Welfare: Now the Single Largest Budget Item

A recent CRS report indicates that welfare is now the single largest budget item in the United States.  This doesn’t reflect government benevolence.  It simply indicates that an unhealthy dependence on government has grown in this country.

Programs in all categories for people with limited or low income have gone up since 2008.  Federal spending for these programs grew 23% from FY2008 to FY2009.  The growth of spending was slower in the two following fiscal years, at 6% and 2% respectively.

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Driving the Day: Last Pre-Election Votes

Today the Senate will be voting on the Continuing Resolution (CR), which passed in the House last week.  This stop-gap spending bill will fund the government for the first six months of fiscal year 2013, which will start October 1.  The Hill explains why lawmakers wanted to get this bill passed so quickly:

“The speed at which lawmakers are moving the bill through the halls of the Capitol can be credited to the deal crafted before the start of the five-week August recess.

Lawmakers are loathe to take votes on items of much substance before the presidential election — or for that matter, any elections — for fear it will hurt their campaigns. Thusly, there is an eight-day session with the CR as the major piece of legislation zipping through the chambers.”

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A New Welfare Czar

In 1964, President Lyndon Johnson declared a “War on Poverty.”  Nearly five decades later, our political dialogue is still riddled with rhetoric that demagogues success.  Clearly, the so-called War on Poverty has failed to reduce the causes of poverty and, like most big-government solutions, created numerous unintended consequences.

After decades of failure, Washington successfully transformed one welfare program.  The 1996 welfare reform law – commonly referred to as Temporary Assistance for Needy Families or TANF – implemented a work requirement for participants that said able-bodied adults should work or prepare for work while in the program.

The law restored human dignity by ending government paternalism and dependency.  The Heritage Foundation’s Jennifer Marshall summarizes the results:

For four decades prior to reform, welfare rolls saw no significant decline and child poverty remained persistently high. Following the historic reforms of 1996, the welfare caseload fell by half. Nearly 3 million Americans achieved independence from government. Poverty among children and single mothers decreased significantly; poverty among black children reached its lowest level in U.S. history, as did the poverty rate for single mothers.

But in July, President Obama unilaterally gutted the law’s work requirements.  In doing so, he ignored the law’s success and his past support for such requirements. Heritage’s Robert Rector – considered by many the man behind the 1996 welfare reform law – explains the stakes:

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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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