Welfare Reform and its Impact in the Nation and in New York
by
Timothy J. Casey, Esq., MPA
Assistant Director
Policy, Advocacy & Research Department
Federation of Protestant Welfare Agencies, Inc.
281 Park Avenue South
New York, New York 10010
phone: (212) 777-4800
fax: (212) 533-8792
email: HN6281@handsnet.org
August 1998
(Distribution of this report was made possible in part by funds granted by the Charles H.
Revson Foundation; however, the author is solely responsible for the report's content.)
I. Introduction and Summary
This report provides an overview of the content and the impact of modern "welfare
reform." Its focus is the national welfare program for families with children, which
has been the principal target of reform efforts. This program was Aid to Families with
Dependent Children (AFDC) until 1996 when AFDC was repealed and replaced by Temporary
Assistance to Needy Families (TANF). The report also touches on General
Assistance, the generic name for a patchwork of state and local welfare programs for
those who are not eligible for federal or federally-aided welfare, and on a few other
related matters.
"Welfare" as used herein means the programs which provide a basic income to
those who qualify as "needy."
Modern welfare reform has been unfolding for the past thirty years at national, state, and
local levels. The three leading themes have been "less for more" smaller
benefits with larger obligations; "none at all" the abolition of welfare for
the most unpopular categories of needy people; and "restrict access" new
bureaucratic barriers to entry and to continued participation. Unless the political
climate changes, the future promises more of the same.
At the national and federal levels, welfare reform's key products include: 1) a reduction
of benefits by every state to a level far below the official poverty line(1);
2) the abolition of welfare for jobless single adults by most states; 3) the abolition of
a federal welfare entitlement for needy children; 4) work obligations for parents of
pre-school age children, including infants and toddlers, with uncertain child care
arrangements for their children; 5) a growing wave of denials to children as a sanction
for their parent's misconduct; 6) a recent emphasis on "diversion" programs
which may prevent needy people from completing the welfare application process; and 7) the
recent establishment of a five year lifetime time limit on federal aid to needy children
which promises to have a drastic impact when its full effects are felt beginning in 2001.
At the New York State level, the State has followed national trends by cutting benefit
levels and by expanding work obligations. However, because New York States's Constitution
uniquely prohibits abolition of welfare for any category of needy people, New York's
welfare system still covers all needy New Yorkers, and New York's new welfare time limits
are followed by a switch from cash aid to "non-cash" aid rather than by the
withdrawal of aid.
At the New York City level, the current City Administration has: 1) reduced the welfare
rolls, in part by making it more difficult for needy people to complete the application
process and by increasing the number of needy people who are sanctioned for non-compliance
with work requirements; 2) made participation in the City's workfare program, WEP, or Work
Experience Program, the work program activity of choice at the expense of participation in
education and training; and 3) fashioned a two-tiered subsidized child care system which
funnels welfare children largely into informal care of unknown quality that is not
regulated, monitored, or inspected.
As to impact, welfare reform's contraction of benefits for families with children has
helped to make child poverty more common and more severe. Child poverty is strongly linked
to poor health, increased mortality, abuse, neglect, and school dropout during childhood,
and to unemployment and low wages in adulthood.(2)
Nationally, the annual child poverty rate rose from its low of 14 percent in 1969 to an
average of 16 percent in the 1970's, 20 percent in the 1980's, and 21 percent in the
1990's (through 1996).(3) The recent rates are
exceptionally high compared to the child poverty rates in other rich countries. One of the
main reasons, if not the main reason, for our exceptionally high child poverty rates seems
be that our public income support system, including welfare, is much more miserly than the
public income support systems in other rich countries.(4)
In New York, welfare reform has helped child poverty to soar. From 1975 to 1994 the child
poverty rate grew from 26 percent to 44 percent in the City, and from 10 percent to 17
percent outside the City.(5) The percentage of the City's
children in households with incomes less than three-quarters of the poverty line tripled
from 12 percent in 1975 to 36 percent in 1994(6) as a
direct result of the State's reduction in welfare benefit levels.
