Welfare Reform (Part 1)

Heritage Explains

Welfare Reform (Part 1)

How We Got Here

It's been 25 years since President Clinton signed into law sweeping welfare reform. But while this massive bipartisan victory did a lot to strengthen families and sanction the dignity of work from the highest levels of government, a victory 25 years ago doesn't not necessarily mean victory for the next 25 years. Today, President Biden and liberals in Congress are now looking to completely end these successful reforms, and replace them with policies that have been proven not to work. On this episode, we look at the lead up to welfare reform, the politics, the posturing, and of course the success. In addition, we look at the current situation here in D.C. and why it's crucial to push back against the left's attempts to upend welfare reform.

>>>Welfare Reform (Part 2): Where We Stand

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Doescher: From The Heritage Foundation, I'm Tim Doescher, and this is Heritage Explains.

President Bill Clinton: From now on, our nation's answer to this great social challenge will no longer be a never-ending cycle of welfare; it will be the dignity, the power, and the ethic of work. Today, we are taking an historic chance to make welfare what it was meant to be: a second chance, not a way of life. The bill I'm about to sign, as I have said many times, is far from perfect; but it has come a very long way. Congress sent me two previous bills, that I strongly believe failed to protect our children, and did too little to move people from welfare to work. I vetoed both of them. This bill had broad bipartisan support, and is much, much better on both counts. The new bill restores America's basic bargain of providing opportunity, and demanding in return, responsibility.

>>> Reversing Welfare Reform and Returning to “Welfare As We Knew It”

Doescher: That was Bill Clinton 25 years ago, just before he signed into law, the Welfare Reform Act of 1996. It was a victory that enabled many people to curb their reliance on government assistance, by placing a high value on strengthening families, and requiring work, in order to receive welfare.

Doescher: While these reforms have, for the most part, been wildly successful, it's also important to note the incredible and resounding bipartisan support this received. I know, that's rare these days, but this story is not over. Like everything, a victory 25 years ago, doesn't necessarily mean a victory forever, especially when there's a global pandemic to hide behind, and the same liberals against welfare reform in 1996 are now running the show.

Robert Rector: Those people, although they were temporarily subdued because all of their predictions were horribly incorrect, they never went away. And they are now in control of the Democratic party. They're in control of the Biden administration, and they have created essentially a completely new program, where for the first time in a quarter century, we're going to go in, and we're going to give cash aid to single mothers who do not work. That was exactly what we said we want to stop doing that 25 years ago. Now they're resurrecting it.

Doescher: Robert Rector is a Senior Research Fellow, here at The Heritage Foundation. He's a leading voice on poverty and welfare, and was integral in the development of the policy ideas behind the Welfare Reform Act of 1996. On this first episode in a three-part series, Robert will walk us through a bit of the history leading up to the Welfare Reform Act, some of the politics, and the left's current attempt to change these crucial reforms. And, while Robert looks back fondly on 25 years, he also warns us what the next 25 could look like if the left is successful in upending welfare reform.

Doescher: Robert, this is the 25th anniversary of the passage of the Welfare Reform Act of 1996; sweeping reforms to our welfare system. And so, I just wanted to get with you for a little context here. You were on the front lines, pushing for this, and obviously had a big victory. But that was then, and this is now, and a lot's happened since then. So just, first give us, just explain the lay of the land in 1996. This was obviously a bipartisan victory. So, talk a little bit about the lay of the land, and what kind of led up to this welfare reform.

Rector: Okay. So I think to understand the reform, we have to go a little bit, way back in time, back to the beginning of the War on Poverty under Lyndon Johnson in 1963. And as the War on Poverty came in, we had began to dramatically expand the benefits given to poor people, and the number of welfare programs, and so forth. And what had happened, as we did that, was in particular, the non-marital birth rate... When the War on Poverty started, about 7% of children were born out of wedlock. Then here we were, 20 some years later, 25 years later, and that number had risen to well over 30%. By 1992, we had one in seven children on the principle welfare program at that time, which was called Aid to Families with Dependent Children. This was a cash aid program, which almost exclusively benefited single mothers, and they didn't work very much. So we had basically pulled about one in seven children into this socially marginal situation with single mothers on welfare; huge numbers of out-of-wedlock births, and a huge population trapped in dependency without work.

Doescher: Just let me stop you really quick here, because for me, as somebody... I'm younger, I'm a millennial. I don't quite understand, and I obviously don't remember the lead up to this. Was this just building on building on building on, and lawmakers didn't want to touch this so-called social safety net? Is that why it was getting so bad?

