April 5 2011

Let's Reform Welfare for the Sake of the Poor

Hadley Heath

Members of both parties claim credit for popular reforms to the welfare system in the mid-1990's.  President Clinton often lists the 1996 law as among his tenure's crowning achievements; Republican Congressional leaders from the era remind the public that it was their party that pushed reform legislation, which the President reluctantly signed after several vetoes.

The reform legislation of 1996 was a step in the right direction, but it didn't go far enough, which is why welfare reform is once again a hot topic in Washington DC.  Today, the U.S. welfare system remains plagued with problems, rising costs, and an incentive structure that backfires on those it seeks to help. 

In the two decades leading up to 2008, welfare spending grew by 292 percent.  This kind of growth in entitlement spending is simply unsustainable, especially given that we already have$14 trillion in national debt and an anemic economic "recovery" in the private sector that will continue to put pressure on federal and state budgets.

While the budget crisis makes it all the more urgent to consider cost-saving reforms, it also makes the public-and many policymakers-reluctant to consider changes to welfare. The poor suffer the most during economic downturns, and rely on federal assistance to get through the rainy days. 

However, reform of our current welfare system is necessary, not just to save our federal treasury from ruin, but for the sake of the neediest Americans.

Ronald Reagan once said, "We should measure welfare's success by how many people leave welfare, not by how many are added."  And by this measure, it's clear that our welfare system is failing.  Four decades ago, 4.3 million Americans were on food stamps.  Today, that number is 40 million. While some welfare recipients use welfare as it was intended-as a way to get on their feet so they can resume independent living-too many become fully dependent on government.  Almost 70 percent of all food stamp spending goes to households that have received food stamps for five years or more.

This is what should concern Americans most about our welfare system: not the cost, but the way that our 77 different federal welfare programs create a lifestyle of dependency, and in the process contribute to the deterioration of the American family and the American spirit.

When big government constantly intervenes, it sends a message to the impoverished that they are not capable of contributing to society.  Americans recognize that handouts come with heavy costs for the recipients, because long-term dependency can destroy personal motivation.  Thoughtful policymakers strive to separate the needy (who truly cannot support themselves) from other able-bodied, work-ready Americans who can and should contribute to society, and will ultimately be a harmed by a system that discourages self-improvement.

That's what policymakers are trying to do today in advancing new legislation.  The Welfare Reform Act of 2011 would extend work requirements created in the 1996 legislation to food stamp programs.  It would also include reporting welfare spending in the President's budget, and return overall federal spending on welfare to 2007 levels as soon as unemployment falls to 6.5 percent or lower.

Critics of this latest welfare reform legislation claim that such changes would gut the safety net and expose millions to severe hardship.  Similar claims were made in 1996:  Opponents suggested that the streets would fill with hungry children, and poverty would spread.  Instead, following that law, 2.7 million families moved off of welfarebecause they had the ability to independently provide for themselves.

In fact, welfare reform should help the truly needy by focusing assistance on them.  Certainly, 40 million Americans aren't incapable of providing for themselves and shouldn't spend years on food stamps.  Short-term assistance should be available, but Americans know that the best welfare program is job creation, which will lead to true economic stability.  The government can aid in private sector job creation only by getting out of the way - reducing taxes, reducing spending, and reducing regulations.

It's an unfortunate (but hardly surprising) fact that greater welfare programs and unemployment benefits discourage people from seeking jobs.  Why take a low-wage job if the government will pay just as much for doing nothing?  The problem is that a low-wage job is often a necessary first step to a better-paying job.  By discouraging people from getting those first jobs, the government is impeding their progress up the economic ladder.

When people talk about the American dream, they usually do not mention food stamps.  Our nation's welfare programs need to be reformed so that they focus assistance on the truly needy, and otherwise encourage work so that millions of Americans aren't condemned to a life of dependency.

Let's reform welfare for them. 

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