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Is Obama gutting welfare reform?

To hear conservatives tell it, the Obama administration is using its executive power to effectively repeal the Clinton administration's signature welfare reform law. Gov. Terry Branstad (R-Ia.) - who was also governor when Clinton signed that bill into law - declared that it was a smashing success “and now we see this administration trying to gut it. I think it is illegal.” Presumptive GOP presidential nominee Mitt Romney says that Obama wants to "strip the established work requirements" from the bill, and John Boehner calls the move "a partisan disgrace."

One man's gutting is, of course, another man's tweaking, but in this case, the Obama administration is not removing the bill's work requirements at all. He's changing them to allow states more flexibility. But the principle that welfare programs must require recipients to move toward employment isn't going anywhere.

Here's what's happening. George Sheldon, the acting assistant secretary for the Administration for Children and Families (ACF) at the Department of Health and Human Services (HHS), sent states a memorandum inviting them to submit applications for waivers from certain aspects of the TANF law. The stated intention is to allow states more room to try programs that promote employment for welfare recipients in the face of the recession. The actual language is rather strict and rules out a number of potential waiver applications. For example, the memo states, "The Secretary will not use her authority to allow use of TANF funds to provide assistance to individuals or families subject to the TANF prohibitions on assistance." Translation: people who aren't on TANF because they didn't meet the work requirements aren't going to get bailed out here. Proposed waivers also must include concrete methods of evaluating performance, and set standards that the new programs must meet for the waiver to continue.

The sort of changes allowed by these waivers, the Center for Budget and Policy Priorities' LaDonna Pavetti argued in a blog, could have a significantly positive impact on TANF's ability to usher people into jobs. She explained that TANF's work requirements are often phrased in terms of "activities," which include not just employment but unpaid work and internships, job searching, etc. "The outcome measure isn't what you want, which is employment rather than activities," she argues. The waivers will make it easier for states to target employment rather than activity participation, so people stuck in unpaid work or spending months on a job hunt aren't counted as successes and denied aid.

The changes also could help reduce red tape, Pavetti says. "There are these extremely strict reporting requirements so staff spend an extraordinary amount of time just counting beans," she explains. "They aren't able to give people the attention they need to actually help them find jobs." The waivers could exempt states from those reporting requirements, freeing up social service workers to actually help those in need.

Welfare experts frame the change as a slight walk-back from the stringent changes to the work requirements established in the Deficit Reduction Act of 2005 (DRA). The waivers don't return the program to the level of flexibility between the initial passage of welfare reform and the DRA's passage, they say, but it moves in that direction. In that way, though, the changes move the law closer to what most people think of as "welfare reform."

Peter Edelman, who served as assistant secretary of HHS under Clinton until he resigned in protest over the signing of welfare reform, tells me that after the DRA "there's so many hoops that the state has to jump through that the last thing that happens is anybody gets help to get a job, especially now in the recession." The waivers are "not a substantial change to the program," he says, but they are constructive.

Both Pavetti and Edelman are quick to emphasize that while the waivers are an improvement, they do not fix what they see as another big problem with TANF, its persistent underfunding. Edelman notes that while other programs for the poor have been powerful stimulative forces during the recession, TANF barely grew at all. "Look at food stamps. It went from 26.3 million people in 2007 to about 46 million now," he notes. "That's huge. And TANF went from 3.9 million to 4.4 million. Only 500,000 more people."

The data bears his point out. While welfare reform did a reasonably good job of transitioning people off the welfare rolls and into employment in the late 1990s, that was because there was full employment and there were jobs for welfare recipients to take. Since the early 2000s, employment of single mothers has steadily dropped, and welfare has left more people without aid or jobs. Only 30 percent of state welfare budgets are spent on actual cash assistance, and the number of people living on less than $2 a day - extreme poverty even by global standards - has doubled since the reforms took effect, according to a study by Luke Shaefer of the University of Michigan and Kathryn Edin of Harvard.

In any case, both Pavetti and Edelman agree that the Republican attacks on the change are dramatically overblown. "It's ridiculous that these people immediately go to saying that the administration is trying to break the promise of TANF. That is beyond fictional," Edelman says.

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