There has been no comprehensive national, state or local effort to monitor welfare
reform's impact on the every day living conditions of the poor although, ironically,
AFDC's 1996 repeal has led to a virtual new industry of "monitoring welfare
reform."(7) The rise over the past quarter century of
a national network of food pantries, soup kitchens, and homeless shelters suggests a
societal acceptance and institutionalization of widespread hunger and homelessness.
Nationally, in September 1997 the U.S. Department of Agriculture released the federal
government's first ever national data on the prevalence of hunger and food insecurity
based on an April 1995 survey. USDA concluded that 11.2 million persons, including 4.2
million children, were experiencing moderate or severe hunger, and that an additional 23.5
million persons were experiencing "food insecurity." In New York City the number
of emergency food programs has grown from 30 to 1000 in the past two decades.(8)
II. Welfare Before Welfare Reform
Modern welfare began in the 1930's. Before then, welfare was almost
exclusively a function of local government and was typically called "relief," a
word which had the same negative connotation that "welfare" now has.
The Great Depression of the 1930's created enormous hardship and social unrest. Part of
the federal response was the Social Security Act of 1935, which laid the foundation of a
two-tiered national public income support system. The upper tier included two new
"social insurance" programs, Social Security and Unemployment Compensation,
which did not have a means-test and which did not acquire the welfare stigma.
The lower or welfare tier of the income support system consisted principally of four joint
federal-state means-tested programs which did acquire the welfare stigma: AFDC, Old Age
Assistance, Aid to the Blind, and Aid to the Disabled. In these programs, states made
payments to individuals who qualified as needy under the state's need standard, and states
received federal reimbursement equal to a percentage of their expenditures which
ultimately was set at a minimum of 50 percent.
The federal rules for these four welfare programs greatly broadened the welfare role of
state governments by requiring uniform statewide standards, state financial participation,
and a "single state agency" which would either administer the programs or
supervise their administration by local governments.
The federal government limited its role in the new welfare system to population categories
that were not considered employable the aged, the blind, the disabled, and families
with "dependent children," defined as children with no more than one able-bodied
parent in the home. Employable adults and two parent families were restricted to continued
reliance on the diverse state and local relief programs which predated the Social Security
Act. These programs came to be called "General Assistance" to indicate their
status as the residual program for those outside the federally-aided categories.
III. The Catalyst of Welfare Reform AFDC's Growth
In the quarter century after the Social Security Act's enactment, growth
in the national income security system was largely confined to the upper tier social
insurance programs. However, around 1960 AFDC began growing far faster than population. By
the time that AFDC's growth surge ended in the early 1970's, AFDC's average monthly
caseload had quadrupled to 3,200,000 families and the percentage of children receiving
AFDC had increased from 3 percent to 11 percent.(9)
Much of AFDC's growth was due to increased propensities by eligible families to apply and
by welfare agencies to approve their applications. President Johnson's "War on
Poverty" and the welfare rights protest movement had reduced the welfare stigma and
had pressured welfare agencies to ease restrictive practices. Additionally, the War on
Poverty had created a national civil legal services program whose law suits on behalf of
AFDC claimants persuaded courts to invalidate many state policies which previously had
kept many needy families off the AFDC rolls.
Growth in the welfare rolls has often provoked controversy and backlash, and AFDC's growth
would become particularly controversial.(10) Most AFDC
families were headed by mothers, and many of them had never been married. A substantial
portion, in some places a majority, were black or brown. Issues of gender, sexual conduct,
and color fused with those of class.
IV. Welfare Reform at the Federal Level
During the past 30 years the leading theme has been to restrict welfare for families
with children. For low income families, this approach has resulted in significant income
losses. These losses have been only partially offset by the establishment and expansion of
the Food Stamp and Earned Income Tax Credit programs.
In 1967 President Johnson and the Congress responded to AFDC's growth with welfare reform
legislation under which states were required to establish AFDC work programs, called
"WIN," in which AFDC parents who were not caring for a pre-school age child
could be compelled to participate on pain of the loss of their share of the grant.
In 1969 President Nixon responded to AFDC's continued growth with a proposal to replace
AFDC with the Family Assistance Program (FAP). FAP combined the liberal elements of a
broader federal role, expanded coverage of two parent families, and a national minimum
benefit, with the conservative elements of stricter work requirements and a likely
reduction of benefit levels in the higher benefit states. FAP was criticized from both the
right and the left, and after prolonged consideration Congress rejected it in 1972.
