Business, Congress, Cover Story, Domestic — December 1, 2002 at 2:53 pm

Capitol Farce

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Lisa Adams was not a welfare queen. When she walked into the office of Jewish Vocational Services (JVS), a San Francisco-based non-profit that offers welfare-to-work training, she was just a black mother of three trying to get her life in order.

Adams, who is currently employed as a receptionist at a San Francisco law firm, is one of welfare reform’s success stories—a former recipient who went through the welfare-to-work system and, less than two years later, was employed and off the dole.

“I didn’t get on welfare until I was off drugs, off living on the streets,” Adams said. “I had a career in mind after I cleaned up and got my children back. Without [career training] I wouldn’t be where I am today.”

In 1996, vowing to produce “the end of welfare as we know it,” Bill Clinton signed into law the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA). That same year, Peter Edelman, former Assistant Secretary for Planning and Evaluation at the Department of Health and Human Services, called PRWORA “the worst thing Bill Clinton ever did” and quit in protest. Clinton’s bill was risky: it replaced the cash entitlement system, Aid to Families with Dependent Children (AFDC), with an experimental “work-first” program called Temporary Assistance to Needy Families (TANF). The bill also devolved more control of welfare programs to the states and enacted time limits to cut off long time welfare beneficiaries.

The welfare reform bill of ’96 has enjoyed key successes, but the bill is due for reauthorization in January and proposed changes to its tenets are simply unrealistic. The Bush administration has advocated a reauthorization bill that, among other provisions, ups work requirements. In its current form, the bill will force financially strapped states into a no-win situation: force recipients off the dole or face the loss of badly needed federal funds.

Much of the pre-’96 debate focused on whether it was a good idea to end cash entitlements as a means of combating welfare dependency. This is now a moot point. Even the most impassioned nostalgia for AFDC will not revive this program from the history books.  Politicians should instead focus their efforts on debunking the premises upon which the reauthorization bill is based, namely declining caseload figures. A look at the economic context of reform, time limits, and the quality of jobs for the newly employed reveals that welfare reform’s success is not so black and white.

For many critics, TANF was a sign of the apocalypse come. The Urban Institute argued that the bill would send one million children into poverty. In fact, the Department of Health and Human Services reports that child poverty rates are at their lowest level since 1979 and overall child poverty rates declined from 20.5 percent in 1996 to 16.1 percent in 2000.

At present, welfare reform has defied everyone’s expectations. Why? That depends which side of the ideological fence you’re sitting on. Proponents of the reform bill (read: conservatives) say the caseload decline, from 5.2 percent to 3.3 percent of the total American population from 1996-1999, is the result of an effective bill. Robert Rector, a senior research fellow at the Heritage Foundation, explains: “Welfare caseloads have dropped by 60 percent. Coincident with that effect we’ve seen dramatic and unprecedented declines in child poverty and the out-of-wedlock birth rate has effectively flattened down.” Critics of the reform (read: liberals) say these supposed advances are due to coercive state policies and a strong economy.

The liberals are right on at least the latter count—another instance of the validity of Clinton’s catchy campaign slogan, “It’s the economy, stupid.” The welfare caseload peaked at 5.5 percent in 1994 and then began to drop—three years before PRWORA’s passage. A study by the Department of Health and Human Services of the welfare caseload from 1993-1996 confirms that a strong economy was a large factor in the decline: “nearly all econometric studies agree that the economy played an important role in reducing caseloads. Most analyses suggest that the economy accounted for one-fourth to one-half of the decline,” it says.

PRWORA only accelerated the downward decline that had begun before its passage. Some social scientists have downplayed the significance of the economy in welfare reform’s success, citing the fact that the decline in unemployment slowed in the late 1990s as the caseload decline accelerated. This evidence notwithstanding, PRWORA is at heart a work-first program and fares better when more, higher paying jobs are available. If the economy did indeed play an important role in reform’s success, then the policy implication is clear: upping work requirements during a recession does not make sense. Consider the Center for Law And Social Policy’s (CLASP) report that from June 2000 through June 2001, a period of relative economic decline, a majority of states (29) reported caseload increases.

Statistics of caseload decline are problematic because they lump together individuals who have been forced to leave along with those who voluntarily departed from welfare.

Time limits require long-term recipients who have been continuously receiving benefits to leave the welfare rolls. The federal government has mandated a maximum time limit of five years—which came and passed this August—but many states have enacted shorter limits. Jodie Levin-Epstein, a senior policy analyst at CLASP explains that “some states have very short time limits, some use waivers…some people can be on for two years then have to be off for two years,” she said. “There are lots of individual state nuances.” Tellingly, CLASP reports that of the four states that experienced the greatest caseload decline in the past year-New York, Illinois, Hawaii, and New Mexico—all reached time limits in 2001 or 2002.

Aside from time limits, states had a vested interest in sanctioning people off the rolls. Under PRWORA, states were given the option of either reducing caseloads—which most did with aplomb—or meeting what is known as the 30/50 requirement, which meant that 50 percent of beneficiaries on the roll had to work thirty hour weeks (the other 50 percent could participate in other cash assistance programs like job training, education, and so on). Instead of meeting the 30/50 requirement, most states simply cut their caseloads. Others created bureaucratic hurdles to cut off the most needy. Harold Leibowitz, the communications director for the Urban Institute’s Assessing the New Federalism Project, posits that these institutional barriers may also have contributed to the decline. “It’s clear that there are many people who are eligible for cash assistance [who] are not enrolled. Many of the people [who] may have been sanctioned off the rolls for inability to follow the new rules on cash assistance are the poorest of poor.”

