Commentary

The Critics Were Wrong: Welfare Reform Turns 10

On August 22, 1996, President Clinton signed the Personal Responsibility and Work Opportunity Reconciliation Act, a bill that despite its obscure title represented the most extensive revision of federal welfare policy in more than 30 years. Among other things, the bill ended the legal entitlement to welfare benefits, established time limits and work requirements for participation in the program, and gave states much more authority to establish other requirements and restrictions.

At the time, most American liberals predicted disaster. As Katha Pollitt wrote in The New Republic, “wages will go down, families will fracture, millions of children will be made more miserable than ever.” One frequently cited study predicted that more than a million children would be thrown into poverty. Welfare advocates painted vivid pictures of families sleeping on sidewalks, widespread starvation, and worse. The New York Times opined, “the effect on our cities will be devastating.” Senator Frank Lautenberg, a Democrat of New Jersey, predicted “hungry and homeless children” would be walking our streets “begging for money, begging for food, even…engaging in prostitution.” The Nation prophesied that “people will die, businesses will close, infant mortality will soar.” You would have expected to step over bodies in the streets.

Ten years on, we see that these claims were about as correct as intelligence estimates on Iraq. Welfare rolls are down. As Health and Human Services statistics show, roughly 2.5 million families have left the program, a 57 percent decline. Some of this undoubtedly resulted from the growing economy, especially in the late 1990s, but today, welfare rolls remain down despite the post-9/11 economic slowdown.

At the same time, poverty rates remain well below those before welfare reform was enacted. According to the Census Bureau, child poverty rates declined from more than 20 percent in 1996 to 17.8 percent today Roughly 1.6 million children were lifted out of poverty. Perhaps even more impressively, since 1996, the poverty rate among black children has fallen at the fastest rate since figures have been recorded. Dependent single mothers, the group most heavily impacted by welfare reform, account heavily for this decline. Since the enactment of welfare reform, the poverty rate for female-headed families with children has fallen from 46 to 28.4 percent—a decline greater than that of any other demographic group.

Most of those who left welfare found work, and of them, the vast majority work full-time. It is true that most of their first jobs were entry-level positions, paying on average $16,000 per year. That’s not much, but for many, it’s an improvement. As you would expect, studies show that as these former welfare recipients gain work experience, their earnings and benefits increase. And, for better or worse, many continue to receive other forms of government assistance.

Surveys of former welfare recipients indicate that they themselves believe their quality of life has improved since leaving welfare, and they are optimistic about their futures. The Manpower Demonstration Research Corporation reveals that a majority of former welfare recipients believe that their lives will be better in one to five years. Many of these recipients actually praise welfare reform for encouraging them to look for work, for giving them a fresh start, and for giving them a chance to make things better for themselves and their children. Both single mothers and their children appear to benefit psychologically from the dignity of working.

Of course welfare reform has not been perfect. A hard-core group of long-term recipients remains trapped in dependency, and poverty rates remain too high. Out-of-wedlock birthrates, while lower than they were, remain a problem. A few former recipients have fallen through the cracks. But by almost any measure you can think of, it is clear that the critics of welfare reform were wrong.

Yet the same critics raise similar scare stories when reforms to other government programs, from Medicare and Medicaid to Social Security, are discussed. Once again we are hearing that any changes, reductions, or “privatization” of these programs will lead to widespread poverty, suffering and corpses on every corner. Given the critics’ record on welfare reform, maybe we should be more skeptical the next time they say the sky is falling.

Michael Tanner is director of health and welfare studies and author of The Poverty of Welfare: Helping Others in Civil Society.