Some of the sticky particulars of welfare reform, possibly the most difficult issue before this session of Congress, began emerging for the first time yesterday in a private memorandum to President Carter.
In it the two men he tapped to devise a reform plan, Labor Secretary F. Ray Marshall and Health, Education and Welfare Secretary Joseph A. Califano Jr., sound a warning.
If Carter sticks to his goal of no higher initial cost than the present system, they said, he may find it politically impossible to get his proposals accepted.
To stay withing that roughly $25 billion cost ceiling, the memorandum proposes cutting off the benefits for substantial number of persons now on welfare, new basic welfare benefits of from less than one-half of about three-quarters of the poverty line, and "virtually no" fiscal relief to local governments.
It calls for creating 1.4 million jobs for welfare recipients, stresses private-sector employment by making that more rewarding, and warns that if costs run higher than anticipated, "it will be necessary to make the jobs or cash problems less liberal in several key respects."
Carter gave tentative approval to the memorandum late Monday, authorising Califano and Marshall to develop a program along the outlines they set down. A copy of the memorandum was obtained by The Washington Post.
The memorandum notes:
"The politics of welfare reform are treacherous under any circumstances, and they can be impossible at no higher initial cost, because it is likely that so many people who are now receiving benefits will be hurt.
"The states are our natural allies in welfare reform - most members of Congress would still prefer not to deal with the subject at all - and there WELFARE, From A1> is virtually no relief in this proposal for governors and mayors.
"In addition there will be problems in cutting benefits for the aged, disabled, and the blind, and there will be disputes over our ability to put a significant number of the 3.4 million mothers on welfare to work."
Califano, who sent the memorandum, with Marshall's approval, suggested as as working strategy ". . . that we stress to the states and to the Congress that we are only presenting a working plan . . ."
He followed that strategy at a news briefing yesterday in which he mentioned some of the proposals in the memorandum and steered away from others without ever mentioning the existence of the memorandum itself.
"I should emphasize that no final decisions have been made on welfare reform," Califano told reporters.
He said the figures in the working plan would almost surely change, and emphasized that he will now start consulting "in depth" with "Congress, the states, localities, recipients, and others to see exactly how our plan should be further developed and refined."
One source close to the issue said there has already been one change. The memorandum proposed tightening eligibility in a way that would hit hardest at the aged and disabled on Supplementary Security Income (SSI) who live with relatives.
Carter, however, said he did not want SSI recipients get any less than they currently recieved, the source said. The estimated $1 billion cost of keeping them where they are was amde up by knocking $100 chunks off basic benefit levels for other groups.
As outlined in the memorandum, the working plan requires two-parent families with children, single persons, childless couples and possibly single-parent families with older children to accept jobs if they can be found.
Those groups would get an ". . . extremely low basic benefit - less than one-half of the poverty level . . ." to assure ". . . a strong incentive to work."
The aged, blind, disabled - except those on SSI - and single parents of young children would get ". . . a minimum level of support - about three-fourths of the poverty level . . ," so they would be encouraged, but not required, to work.
For those not required to work, the memorandum propose a basic welfare benefit of $4,700 for a family of four in 1978, $3,300 for a single parent with one child, $2,600 for an aged, blind or disabled individual, and $3,900 for the aged, blind or disabled couple.
For those who are required to work, the basic benefits would be lower: $2,600 for a family of four if a job is available, $1,100 for a single individual, and $2,200 for a childless couple.
To encourage seeking jobs in the private sector, those required to work would get to keep the first $3,800 of their earnings if they held private jobs, but only the first $1,900 if they accepted specially created service jobs.
Once the reecipients earnings reached those fidures, their welfare benefits would be cut by 50 cents for each additional dollar they earned.
The memorandum proposes two changes that it calls "highly controversial," because they would "lower the program's cost significantly by reducing payments to many current recipients."
One would, in effect, average all of the income of persons living together, in determining whether any one of those persons are eligible.
Currently only an individual's own income is taken into consideration.
The other changes would determine eligibility "on the basis of income received in the prior six or 12 months," instead of month-to-month, as is generally done now.
In general, the memorandum notes, two-parent families with children, single-parent with children in states that pay low welfare benefits, and individuals and childless couples in states which limited general assistance programs would be better off under the new program.
"Many current recipients would receive substantially less federal support," the memorandum notes, including those in households now receiving extended unemployment benefits, which would be cashed out, along with food stamps. No specific numbers were given.
The memorandum said that the administration's ability to create 1.4 million jobs "remain unproven." Califano told reporters, "I think it'll take everything we have to provide 1.4 million jobs . . . and you'll notice we said we'll try to do everything we can to attempt to produce them . . ."
The jobs, both public and private, would be mostly minimum wage jobs.
Among the issues yet to be resolved are state supplements to the federal payments, fiscal relief for state and local governments, regional cost of living differentials, whether there should be a work requirement for single-parent families, the whole program's relationship to Medicard, and whether Puerto Rico, Guam and the Virgin Islands should be included in the new program.