong sexual abstinence curricula s ubstan tially change teenagers attitudes toward early sexual activity. Among girls taking ab stinence courses, pregnancy rates have been reduced by over 40 ercent when com pared with girls who have not taken the sex abstinence classes. By contrast, pro gr a ms promoting contraception may increase pregnancy rates 2 8) Cap the growth of welfare spending No matter how frequently official Washington proposes to end welfare, the costs of welfare continue to rise. Welfare absorbed about 1.5 percent of GNP when Lyn don Johnson launched the War on Poverty in 1965; it had risen to over 5 percent by 1992.

With a $305 billion price tag, welfare spending now amounts to $8,300 for each poor person in the U.S. Worse still, Congressional Budget Office figures project total w el fare costs to rise to half a trillion dollars, or about 6 percent of GNP, by 199828 Pre 26 For children born years agd it often is impossible to locate the father. The paternity establishment rule should therefore be applied prospectively: the mother s h ould be required to establish paternity in order to receive welfare for children born in 1994 and after 27 U.S. Department of Health and Human Services, Office of Adolescent Pregnancy Programs, Final Report O.A.P.P 28 These figures represent estimated fed e ral, state and local spending on means-tested welfare programs and aid to ooosl6-05,1985-1990, p. 8 15 dictably, the Clinton Administration maintains that half a trillion dollars is not enough; ending welfare for the Clinton Administration means adding on even more spending.

The long history of bogus welfare reforms, all of which were promised to save money but did not, leads to one obvious conclusion. The only way to limit the growth of welfare spending is to do just that: limit the growth of welfare spen ding. The wel spending should be capped at, say 3.5 percent per annum? Individual programs would be permitted to grow at greater than or less than 3.5 percent according to con gressional priorities, provided aggregate spending fell within the 3.5 percent ceiling.

By slowing the outpour from the federal welfare spigot, the cap gradually would re duce the subsidization of dysfunctional behavior: dependency, non-work, and illegitimacy. The cap also would send a warning signal to state welfare bureaucracies.

Cushioned by a steady and increasing flow of federal funds in the past, most bureau cracies have found no need to grapple with the tough and controversial policies needed to really reduce illegitimacy and dependency. With a cap on future federal funds, st a te governments would, for the first time, be forced to adopt innovative and aggressive policies which would reduce the welfare rolls. faresystem must..be.put on adiet..The&Ure growth of. federal means-tested welfare CONCLUSION: THE COMING BOGUS REFORM Cli n tons promise to end welfare as we know it was a focal point of his 1992 elec tion campaign. Clinton aides admit that welfare reform is pivotal to Clintons effort to de fine himself as a New Democrat. By claiming that he will require welfare recipients to w ork for the benefits they get,.Clinton has seized a very popular issue; nearly 90 percent of the public believe that able-bodied welfare recipients should be required to do work for their welfare checks.30 But Clintons actions in his first year in office i ndicate strongly that he intends to ex pand rather than end welfare. While Clinton no doubt will boldly embrace the symbols of reform, there is very little indication that he willactually seek substantial changes in the current system. All the evidence su ggests that Clinton will duplicate the meaningless wel fare reform debate of 19

88. As in 1988, the public again will be told that America has achieved a revolutionary change in welfare when in fact little or nothing has been al 1 tered economically disadv antaged communities. The Congressional Budget Office estimates only future federal spending.

Future state and local spending figures were estimated separately by assuming that the ratio of federal spending to state and local spending on specific programs would remained unchanged. This is a reasonable assumption since the required state contribution to most federal welfare programs is legislatively established at a fixed percentage of federal spending on that program. These percentages change little over t i me 29 Medicaid could be exempted from the cap 30 For example, a Gallup poll conducted between March 30 and April 5,1992 found that 88 percent of adults polled favored a law requiring all able-bodied people on welfare, including women with pre-school child r en to do work for their welfare checks. Many polls by other organizations show almost identical results 16 Using the 1988 reform and the first year Clinton record as prognosticators, it seems likely that President Clinton will propose a new round of bogus reform which will have the following features d Any proposed legislation will have tough language about requiring work, but the actual work provisions will be technical and complex. Few on Capitol Hill will read and understand them C I I d While the Admin i stration will claim that vast numbers of welfare recipients will be required to perform community service work under its proposed legislation few will actually be required to work. The percentage of AFDC recipients who are actually required to perform com m unity work service work will probably be under 10 percent in 1996 d The workfare programs established will be inefficient and unnecessarily expen sive. The costs of operating these programs will exceed any savings they achieve by encouraging welfare recip i ents to leave the rolls. The Clinton Administration will claim vaguely that the programs will save money in the long run d The Clinton Administration will call for a heavy new investment in education and training programs for welfare recipients despite th e compelling evidence that such programs are ineffective in raising the wage rates of welfare recipients d The false .notion that huge numbers of welfare mothers have been required to work will be used to justify creating a federal day care system for midd l e class families d The central problem of high illegitimacy rates will rarely be mentioned; no effec- tive policies to reduce illegitimacy and promote marriage will be adopted d Means-tested welfare spending will continue to soar after the reforms and wil l almost certainly top $500 billion by 1998 d The entire Clinton reform will be swaddled in tough, conservative rhetoric.

The bogus welfare reform of 1988 simply perpetuated a social disaster. By creating a facade of illusory change, the 1988 Family Suppor t Act stalled serious reform efforts for a half decade. Accumulating evidence indicates the 1988 process is about to be repeated.

