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National research Council (US) Committee on Population; Moffitt RA, editor. Welfare, The Family, and also Reproductive Behavior: research study Perspectives. Washington (DC): nationwide Academies press (US); 1998.


Rebecca M. Blank

The system of public assistance in the United claims is continually evolving. In part, this is early to an altering demographic and also economic conditions, yet even more importantly, public help programs have been the target of recurring reform efforts. The most recent significant legislative readjust occurred v the it spreads widespread of the personal Responsibility and Work chance Act of august 1996.

This chapter summarizes patterns in public aid programs end time. The first section looks at historical transforms in the expenditure levels and also usage the public help programs. The 2nd section investigates just how public aid programs fit right into state and also federal budgets. The third section summarizes the current legislative changes, and the last ar discusses patterns in regimen design and operation.

Evolution of Expenditures and also Participation in Public assistance Programs

For lot of U.S. History, public assistance was the duty of local townships and counties, with states becoming much more and an ext involved end the last fifty percent of the nineteenth and also the beforehand twentieth century. Together in many other areas of social policy, the federal government"s involvement walk not start until the new Deal program of the 1930s established a precedent for federal duty in this area. Also so, together programs remained fairly small in the immediate years after the 1930s, through only small numbers of recipients and little costs.

Things changed dramatically in the 1960s and also 1970s. The primary cash aid program, aid to families with Dependent kids (AFDC), increased considerably due come a range of changes that brought many an ext eligible single mothers and also their kids onto the aid rolls.1 The establishment of the Food Stamp regime in the early on 1960s result in major spending increases throughout the 1970s, when Food Stamps were increased to every county and payment rules were simplified. The Medicaid routine was developed in 1965, offering health insurance come low-income family members who met particular eligibility criteria. Medicaid spending levels raised steadily through the 1970s and 1980s, reflecting both increases in the eligible populace and increases in medical costs. Highly variable state programs because that the elderly and the disabled were relocated to the commonwealth level in the beforehand 1970s when the Supplemental Security income (SSI) regime was produced to carry out uniform cash help to elderly, blind, and disabled individuals throughout the nation. Finally, together a supplement to low-wage workers, the Earned revenue Tax credit transaction (EITC) program started on a tiny scale in 1975.2

Figure 3-1 shows just how inflation-adjusted expenditures on public aid programs have readjusted since 1965. (Medicaid is not presented in figure 3-1, however is questioned below.) after peaking in the mid-1970s, AFDC expenditures have been mostly constant. Food rubber stamp expenditures increased with regime expansions in the 1970s, fell during most of the 1980s, but have get an impression again end the previous 7 years as caseloads have actually grown. The SSI regime remained a fairly constant-expenditure routine for the very first 10 year of the existence, however its expenditures have actually recently shot increase with expanded eligibility categories. Similarly, the EITC was a little program for its an initial 10 years, yet over the past 10 years, major benefit expansions have actually made the EITC regimen as large as AFDC, Food Stamps, or SSI.3


Figure 3-1

Dollars invested on earnings support (1995 dollars). NOTES: AFDC and also SSI show advantage payments. Food Stamps shows coupon value. EITC shows total costs consisting of refunds and also tax expenditures. SOURCES: AFDC 1965–1993, Food Stamps 1965–1994, and also (more...)

Figure 3-2 shows changes in the variety of participants in income support programs. Authorized in AFDC to be reasonably level throughout the 1970s and 1980s. Food stamp participation trends mirror safety trends. In both AFDC and also Food Stamps, sharp caseload increases developed in the beforehand 1990s. As number 3-2 indicates, these boosts leveled turn off by the mid-1990s, and more recently available data show that caseloads have actually fallen substantially due to the fact that 1995 in both programs. EITC participation has actually risen in addition to benefit levels. SSI participation has actually risen only gradually over the past decade, although prices are rising more steeply.


