Terrance Heath

Paul Ryan & Welfare Reform's Catastrophic Success

Filed By Terrance Heath | April 08, 2011 3:00 PM | comments

Filed in: Politics
Tags: budget, Eric Cantor, government, Paul Ryan, shut-down, welfare

When conservatives start talking "welfare reform" progressives usually respond one of two ways. We either: (a) start inching towards the exits; or (b) stand in open-mouthed wonder, asking one another, "Wait, they’re not serious, right?"

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Oh they’re serious, alright. In fact, that’s why we start making for the exits - because their serious. And none is more serious than the current poster boy for "serious" conservatives, Rep. Paul Ryan, who took to the pages of the Wall Street Journal touting his "Path to Prosperity" as an effort to build upon the welfare reform of the late 90s.

Welfare reform: This budget will build upon the historic welfare reforms of the late 1990s by converting the federal share of Medicaid spending into a block grant that lets states create a range of options and gives Medicaid patients access to better care. It proposes similar reforms to the food-stamp program, ending the flawed incentive structure that rewards states for adding to the rolls. Finally, this budget recognizes that the best welfare program is one that ends with a job - it consolidates dozens of duplicative job-training programs into more accessible, accountable career scholarships that will better serve people looking for work.

See, there’s the problem with this is that the welfare reform of the late 1990s was not a success. Not unless you’re a conservative. And even then it was at best a "catastrophic success" - defined here as "success" that’s actually catastrophic for those it’s purported to help. That’s also what makes it a success. That is, if you’re a conservative.

What makes it a success? Well, in a sense, failure. It works if it doesn’t work, in other words, especially if it doesn’t work for the right people - because the right people are the wrong people. Follow me? No?

If you want a detailed explanation, I recommend Paul Rosenberg’s six-part series, "The Myth That Conservative Welfare Reform Worked." Ryan lays out the wrong-headed assumptions that drove the 1996 welfare reform passed by a Republican congress and signed by Democratic president Bill Clinton - a program so punitive that two members of President Bill Clinton’s administration quit in protest. He throughly debunks, the conservative idea that our welfare system caused the very problems it was intended so solve, and does so in such detail I can’t hope to duplicate it here. I direct you to part 2 of his six-post series for that.

What’s most intriguing in this case is Rosenberg’s critique, based on a Center on Budget and Policy Priorities report, of what its conservative proponents use as the primary measure of its success:

Ten years after "welfare reform" passed, most of Versailles thought it was a great success. But CBPP pointed out that a lot was being left out of these accounts. Indeed, it found that more than half the decline in caseloads–the primary measure of "success"–was due to people who were eligible and needed help not receiving the help they were entitled to. That’s some success!

This is from Brad Plummer, whom Rosenberg quotes in part 2 of his series.

While I was moving, the tenth anniversary of welfare reform came and went without too much fanfare. Many observers simply declared that welfare reform had "worked," because caseloads had declined. But what kind of metric is that? The whole point of reform was to push people off welfare. Of course caseloads were going to decline-that’s what the law did. We should be asking if families are now better off because of it.

Plummer supplies the data to answer his own question.

Nation-wide, welfare caseloads declined from 4.4 million families in 1996 to about 2 million families today, as states began kicking people off the rolls. So what happened to all of those families? The Urban Institute conducted a massive survey on this, and found that in 2002, of those who left welfare:

  • 57 percent were working (about 40 percent full-time)
  • 26 percent had returned to welfare
  • 14 percent had "no employment income, no working spouse, and no cash welfare or public disability benefits." (Presumably some of these families receive other benefits from America’s stingy safety net, such as housing assistance, food stamps, or WIC grants.)

Welfare "reform" has obviously failed the last group, people who by and large are in poor physical and mental health and unable to work. That’s about 300,000 families so far, and the number has grown since 2000. Many more families who still receive assistance will likely face a similar situation once they run up against the five-year time limit and get kicked off welfare. That’s especially true if Republicans in Congress get their way and pass rules that would make it harder for states to evade these time limits.

Now consider the first group, those who went back to work. Their median hourly wage was about $8 per hour in 2002, or about $16,000 per year. Many families do better, many do worse. For a single mother, though, that’s not enough to raise children on-it’s hardly a wonder that the poverty rate among single working mothers increased slightly during the "booming" economy in the late 1990s, as women were pushed off welfare to find jobs that paid little. And those jobs are often precarious; an illness or a broken car can easily mean getting fired, with only a shredded safety net to fall back on.

I’m increasingly convinced that most of the time - whether it’s jobs, the economy, or health care - progressives and conservatives are almost never talking about the same thing. If you’re a progressive, all of the above is evidence of that conservative welfare reform was a failure and a fraud, because it didn’t leave families better off because of it. It you’re a conservative, welfare reform was a success because it reduced the number of people on welfare - and that’s all it was supposed to do. It was supposed to get people off welfare rolls. Period. After that, they were on their own.

