TANF: It Worked, Mostly

Policymakers and child advocates expect safety net programs to expand enrollment when unemployment increases, as it does during recessions. Studies of Temporary Assistance for Needy Families (TANF), the nation’s major cash welfare program, showed that it expanded less than the Unemployment Compensation (UC) and SNAP (previously food stamps) programs during the Great Recession. As compared with a TANF increase of only 7 percent, UC increased by 139 percent and SNAP by 29 percent.

However, a study we published this week showed that if the increase in the TANF rolls is measured during the unique period of rising unemployment in each state rather than during the dates of the national recession (December 2007 to June 2009), TANF increased by either 12 percent or 30 percent under two methods of determining the period of increasing unemployment in each state. States differed dramatically in how their TANF rolls increased. Using the state measure that showed the biggest increase, eight states increased by less than 10 percent while 30 states increased by more than 20 percent—three of which increased by more than 80 percent.

Even so, many critics think that TANF should have covered more families during the recession. This is a reasonable argument because TANF is the nation’s only cash welfare program (except in the case of families with a disabled member). But TANF is not just a welfare program. In 1996 the Aid to Families with Dependent Children program was replaced by TANF and turned into a program that emphasizes work and self-sufficiency more than any other welfare program. In addition to limiting most families to five years of cash welfare, every state designed a TANF program intended to encourage, cajole, and require parents to work at the threat of having their cash benefit reduced or even ended. The result was that the TANF rolls plummeted by well over 50 percent. Simultaneously, work rates among single mothers reached their highest level ever and poverty among children in female-headed families and among black children reached their lowest level ever. On the other hand, there was and still is a substantial group of single mothers, often called disconnected mothers, who did not work steadily and did not receive cash welfare during the recession. These mothers and their children were worse off than they would have been if they still received cash welfare.

Thus, there appears to be a tradeoff between tough work requirements and an increase in disconnected mothers who are highly likely to be in poverty. The number of disconnected mothers increased during the recession, but it has been a problem for many years. Some analysts argue that the best solution to the problem of disconnected mothers is to loosen TANF work requirements, especially during recessions.

Those of us who are reluctant to loosen work requirements, however, should support other solutions. A far preferable solution is to provide funds to states to establish work programs so that even mothers who cannot find jobs can continue to receive a cash TANF benefit by working at government jobs provided by the states. Even better, states can use the additional funds to subsidize jobs in the private sector so that mothers would not need a TANF benefit. Many states used emergency funds provided by the 2009 stimulus bill to establish such jobs, mostly in the private sector. It is time for Congress to fund large-scale demonstrations by states willing to conduct rigorous experiments to determine whether they can effectively and efficiently establish government jobs or subsidize private sector jobs for mothers who cannot find work. Facing strong work requirements and continuing to work is the best way to ensure that mothers avoid becoming disconnected, avoid falling into poverty, and avoid dependency on welfare benefits.