Welfare changes will mean more people in poverty

Ever since the post-1960s backlash that gave rise to the New Right, welfare has been one of the most unpopular and misunderstood public programs in America – and in California. Now the state is poised to undermine the most successful parts of its program, all but ensuring that more people, not fewer, will continue to struggle with poverty.

The 1996 national reform of welfare, which created Temporary Aid to Needy Families, or TANF, pushed states to reduce their welfare rolls and required certain rates of work participation for those receiving grants.

Yet despite this reform, welfare remains a popular political target, and California’s program, CalWORKs, came under attack last year in the midst of the budget crisis, resulting in major changes to the program. While the Administration of Gov. Arnold Schwarzenegger says these changes are intended to encourage work participation, they will in fact damage the ability of poor families to either reenter the work force or pull themselves out of poverty.

The changes to CalWORKs are scheduled to go into effect July of 2011. Currently, families where the parents do not comply with work requirements have their grant reduced to what is called a child-only grant. This places the children in the safety net, protecting them from circumstances they cannot control. Once the latest changes take effect, however, this child-only grant will be reduced after 90 days of non-compliance to 75 percent, and then to 50 percent after another 90 days if the parents still do not comply with the state’s requirements.

Other changes will also go into effect. Currently, able-bodied families are limited to 60 months of aid. This will be reduced to 48 months. Previously, time spent in sanction status did not count towards this 60-month limit, but once the reforms go into effect, sanction time will count towards the 48 month limit. Self-sufficiency reviews, which involve visits from local welfare officials to determine the progress and problems families encounter in complying with work requirements, will increase from once a year to twice a year. Finally, grant amounts will not automatically be adjusted to keep pace with increases in costs of living.

The reforms represent a compromise between Assembly Democrats and Governor Schwarzenegger. The Governor had previously proposed eliminating the safety-net of the child-only grant, and then later proposed a 24-month limit to grants. Although he did not get everything he wanted, Schwarzenegger worked with Republicans in the Legislature to push for changes in exchange for their votes on the budget, which requires a two-thirds supermajority to pass.

“This is a really classic lesson in sausage making,” says Frank Mecca, the executive director of the County Welfare Directors Association. “It all went into the meat grinder and it emerged far less coherent than it even started.”

It is unlikely that the long-term reforms will reduce poverty. Although a range of studies have come to varying conclusions, on the whole the research consensus points towards the effectiveness of well-funded programs that offer education, training, and exemptions for the first money earned at work, giving welfare recipients plenty of incentives to enter the workforce if they can. The evidence for the isolated effectiveness of harsher sanctions, however, is weak and inconclusive.

“Actually helping to get people to work,” says Mike Herald of the Western Center on Law &

Poverty, “is how you cut your rolls.”

Many states, however, have focused only on decreasing their rolls rather than helping recipients out of poverty. The national TANF reform of 1996 obliged states to increase their work participation and cut their rolls, but not to track what happened to recipients once they went off the program. Therefore, there is no single, clear data set on what has happened to those pushed off of welfare after TANF went into effect. Too often, reducing the rolls substitutes for truly reducing poverty and improving the lives of those who struggle with it.

However California’s program, CalWORKs, has been one of the less punitive programs in the nation since 1996. Rather than relying primarily on sanctions to reduce the number of people on aid, CalWORKs has focused on education and job training.

This has left CalWORKs vulnerable to attack from critics who point to California’s low work participation rates. According to the federal measure, only 22 percent of recipients are meeting work requirements.

However, the welfare services community argues that the federal measure is seriously flawed. It only counts those working the entire amount of hours required, and measures work participation only at a single moment, rather than over time. Therefore someone who works could fall one hour short of the requirement and fail to receive any credit for working. Those who experience cyclical unemployment are also recorded as completely noncompliant. The County Welfare Directors Association reports that when measured accurately, 50 percent of work-required adults have employment earnings, and 65 percent of work-required adults participate in some kind of work or education activity.

Yet critics of CalWORKs prefer to cite the federal measure, supporting the impression that the majority of welfare recipients are undeserving. The idea that increased sanctions result in more work participation is popular with much of the public, and despite the TANF reform, says Herald, “it still remains stuck in the popular consciousness that people are scamming the system.”

However, most research contradicts the image of the lazy welfare recipient. Studies show that families in sanction status are in fact far more likely to face serious barriers in the way of self-sufficiency. These include such obstacles as transportation, child care, disabilities and mental illness. Therefore, sanctions fall the most heavily on those already facing the largest obstacles.

Unfortunately, the portrait suggested by the misleading federal work participation measure reinforces negative stereotypes and anecdotal evidence about welfare recipients. Taxpayers are constantly presented with the story of an otherwise able-bodied individual living off the government while failing to contribute to society. Unacknowledged are the personal and structural barriers that often stand in the way of self-sufficiency. Meeting the work requirements is especially difficult in hard economic times, when jobs are scarce or nonexistent.

“A lot of people out of jobs are very interested in getting back to work,” says Cynthia Wallington of the El Dorado County office for CalWORKs in Placerville. “They’re not interested in sitting at home and just collecting welfare.”

One of the effective mechanisms for lifting families out of poverty is California’s earnings disregards policy, which is a positive work incentive. CalWORKs allows families to earn more money from employment without having their grants reduced, while other states start reducing or eliminating grants at a lower income level. Working therefore presents a clear benefit to a struggling family, helping them retain enough income to actually improve their situation. Such an earnings disregards policy keeps more people on the rolls longer, however, and requires a larger investment in California’s poor.

Welfare critics may not want to hear that reducing poverty requires more public investment. But they have no other choice if they indeed wish to reduce poverty. The evidence suggests that the primary obstacle that poor families face is not their own unwillingness to work, but the difficulty of obtaining self-sufficiency in an economy that offers very few options to the least fortunate.

Since 1998, approximately 500,000 CalWORKs recipients have left the program after obtaining employment. The changes to CalWORKs that have been adopted but have not yet taken effect would threaten exactly what has made CalWORKs a successful program in helping Californian residents struggle against poverty.

While slashing welfare programs and increasing sanctions is an effective political strategy, it does not meet the goal of helping families out of poverty. Poverty is primarily a social problem, not an individual failing, and it cannot be alleviated by blaming the victims.

Robin Averbeck is a PhD candidate in history at UC Davis.

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