Though Congress rejected FAP, it approved a companion proposal to federalize welfare
for the aged, blind, and disabled, by replacing AFDC's three sister programs Old Age
Assistance, Aid to the Blind, and Aid to the Disabled with the Supplemental Security
Income (SSI) program, which is administered by the Social Security Administration. SSI has
a nationally uniform federal benefit level, which is adjusted on an annual basis to
reflect inflation, and which is currently $494 a month for an individual, 74 percent of
the poverty line, and $741 a month for a couple, 82 percent of the poverty line. (About
half the states supplement the federal SSI benefit with state funds; the current New York
supplements of $86 for an individual and $102.50 for a couple bring the total benefit for
an individual to $580, 86 percent of the poverty line, and the total benefit for a couple
to $843.50, 93 percent of the poverty line.) SSI has not acquired the welfare stigma and
generally has not been part of the welfare reform debates.
In the early 1970's Congress also enacted legislation which transformed the federal Food
Stamp program into a national income support program with uniform national eligibility
standards and benefits. Food Stamp benefits are in the form of food coupons or credits
that can be used only for food. The maximum benefit is an indexed amount which ranges from
about 25 percent to about 30 percent of the poverty line depending on family size, and
which is currently $321 a month for a family of three. A family's benefit is computed by
reducing the maximum benefit $.30 for each dollar of cash income after certain deductions.
Most welfare recipients and most other poor people qualify for a Food Stamp supplement.
In 1973, following FAP's defeat, the Nixon Administration focused new attention on
controlling AFDC's growth by tightening program access. The key initiative was a new
"quality control" system which threatened states with financial penalties for
erroneous payments but not for erroneous application rejections or case closings. This
one-sided policy remained a mainstay of federal AFDC policy for the rest of AFDC's
history. Critics charged that it led to a large increase in denials to eligibles.(11)
AFDC was reformed twice under President Reagan, first by the Omnibus Budget Reconciliation
Act of 1981, and then by the Family Support Act of 1988. On both occasions, the reforms
emphasized work obligation. Parents of pre-schoolers would now also be subject to work
requirements unless the child was below age one or, at state option, below age three.
Program expansions in 1990 and 1993 transformed the federal Earned Income Credit (EIC)
into a major program of aid for the "working poor." The EIC is a refundable tax
credit which functions as a wage supplement for low income families with earned income.
Credit amounts and related program parameters are indexed. For households with one child,
currently the EIC is 34 percent of annual earnings up to $6,680 for a maximum credit of
$2,271; the maximum is phased out at a rate of 15.98 percent of earnings in excess of
$12,260. For households with two or more children, currently the EIC is 40 percent of
annual earnings up to $9,390 for a maximum credit of $3,756; the maximum is phased out at
a rate of 21.06 percent of earnings in excess of $12,260. (Several states have created
state EIC's to supplement the federal EIC; the New York EIC is currently 20 percent of the
federal EIC.)
The Family Support Act of 1988 was passed with bipartisan support and was widely hailed as
important welfare reform by key leaders in both major parties. Many people thought that
its passage had eliminated welfare reform as a national political issue.
In 1992, Candidate Clinton nevertheless make welfare reform a major issue in his campaign
by his call for welfare "time limits" and his pledge to "end welfare as we
know it."
In 1996, after the Republicans had gained control of Congress, Congress obliged President
Clinton's call for more welfare reform by passing the Personal Responsibility and Work
Opportunity Act (PRA), which President Clinton signed into law in August 1996.
The PRA abolished AFDC and replaced it with the "Temporary Assistance to Needy
Families" (TANF) program. TANF differs from AFDC in four key ways.
First, TANF has "block grant" funding under which a state gets a fixed dollar
amount of federal funding, rather than entitlement funding under which a state is
reimbursed a percentage of total expenditures. The block grant funding makes benefit
increases less likely because the state must pay 100 percent of the cost of any
expansions; and the block grant funding makes benefit reductions more likely because the
state gets 100 percent of the savings from any reductions.
Second, TANF eliminates a child's federal statutory entitlement to receive aid if the
child qualifies as needy under state need standards. One consequence is that states may
now deny aid to children as a sanction for parental misconduct, which AFDC generally had
forbade. History has shown that states are prone to deny aid to needy children whose
parents are deemed undeserving when federal policy permits states to do so.
