Why the New Workfare Won't Work
Almost everyone agrees that work must replace welfare. Following President Clinton’s lead, both Democrats and Republicans have embraced the idea of a two-year limit on welfare, during which recipients of Aid to Families with Dependent Children (AFDC) would be given education, training, child care, and job-placement services. Afterward, when entering the labor force, they would continue to qualify for transitional services like Medicaid and child care during the first year of employment, as is currently the case under the Family Support Act.
This approach is a variation on workfare experiments that have disappointed policy-makers since the 1967 work-incentive program. Although the reforms now in fashion are more stringent in their demands, and more generous in their incentives, they are no more likely to succeed than earlier schemes.
The ultimate question is: what happens to welfare recipients who follow the program, but are unable to secure employment after the two years? According to current thinking, they should be required to participate in some form of public-works program established by the state. This is a tough-sounding quick fix that will surely create more problems than it solves. For those who have not found a job after two years are likely to include many AFDC mothers who are among the least skilled and least motivated in the welfare population. The social and economic costs of employing them in public works will be staggering.
Thus, estimates by the Congressional Budget Office indicate that expenditures for on-the-job supervision of these workers and day care for their children would amount to $6,300 per participant. With the average AFDC grant already about $5,000, participation in mandatory work programs would hence more than double the costs for each welfare recipient. Smoke-and-mirrors proposals to finance this plan through taxing food stamps and cutting other welfare benefits suggest just how desperate the administration is becoming as it starts to calculate the costs of public works. And beyond fiscal concerns, the cynicism and demoralization bred by make-work would surely undermine the already shaky standards of public bureaucracies.
Other aspects of the current thinking on welfare reform are also hardly likely to go according to plan. In particular, proposals for reform organized around incentives to work and a two-year limit on public support are plagued by three problems: they ignore success; they create perverse effects; and they require a level of callousness that social-agency personnel are unlikely to countenance.
For many families, AFDC serves not as a poverty trap, but as a temporary support in hard times; in fact, about 48 percent of all AFDC spells last less than two years. True, this success rate can be somewhat misleading, since one-third of short-term cases will enroll in AFDC again some time in the future and, in any event, most AFDC costs are attributable to long-term recipients. Nevertheless, reform measures that ignore the substantial number of successful cases are only likely to increase program expenses still further. By providing various transitional services and other incentives to work, they will raise the costs of public support for families who previously, in the absence of these benefits, would have left the rolls.
At the same time, if incentives are high enough, they may perversely encourage those who are already in low-paying occupations to leave work for AFDC, and then recycle back into the labor force in order to qualify for the transitional benefits.
Finally, for those welfare recipients who refuse to participate in either training or public works, how are public agencies to enforce mandatory work requirements? Answers to this question are harsh and unsatisfactory. The Republican Task Force on Welfare Reform, for example, would impose sanctions on those who fail to participate by initially reducing the family’s AFDC grant and food-stamp benefits by 25 percent, and after six months dropping them from AFDC altogether. But proposals of this sort disregard the question of what will happen to the children on welfare, for whom the AFDC program was originally devised.
Whatever hard lines policy-makers may draw, moreover, workers in welfare agencies are unlikely to impose sanctions that would virtually drive families with children onto the street. And if these sanctions were enacted, one may confidently predict that the two-year limit would become to welfare in the 1990’s what deinstitutionalization was to mental illness in the 1960’s, the deferred costs of which now plague our cities.
The essential problem with the transitional-incentives and time-limits approach to welfare reform is that it deals too generously with those recipients who are most competent and motivated, and too harshly with those who are least competent and motivated. I would suggest an alternative—one that begins with the need to distinguish among AFDC families, and seeks to ensure the well-being of children.
Families enter the AFDC program for different reasons and remain on the rolls for varying periods of time. About 60 percent of AFDC spells begin because of either a decline in family earnings or a divorce (or separation) of married couples with children. I would argue that these cases should be treated differently from the 30 percent of AFDC spells that begin when an unmarried woman has a child.
The reason is simple. Welfare applicants who were married or employed for some period of time prior to enrollment in AFDC are generally independent citizens who had been abiding by social conventions and trying to follow the rules. It is reasonable to presume that they are competent and motivated to become self-sufficient. Thus, they should be considered a separate group, awarded AFDC benefits, and left alone for two years to reorganize their lives. A high proportion of them will be among the 48 percent of recipients who leave the welfare rolls of their own volition in less than two years. Those remaining on AFDC after two years could then be enrolled in the first phase of intervention, leading to what might be termed “managed dependency.”
As for women who enter the AFDC program because of out-of-wedlock births, they are another matter. For one thing, they are younger and more likely to become long-term recipients than those in the other group. For another thing, their children are at great risk of harm. Children in single-parent families are twice as likely to be abused as those in households where both parents are present; when the single parent is a teenager, the risk is even higher. This group should be targeted for special intervention, if for no other reason than to protect the children.
Instead of forced labor and make-work schemes, however, the intervention would be divided into two phases. In the first, practical assistance would be offered to mothers and protection would be provided for their children by means of regular home-health visits, assistance in home management, encouragement of school drop-outs to complete their high-school requirements, and development of systematic plans for reintegration into the labor force.
After three years, those still on AFDC would enter the second phase. Here, greater social controls would be employed, reflecting the recipients’ emerging status as “wards of the state.” Home visiting to supervise child-care practices would continue, and the level of public-assistance grants would remain the same. But during this phase, a case manager would be assigned to exercise increased regulation over each family’s financial affairs, which would entail payment of rent and utilities and weekly allocations of food stamps. There would also be increased monitoring of outside resources available to recipients, which would reduce their AFDC grants.
Tightening social control through case managers and home-health visitors would certainly raise the costs of AFDC. But this would still be a relatively inexpensive way for society to protect vulnerable children, while giving notice that long-term public dependence would be accompanied by greater public surveillance. Increasing the role of public authority in recipients’ lives would make welfare less attractive to some who might otherwise be employed.
This is a modest goal, but those who demand more would do well to recognize that tinkering with AFDC is not the answer. Although AFDC may help to sustain the never-married, single-parent culture of poverty, it did not create this unhealthy pattern of behavior, and forces larger than those generated by welfare reform will be required to eliminate it.
Indeed, a serious effort to reduce welfare must go well beyond adjustments in the AFDC program. The best and fairest incentive would be to increase the work-related benefits of low-paying jobs of the kind that many welfare recipients might perform. Progress along these lines is already under way with the expansion of tax-based social transfers, such as the earned income-tax credit. Working families also need the security of medical protection, which those on welfare receive through Medicaid. Finally, there is widespread agreement that absent fathers should be held responsible for the financial support of their children (though resources for such support is often quite limited among fathers of children in the AFDC population).
Even with all this, dependency will not disappear. Whether due to personal deficiencies or forces beyond their control, people in need of care will always be with us. At the very least, however, social policies aimed at alleviating dependency should not condemn children for the hard luck or personal frailties of their parents.