Paul Ryan, in his WSJ op-ed, says that with his roadmap we "strengthen and improve welfare programs for those who need them, we eliminate welfare for those who don’t." It curious, because it really does sound like he wants to duplicate the catastrophic success of the welfare reform of the 1990s. The "success" was getting people off welfare rolls, not necessarily improving their condition. It was about reducing the number of people receiving government assistance, not reducing the need for assistance. Simply put, it’s fewer people getting help, instead of fewer people needing help.

What makes it a success is also what makes it catastrophic; at least for the people fall from the welfare rolls. Getting people off welfare rolls isn’t a good measure of success, because it fails to ask what they fall into. If the answer is "they go to work," the next question is whether they go to work that pays them a livable wage, and whether they go to work that gives them a n opportunity to improve their economic status, rather than just barely get by. That’s success.

Both Rosenberg and Plummer point out that the 1996 welfare reform failed to lower the poverty rate. The decline the poverty rate among African Americans actually slowed after 1996. Among single working mothers, the poverty rate actually increased, because the jobs they get are "often precarious; an illness or a broken car can easily mean getting fired, with only a shredded safety net to fall back on." Plummer asks "So what, exactly, did welfare reform accomplish, apart from pushing people who genuinely need assistance off the rolls and saving the government a few bucks?" The answer would seem to be "Not much." Perhaps because that’s all it was supposed to do.

We’re still living with the fall out of that failure. All those families who weren’t any better off after welfare reform, are even worse off in this recession, after what Lara Flanders calls the Clinton era "house of cards" - deregulation, "welfare reform" and NAFTA - collapsed. Dean Baker points out that in his praise of the welfare reform of the late 1990s, Ryan "apparently has not noticed the large rise in child poverty rates in this recession as well as the limited response of TANF spending to the large rise in unemployment due to the recession."

If, as Plummer says, we are to ask whether families are better off now because of welfare reform, we’d have to take into account not only the child poverty rate, but also the way states are now pulling a "bait and switch" on the resources that are supposed to make welfare reform "work."

Despite a substantial increase in federal support for subsidized child care, which has enabled some states to stave off cuts, others have trimmed support, and most have failed to keep pace with rising demand, according to poverty experts and federal officials.

That has left swelling numbers of low-income families struggling to reconcile the demands of work and parenting, just as they confront one of the toughest job markets in decades.

The cuts to subsidized child care challenge the central tenet of the welfare overhaul adopted in 1996, which imposed a five-year lifetime limit on cash assistance. Under the change, low-income parents were forced to give up welfare checks and instead seek paychecks, while being promised support - not least, subsidized child care - that would enable them to work.

…As the American social safety net absorbs its greatest challenge since the Great Depression, state budget cuts are weakening crucial components. Subsidized child care – financed by federal and state governments – is a conspicuous example.

When President Clinton signed into law the changes he declared would "end welfare as we know it," he vowed that those losing government checks would gain enough support to enable their transition to the workplace.

"We will protect the guarantees of health care, nutrition and child care, all of which are critical to helping families move from welfare to work," Mr. Clinton pledged in a radio address that year.

Now, with the jobless rate hovering near double digits and 6.7 million people unemployed for six months or longer, some states are rolling back child care.

How long before conservatives tout the reduction in families receiving child care assistance as another sign of the "success" of welfare reform? Given how many still see it as an overall success, my guess is any day now.

Of course, blacks and single working mothers were easy groups to stigmatize then, and still are now - as we saw during the health care reform debate - for reasons Rosenberg explains pretty well.

At the policy level, the master narrative Katz identified played a key role.  People remained reluctant to cut the welfare state-to this day, even a majority of self-identified conservatives routinely says that most welfare state programs should continue to be funded at or above current levels.  But if one remains focused on (implicitly racially-driven) questions of who is deserving, the narrative can be completely changed, so that support for welfare state programs themselves is never the issue, and hard-core conservative ideologues never suffer for their ultimate desire to completely eliminate them--something that less than 1% of the American people support.

... The myth of an undeserving power has ancient roots, much older than anti-black racism, which only developed as the need for and access to African slaves emerged in the 16th Century.  But racism infused that myth with a virulent power that helps sustain a staunch refusal to face empirical facts that dominates American politics down to this day.  If one did face those facts, one would find that welfare generally reduces poverty, just about any way you slice it.

It’s not that welfare can’t induce dependency, or that some people won’t game the system.  It’s that such effects are relatively minor, and should not be used to punish the vast majority of those who are already being ill-served by our economic system… which brings us to our third disconnect, an unwillingness or inability to critically examine our economic system as a whole, and seek to make it more just for everyone.  Blaming the "undeserving" poor and refusing to even think about criticizing the system go hand-in-hand with one another as principle tenets of conservative ideology.  Measuring "success" by reducing the number of poor clients represents the perfect expression of this ideology, and the establishment of its position of hegemonic dominance. Self-styled Versailles "liberals" who embrace this hegemony, and bash those who question it-as Benart does-are as much a part of the problem as the conservatives who originally promulgate the ideology in its purest form.