Rector: When AFDC was created, and as it was expanded, and as we added food stamps and Medicaid and so forth, it was originally presented as a program for widows. And those who understood, realized that actually by the sixties, this was no longer a program for widows; it was for mothers who had never been married, and was becoming an alternative to marriage. Women were marrying the welfare state, rather than the fathers of their children. But there had been a sort of taboo about talking about this; and the person who began to break that down was actually President Reagan.

>>> Bait and Switch: Biden Child-Allowance “Tax Relief” Overturns Welfare Reform

Rector: President Reagan, as he was in the presidency, consistently, over and over again, talked about reforming the Aid to Families with Dependent Children program by putting work requirements in. He had tried to do that when he was governor in California, back in the early seventies. And he also talked about the importance of marriage. And this message, even though he was unable to accomplish those things, resonated. And by the early nineties, there was a clear recognition that this system was failing; both the left and the right recognized that the system was failing. And in particular, is marriage fell apart in the inner city; we were having an explosion of crime, and the crime was occurring primarily among young men that had been raised without fathers. And this was almost a national crisis at that point. And there was a clear recognition that something needed to be done.

Doescher: And actually, didn't Bill Clinton run on this issue?

Rector: Absolutely.

Doescher: Huh. A democrat.

Rector: So unfortunately, after Reagan left, President Bush really didn't do much of anything about this. And Clinton stepped in. And the single issue that Clinton ran on was ending welfare as we know it ending; ending the AFTC program is we knew it. If you were two weeks out in any swing state in the election in 1992, the only ads that Bill Clinton was running was ending welfare as we know it; which basically meant time limits and work requirements on this central cash aid program. That's what put in the White House. That's the issue that elected him; and he managed to flank the Republicans on the right on that issue.

Rector: Unfortunately for Clinton, he got in office, and he had a lot of left wing appointees and so forth, and they basically stonewalled this issue, so that he didn't really do any reform. And he did other issues, and he didn't do this principle campaign promise that he had made. And because he had not acted on this primary promise that put him in the White House in 1994, the Republicans took the House of Representatives for the first time in forever.

Doescher: They were able to hold him accountable to it, once they were in.

Rector: They were. And the fact that he had not implemented his promise to reform welfare was the centerpiece in the Republicans coming in. They wrote the Contract for America, which had welfare reform at its centerpiece. And I contributed to that indirectly through the Congressman I was working with, who was Jim Talent from Missouri, who was just a splendid, splendid Congressman.

>>> Congress Should Reject Efforts to Restore “Welfare as We Knew It” by Expanding Child Credits

Doescher: So let me just stop you right there, because I want to get into your mind as you were seeing this come to life. This is your life's work, Robert. You have done so much on this. Guys, if you log onto the Heritage website, I can link to a lot of Robert's work there. It is so expansive, and it goes way, way back. And so I just kind of wanted to get into your mind a little bit with ideas. When you were talking with lawmakers, what were the ideas that you said must be in there? "This must be in there." And what was the success rate of those ideas?

Rector: Well, there really were two things. There was work, and there was marriage. And I regarded the principle, actual problem was the collapse of marriage that had occurred in low income communities that everyone kind of recognized that this had happened in the black community, where you had moved from about 20% children being born out of wedlock at the beginning of the War on Poverty, of to around 70% by that time; an absolute catastrophe.

Rector: But also at that time, it was beginning to spread among lower income whites. And this was the worst feature of the welfare state. And then, also moving families out of the mainstream of society, and into a sort of culture of welfare dependence, by having a cash aid program that did not require or encourage work; that was also a terrible thing.

Rector: And honestly, back then, we did not talk about the cost of the welfare system. We didn't say we were trying to save money. We said that the welfare system was destroying the poor. And that's the message that we used. And the American public absolutely believed that; and they believe that to this day. And so what we proposed there, were a series of policies that would begin to help to restore marriage, and to, for the first time, require work as a condition for getting aid.

Rector: What I said at the time, and I say to this day, that welfare should not be a one-way handout; it should be a system of reciprocal obligation, in which we are here, as taxpayers and society to support you if you need that support, you need aid to help raise a family; but we're not just going to give you something for nothing. We're going to expect you to work in return for that. If you can't find a job right away, we're going to ask you to come down to the welfare office, and do some job preparation, maybe do some supervised job search, maybe do some community service work. And I had, knowing contrary to the prevailing academic wisdom at that time, I knew from various obscure studies that when you did that, you would get a dramatic change in behavior, a dramatic reduction in welfare dependence, and a great increase in work.

Doescher: We had a victory even obviously, that was 25 years ago.

Rector: Right.

Doescher: And so, my question really is, has anything changed in that 25 years to lighten welfare reform? Have the Democrats been successful in chipping away at that, given their propensity to not support something like this?

