House Budget Committee

The Future of Welfare to Work

Editor's Note: Ron Haskins testified before the House Committee on the Budget on the issue of how far social policy should go in demanding work. Haskins argued that the current economic situation requires a determination of what changes in federal and state policy would allow states to respond more quickly and completely during the next recession, but without any permanent loosening of the current work requirements.

My goal in this testimony is to clarify one of the most important issues in American social policy. This issue, which has been evolving since passage of the Social Security Act in 1935, has been brought to the forefront by the recession that now plagues us. The issue is who should be expected to work and how far should social policy go in demanding work.

The elderly, the disabled, and children are the easiest to deal with. Hardly anyone expects members of these large demographic groups to work, although even here there are important issues of definition. The definition of the elderly for the purposes of Social Security is being gradually increased from 65 to 67 as a result of recommendations by the Greenspan Commission in 1983. Some policy analysts have recommended that the age of eligibility should be increased still further. There is little or no pressure from the public or major organized groups to change the definition of age for purposes of program eligibility, but it is a good bet that when Congress finally decides to seriously address the nation’s cancerous budget deficit, the definition of elderly will get close scrutiny.

The definition of disability is one of the great conundrums of American social policy. There is a large class of people who have medically established physical disabilities about which there is little or no disagreement, although some people with extensive physical disabilities who could easily qualify for disability payments choose to work. The definition of emotional and behavioral disabilities is more tortured. I recall that during the debate over welfare reform in 1995, a senior analyst at the Congressional Research Service testified that, due to the interaction of unclear statutes and regulations plus confused interpretations of the statutes by the Supreme Count, the definition of childhood disability in the Supplemental Security Income (SSI) program was essentially behaving in an age inappropriate way. Clay Shaw, the subcommittee chairman, immediately remarked that under that definition half the members of Congress were qualified for SSI.

The welfare reform law of 1996 significantly tightened the definition of disability in the SSI program. Before 1996, anyone found to be addicted to drugs or alcohol was entitled to a guaranteed cash benefit and health care coverage. The welfare reform law simply eliminated alcoholics and drug addicts from both the SSI program and the Social Security Disability Insurance program by dropping them from the definition of disability.  There may have been negative impacts on addicts who would have been eligible for SSI under the old definitions but are no longer eligible, but if there are no one has demonstrated them in a good study.

These definitional problems with age and disability are relatively modest compared with the lively debate conducted over the years about the eligibility of able-bodied adults – especially mothers – for welfare benefits. Before the 1996 reforms, mothers who met a test of low resources and low income were entitled to cash welfare from the Aid to Families with Dependent Children (AFDC) program and their entire family was covered by Medicaid and the Supplemental Nutrition Assistance Program (SNAP; formerly food stamps). From time to time Congress passed provisions that encouraged able-bodied mothers to work or prepare for work. But these provisions were weak and ineffective. In a typical year before welfare reform passed, data from the Department of Health and Human Services showed that less than 10 percent of AFDC recipients participated in a work program or a program in which they searched for work. Few of these participated full-time. By contrast, nearly 35 percent of the caseload was enrolled in educational activities, although the evidence that these educational experiences led to work was minimal.

Perhaps the most important single issue in the 1996 welfare reform debate was that Republicans wanted to have tougher work requirements but Democrats were reluctant to put impoverished mothers at risk by penalizing them if they didn’t work. The Family Support Act of 1988 had strengthened work provisions somewhat, but still, as the data just cited demonstrates, the overwhelming majority of adults on AFDC did not work or prepare for work.
 
That changed with the election of President Bill Clinton in 1992 and the Republican takeover of Congress in the 1994 elections. Clinton campaigned on limiting time on welfare and emphasizing work requirements. Although he did not deliver on this promise in his first two years in office, upon achieving a majority in the 1995-1996 session of Congress, Republicans immediately introduced a bill that backed up work requirements with sanctions and time limits and provided states with a block grant featuring fixed funding that gave them a strong incentive to help adults leave welfare. The Republican bill strictly limited the amount of education that could count as work on the philosophy that only work led to more work. After a bitter Congressional fight that lasted until July 1996, a bill that had tough work requirements backed by sanctions and time limits passed on a bipartisan basis and President Clinton signed the bill in August 1996.