But American society cannot afford another round of bogus welfare reform. The wel fare state is out of control and growing rapidly. Insidiously, welfare creates its own clien tele; by undermining work ethic and family structure, the welfare state generate s a grow ing population in need of aid. This is why welfare spending has risen from l .5 percent of GNP when Lyndon Johnson launched the War on Poverty in 1965 to 5 percent today.

Spending will rise to 6 percent of GNP within few years, and there is no end in sight.

Moreover, by promoting illegitimacy and family disintegration, welfare is a leading cause of crime and other social problems 17 The only way to end this expensive and destructive pattern is to enact true reform-re form that controls costs, redu ces dependency, and above all, reduces illegitimacy Robert Rector Senior Policy Analyst David Kuo assisted in preparing this study 18 .APPENDIX Proposed Expansions for Welfare Programs from A Vision for Change for America The Clinton Administration Budget Proposal FY 1994 r The following is a list of spending increases in means-tested welfare programs and re lated programs for low-income persons and communities proposed by the Clinton Ad ministration in its initial budget submitted to Congress on February 17th of this year.

While not all of these spending increases were enacted by Congress, the list does give a clear indication of the priorities of the Clinton Administration.

All figures are taken directly from the Appendix to the Presidents budget summary, A Vision of Change for Arneri~a Most figures represent proposed spending increases over a five-year period from fiscal year 1994 through fiscal year 19

98. However, Sum mer of Opportunity figures generally represent short-term spending initiatives of on e or two years. Some programs are listed more than once in the budget, receiving multiple in creases from separate initiatives. For example, the Clinton Administration proposed to in crease WIC funding as part of the Summer of Opportunity and again as par t of Life long Learning. In these cases, the total proposed increase for the program is the sum of all the increases listed separately in the budget Proposed Increases in the PI 1994 Budget Request Summer of Opportunity WIC Supplemental Feeding Program Exp and food benefits to women and children. Cost 75 million Emergency Food Assistance Program Chapter 1, Summer School Program Provide added federal money to purchase food for food banks.

Expand funding for summer school programs for children in poor neighborhoods.

Expand education funding for schools in disadvantaged areas.

Expand Head Start through the summer months Cost 23 million Cost 500 million Cost 235 million Cost 500 million Chapter 1, Census Supplemental Head Start Summer Program 31 Executive offic e of the President, Office of Management and Budget, A Vision of Change for America (Washington D.C U.S. Government Printing Office, February 17,1993 19 HHS/Head Start Childcare Feeding Pay for meals of children attending the expanded Head Start summer pr ogram.

Buy vaccines for low-income children.

Immunization Cost 56 million Cost 300 million Summer Youth Employment Finkhce more thaii 700,000 Suinriier jol for low-income youths. Cost 1,000 million Worker Profiling Provide funds to identify workers that n eed job placement help. Cost 29 million in community service projects.

Extend Unemployment Compensation: National Service Program Urban Development and Housing Initiative Pay volunteers to perform community service.

Accelerate Public Housing Modernizatio n Accelerate a backlog of funding for Community Service Employment for Older Americans Provide added funds to expand participation of senior citizens Cost 26 million Cost 4,OOO million Cost 15 million improving public housing. amyear cost: $1,035 million C ommunity Development Block Grants Funding for previously unfunded projects like street and bridge work, building rehabilitation, painting and resurfacing, and other public service projects in disadvantaged areas 5-year cost 2,536 million Supportive Housin g Expand funding for homeless shelters. 5-year cost 423 million Environment/Energy Increase Weatherization Grants Expand grants to encourage state weatherization programs for low-income people 5- year cost 47 million Rebuild America -Infrastructure Busines s and Community Initiative Provide federal assistance to low-income rural residents to raise their standard of living.

Provide more federal money for low-income people to insulate their homes Increase Weatherization Grants 5-year cost 1699 million 5-year cost 375 million 20 Community Development Block Grant Provide more funds for low- and moderate-income residents to impr ove their communities.

Invest in enterprise zones in poor areas.

Enterprise Zones (tax incentive Community Development Banks ate banks-iXat would provide gdvemment loans for business and housing purposes in low- and moderate-income areas Expand housing subsidies to more Americans.

Provide funds to upgrade government rental housing.

Increase funds for homeless.

Increase funds to repair and restore public housing.

Provide added spending on young people Housing Vouchers Preservation and Restoration of Ass isted Housing Supportive Housing Program Distressed Public Housing: HOPE Youthbuild Lifelong learning WIC (Special supplemental food program for women infants, and children Expand food aid to families with young children.

Parenting and Family Support 5-ye ar cost 430 million 5-year cost 4,119 million t 5-year cost 468 million 5-year cost 1,370 million 5-year cost 1,377 million 5-year cost 424 million 5-year cost 373 million 5-year cost 106 million 5-year cost 3,634 million Provide funds to government progr ams to teach low and moderate-income parents how to raise children.

Increase Head Start funding.

Employ volunteers for community service 5-year cost 1,450 million 5-year cost 13,846 million 5-year cost 9,430 million 5-year cost 14,910 million Head Start N ational Service Worker Training Initiatives Rewarding Work EITC Add to funding for training low-income workers.

Expand refundable tax credits to low-income working families with children 5-year cost 26,787 million 5-year cost 2,400 million Unemployment Ex tension 21 Health Care Food Stamps Low-income Home Energy Assistance Program Provide funds to expand the Food Stamp program.

Increase funding to pay utilities bills for low- and moderate-income families 5-year cost 12,000 million 5-year cost 2,945 million a L 22

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