Rector: No. What has happened, is that the reform has gradually continued to produce positive effects. With a proper measurement of child poverty; the child poverty rate among single mothers today is about two-thirds lower than it was 25 years ago. And it's down around 10%, down from where it was, which was around 35% to 40% before reform.

>>> The Biden Child Allowance: Examining the Impact of Welfare on Work

Rector: The other thing that's important is to look at say, teen pregnancy and teen births. In the 20, 30 years before welfare reform, the rate of births to women 19 and under, women 17 and under, had gone up roughly four-fold. It was like a mountain slope going upward. Welfare reform was passed, and what we said to that group was, "Look. You're no longer going to get a lifetime of cash when you have a baby without being married. If you're under 18, you don't get this for free. You're going to have to go back to school. You're going to have to be in school; you're going to have to live with a parent. And the aid is time limited. You're not going to get this for 18 years. You're going to get it for five to 10 years." And as soon as we did that, the teen birth rate, and the teen abortion rate, both in conjunction, fell.

Rector: The one problem that happened with welfare reform was the Republicans only reformed one of the 90 welfare programs. The rest of them: food stamps, housing...

Doescher: That's right. Wait. I just want to stop you. You can't just brush over that number. In your work, you say this all the time; there are 90, 9, 0, welfare-style programs that cost Americans over a trillion dollars a year. Is that correct?

Rector: That's correct. $1.2 trillion, yeah.

Doescher: Okay. I just wanted to make sure we didn't just jump over that.

Rector: Yeah. Sure.

Doescher: We only reformed one aspect of it that's welfare.

Rector: One of the programs, housing, Section 8 housing, Medicaid, food stamps, all of those programs were not touched by reform. And we expected that, given the success of welfare reform, that the Republicans in the early 2000s, would come in and begin to reform these other programs; and that never happened.

Doescher: Right.

Rector: The other problem was that we set up a goal in the replacement program for Aid to Families with Dependent Children; we created a new program called Temporary Assistance to Needy Families, that did have work requirements. It also had goals of increasing marriage; but the work requirements were mandatory in the states; the marriage stuff was more voluntary for the states, and they didn't do anything.

Doescher: Yeah.

Rector: And that was the worst failure of welfare reform, was we were supposed to have the states do these pro-marriage programs, and their bureaucracies resisted; they didn't do them.

Doescher: This is a monumentally tough time right now that we're in. We've got all sorts of big, massive issues happening all at once on the Hill. We've got this Infrastructure deal, the Reconciliation deal that could be attached with that. We're talking trillions and trillions of dollars of spending. And while we are concerned about spending, we're also concerned about what might be in those agreements, those deals; and welfare reform basically is on the chopping block. Isn't that correct?

Rector: Yeah. It's completely reversed. The cache that they're giving, which will be roughly $3,000 a child, is very similar to what the cache that we gave, adjusted for inflation, back 25 years ago, with all those negative effects.

Doescher: How do we stop this? Is this being thrown in with all this other stuff that's happening right now? Or is it-

Rector: Yeah. It's going to be in a massive Reconciliation bill. It's called a child tax credit. In fact, it has nothing to do with taxes. These are cash grants, and most of, almost all the money goes to families that don't work, or work very little. It's just, "We're going to send you a check every month, and we require you to do absolutely nothing in exchange for this check." It's a horrible message to send out.

Rector: And what you're also going to be doing is, you're to be saying to a 15 year old girl, "Look, if you get pregnant, you have a baby, we're going to give you $360 a month, really, until the child turns 18."

Doescher: Oh my.

Rector: And that's exactly the sort of problem that caused the catastrophe of teens having babies back before welfare reform. We're basically saying, "Yeah, that was a good idea." Bill Clinton ran on ending welfare as we know it. What Biden is doing is restoring welfare as we used to know it, and he's taking the absolute worst aspects of the old pre-reform system, and putting them back in place, doing everything that we basically got rid of 25 years ago.

Doescher: Well, Robert, you have continued to do incredible work on this. And I am always grateful to chat with you. Thank you for your time. It's a valuable commodity here in this day and age. So please, stay well, stay healthy, and keep us updated on this.

Rector: Okay.

Doescher: We want to thank you so much for joining us for Part One of this series on welfare reform. If you appreciate what we do here on Explains, go for the hat trick; hit that like button, hit that share button, and leave us a comment. Let us know if you agree. Even better, let us know if you disagree.

Doescher: Also, I've linked to all the relevant work that helped build out this episode. Robert Rector has so much great content, so I want to be sure you have all the resources you need and more. Michelle will be back next week with Episode Two of this special 25 years of Welfare Reform series. We'll see you then.

Heritage Explains is brought to you by more than half a million members of The Heritage Foundation. It is produced by Michelle Cordero and Tim Doescher, with editing by John Popp.