Economy

How Jeb Bush Plans To Destroy Anti-Poverty Programs

CREDIT: AP Photo/Lynne Sladky

Republican presidential candidate Jeb Bush

On Friday, Republican presidential candidate Jeb Bush released a wide-sweeping plan to reform many of the country’s largest safety net programs, calling them “broken,” “bloated,” and “destructive.”

The heart of his plan involves ending the current models for the Temporary Assistance for Needy Families (TANF) cash assistance program, Supplemental Nutrition Assistance Program (SNAP) or food stamps, Section 8 rental assistance, and public housing programs. Instead, he would require states to apply for “Right to Rise” grants — essentially a fixed amount of money, doled out in proportion to how much a state currently receives, that states would use to help low-income residents how they see fit. “Right to Rise Grants will give states more flexibility in how services and benefits are delivered,” Bush writes in his proposal, which he says will better eliminate poverty.

But that’s not what history says happens when programs are turned into block grants. Perhaps the biggest test of this was welfare reform enacted in 1996, which created current-day TANF. Rather than the federal government sharing the costs with states as need increases and decreases, states get a fixed sum to administer their cash welfare programs and large discretion in designing them.

The amount given to states through the block grant hasn’t been increased since that time, so it has lost 28 percent of its value to inflation since then. Thanks in part to the fact that states are essentially incentivized to reduce the rolls and therefore free up more resources, fewer and fewer people are getting the assistance. In 1996, welfare reached 72 percent of poor families with children, but by 2012 that share had dropped to 26 percent.

The same story has played out with other large, block-granted programs. Out of 11, eight have shrunk in size, some by severe amounts. Title 1 education for disadvantaged areas has fallen 115 percent since its creation, the Social Services Block Grant has fallen 87 percent, and the Community Development Block Grant, Home Investment Partnership Program, and the Training and Employment Services Block Grants have all fallen by about 60 percent.

While past Republican proposals to block grant more programs have similarly claimed this policy would give states more flexibility to address poverty, the opposite is often true. States can already request waivers from the government to experiment with new ideas. But more often, the truth is that block grants cut federal government spending without naming specific cuts to programs, and then leave the states with the burden of figuring out how to serve poor people under stricter restraints.

SNAP, on the other hand, is not currently a block-granted program. And it has responded far better to the most recent economic downturn. As unemployment, and therefore the need for assistance, spiked between 2007 and 2011 during the Great Recession, enrollment in food stamps rose by 45 percent. Enrollment in TANF, on the other hand, actually dropped in nearly a third of states. One estimate of a proposal to block grant SNAP found it would reduce the program by $137 billion, or 18 percent, over a decade and kick millions of people off.

Bush’s proposal goes even further than many block-granting plans put forward by Republicans, however. He leaves the door open for a state failing to get funding at all. “The grants will not be an open-ended entitlement to states,” he says in the proposal. “Instead, states will be required to meet several conditions before they qualify for the grants.” Those requirements will include developing quantifiable goals for getting more people into employment, reducing out-of-wedlock births, and promoting marriage, as well as the adoption of more stringent work requirements and time limits with exemptions for “a minority of beneficiaries” who face severe barriers.

His plan does promise to provide additional funding during an economic downturn, which differs from current block grant policy. It would also bar states from using the grant money for other purposes, something that many of them are all too willing to do today.

Beyond the block grant, Bush also emphasizes promoting marriage as a path out of poverty. “The most effective anti-poverty program is a strong, two parent family,” he writes. His plan would “ensure that safety net programs encourage marriage,” as well as end any penalties in current safety net programs faced by married couples.

But the evidence here is also not in his favor. More than two-thirds of single mothers who marry end up simply divorced later on, something that leaves them worse off financially than if they had stayed single. Meanwhile, more than 9.3 million married people still find themselves living in poverty.

And even if it were a stronger solution, it’s not clear the government could do much about it. It has already spent millions of dollars on a variety of marriage promotion programs. Yet these programs have had no impact on whether participating couples get married or even stay together, as well as no impact on the divorce rate. One program even made couples less likely to stick it out.

The proposal also aims to go after what Bush sees as “considerable waste, fraud and abuse” in safety net programs by increasing income verification requirements and “eliminat[ing] billions of dollars in wasteful spending by cutting federal administrative costs.” But there isn’t a lot of evidence of widespread fraud. A 2013 watchdog report found that while the federal crop insurance program misspent $14.6 million in high-dollar overpayments and farmer conservation programs misspent $2.7 million, SNAP and four other anti-hunger programs had exactly zero high-dollar overpayments. The overpayment rate for SNAP is at an all-time low of just 2.61 percent.