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For Better Or Worse?

By Robert J. Samuelson
Wednesday, July 31 1996; Page A27


We are now hearing a lot about the promise and peril of "welfare reform." To its champions, the legislation nearing congressional approval would destroy the "culture of dependency." Critics see it as further impoverishing many poor families. Both are correct. The exercise aims to promote self-reliance by making it harder for people to rely on government. Without the threat of extra suffering, people would have no reason to change. What can't be predicted is how the good and bad will balance.

I have put "welfare reform" in quotes, precisely because "reform" is a term of art. It is automatically attached to any scheme for social change, from "campaign finance reform" to "school reform." In debates about these proposals, the protagonists act as if they can easily foretell the effects, for good or ill. As often as not, this convenient fiction spawns "reforms" with many unintended consequences. The process is now in full swing with "welfare reform."

The combatants regularly issue confident predictions and shrill denunciations that depict a fixed future. Last week, for example, the Urban Institute, a research group, released a study estimating that the House-passed welfare bill would increase the number of people in poverty by 2.6 million people, including 1.1 million children. Naturally, opponents of the legislation seized upon this to emphasize how bad it is. But a close look at the study shows that its conclusions ought to be highly qualified.

The House and Senate bills would give states great flexibility to run their welfare programs within broad federal guidelines. Total lifetime federal benefits would be limited to five years, though states could exempt 20 percent of their caseloads. States would be pressured through complex regulations to move most mothers into some type of "work" within two years. After making some assumptions about state programs, the Urban Institute study estimates that the loss of benefits would outweigh the increase in earnings from jobs.

This could happen. The study's assumptions aren't implausible. But uncertainties abound. First, the full rise of people in poverty would occur only in 2002 after all the bill's provisions took effect. Between now and then, Congress (or the states) could make changes if things went badly. This is especially true of one of the bill's worst provisions: the denial of many benefits, including food stamps, to legal immigrants. That alone accounts for about two-fifths of the bills' benefit cuts.

Second, the increase in the poor would be much less – only 800,000 and not 2.6 million – if the Urban Institute had used the government's official definition of poverty. I cite this difference not because I think the Urban Institute deliberately inflated the impact of "welfare reform" but because it shows how perceptions can be shaped by somewhat arbitrary statistics.

(For numbers freaks, the difference arises because the government definition counts only cash income to determine who falls below the poverty line: $15,141 for a family of four in 1994. Excluded are benefits such as food stamps that substitute for cash. The Urban Institute counts many of these benefits. As a result, the Urban Institute finds many fewer poor people; but if welfare reform cuts non-cash benefits, the impact on recorded poverty is greater. Still, the number of poor by the Urban Institute's count – even after adding 2.6 million – would be almost 25 percent lower than under the government count.)

Statistics aside, what matters are people. Would more be made better or worse off by "welfare reform"? Unfortunately, we can't answer that, because we can't predict all of "reform's" effects. The Urban Institute examines one aspect of change: the shift from welfare to work. The study assumes that two-thirds of mothers who lost welfare would get jobs – many part-time – paying about $6 an hour. That wouldn't offset all the lost benefits. But this may miss some other favorable effects. Stingy welfare would discourage some out-of-wedlock births and prompt some parents to marry. "The main route off welfare for good is marriage," says Douglas Besharov of the American Enterprise Institute.

How large might these changes be? Neither Besharov nor anyone else knows. But the social climate is shifting, and "welfare reform" is simply a part of the change. Harsher welfare may reinforce the messages that many teens are hearing elsewhere; and the impact may be amplified by tougher enforcement of child support payments and more prosecution for statutory rape of older men who prey on young girls. Teens account for 29 percent of out-of-wedlock births; the worst aspects of the "welfare problem" would diminish if, somehow, these pregnancies would drop.

The case for the present "welfare reform" is that, despite many flaws, it would disrupt the existing system. As Mickey Kaus argues in Newsweek, we may discover what works and what doesn't. Some states would emphasize job training and child care for welfare mothers; others would impose harsh time limits. All could be forced to examine how charities, churches and self-help groups can best aid vulnerable families. This process is already occurring through "waivers" granted to states to modify existing federal rules; the legislation would give change further impetus.

We ought to be sober about the possibilities. We are dealing with the most stubborn problems of poverty – family breakdown, low skills and human relationships. Changing how people behave isn't easy. Indeed, new government figures show that out-of-wedlock births continue to rise, as Charles Murray notes in the Weekly Standard. In 1994, they were 32.6 percent of all births, up from 28 percent in 1990. These numbers are an argument for assaulting the status quo and a reminder of how hard it will be to change.

The remaining drama over the welfare bill is mostly political: Will President Clinton sign it? And who then – a Republican Congress or a Democratic president – will get the credit or blame for enacting or killing "reform"? However the drama ends, the welfare dilemma will endure. It is this: How can a decent society protect those who can't protect themselves without being so generous that it subverts personal responsibility? No one on either side of this bitter debate has an obvious answer.

© Copyright 1996 The Washington Post Company

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