Figure 3-2

Participants in revenue support programs. NOTES: AFDC, Food Stamps, and also SSI display numbers that recipients. EITC shows number of tax returns. SOURCES: AFDC 1965–1993, Food Stamps 1965–1994, and also SSI 1994 from society Security management (1995); (more...)

Figure 3-3 gives a straight comparison the inflation-adjusted benefit cost every participant in every of this programs. Per-person AFDC spending decreased over time, and per-person Food stamp spending has actually been mostly flat. The SSI and also EITC programs present increases in services paid every participant over time. That is likewise noticeable that SSI recipients get far an ext assistance than participants in other programs.


Figure 3-3

Average monthly benefits (1995 dollars). NOTES: AFDC, Food Stamps, and also SSI show benefits per person. EITC mirrors benefits per taxes return. SOURCES: AFDC 1965–1993, Food Stamps 1965–1994, and SSI 1994 from society Security management (1995); (more...)

In stepping far from the specific numerical trends, what space the effects of these transforms over the past few decades? Cash assistance for nonelderly and nondisabled people has always been relatively restricted in the joined States, contrasted to many European nations. As a share of public help support, cash support has steadily decreased over the past two decades. Increasingly, resources are accessible through in-kind program (such as Food Stamps or Medicaid) or v behaviorally tied support programs, in which cash help is attached with work-related behavior. This is most evident in the expansion of the EITC, i beg your pardon is obtainable only to family members with working low-income adults. But even the AFDC program ended up being increasingly behaviorally linked, together legislative changes over the past 15 years mandated that more AFDC recipients get involved in project search and also employment programs.

The joined States continues to identify sharply in between different teams of low-income families. Elderly individuals receive far an ext support than family members with working-age adults. Nonelderly low-income family members have constantly been a resource of frustration because that the public help system. On the one hand, the adults in these families are regarded with part suspicion: why space they not successfully working their means out of poverty? While always applied to male-headed households, this viewpoint has additionally come to overcome our image of female-headed families as well, together employment amongst mothers has actually become more accepted. Top top the other hand, the adults in these family members come attached come children, whom we check out with less suspicion and want to assist. The an outcome is a continuous tension in public assistance programs between the type of requirements and limits put on aid to families and also the demands of the children in those families. Supporters of greater behavioral requirements and more restricted assistance inevitably allude to the adults and claim that they need to take an ext responsibility for your own economic well-being. Enemies of these changes inevitably point to the children and claim that they need to not it is in hurt because of the misfortunes of your parents. Current legislative transforms have sustained stronger work-related mandates, but this dispute is much from resolved. Credible research study that mirrors how kids are influenced by permanent work requirements applied on their single-parent mother may have a significant effect on future transforms in the framework of public aid programs.

Finally, it is precious noting that the expenditure fads in these 4 public aid programs are dwarfed by the cultivation expenditures in the medicaid program. Figure 3-4 plots inflation-adjusted spending on Medicaid, independently showing safety on the elderly and also disabled (largely those eligible because that the SSI program) and also spending on households with youngsters (largely those eligible because that the AFDC program.) While health and wellness expenditures climbed throughout the economy, they rose quicker for Medicaid, in component because Medicaid typically serves a population with greater health problems.4 In current years, medical allowance spending on the non-elderly, nondisabled populace has leveled off, however it has continued to rise for the elderly and also disabled. Several of the biggest expenditure increases have been for the Medicaid population in long-term care facilities.


Figure 3-4

Dollars invested on medicaid by eligibility category (1995 dollars). SOURCES: 1972 and also 1994 from society Security administration (1995); 1973 indigenous U.S. Department of Health, Education, and also Welfare (1975); 1974 from U.S. Room of Health, Education, and also (more...)