Third, TANF has a time limit which restricts aid to five years (60 months) in a child's
eighteen year childhood. While hardship exemptions are permitted for up to one fifth of
cases, studies of AFDC dynamics have found that at any given point in time about half of
those receiving aid have already received aid for five or more years, often in multiple
spells with the pattern of job loss>welfare receipt>job entry/welfare closing>job
loss>welfare receipt.(12) Starting in 2001, it
therefore appears that hundreds of thousands of needy families will begin exhausting their
federally funded TANF benefits and will face destitution unless states are willing to
continue to aid them entirely with state funds.
Fourth, compared to AFDC's work rules, the TANF work rules are more discouraging of
education/training and more encouraging of workfare. While the federal TANF rules,
strictly speaking, do not mandate any particular work rules approach, they create a
framework in which states are less likely to allow participation in education and training
to satisfy the work rules.
Welfare reform will return to the federal agenda no later than 2002, when TANF will sunset
if it is not extended.
In addition to repealing AFDC, the PRA cut federal and federally-aided benefits for legal
immigrants, making many immigrants ineligible for most benefits unless and until they
become naturalized citizens, which usually requires a waiting period of years among other
requirements. These immigrant exclusions will have a harsh impact on communities with
large immigrant populations, such as New York City where about a third of the population
is foreign born. In the case of SSI and Food Stamps, the PRA applied the immigrant
exclusions to immigrants who were already in the country, as well as to those who would
arrive afterwards. Subsequent legislation restored SSI eligibility for most of those who
were already here, and restored Food Stamp eligibility for about a third of those who were
already here.
V. Welfare Reform in the States
AFDC's growth surge of the 1960's made welfare a major issue for most state
governments. During the 1970's, most states adopted the same basic strategy to control
program growth: stricter administration to make program participation less accessible; and
lower benefits and expanded work requirements to make program participation less
attractive. Most states continued this strategy in the 1980's and 1990's.
Between 1970 and 1997, real AFDC/TANF benefit levels declined by at least 23 percent in
every state and by 50 percent in the median state.(13) In
1997, the AFDC/TANF benefit for a family of three ranged from 11 percent to 66 percent of
the poverty line, was less than the federal SSI benefit for an individual in all but 12
states, and was only 34 percent of poverty ($377 a month) in the median state(14); the combined Food Stamp and AFDC/TANF benefit ranged
from 39 percent to 90 percent of the poverty line, and was 62 percent of poverty in the
median state.(15)
The restrictive welfare reform strategies that began to take hold in the late 60's and
early 70's succeeded in checking AFDC's growth. From 1973 through 1989 the percentage of
children receiving AFDC was basically stable at 11 percent despite a sharp increase in the
percentage of children who were poor. Because AFDC receipt rates were stable while child
poverty rates were growing, recipient children declined as a percentage of poor children
from a peak of 80 percent in 1973 to an average of less than 60 percent in the 1980's.(16)
The anti-welfare animus resulting from AFDC's growth spilled over to General Assistance.
Since the 1970's, most states have contracted their General Assistance program by reducing
benefits or by narrowing coverage, or by both. According to the most recent major study,
by 1996 only 15 states provided General Assistance to employable but unemployed
individuals without children, some of these states had time limits, and benefits averaged
only 39 percent of poverty.(17) Several studies documented
great hardship arising from General Assistance cuts.(18)
By October 1997, all states had converted their AFDC programs to TANF, some making many
policy changes, some making only a few. Twenty states chose to establish time limits which
are shorter than the 60 month maximum permitted by the federal rules.(19)
As of early 1998, only five states had raised the benefit levels which were in effect
prior to the PRA in July 1996, and four states had cut benefits below their July 1996
levels.(20) On a more positive note, many states now allow
recipients who have earnings to keep some of their earnings without loss of benefits.
TANF allows states to deny benefits to children as a sanction for their parent's
misconduct. Most states now do so in at least some circumstances, and these practices seem
likely to grow. Thirty four states, for example, have adopted "full family
sanctions" under which benefits are denied for the children's needs, as well as for
the parent's needs, during a period of sanction for a work rules violation.(21) In six states the full family sanction can be a
permanent, lifetime sanction period when there are multiple incidents of parental
non-compliance.
