Has Welfare Reform Been a Success?

For a look at the successes and failures of welfare reform, 10 years later, Ed Gordon talks with Michael Tanner, director of health and welfare studies at the Cato Institute and economist and author Julianne Malveaux.

ED GORDON, host:

Joining us now to review welfare reform a decade later, Michael Tanner, director of Health and Welfare Studies at the Cato Institute and author of The Poverty of Welfare: Helping Others in Civil Society. And economist and author Julianne Malveaux. She's also a regular participant on our Roundtable segments here on this program. I welcome you both.

Many people wonder - Julianne, let me start with you - what would happen to women like Mary? If numbers are to be believed, proponents will say it's working. Welfare participation down 60 percent. Earnings of the poorest 40 percent of the families headed by single mothers have doubled since 2000. And between 1995 and 2004, 1.6 million children rose out of poverty with their parents. Tell us what we're missing in those numbers.

Ms. JULIANNE MALVEAUX (Economist; Author): One of the things I think we're missing is the fact that fewer than half of those eligible to receive public assistance are now receiving it. Many of the requirements have pushed people off public assistance, in some cases because some states have very harsh sanctions. Those sanctions are against the parents, but the children are the ones who end up paying that price. We also, Ed, are missing the fact that the minimum wage has not been increased in a decade. So many of the folks who have basically taken minimum wage jobs are now finding their circumstances worse off.

While the expanding economy was not the only reason why welfare deform - and I always called it deform - looked like a paper success, the fact is now the economy is contracting and we never made provisions for those. I would summarize by saying there are three kinds of people on public assistance. Three kinds of women. We're talking about women with children.

One are women like Mary Caferro and there are others, come on temporarily, they have exigent circumstances, their work ethic and other things is going to get them off. Maybe they're on for six months or a year. They get a college education. They do something. They're gone.

At the bottom you have the hardcore can't work, won't work, don't have any skills. You don't know what to do with them because their issues are not just public assistance.

And in the middle you have people who survive kind of episodically. They get a job. They lose the job. They have a car. The car breaks down. They're on a merry-go-round. They're in jobs that are low wage and temporary and I don't -

GORDON: So they just can't seem to get out of that cycle?

Ms. MALVEAUX: They can't it together. And I don't think that welfare deform has substantially improved their circumstances.

GORDON: All right.

Ms. MALVEAUX: The people at the top we don't care about. The ones on the bottom have gotten kicked off. The ones in the middle who really are trying are really having a hard time.

GORDON: All right. Michael Tanner, is this a paper tiger or is what we see truly progress?

Mr. MICHAEL TANNER (Director, Cato Institute Health and Welfare Studies; Author, The Poverty of Welfare: Helping Others in Civil Society): Well, it's a modest improvement and that should be measured against what was predicted at the time welfare reform passed. If you remember back ten years ago, critics of welfare reform were predicting that a million and a half to two and a half million more children would be thrown into poverty. The Nation magazine wrote about how people would be dying, that there'd be mass starvation in America because of this reform. None of these things happened. The fact is that welfare rolls are down, most of the people who left welfare and modestly better off. They're not necessarily out of poverty, but they're earning slightly more than they were before; and if combined with other government programs, they're doing okay. A few people have fallen through the cracks and we need to do better about that. And a great many people are still trapped on what some people call welfare light, where they're still getting a great many other government programs and not really independent.

I think, in general, you can say that welfare reform never accomplished all the promises its supporters claimed it would do in terms of turning people into independent economic units that would be out supporting families on their own, nor did it create all of the problems that critics said it was going to create.

It's been, you know, I'd sort of give it sort of a gentleman's C-plus.

Ms. MALVEAUX: You know what, and Michael is kind of correct to wash our faces in it, if you will, those who called for gloom and doom. But, Ed, the deal is -we were talking before we went on the air about the enormous emotion that was engendered in 1996. We'll remember Congresswoman Maxine Waters excoriating Bill Clinton at the '96 Democratic Convention because she considered him a sellout for going with this.

The fact is after welfare deform passed, we stopped paying attention to poverty. So the other assaults on poor families have included the demolition of Section 8 housing and housing projects. The fact that before welfare deform, it was easier, let's say, for a highly motivated person like the state legislator you just interviewed to get a college education on public assistance. Now states are cracking down on that.

So it seems that once the battle was over, people didn't try to reassemble the troops to talk about what we really need to do for poor people.

GORDON: Michael, what we did see...

Mr. TANNER: Well, actually...

GORDON: Let me throw this in and then pick up on that point. What we did see with the reauthorization of the reform bill are stricter requirements, including - and as Julianne has just suggested there - the inability now for these women to count as work continuing education in hopes of getting a bachelor's agree and pulling themselves out of abject poverty.

Ms. MALVEAUX: Or even a GED, Ed; even a GED.

Mr. TANNER: Well, I think to some degree this is a sideshow. The fact is that this is a relatively recent change to the welfare reform as part of the reauthorization that passed this year. Prior to this, states could allow education, including college education, to count as meeting the work requirement. Many - and in fact most states actually did - and relatively few women took advantage of it.

The fact is the very same social pathologies that make it difficult for many women on welfare to go to work - substance abuse problems, abusive boyfriends, lack of education experience or job experience before this - are the same problems that make it difficult for them to go on to college.

So I think we're talking about a very small minority of women who would be able to go on and get a college degree and support themselves that way. Instead, what we're talking about is people who get into their first job. It is often a low wage/minimum wage job, often with very few benefits, and it is often difficult to support a family on that.

However, once they get into a job, if they stay in that job, the studies show that their incomes rise and they do end up with benefits as you move on. Four or five years down the road, they're doing much better. It's a matter of getting off the dole and getting into that first job that really counts.

Ms. MALVEAUX: But, Michael, four or five years...

GORDON: One important note, Julianne - with less than a minute to go - when we talk about getting off the dole, we're still talking about very little money coming into a household.

Ms. MALVEAUX: We are. And, Ed, I just want to raise the other issue of healthcare and health insurance. And we look at the bankruptcy bill, another attack on the poor. The most frequent data point is indeed a single woman who has gone into bankruptcy because of a health bill. This was probably a woman who got off public assistance and didn't have the benefits. It takes a while for those benefits to kick in.

So we're not talking about a lot of money. Even when these sisters are earning, and it's mostly African-American women, but many white women as well, they're earning $16,000 a year. How do you raise, you know, a couple of kids on $16,000 a year? I mean that's the question that we really have to look at and then really raise questions about the social supports that we must have if we continue in developing a low wage economy.

GORDON: Well, one thing is clear, a decade later, we see that questions remain. Michael tanner is director of health and welfare studies at the Cato Institute, and author of The Poverty of Welfare: Helping Others in Civil Society. And economist and author Julianne Malveaux is president and CEO of Last Word Productions. I thank you both.

Ms. MALVEAUX: Thank you.

Mr. TANNER: Thank you.

GORDON: The 1996 Welfare Law helped move millions of mothers from public assistance into the workforce, but it did little to help the bleak prospects of poor young fathers. Experts weigh in on how government policy could reverse that trend. You can read their suggestions at our Web site at npr.org.

Coming up, New Orleans mayor still believes race played a role in how the city was treated in the wake of Katrina. And the president holds a press conference to defend his foreign policy. We'll discuss these and our other topics on our Roundtable.

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