Much to the chagrin of politicos, poor people do not just disappear. People kicked off the welfare rolls often end up living off the state again in some form or another. According to Leibowitz, “the numbers of people using food banks and shelters is increasing.” Individuals who leave the rolls also may receive funds from “nonassistance” programs like substance abuse treatment or childcare services, which do not count in welfare caseload figures. As the urban decay of the 1970s proved, an increase in poverty is usually a stone’s throw away from increased crime rates and violence. Adams puts it succinctly: “I’m saying from experience, if people can’t find jobs, they are going to [engage in] criminal activities to get money for their kids.”

In Bowling for Columbine, rabble rouser cum documentarian Michael Moore tells the story of a mother who was forced to work two late-shift jobs in order to meet Michigan’s welfare requirements. Due to her difficult work schedule, and the fact that she had been evicted from her apartment, the mother had to leave her six-year old son under her brother’s care every night. The son, lacking adequate supervision, obtained a gun and shot one of his six-year old classmates. Whatever one thinks of Moore’s implication that welfare-to-work is to blame for this act of violence, his anecdote portrays the catch-22 that many TANF beneficiaries face. In order to receive benefits to support their family, many recipients—typically single women—have to sacrifice the quality of their family life.

Jodie Stein, the coordinator of the Legal Employment Action Program at JVS, also worked at the Jewish Employment Vocational Services in Philadelphia during the 1996 welfare reform act. She says that caseworkers were forced to push people off the rolls in order to meet federal requirements. “[Recipients] were told that they had to take the very first job they were offered no matter what. I really got frustrated because they took these crappy minimum wage jobs they got offered. Some enjoyed the jobs but most quit and came back into the system,” Stein said. “It didn’t seem to be making any real changes, didn’t really treat people like people with choices and goals [and] didn’t really encourage them to aim higher, to change their situation. It kind of kept them in poverty.” Stein says that the Philadelphia program has improved since her departure, but that upped work requirements will create a similar need to push people into the first available jobs.

Another fundamental flaw of TANF is that caseworkers are not required to follow up with anyone who leaves the rolls. In other words, if Joe Smith leaves the roll because he receives a job at McDonald’s, his former caseworker does not have to call him up six months later to see if he is still employed. This kind of follow-up would not be costly and the data would counterbalance caseload decline figures. Although data about the outcomes of recipients who leave the rolls is scarce, the Urban Institute has conducted several “leaver” studies to determine how many former welfare recipients returned to the rolls. The Urban Institute found that about 22 percent of all U.S. families that left welfare between 1997 and 1999 returned by 1999. Taking these statistics into account, HHS’s dramatic caseload figures start to look a little less miraculous.

Welfare reform’s five-year anniversary came and went this August with barely a blip on the media radar. Welfare reauthorization, like many domestic issues, will likely receive short shrift with the lame-duck Congress. “I think a lot of issues are competing for front burner status against overwhelming issues such as homeland security a potential war with Iraq,” Levin-Epstein said. She anticipates that Congress will draft a continuing resolution and leave the reauthorization bill for the 108th Congress. Both Rector and Leibowitz believe that the final reauthorization bill will resemble the one currently drafted by the House of Representatives, which ups the 30/50 requirement to 40/70 (70 percent of caseloads must work 40 hours a week). The bill is also less flexible in its definition of “work” than the ’96 bill.

Reauthorization is problematic for a number of reasons, not the least of which being that it is premised upon exaggerated caseload decline figures. Rector says the 30/50 requirements are “obsolete because states have already met them” and that if states have difficulty meeting the new requirement, they can simply cut caseloads. This easy either-or paradigm ignores the fact that most states never met the 30/50 requirement and instead simply cut caseloads. But the caseload decline has tapered off. According to CLASP, from June 2001 through June 2002, the national welfare caseload decreased by 2 percent whereas it had dropped a staggering 16.3 percent between June 1998 to June 1999. Reauthorization will compel states to sanction people off the rolls while forcing recipients into any and all jobs in order to receive federal funding. Stein’s program, with its emphasis on long-term job training, will fall by the wayside if this bill passes.

“It’s just going to create a situation back to what I experienced in Pennsylvania—pushing [recipients] into the first job that comes. With the economy like it is right now, it will be disastrous,” Stein said. “I think [politicians] still believe that work will solve everything, that if you push people into jobs, they’ll be self-sufficient. The reality is it’s not true, especially not in a high cost of living city like San Francisco, [where] you can’t live on minimum wage.”

The problem with welfare reauthorization is not its work-first philosophy, but unrealistic work requirements. As Leibowitz explains, “The reauthorization bill clearly understands the need to provide various services to people to make their transition from welfare to work successful…the emphasis on work is important. I simply think that states will have a difficult time meeting the various aggressive targets in the senate and house finance committees.”

Welfare reform was not the worst thing Clinton ever did and the caseload decline is, at least in part, a testament to that fact. When welfare reform has been successful, however, it has been successful because recipients developed real, long-term job skills. Lisa Adams is proof positive of this welfare philosophy.

“Anybody can get a job at McDonald’s, but a career…it’s not that easy, it’s not that simple. When you’re coming from the streets you can’t just go into the corporate world. You have to have the training,” Adams said.

The danger of the reauthorization bill is that it will end programs that emphasize long-term job skills because fast results in the short-term are more impressive, if less effective. Politicians fail to see that declining caseload figures are deceptive. Welfare by the numbers finds people jobs and takes them off the rolls. But the reality is different. If the 108th Congress mandates unrealistic term limits, it will perpetuate myths about welfare reform miracles and undo its real successes.

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