TANF also repealed federal AFDC rules safeguarding the right to apply for cash assistance.
Many states are now experimenting with "diversion" programs whose stated purpose
is to divert needy people who contact the TANF office to other possible means of support.(22) In New York City, there is emerging evidence of abusive
diversion practices in which needy families are simply turned away without being allowed
to apply.(23) Such abuses seem to be occurring elsewhere
as well.(24)
Recession drove up the AFDC rolls from a monthly average of 3.8 million families in 1989
to a peak of 5 million families in 1994. Recovery drove the rolls back down to 4.4 million
in August 1996, the month in which President Clinton signed the PRA into law.
Since August 1996 the AFDC/TANF rolls have continued to decline, falling 27 percent to 3.2
million families in March 1998.(25) There has been no
comprehensive analysis of the reasons for the continued decline. Some of it is probably
due to continued job growth, some to new initiatives to move recipients into employment,
and some to increased denials to needy families from the restrictive application and
sanction policies which the TANF rules permit. A recent analysis of studies in nine states
tracking adult recipients who exit TANF concluded that between 40 percent and 50 percent
were unemployed.(26) Typical wages for those who were
employed were only $5.50 to $7.00 an hour.
VI. Welfare Reform in New York State
New York State's AFDC caseload grew from 69,000 families in 1960 to 256,000 families in
1969.(27) By the early 1970's state welfare policy had
turned more restrictive. Work requirements would be broadened, access would be made more
difficult, and benefits would be reduced.
Between 1975 and the present, typical welfare benefits have fallen from 110 percent to 51
percent of the poverty line and from 35 percent to 16 percent of state median income.
Benefits have been frozen since 1990.(28) The current $577
benefit level for a typical family of three is $3 less than the $580 SSI benefit level for
a single individual in New York State. Due principally to the reduction in the benefit's
real value, between 1976 and 1996 welfare spending declined from 1.59 percent to .65
percent of state personal income.(29)
New York State is unique in having a provision in its State Constitution, Article 17,
which the state courts have found generally to prohibit the denial of aid to needy New
Yorkers except for misconduct. As a result, New York has continued to provide General
Assistance until recently called Home Relief to all those outside the federal
categories.
The State responded to the PRA with the Welfare Reform Act of 1997. The new law changed
the names of the two components of New York's welfare system from AFDC and Home Relief to
Family Assistance (FA) and Safety Net Assistance (SNA). FA generally covers households
with children the TANF population and SNA generally covers households without
children. The rules are generally the same in both programs.
While recognizing that New York's Constitution prohibits the termination of aid based on
an arbitrary time limit, the Governor and the Legislature agreed that New York should
nevertheless have a welfare time limit beyond which something punitive happens.
Consequently, the new welfare law provides for a switch from cash aid to
"non-cash" aid after a household has received FA for five years or SNA for two
years. When aid is "non-cash," the welfare department may pay rent and utilities
directly to the landlord and utility company, issue a small cash allowance of up to a $1 a
day for an individual, and issue any remaining benefits through an electronic benefit
swipe card system not yet operational that can be used to purchase goods and
services but not to access cash.
The new welfare work rules exempt only parents caring for a child less than 12 months old,
and even these parents only for a maximum of three months. The new rules also give
localities substantial discretion over the types of activities to which work program
participants will be assigned.
The new welfare rules allow families with children to keep over 40 percent of any
earnings. New York also has a state EIC equal to 20 percent of the federal EIC which
provides an additional supplement to low income families with earned income.
The new welfare rules provide for statewide implementation by September 1999 of a
"learnfare" program for children in grades one to six. A family's monthly grant
will be reduced by $60 for three months if a child has more than four unexcused absences
in any academic quarter. The funds will be restored if the child has no unexcused absences
in the next quarter.
Governor Pataki has proposed welfare cuts each year he has been in office, including a
recent proposal for full family sanctions. The Legislature has accepted some of his
proposals and rejected others.(30) If Governor Pataki is
re-elected to a second term in November 1998, proposals for additional cuts seem likely.