Trends in the variety of Medicaid recipients look quite different from safety trends, as figure 3-5 indicates. Till the late 1980s, the population of recipients was quite flat, despite steady boosts in expenditures. Recent eligibility extend for youngsters in low-income family members have significantly increased the number of young medical allowance recipients. 5 Slight boosts in recipiency amongst the elderly and disabled have likewise occurred. Figure 3-6 reflects the ramifications for medical allowance spending every recipient. Many strikingly, per-person Medicaid prices for low-income children and also related adults have actually been essentially flat—and are really low contrasted to per-person prices for the elderly or disabled. Every one of the growth in medicaid dollars because that families and also children is because of increases in the default population. In sharp contrast, per-person medicaid spending because that the elderly and also disabled has actually increased steadily for over 2 decades. Medicaid spending ~ above the elderly and disabled has been largely driven by increases in the person price of services noted to this population, and also not by population growth.

Figure 3-5

Number of medicaid recipients through eligibility category. SOURCES: 1972 and 1994 from social Security management (1995); 1973 native U.S. Department of Health, Education, and Welfare (1975); 1974 indigenous U.S. Room of Health, Education, and also Welfare (1976); (more...)

Public assistance Programs and also Government Spending

Ongoing federal budget plan deficits have resulted in increased pressure to reduced all develops of federal spending. Countless states run under well balanced budget requirements and also are additionally constantly seeking locations where costs can be decreased in bespeak to accomplish other publicly demands. Public help programs have regularly been a major target in efforts to reduced state and also federal budgets. At least some the this is due to a misperception top top the part of countless Americans about the function played by public aid in the budget. Because that instance, a 1995 CBS News/New York time poll indicated that over 50 percent the the populace thinks the federal government spends much more than 20 percent of its budget on welfare programs (Roper center for windy Opinion Research, 1995).

Figure 3-7 shows the ingredient of federal expenditures in 1995. Public assistance accounted for 14 percent of federal expenditures, of i beg your pardon 6 percent was due to Medicaid spending. While not an trivial share, an ext was invested on social Security, on defense, and also on net interest on the debt.

Figure 3-7

Federal expenditures because that fiscal year 1995. SOURCE: U.S. Office of Management and also Budget (1995).

Much the the development in federal expenditures on public aid is fairly recent, and it is heavily as result of increases in medical allowance expenditures. Figure 3-8 shows the trends over time on federal government spending on social programs as a portion of all outlays. Family members support program (primarily AFDC) have been flat at around 1–2 percent of the U.S. Spending plan for decades. If Food Stamps are added to family support, this accounts because that a level 2–3 percent of the U.S. Budget. In these core public assistance programs—the programs the U.S. Citizens room most likely to recognize as ""welfare"—there is no evidence of high or growing budget plan shares.

Figure 3-8

Government spending on social programs together a fraction of outlays. NOTES: The category "Family Support" has payments to states for AFDC benefits, administration, and also child assistance enforcement. The category "All various other antipoverty" consists of child nutrition (more...)

The federal budget plan share for every antipoverty program (except Medicaid) has risen from 6 come 8 percent end the previous 5 years, primarily because of the expansion in the EITC and also SSI programs, disputed earlier. Yet the big budget-buster is Medicaid, which has actually increased native 5 to 8 percent the the federal budget plan in just a couple of years.

The impact of medicaid on public budgets is even more visible in ~ the state level. Number 3-9 shows the break down of state expenditures for 1992, the many recent year because that which this data are available. Medicaid accounts because that 11 percent the the mean state spending plan in that year; other public aid accounts for just 3 percent. Together at the federal level, the medicaid share of state budgets has been growing dramatically over time. The result is that virtually all states are facing a crisis in their public aid spending: All claims are right now spending much more for public aid in total than they to be 10 year ago, but practically all says are spending less on non-Medicaid assistance. In short, programs for low-income nonelderly and also nondisabled family members have been cut in order to accommodate the growth in safety on clinical assistance. While countless have decribed the growing price of windy assistance challenged by the states, few state governors have actually publicly questioned the primary cause of this problem—increasing costs in clinical services (especially long-term care services) because that elderly and also disabled persons. Instead, they have often mistakenly assumed that the difficulty is safety in other programs and also have reduced general assistance, lower AFDC benefits, or taken other steps that limit public aid spending in areas where prices have not been rising.

