Welfare to Work Doesn’t Work Without Work

August 27th, 2011 at 10:02 am

There have been a number of posts and articles on the 1996 welfare reform law (TANF—Temporary Assistance for Needy Families), as it turned 15 last week.   I argued that it’s a fair weather ship, performing far better amidst strong labor demand, foundering otherwise.  My CBPP colleague Donna Pavetti posts some compelling evidence in that regard here too.

Rep Dave Camp, the Republican chairman of the House Ways and Means Committee, feels differently.  He released a statement including this point:

“Welfare reform has worked to reduce dependence by promoting work, as intended.  But the job is not finished.  Not only are more reforms needed to ensure that all families on welfare can and do prepare for work, but other programs can and should be reformed to follow suit.  Welfare reform proved that low-income families want to work and support themselves.  We ought to build on those successes by taking steps to ensure that government programs support and not undermine that enduring American work ethic.”

Now, look at this trend in employment rates—share of the group with jobs—for low-income single moms (family income below two times the poverty level) from 1995 to 2009.  If Rep Camp had made this statement in 1999, he might have had a case.  But since then, the share of low-income single moms with jobs has consistently fallen, and, given a welfare program now conditioned on work, the safety net failed to adequately catch them and their kids.

Source: Census ASEC data, analyzed by Arloc Sherman

His whole statement is pure “supply-side” as if promoting work, wanting to work, being prepared to work, gets you a job.   In fact, when the strong demand side conditions of the latter 1990s faded, the fair-weather ship of welfare reform hit the shoals.

I bolded the last line of his statement, however, because there’s a way you can read it that actually makes sense.  I happen to think he’s right that families want to support themselves, but go ahead and make all the rules in the world in all the safety net programs we have: if there are not enough jobs for people, they won’t be able to support themselves or their families through work.

In this regard, ensuring “that gov’t programs support…that enduring American work ethic” means making sure people have jobs.  It so happens there’s a great way to do that—a jobs program from the Recovery Act that was highly successful in helping the TANF population find work—read about it here.

If Rep Camp and others want to preserve the work ethic, they’re going to need to help create some work.


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8 comments in reply to "Welfare to Work Doesn’t Work Without Work"

  1. foosion says:

    There are 4-5 people looking for jobs for every available job opening. http://www.bls.gov/web/jolts/jlt_labstatgraphs.pdf (see chart on second page).

    No matter what their work ethic, or how low paid a job they’re willing to take, there is no way all of them get jobs, because there aren’t enough jobs.

  2. bakho says:

    Clinton policies tied a lot of benefits to jobs. These policies made work far more valuable than welfare. However, in an economic downturn, these benefits disappear.

    How much do the resulting cuts in benefits to the lowest wage earners increase the severity of recession and prolong unemployment, because demand for goods and services depends on supplements given to those who have jobs?

    Does this serve as an “automatic unstabilizer” that makes recessions worse?

  3. Geoffrey Freedman says:

    What happens if extended Federal unemployment insurance extensions are not renewed?.

    I expect that it will be a huge problem in retail and a huge burden placed on state welfare programs, more people will fall through the cracks, and a further contraction of GDP.

    I know there is some talk that long term unemployment beneifits creates a disincentive to find work, but what if there are no jobs?

  4. Michael says:

    Sigh. This was always endgame — conservatives hate the idea of an American middle class. They peeled off the working class from the middle class with the false promise that they were going to stop there. You didn’t have to be faster than the bear, you just had to be faster than your buddy.

    Well, that’s only true if the bear is hungry for himself. If he’s just here to kill people, you’re much better off picking ground and making a stand together.

  5. pjr says:

    People do want to work and we must do something about their inability to find jobs. We need investment projects eventually, and now is the time to do it. Temporary income tax hikes on the top one percent AGI, on dividends, and on capital gains could easily fund at least a couple million jobs without further busting the budget. This wouldn’t much affect demand levels from top-earners but would remove many people from the unemployment rolls and spur business expansion and hiring to satisfy the increased demand from the re-employed. The hikes could be cancelled once we’ve recovered sufficiently. The added economic growth would reduce longer-term deficit challenges. It’s time for the GOP to agree to temporary tax hikes to get this economy rolling to everyone’s benefit.

  6. PeonInChief says:

    I’m much less sanguine about welfare “reform” than other folks here. What it did was to force women to cobble together several part-time jobs to make a poverty-level wage. It didn’t reduce poverty, but did increase the cost of being a low-income household. In addition, it deprived children of ongoing care, as mothers going from job to job couldn’t do much more than tell the kids not to burn down the house. One study found that low-income single mothers in the US have less time for their children than low-income single mothers in other OECD countries, and that this further exacerbates the unequal educational outcomes for those children. See http://www.unicef-irc.org/publications/pdf/rc9_eng.pdf

    In addition, as state budgets have come under pressure, the ancillary services for Welfare to Work programs, most importantly childcare, have been cut, leaving low-income mothers with few options but to survive on the margins. This has led to an increase in families with little or no cash income at all.

  7. david utterback says:

    Carol Plato, director of a Florida hospital administrator about the millions of tax dollars spent providing health care for illegal aliens is spreading like wildfire on the internet.
    Inher testamony on utube she states non paying patients bills
    are folded into working families bills.
    When we go into the hospital on 42nd and Dodge Omaha NE
    the hospital is crowded with Afro Americans presenting the
    red and white cards for payment. When visiting SOMA in South
    Omaha we see illegals coming in for treatment, but caucasions
    must pay according to income.

    Thus medical premium in 2004 for self, wife and children were
    $24,000 annually of which we know illegals and others are not
    paying. When want ads for work appear in newspapers, it would
    seem many are not applying and in observing many are too good
    to work. As a result of the high medical for caucasions whom
    have the work ethic, six million have expatrioted and nine million
    according to americawave.com are contemplating moving abroad.
    Observing the character, the body language, the speech of many
    people, they are simply unemployable due to their lack of willingness to participate, hence never finding a job because
    they present themselves in such a way, no employer would want
    to be burdened with them. The Journal of American Physicians and Surgeons reports that “free medical care has degraded and closed some of America’s finest emergency medical facilities, and caused hospital bankruptcies: 84 California hospitals are closing their doors. Anchor babies, born to illegal aliens instantly qualify as citizens for welfare benefits and have caused enormous rise in Medicaid costs and stipends.” Also Arthur Levitts book entitled
    Take On The Street, explains how welfare applies to persons forging document that caused the mortgage crisis too are welfare
    as they’ve never been imprisoned for forgery.
    Something is terribly wrong with ethics and the failure of government to protect its own citizens favoring illegals and
    minorities that are the highest crime rate offenders. Viewing
    nationmaster.com and the Department of Justice statistics people
    whom commit rape, murder are not employable of not a constitutional liability to the working Americans black, white and Hispanic. All such welfare by those whom are repeated offenders,
    and forgerers, and living off the working class do not constitute
    a basic function of government.