VII. Welfare Reform in New York City
New York is one of the minority of states in which welfare is still administered by
agencies of local government, rather than by agencies of state government. New York City
and each of the counties outside the City are responsible for administering welfare in the
local area, and for paying for about half of welfare's local cost net of the federal
contribution.(31) As welfare's gatekeepers, the City and
other local governments can significantly impact the size of the local welfare caseload.
Because the incidence of poverty is much higher in the City than in the rest of the State,
the City has about 70 percent of the state's welfare recipients and pays about 70 percent
of welfare's total local share, even though the City accounts for something less than 40
percent of the State's population. As of December 1997, there were 1.16 million recipients
statewide, with 817,000 of them in the City.(32) In both
the City and the State, over half of welfare recipients are children.
State welfare policy gives local governments substantial discretion in assigning welfare
recipients to work program activities. Under Mayor Giuliani, the Human Resources
Administration (HRA), which administers welfare in the City, has placed the highest
priority on assignments to the WEP program, where monthly participation now exceeds 35,000
and is scheduled to grow. The increased WEP participation has been at the expense of
participation in education and training. While the City does not publish the number of
welfare recipients in education and training activities, education and training providers
say that the City's policies have caused sharp declines in activities such as English as a
Second Language (ESL), basic literacy, GED, and vocational training. City University
(CUNY) reports that the number of welfare parents in the CUNY system has declined from
about 26,000 to about 13,000.
WEP is a workfare program in which recipients "work off" their cash and Food
Stamp benefits at a government or non-profit office, with the hours of work calculated
based on the minimum wage rather than the prevailing wage. WEP's critics charge that WEP
rarely leads to employment and that WEP has displaced/replaced regular civil service jobs,
thereby reducing the number of living wage and entry level positions available to working
people. These criticisms seem to have been substantiated by a major investigation of WEP
by the New York Times whose findings were reported in a four part series which
ran from April 12 to April 15 of this year. The first two major articles were headlined
"Evidence Is Scant That Workfare Leads to Full-Time Jobs" and "Many
Workfare Participants Are Taking the Place of City Workers."
As the result of federal and state welfare reforms, more welfare parents with pre-school
age children are being assigned to work activities. In the City, welfare children
typically are channeled into unregulated child care, while most other subsidized children
are channeled into regulated care, as detailed in a 1997 report by the Public Advocate.(33) The Public Advocate found that HRA "pressures
[welfare] parents to find and utilize the cheapest care" and "routinely violates
state laws requiring that [welfare] parents be given information and assistance in finding
appropriate care."
Since 1995 the City's welfare caseload has declined by 30 percent. Though some of the
decline may be due to job growth, it is unlikely that job growth is the full explanation.
While in recent years the City has regained about 200,000 of the 300,000 jobs it lost in
the recession of the early 1990's, the welfare caseload has now fallen below its 1989
level even though the City still has 100,000 fewer jobs than in 1989.
Much of the decline in the caseload may be due to an increase in denials to needy,
financially eligible persons resulting from stricter verification requirements and
stricter administration of the work rules. Under Mayor Giuliani, the welfare application
rejection rate rose from 27 percent in 1994 to 54 percent in 1997.(34)
The Citizens Budget Commission concluded in a 1997 report that there was "evidence
that elements of the [HRA] initiative are causing otherwise eligible indigent New Yorkers
to be denied cash benefits," and recommended that "[a]dministrative procedures
could be revised to avoid inappropriate rejection of applications and inappropriate
closing of cases."(35) Similarly, under Mayor
Giuliani, sanctions for alleged non-compliance with workfare rules increased from less
than 15,000 in 1994 to over 82,000 in 1996. About a quarter of the sanctions are appealed
to a state fair hearing, and about two-thirds of those who go to a hearing win their
appeal.(36)
Though 40 percent of the 350,000 individuals who have disappeared from the City's welfare
rolls in the last few years are children, the City has nevertheless refused to conduct a
study of the conditions and circumstances of those whose welfare cases have been closed.
