Welfare Reform’s 16th Birthday Is Anything But Sweet

Our guest blogger is Melissa Boteach, director of Poverty to Prosperity at the Center for American Progress Action Fund.

Bill Clinton signs welfare reform.

Sixteen years ago today President Clinton signed the law that did away with guaranteed income assistance for poor families with children and replaced it with Temporary Assistance for Needy Families (TANF). It was a watershed moment in poverty policy that fundamentally changed the landscape for struggling families.

For too many poor children, this 16th birthday is anything but sweet. As a present they get increased child poverty rates and a campaign from Mitt Romney and Paul Ryan that demagogues their families.

When TANF was first enacted, child poverty fell significantly and racial and ethnic disparities closed. Many politicians attributed these positive trends to the law’s new work requirements and time limits on income assistance. While these factors likely pushed more mothers into the labor market, the Clinton-era rates of economic growth and rising wages, along with the president’s policies on increased access to childcare and tax credits for working families, also played a significant role.

When the economy tanked, those gains began to unravel. As a flat-funded block grant, TANF lost the ability to respond to increased need in tough economic times and has lost approximately 30 percent of its value since 1996.. During the Great Recession, several states actually decreased their caseload as poverty rates rose each year. And today, only about 27 percent of poor families with children can access the program as opposed to the two-thirds of poor families with children that did in 1996:

Given that reducing child poverty was never a goal of the original legislation, perhaps this is not surprising. The current design of TANF’s work participation rates encourages states to help the easiest to employ families over those that face serious barriers to work and need more help. Moreover, the incentive structure of the program is focused on caseload reduction as states receive incentives for kicking people off the rolls regardless of whether or not they have found employment.

What states did not receive from the program was an incentive to cut poverty.

One silver lining from welfare reform was that many progressives thought enacting these reforms would take welfare “off the table” as an issue for demagoguery. No more fake welfare queens in Cadillacs used to drive a wedge between voters and foster working-class resentment. The American public would know that people on income assistance were required to work and that assistance was temporary.

Unfortunately, today, on TANF’s 16th birthday, the Romney/Ryan campaign is running false ads about families on income assistance in swing states, claiming the Obama administration wants to “gut work requirements” and “hand people checks.” Those claims are not only blatantly false — the Obama administration is trying to improve employment outcomes for low-income families through a waiver system Romney supported as governor — but a cynical maneuver that threatens to undermine bipartisan consensus that states could innovate with new approaches to improve employment opportunities for vulnerable families.

The pre-1996 welfare system had its flaws and was in need of reform. But record of conservative reform efforts is clear: Today, there are more children poverty, more working poor families, and unfortunately more demagoguery. As we move forward, we need to focus on creating an income assistance program that puts child poverty reduction and not caseload reduction as the central goal and addresses the fundamental barriers that families have to accessing sustainable employment.