But in targeting Medicaid, conservatives like Ryan are also targeting a whole new demographic of "welfare queens," as Matt Yglesias points out.

In other words, people are supposed to think Medicaid is that "bad" kind of government spending, the one that goes to shiftless black folks not hard-working Americans like you and me and Paul Ryan. But look at the actual distribution of Medicaid dollars:

This is mostly a program for the elderly and the disabled. It’s the main way we finance long-term care in this country. If you don’t directly benefit from it, you very likely have a parent or grandparent who does and whose financial needs will simply tend to fall on you if the program is cut. Meanwhile, in terms of the "welfare" aspect of Medicaid by far the largest set of poor people it covers are poor children. Is Ryan’s view that these kids should have worked harder to have rich parents? Poor kids tend to struggle with a lot of problems and are in many ways disadvantaged in the competitive economy by the time they’re out of diapers. It seems to me that investing in their basic health care is a no brainer way of leveling the playing field somewhat and ensuring that the country is making the most of our human resources.

In the unlikely event that Ryan’s budget proposal became actual policy, it’s going to have the same effect as the late 90s welfare reform that Ryan uses as his model. The primary measure of its success will be the declining numbers of people receiving services from the programs Ryan is targeting.

It’s highly unlikely that those people - the elderly, the disabled and children - will be better off. That goes for their families, too. As DailyKos’ Joan McCarter points out, a quarter of Medicaid spending pays for long term care for the elderly. Without Medicaid, families who are already taxed more under Ryan’s plan, have to pick up those costs. That’s an added burden for middle class families.

Taking Medicaid funding from families with disabled children and parents and grandparents in nursing homes compounds that.

Plenty of middle-class families only remain middle class because they’re spared crippling medical and long-term care costs. A decade or two of the Ryan plan, and there will be no more middle class in America.

But that’s why it will be a success. Making people better off, by reducing their need for assistance, isn’t the point of conservative welfare reform. The point of conservative welfare reform is reducing the fewer people receiving help, not the reducing the need for help. That’s why it’s so successful, if you’re a conservative like Paul Ryan. Because all you have to do is cut.

As tiresome as it’s been to hear about  Paul Ryan and his plan, I agree with Dean Baker that the gentleman from Wisconsin has actually done us a service in presenting it.

The reason why this is so useful is that there is nothing in the Ryan plan that has not been circulated in policy circles for decades. Almost everything in the plan has been tried and failed. The plan ignores obvious economic realities, such as the bubble-induced recession that has left 25 million people unemployed or underemployed. It doesn’t lay a glove on the rich and powerful, while threatening to undermine the limited economic security enjoyed by tens of millions of middle class families.

Yet many pundits will applaud the plan as brave, innovative and creative. In making these pronouncements these pundits will immediately reveal themselves as worthless hacks who either lack the ability or desire to do their own thinking. Their endorsement of the Ryan plan will be like a scarlet letter permanently marking them as someone who has no place in a serious policy discussion. For this reason we owe Mr. Ryan a real debt of gratitude.

Eric Cantor made headlines when he said of Social Security, "We’re going to have to come to grips with the fact that these programs cannot exist if we want America to be what we want America to be."

Paul Ryan is saying the same thing, though not as succinctly, in his plan. He and conservatives like him are showing us what they want America to be. And it’s not an America where fewer people need help, because more of them are working at jobs that offer, livable wages, good benefits, and a chance to raise their economic standing. It’s an America where fewer people are getting help.

That’s the success and the catastrophe of conservative welfare reform

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I believe there is always room for reform but we should always carry the principal of are we reforming to help people or to take away from them?

When you create a system of support, yes people rely upon it but that is not a bad thing. If they need food or medical help that is the purpose of these programs. To lift someone up in dignity of allowing them to be fed and healthier is noble.

The enemy has never been social programs its been spending. I don't care who has been in power government spends recklessly. If they try to live within their budgets more instead of snap drastic cuts we would not have such issues.

"Welfare reform" is based in a false consciousness about how the economy works: a brilliant person does something great, gets a lot of money through the sheer greatness of their actions, and then employs others to get the economy moving. That's not the way things work. Money is printed and distributed by the government and it's supposed to be a means of getting everyone to work as efficiently as possible (instead of us all doing subsistence farming and making what we need at home). Some people scheme and come up with ways to take more from others. It's not always related to brilliance. The government, which created the money in the first place, should step in and take the edge off the natural tendency for people with money to use it to take away other people's money.