The 1996 legislative Changes6

The 1996 welfare revolutionary legislation has actually been explained as a revolutionary readjust in the structure and emphasis that U.S. Welfare programs. In reality, the changes are at as soon as both less radical and much more radical than is regularly claimed. Castle are much less radical in the sense that the criticisms of existing antipoverty programs the they embody are not brand-new and reflect concerns that have actually long been component of the U.S. Conflict over helping the poor. Encouraging work, strengthening families, and also reducing government expenses are not brand-new ideas. ~ above the various other hand, this regulation has developed a more basic change in the commonwealth government"s function in antipoverty efforts than any kind of legislation due to the fact that the Social security Act of 1935, offering the states much an ext control end programs and the federal federal government much less. This ar summarizes few of the most important elements of the brand-new legislation.

The law creates a new block approve to the states, the Temporary help for Needy families (TANF) block grant. The AFDC routine is abolished and states room given virtually complete manage over the style of your public aid programs. States can use TANF money for any programs that achieve the purposes of the block grant, which include providing help to needy families, finishing the suspended of needy parental on government benefits, preventing and reducing out-of-wedlock pregnancies, and encouraging the development of two-parent families.

In providing states this expanded program authority, the law eliminates family entitlements come cash assistance. Under AFDC, any family the met the eligibility requirements had actually to be listed with assistance according to created rules and also regulations. Under the new law, states have actually much more discretion in determining who should obtain funds and how much they have to get. Lock can get rid of some teams from assistance, redirect money away from cash assistance toward solutions designed to stop teen pregnancy and promote marriage, or impose behavioral requirements ~ above the recipients the public help funds. If money runs brief at the end of a budget year, families can be turned away.

State entitlements come open-ended federal payments are additionally at one end. AFDC to be a matching grant program rather than a block grant program. If claims spent more, federal dollars automatically increased. Under TANF, claims will get a fixed amount that money indigenous the federal federal government in future years, equal to the federal payments they got in the beforehand 1990s for AFDC and related welfare-to-work programs. This leaves claims bearing the jae won risk have to there be rise in poverty or unemployment; the federal government will not instantly increase payments if a state has to provide assistance to much more people. The commonwealth dollars are likewise fixed in ~ the very same nominal level, so they come to be less gradually with inflation.

Although claims have better discretion to recognize who is helped, the federal law imposes new mandates v regard to job-related requirements and also payment borders for those who receive TANF funds. Any parent who has received 24 month of help in programs funded v TANF must be functioning or in a job-related program in order to receive additional funding. By 1997, 25 percent the all households in the state receiving TANF support should be functioning at least 20 hours per week. By 2002, 50 percent of all family members must be working at the very least 30 hours per week. (States have considerable discretion to define what counts together "work.") This vastly rises the share of the caseload who should be working, although these needs are lowered if caseloads autumn within the state. (Because the the recent decrease in caseloads, in the quick run a number of states will challenge much lower requirements.) The 1996 legislation detailed no brand-new federal accumulation to assist states in expanding their job-related programs, back some extr funds were added in the 1997 budget plan legislation.

TANF dollars space time-limited to any kind of individual. No family can receive capital from TANF if one adult in that family members has already received 60 month of help over his or her lifetime. (At your option, states can impose even shorter time limits.) claims are allowed to exempt 20 percent of their caseload indigenous this 5-year limit. States can additionally continue to support households with state-only funds, which will certainly probably bring about some an innovative accounting through regard come which families are being sustained on federal versus state dollars.