However, the available evidence suggests that many households have been left with little
or no income. According to state welfare officials, only between a quarter and a third of
the parents and other adults who leave the City's public assistance rolls have reported
earnings over $100 in the quarter after they leave the rolls.(37)
Denials to needy families are likely to increase as a result of the Mayor's new initiative
to convert welfare offices to what the Mayor calls "Job Centers." "Job
Center" is a misnomer. Job Centers do not give people jobs. Rather, they seek to
divert needy people from applying for public assistance. The New York Times reported on
June 22 that the Administration has instructed Job Center staff that their "primary
goal" is diverting people from applying for public assistance.(38)
While there is no evidence that Job Centers are helping people to get jobs, they do seem
to be preventing needy people from getting public assistance. Mayor Giuliani has stated
that the application approval rate has cut in half in the offices that have been converted
to "Job Centers." The City has not put in place any system to track what happens
to those who are diverted.
VIII. Conclusion
As detailed above, welfare reform has generally meant a contraction of welfare for
families with children and, in most states, the near abolition of welfare for single
adults.
For low income families with earned income, the expansion of the EIC has partially offset
the loss of welfare income. However, many poor families have little or no earned income
for lengthy periods due to disability, lack of work, or lack of child care, and during
these periods they can not benefit from aid that is targeted to the "working
poor."
The contraction of welfare has continued in recent years even though economic recovery has
yielded both revenue growth and caseload decline. The contraction may speed up if the
economy turns sour and welfare caseloads begin to grow.
The high child poverty rates that have accompanied the contraction of welfare could be
reduced by reversing the contraction of welfare and/or by new policy initiatives outside
of welfare. Some of the non-welfare initiatives that have been suggested include: 1)
subsidized employment where the government is the employer of last resort for low income
individuals who can not find regular work; 2) a higher minimum wage; 3) reforming
unemployment compensation by broadening coverage and by raising benefits and extending
their duration; 4) a childrens allowance program, as in every other rich country, which
would make payments to all children regardless of income; 5) assured child support, as in
several European countries, in which the government guarantees all single parents
regardless of income a minimum amount of child support; 6) the conversion of existing rent
subsidy programs from "waiting list" programs which serve only some of those who
are eligible to entitlement programs which would serve all who are eligible; 7) universal,
free child care.
Unfortunately, the political will seems lacking for major anti-poverty initiatives either
inside or outside of welfare. Unless the political climate changes, high child poverty
rates are likely to persist.
Footnotes
1. The 1998 poverty line for a given household size is determined by
summing $8050 for the first household member and $2800 for each additional household
member. 63 Fed. Reg. 9235-9238 (Feb. 24, 1998). For a household of two, for example, the
poverty line is $10,850 a year, which converts to $904 a month and $209 a week.
2. See, e.g., Sherman, Poverty Matters, The Cost of Child
Poverty in America, Childrens Defense Fund, Washington, DC, July 1998; Brooks-Gunn
& Duncan, The Effects of Poverty on Children, 7 The Future of Children
55, Summer/Fall 1997.
3. Poverty and Income Trends: 1996, Center on Budget and
Policy Priorities, Washington, DC, March 1998, calculated from data on page 21.
4. See Smeeding, Financial Poverty in Developed Countries: The
Evidence From LIS, Maxwell School of Citizenship and Public Affairs Syracuse
University, Syracuse NY, April 1997; Casey, Child Poverty and Public Transfers in
International Perspective, 25 Clearinghouse Rev. 521, Special Issue 1991. See
also Plotnick, Child Poverty Can Be Reduced, 7 The Future of Children 72,
Summer/Fall 1997.
5. Low-Income Populations In New York City: Economic Trends and
Social Welfare Programs 1996, United Way of New York City, April 1997, Table 5.
6. Id.
7. The 1998 Green Book, Committee on Ways and Means U.S.
House of Representatives, WMCP:105-7, includes a whole new section, Appendix L, just
summarizing the major new welfare reform monitoring efforts.
8. Breadlines in Boomtown, New York City Coalition Against
Hunger, June 1997.
9. Calculated from data in 1996 Green Book, Committee on
Ways and Means U.S. House of Representatives, WMCP:104-14 at 471, 1177; and Annual
Statistical Supplement to the Social Security Bulletin, 1993, U.S. Department of
Health and Human Services, at Table 9.G1.
10. See Cloward and Piven, Regulating the Poor, Vintage
Books, New York City, 1971.
