MONDAY MARKS the 20th anniversary of the great domestic policy innovation of the Clinton administration: welfare reform. The federal cash assistance program for the poor was converted from an open-ended benefit to a time-limited one conditioned on work effort, paid for by fixed federal grants to the states (plus state dollars). Born amid fierce ideological controversy, welfare reform has grown to maturity amid equally intense scrutiny, with both supporters and critics mining the data for validation.
It is not surprising, therefore, that think tanks and academics marked the landmark legislation’s birthday with more studies supporting their points. The liberal Center on Budget and Policy Priorities produced a report noting that the share of poor children living in “deep poverty” grew in the wake of welfare reform. Scott Winship of the conservative Manhattan Institute countered, arguing that conventional measures of poverty may, for various technical reasons, understate welfare reform’s positive impact.
All of this added to an already ample information base; none of it, though, altered the basic picture laid out this year in a comprehensive review of the literature by economists Marianne Bitler and Hilary Hoynes: “Welfare reform contributed to a significant reduction in welfare participation and an increase in female employment, with little consistent evidence that reform led to an increase (or decrease) in poverty or a worsening of (or improvement in) child well-being.” We might add that one of welfare reform’s declared objectives — a dramatic reduction in teen pregnancy rates — has also been achieved over the past quarter-century. Though that positive trend started before welfare reform’s passage, it is at least plausible that its continuation had something to do with pregnancy prevention programs tied to the bill.
More to the point, 20 years is a long time for any policy to remain on the books without structural revision, and welfare reform is no exception — especially given its necessary link, via the work requirement, to the fast-changing U.S. labor market. Congress, however, has failed to pass a comprehensive authorization since 2010; it has been making do with a series of temporary extensions. Meanwhile, total federal funding has been frozen at $16.5 billion per year since 1996. States continue to game the block-grant mechanism, using money for programs well outside the law’s “core purposes” — helping the poor get work and providing cash assistance until they do. Some states are squeezing benefit levels and shortening lifetime eligibility periods — to as little as one year in Arizona.
A welfare reform update would keep its core principle — benefits conditioned on work effort — while requiring states to spend more of their funds on achieving the work goals. Congress should permit more flexibility in how individuals may meet work requirements to reflect needs for education, vocational training, addiction treatment and other long-term services. It should also increase support for child care, to help parents who take low-wage jobs with unpredictable schedules to meet the work requirement. There should also be a mechanism for increased funding during recessions.
It seems that every year, Washington greets welfare reform’s anniversary the same way: by arguing about it. This time Congress ought to celebrate with less talk and more action.