Only in Barack Obama's Washington would the most successful federal reform of the past half-century not only fail to be emulated, but actually be reversed. Yet that's what Democrats have done to the vaunted 1996 welfare reform instituted by the Newt Gingrich-led Republican Congress. A recent Heritage Foundation report explains why the reform needs to be fully reinstated, and why 70 other welfare-related programs should be modeled on it.
The 1996 reform shrunk caseloads by more than 2.8 million families, or 60 percent, while leaving 1.6 million fewer children in poverty. It involved only one program, formerly called Aid to Families with Dependent Children, now known as Temporary Assistance to Needy Families (TANF). The success of TANF stemmed from requiring able-bodies recipients to work or further their education, while rewarding states that moved able-bodied individuals off the rolls while boosting assistance to the elderly and disabled.
The 2009 stimulus package undermined the work requirements and the incentives for states to keep their caseload number low. In short, it backtracked on the two most essential parts of the reform.
The Heritage study by Robert Rector and Kiki Bradley notes that 70 other means-tested, welfare-related programs do not contain work requirements or other reforms at all. The cost of these programs kept growing after 1996 even as TANF created savings. Since 1989, reports Heritage, the annual cost of all welfare programs combined has increased by 292 percent, faster than Social Security and Medicare (213 percent), education (143 percent), or any other part of the budget. President Obama's budget request for 2011 would hike total spending for all these programs to $953 billion, which is another 42 percent increase in just three years. One of the biggest splurges is in the food stamp program, which would rise to $75 billion from just $39 billion in 2008.
This explosion in welfare spending is irresponsible, unsustainable and must be stopped.
The Heritage authors propose a series of sensible solutions that should be adopted. First, they would restore the work incentives and state incentives to TANF. Second, they would impose similar incentives - again, just for the able-bodied, not the disabled - on the food stamp program and on housing assistance, which are two of the largest other forms of welfare. Third, they would roll back total welfare spending to near pre-recession levels and then let it rise only as much as inflation. Fourth, they would treat part, maybe a third, of welfare assistance as loans that eventually would be paid back on reasonable terms, rather than outright grants. Finally, they would eliminate perverse incentives in some of the programs that make it more lucrative for parents to be unmarried.
These welfare reform ideas don't put an end to the social safety net. They merely refashion it from a hammock into a trampoline. In which case, the Heritage proposals promise just the right amount of bounce.
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