11. See Casey & Mannix, Quality Control in Public
Assistance: Victimizing the Poor Through One-sided Accountability, 22 Clearinghouse
Rev. 1381 (April 1989).
12. Green Book 1998, Committee on Ways and Means U.S.
House of Representatives, WMCP:105-7 at 531-535.
13. 1998 Green Book, Committee on Ways and Means U.S.
House of Representatives, WMCP:105-7 at Table 7-14.
14. Id. at Table 7-8.
15. Id.
16. 1996 Green Book, Committee on Ways and Means U.S.
House of Representatives, WMCP:104-14 at Table 8-27.
17. Uccello, McCallum, & Gallagher, State General
Assistance Programs 1996, The Urban Institute, Washington, D.C., Oct. 1996, at 1-3.
18. See Jobless, Penniless, Often Homeless: State General
Assistance Cuts Leave "Employables" Struggling to Survive, Center on Social
Welfare Policy and Law, New York City NY, February 1994.
19. Summary of Selected Elements of State Plans for Temporary
Assistance for Needy Families as of November 20, 1997, National Governors'
Association Center for Best Practices, Washington, D.C.; The New Welfare Law: One Year
Later, Childrens Defense Fund, Washington, D.C., October 1997.
20. Reinvesting Welfare Savings, Center for Law and Social
Policy, Washington, D.C., March 1998; Are States Improving the Lives of Poor Families,
A Scale Measure of State Welfare Policies, Tufts University Center on Hunger and
Poverty, February 1998.
21. One Year After Federal Welfare Reform: A Description of
State Temporary Assistance for Needy Families (TANF) Decisions as of October 1997,
Urban Institute, Washington, D.C., March 1998, Draft Preliminary Edition.
22. Welfare Reform - States are Restructuring Programs to
Reduce Welfare Dependence, US General Accounting Office, GAO/HEHS-98-109 (June 1998),
at 60 ff.
23. "New York's New Strategy Sharply Cuts Welfare Applications
at Two Offices," New York Times, June 22, 1998.
24. "States' Welfare Shift: Stop It Before It Starts," Washington
Post, August 12, 1998.
25. US Department of Health and Human Services, at
http://www.acf.dhhs.gov/news/aug-mar.htm.
26. Staff of National Governor's Association et. al., Tracking
Recipients After They Leave Welfare, April 1998,
http://www.nga.org/Welfare/StateFollowUp.htm.
27. Cloward and Piven, Regulating the Poor, Vintage Books,
New York City, 1971, at Appendix Table 1.
28. Four Assembly members -- Roger Green, Jeffrion Aubry, Rhoda
Jacobs, and Martin Luster -- have recently introduced a bill which would restore the grant
to 110 percent of the poverty line over a four year period, A10292, the Public Assistance
Grant Restoration Act. Contact the author for information about the status of this
proposal.
29. Calculated by author using expenditure data from NYSDSS
Social Statistics and Statistical Supplement, Various Editions, and State Personal
Income Data from NYS Data Center Internet Document at
http://205.232.252.23/nysdc/ECONOMIC.html#Personal Income. Expenditures includes
expenditures for AFDC and Home Relief from federal, state, and local funds.
30. The State Senate is controlled by Republicans and tends to
support welfare cuts. The State Assembly is controlled by Democrats and tends to oppose
welfare cuts.
31. In most states the state government pays 100 percent of
welfare's cost net of the federal contribution.
32. Social Statistics, December 1997, New York State
Office of Temporary and Disability Assistance.
33. Welfare and Child Care: What About the Children, Public
Advocate for New York City, June 1997.
34. "Rigid Enforcement of Workfare Rules at Heart of Welfare
Cuts," New York Times, April 15, 1998.
35. The State of Municipal Services in the 1990's: Social
Services in New York City, Citizens Budget Commission, New York City, NY, at 9-17.
36. "Rigid Enforcement of Workfare Rules at Heart of Welfare
Cuts," New York Times, April 15, 1998.
37. Local District and State Performance Measures, New
York State Office of Temporary and Disability Assistance, January 1998, Tables TA 4a, 4b.
The data is for closings in March 1997.
38. "New York's New Strategy Sharply Cuts Welfare Applications
at Two Offices," New York Times, June 22, 1998.
