From 1972 to 1984, the value of combined welfare and food-stamp benefits for a family of four with no other income dropped 22 percent nationwide, according a study by the House Ways and Means Committee.
The main reason was that states' cash welfare payments failed to keep up with inflation, the Ways and Means document said.
The study found a rise in maximum welfare payments for families without other income from 1960 to the early 1970s. By 1972, measured in constant 1984 dollars, the average welfare family of four with no other income received $8,894 in welfare and food-stamp benefits.
During the 1970s and early 1980s, however, there were periods of sharp inflation. States did not raise benefits in the Aid to Families with Dependent Children (AFDC) program enough to keep up.
As a result, the combined AFDC and food-stamp benefit level for a family of four without other income averaged $6,955 nationwide in 1984.
This figure was 21.8 percent below the 1972 level and a bit above the level attained in 1960 before there was a food-stamp program.
The study found that the purchasing power of combined welfare and food-stamp benefits dropped in each of the lower 48 states from 1972 to 1984. Figures were not given for Alaska and Hawaii.
Maine had the smallest drop, 1.1 percent. Many states measured decreases between 20 and 30 percent. The latter included Massachusetts, New Jersey, Pennsylvania, Michigan (the figures were for Detroit), Idaho, Kansas, Illinois and South Dakota. For the District of Columbia, the drop was 25.6 percent, for Maryland, 14.9 percent, and for Virginia, 28 percent, the study said.
The study calculated that a working welfare mother with three children, receiving food stamps and an income at half the official poverty level had 28.5 percent less purchasing power in 1984 than in 1972.
It found that, on average, such a woman's purchasing power in 1972 would have been $11,546, in 1984 dollars. By 1984, her purchasing power would have shriveled to $8,250.
The reasons were higher Social Security taxes; higher income taxes, because standard deductions and personal exemptions were not increased to keep up with inflation; reduction of welfare benefits for working persons as a result of President Reagan's 1981 welfare amendments and the states' failure to have welfare-payment levels keep pace with inflation.