The it spreads widespread of time limits is the most dramatically new part the the legislation. At this point, however, the is unclear precisely what the influence of this time borders will be. If over there is high joblessness or if many adults hit these time borders at a point when lock are plainly unable to host a full-time job, states might well shot to negotiate for more extensive exemptions. In addition, enforcing this lifetime limit efficiently will require state and also national tracking equipment that determine the cumulative months of support got by any kind of individual in any type of state. Yet the legislation consisted of no accumulation for establishing such systems, i beg your pardon may permit some recipients to avoid the time limits in the near term.

In regards to both dollars and numbers of people affected, the biggest affect of the 1996 law will it is in on those who were as soon as AFDC participants and who currently are topic to the state-designed programs funded by the TANF block grant. However a variety of other provisions in this invoice will affect other programs and also other teams of people. The regulation sharply restricted the access of public aid to immigrants (although few of these cut were revived in later legislation in 1997); minimal Food stamp benefits to nonelderly, nondisabled adult without children; and also narrowed eligibility categories for SSI.

Larger trends in regimen Changes7

As listed above, the 1996 law pushed further and also faster in some directions where changes in public help had currently been occurring. This ar discusses 3 of the significant trends in the framework of public assistance programs over the previous decade.

Increasing focus on behavioral Requirements as component of routine Eligibility, with particular Emphasis on work Behavior

More than twenty-five years ago, chairman Nixon suggest to roll all cash and non-cash income help programs right into one solitary cash aid program, obtainable to all families who met the earnings eligibility requirements. Typically referred to as a an adverse income tax, such a system would provide cash support through the taxes system. The pendulum has actually swung much in the other direction, so the Nixon"s not-so-ancient proposal seems practically unbelievable in today"s political climate.8 The current emphasis is really much in the opposite direction: time-limited programs accessible for narrowly characterized target groups, ensuring that huge numbers of human being are no eligible because that substantial amounts of public assistance. Those who execute receive aid must develop their "deservingness" by enrolling in project training and also placement program or working and (in part states) limiting your future fertility, ensuring their children are as necessary cared for, or meeting various other state requirements.

These much more targeted and also behaviorally linked public assistance programs will face several major problems that have not yet been totally understood. First, such a proliferation the mandates and behavioral demands is typically an ext expensive to operation (per person) that are cash assistance programs, due to the fact that the previous require much much more monitoring. The cheapest and most administratively effective program is one that just writes and also mails a inspect each month. The much more information that situation workers have to regularly collect, process, and also evaluate, the greater are governmental costs, and also the greater is the potential for errors, misunderstandings, and also management problems.

Second, this tendency flies directly in the challenge of an additional desire that is often articulated in ~ the exact same time: To reduce governmental interference in people"s lives. By mandating behavior conformance and income eligibility for public help programs, government"s duty in the resides of low-income human being becomes much an ext intrusive.

The effectiveness of these behavior mandates will count upon exactly what lock require and also how easily they deserve to be monitored and also enforced. There is solid support for behavior mandates that encourage parents who get public assistance to get in job training and job search programs; the evict people from public real estate who engage in criminal behavior; and that link job recommendations and placement through high college performance among youth. Other behavior mandates are an ext controversial, such as cutting a family"s public assistance benefits if the mommy cannot store a teens in college or refusing public assistance to infants born come unmarried mothers.

Deciding which behavioral mandates make sense requires great judgment about what can be properly implemented without substantial increases in administrative complexity and also cost, what mandates are likely to motivate alters in habits (rather than being just punitive), and what actions can produce unacceptable levels of need among mothers and also children who can not fulfill the mandate. Programs v extensive but unmanageable needs that finish up having small effect may only make life harder because that the poor and also increase publicly cynicism around the ineffectiveness of federal government programs.

