Yes, Pres. Obama Gutted Welfare Reform

In the midst of the presidential campaign, Heritage’s Robert Rector reminds us that less than two months ago, President Obama gutted the landmark 1996 welfare reform law:

At the core of the 1996 law are “participation rate requirements” that ensure that 30 to 40 percent of able-bodied TANF recipients must engage in any of 12 different “work activities” for 20 to 30 hours per week. The administration would exempt states from this requirement and encourage them to operate under alternative performance measures. For example, HHS Secretary Kathleen Sebelius has said that to bypass federal workfare requirements, a state would have to “move at least 20percent more people from welfare to work compared to the state’s past performance.” 

At first blush, a 20percent increase in “employment exits” sounds impressive. But what does it mean? In the typical state, about 1.5percent of the TANF caseload leaves the rolls each month because of employment. To be exempt from the federal work requirement, a state would have to raise that number to about 1.8percent of caseload. This is a minuscule change; as the economy improves, this small increase will occur automatically in most states. Moreover, states keep imperfect employment records of those leaving TANF; many states could easily achieve the required increase through modest improvements in recordkeeping alone.

As pointed out on Senator Jim DeMint’s (R-SC) blog, “Dramatic rule changes that transform the heart of a law should not be done unilaterally by a government agency. Only members of Congress have the power to write legislation. Unaccountable bureaucrats don’t have the power to rewrite it later.”

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Fact Checkers Wrong on Obama’s Welfare Spin

Everyone needs oversight and fact checkers – no matter how revered by professional political pundits, campaign flacks and talking heads – are no exception.

Just look at welfare.

On July 12, the Obama administration unilaterally – and illegally – gutted a key work requirement provision of the 1996 welfare reform law.  The Heritage Foundation’s Robert Rector and Kiki Bradley explained that if Congress intended the work requirements to be waivable “it would have listed that section as waiveable,” but “it did not do that.”

Intended to be part of President Obama’s “We Can’t Wait” political strategy, the move instead reinforced the notion that his policies are making Americans more dependent on government (remember, food stamp spending has doubled under his watch).  And less than a month later, the Romney campaign rolled out an ad attacking President Obama’s executive order.

The fact checkers went ballistic (here, here, here and here), but in doing so missed the key loophole created by the administration.  Heritage’s Rector explains the creation of sham work standards:

In order to be exempt from federal work participation standards, HHS Secretary Kathleen Sebelius stated that a state would have to “move at least 20% more people from welfare to work compared to the state’s past performance.” This standard is vague, since states do not actually need to fulfill it but merely “demonstrate clear progress toward that goal no later than one year” after they are exempted from the old TANF work standards. Nonetheless, at first glance, this goal looks fairly impressive.

President Obama’s HHS will exempt states from the federal work requirements if they increase by 20 percent the number of TANF cases that lose eligibility due to increases in earnings, a measure called “employment exits.” There are four reasons why a 20 percent increase in the number of employment exits, although it sounds impressive, is a very weak or counterproductive measure of success in welfare reform.

Why is it a sham?  1) Employment exits will increase automatically when the economy recovers.  2) States could meet the target simply with better record keeping.  3) A 20 percent increase in exits is insignificant.  4) More employment exits indicate a larger caseload.

Amazingly, none of the fact checkers bothered to discuss the shame exit metric.  Apparently, none could be bothered to explain why it is a perverse measure of success.  Fortunately, Rector does and he explains the logic (if you can call it that) of the administration’s metrics:

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Welfare Work Requirements Not Waiveable

The Heritage Foundation’s Andrew Grossman has written a Legal Memorandum on the Obama Administration’s recent directive to grant waivers to states in order to get out of the welfare work requirements included in the 1996 reforms. Not only does this undermine the letter and the spirit of the law – which cut the welfare rolls in half and increased the employment and salaries of low-income individuals – but it also runs contrary to the law:

“Under the guise of providing states greater ‘flexibility’ in operating their welfare programs, the Obama Administration now claims the authority to weaken or waive the work requirements that are at the heart of welfare reform. In particular, it argues that Section 1115, which provides waiver authority for states to establish demonstration projects, authorizes it to approve state programs that ‘test approaches and methods other than those set forth in section 407,’ including different ‘definitions of work activities and engagement.’ In this way, states could evade Section 407’s work-participation requirement without sacrificing federal funding.

“But the Obama Administration’s claim that it may weaken or waive work requirements is contrary to law. Section 407 establishes a stand-alone requirement for state welfare plans that brooks no exceptions, befitting its status as the core component of the 1996 reform. It is also absent from the list of requirements that may be waived under Section 1115. Indeed, to eliminate any possible ambiguity as to whether the work requirements could be waived immediately following passage of the 1996 reform, a separate provision specifically states that waivers ‘shall not affect the applicability of section [407].’

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Reinstating Welfare Work Requirements

The pushback against the Obama administration’s illegal effort to gut welfare reform work requirements continues. House Ways & Means Committee Chairman Dave Camp (R-MI), Education & Workforce Committee Chairman John Kline (R-MN), Republican Study Committee Chairman Jim Jordan (R-OH), and Senate Finance Committee Ranking Member Orrin Hatch (R-UT) have introduced the Preserving Work Requirements for Welfare Programs Act, which would prohibit the Health and Human Services (HHS) from providing states waivers for welfare work requirements.

Last week, HHS Secretary Kathleen Sebelius encouraged states to seek “waivers” of work requirements for welfare recipients from the Temporary Assistance for Needy Families (TANF) program. In 1996, this program was reformed by a Republican-led Congress (influenced by The Heritage Foundation’s Robert Rector) which ultimately forced President Clinton to sign the overhaul into law. The reforms enacted resulted in declines of government dependence, including:

  • Significant increases in the employment and earnings of single mothers;
  • Record declines in welfare dependency as TANF rolls fell by more than 57 percent; and
  • Significant reductions in child poverty in female-headed households, which even after the impact of a deep recession are still below pre-reform levels.
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Letter: Reinstate Welfare Work Requirements

Senator Orrin Hatch (R-UT) and Representative Dave Camp (R-MI) have written a letter to Health and Human Services (HHS) Secretary Kathleen Sebelius denouncing the undermining of the 1996 welfare reforms by waiving work requirements for welfare recipients. The HHS announced last week that it was encouraging states to provide “waivers” to such requirements in the Temporary Assistance for Needy Families (TANF) program.

In 1996, the Republican-led Congress – inspired by the great work of Robert Rector of The Heritage Foundation – forced President Clinton to accept sweeping welfare reforms that resulted in record numbers of welfare recipients leaving the government’s dole and getting themselves out of poverty. To undo those reforms – primarily the work requirement – now will ensure that millions will be discouraged from ending their dependence on the federal government and will in turn hurt our economy. Sen. Hatch and Rep. Camp understand this, and contend that such waivers are not even allowed under the 1996 reforms:

“Simply put, if Congress had intended to allow waivers of TANF work requirements, it would have said so in the statute. Instead, Congress did the opposite and explicitly prohibited waivers to section 407 work requirements, among other sections of the Social Security Act.”

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