A Return to an ext Local and also State Discretion in the style of Programs

Public assistance in this nation was totally based in ~ the ar or township level 150 years ago. Over time, states took over more and much more of the financing and also operation that programs, and then, starting in the 1930s, the federal government entered the scene. The duty of counties and states has always been important, however. The federal federal government has never directly administered public aid programs. The human being who actually run programs room all county, local, or state-level employees. The checks received by poor families or by those who run public services for the bad have constantly been drawn on state or municipal banks, and also states have actually always listed substantial capital for numerous public help programs. Over time, however, the federal federal government has pertained to fund much more programs and has imposed much more regulations on exactly how programs could be run. End the 1980s, claims were provided the chance to use for waivers to run programs the did no conform to federal rules, but these waivers often tended to be restricted in scope and also often took a good deal of time and also effort to negotiate. The it spreads widely of TANF substantially increases state discretion end public assistance programs.

The interest in returning an ext control come the state or regional level grows the end of 4 quite various perspectives. First, some argue that giving an ext discretion and control earlier to claims will minimize the rigidities and bureaucratic nature of numerous current public aid programs. Second, part who think that we just don"t know enough to style effective nationally operation antipoverty programs, advocate enabling states to experiment with a range of programs favor job training, education and learning reform, or housing assistance. From this multiple experimentation will come much better evidence ~ above what functions effectively and what walk not. Third, those who room concerned around the growing scope of federal authority want to devolve centralized decision making far from the federal government and ago to the states. Fourth, those who worry about the commonwealth deficit and also want to reduce federal spending see these transforms as a means to reduced federal safety on antipoverty programs and induce says to take better fiscal responsibility for the maintain of these programs.

Some that these disagreements have lot to introduce them. Absolutely for programs like job training, whereby there are substantial differences across local areas in the nature that jobs available and the features of the low-income population, running in your ar designed program is important in order because that programs to it is in effective. Indeed, the federal federal government has always largely left the details design of job search and also job training program to state and also local discretion. Similarly, in areas where present programs have been mostly ineffective, together as efforts to engage teenage high institution dropouts in employment and training programs, allowing different says to experiment with various programs might an outcome in useful new information.

On the other hand, over there are additionally serious problems with limiting the federal function in public aid programs to resolved levels of block grant funding. First, states have actually less ability to finance antipoverty programs than the federal government. The need for public help is in ~ its largest when the economic climate is the rockiest. Thus, public help programs room necessarily countercyclical, expanding when the economic climate is in recession and contracting once the economic climate booms. Due to the fact that most states operate under year-to-year well balanced budget requirements, it is practically impossible because that them come run major countercyclical programs. In economic recessions, taxes revenue shrinks and also this often way they have to cut back on safety at exactly the time when need is increasing. This financial problems, confronted by claims in the great Depression of the 1930s, were one of the main reasons the federal federal government became an ext involved in jae won public assistance programs.

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Second, if the federal government has been periodically inept and also sometimes foolish in the means that it has managed and also run antipoverty programs, says hardly have actually a far better track record. In fact, much of the catalyst toward more centralized regulations and rules in the 1960s occurred because of issue over just how these programs were being operation by many states, where racist exclusions and also arbitrary dominance making were all also common. While over there are constantly states the take the lead in implementing new management procedures, the federal government has to be a key agent pushing states to mitigate waste and fraud by diminish errors in determining eligibility because that assistance, by requiring constant program reports, and by encouraging says to upgrade computer system systems.

Third, there continue to be concerns about the same of state-run public assistance programs. For instance, if some states choose to dramatically reduced all creates of cash assistance and other states maintain their existing programs, benefit differences throughout states could become much larger than they currently are. This might not just raise same concerns, yet could also cause an extensive migration through low-income families, forcing those states that want to maintain an ext generous program to cut them back because of growing low-income populations. This form of competition in between states has been described as the "race come the bottom," definition that as soon as states space given complete control over public aid benefits, there room incentives because that all states to administer less than they can otherwise select to, the end of a fear of gift a "magnet" for bad people.9