The American Welfare System; a Failed Policy

For two decades, the United States (U.S.) has exemplified a country that is both focused on maintaining an independent society and providing financial assistance for those in need. In 1992, Bill Clinton’s presidential campaign promised significant welfare reformations that would effectively “end welfare as we know it” (Carcasson). The system’s stated purpose was to move families from “welfare to work”,and the late 1990’s demonstrated that this approach to welfare was successful. Standards of living in impoverished areas began to improve and more people were entering the work force (Glass). However, as the system continued to develop and operate, significant faults within President Clinton’s reformations emerged. In spite of the inordinate amount of funding and resources that have been exhausted on the welfare system, beneficiaries struggle to support themselves financially. Rather than incentivizing welfare recipients to seek employment, this system penalizes labour and facilitates the poverty cycle. Throughout this essay, I maintain the firm belief that the current welfare program, operating within the United States, regularly falls short of its purported goals and these inadequacies are rooted in the unaccountability in state funding, asset limits, and the family cap.

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         In 2010, the Government Accountability Office (GAO) reported that seventy-six percent of welfare eligible families chose not to participate in federal assistance programs (GAO). Why have so many families decided to forgo a government cheque that could alleviate fiscal difficulties? Throughout this essay I address this question by evidencing several fundamental flaws within the United States’ welfare system that have precipitated massively shrunken benefit programs. First, I will demonstrate the shortcomings of this financial policy by highlighting several flaws that have hindered the attainment of its main objectives. I will lend specific focus to analyzing three defects within the system: welfare state funding, family financial assistance, and asset limits. Lastly, I will address the claim that poverty has been reduced since welfare reformations – a claim that, although partially true, is nevertheless misleading. Throughout this essay I maintain the stance that the United States welfare system is inadequate at fulfilling its intended goals.

         A key premise underlying the failings of Clinton’s welfare program, Temporary Assistance for Needy Families (TANF), is that if states are offered more freedom with TANF funds, they may offer a stronger safety net for individuals who are unable to work and subsequently need help obtaining a job. Under this provision, “the mobility in the welfare system would enable states to fund additional in-work programs to demonstrate the increased emphasis on welfare being transitory and work-focused” (Schott). However, two decades of evidence have demonstrated that when states are given an inch, they take a mile. Annual state expense reports revealed that while a portion of TANF funding was used for its intended purpose — providing financial assistance for families unable to support themselves — most states redirected their endowment to finance other state projects (“2015 Federal TANF & State MOE Financial Data”). The majority of the funds that states withdrew from the social safety net have not gone to the intended recipients. Rather, states used a fraction of the funds to finance services for families above the poverty level, fill budget holes and strengthen child welfare systems (Schott). Consequently, the cash assistance safety net, designed to support the nation’s poorest families, has diminished significantly. TANF is no longer effectual and fails to reach all the families it claims to help. Since the emergence of TANF, poverty rates among children have increased by over fifty percent (Arloc). The combination of TANF’s limited accountability and spending flexibility has resulted in the deliberate neglect of the program’s basic purposes: child care, work preparation and direct assistance.

         The second failure of the United States’ welfare programs is the requirement to have minimal assets to be entitled to aid. The purpose of asset tests is to, “ensure that individuals have exhausted most of their own resources before turning to taxpayers for support. Public assistance programs are intended to provide benefits only to those with too few resources to avoid destitution (Vallas). To determine whether an applicant is eligible for financial assistance, government agencies examine both income and assets, including anything of monetary value, such as stocks, bonds. and bank. accounts (Vallas). In general, as the worth of one’s assets rise and income increases, benefits disappear. .These limits serve as a hindrance. to economic security and mobility by discouraging families from attempting to save and build up the resources they need to get ahead. This system necessitates a depletion of wealth and valuables.to be accessible; thus, forcing welfare beneficiaries to become so financially fragile that any unpredicted financial setback will be detrimental. By diminishing their ability to. surmount financial complications, such as a home repair or the need to buy a new office appliance, the government makes it more likely that people become destitute with the inability to pay their bills.

         Moreover, the welfare system’s lack of success can be attributed to the family cap policy. Introduced to Americans through the Welfare Reformation Act of 1996, the family cap was designed to disincentivize impoverished families from birthing additional children to receive state benefits (Wiltz, 2016). Under this policy, if a family has a second child while receiving TANF payments, the family is not granted any additional financial assistance for that child and they obtain $100. less from their monthly welfare payment (Office of Family Assistance). Instead of reducing the number of children born to welfare recipients, the family cap policy does quite the opposite. In a report released by researchers at Urban Institute, family caps were discovered to have increased the “deep poverty” rate of single mothers by 12.5 percent and increase the deep poverty rate of children by 13.1 percent (McKernan, 2006). These statistics demonstrate that the government’s efforts to prevent mothers on welfare from having additional children were ultimately useless. Thus, the effects of this endeavour resulted in an increased dependency on state benefits and facilitated an increase in poverty rates.

         Welfare reform, a distinctive feature of the Clinton presidency, is widely regarded as a success. Changes to the system were enacted on the assumption that prolonged reliance on the welfare system heightened existing financial difficulties. But through Clinton’s new financial policy, reformers believed that the government’s focus on employment would alleviate these shortcomings. Proponents of the TANF model argued that the system was efficacious in reducing the number of people expending financial assistance. In 1996, the number of individuals securing financial assistance peaked at 12.6 million and within four years of welfare reformation, this number dropped to 6.3 million (Ehrenfreund, 2016). Supporters of the new welfare system heralded Clinton’s reformations as a success and attributed the poverty decline to his new financial policy (Haskins, 2016). However, the majority of individuals that departed with the welfare system, were forced to surrender TANF payments under the new policy that necessitated the employment of parents to be eligible for financial assistance. This new system translated into a decrease in welfare recipients but heightened the number of Americans working for an income below the poverty line. According to The Economist,

“By the absolute-poverty measure, the number of people in working-poor households has grown by more than 2 million over the past decade, a rise in the rate of over one-quarter. Even among households in which all wage-earners have full-time work the proportion in poverty has risen over the period. For parents in full-time work the rate of absolute household poverty has increased from 5% to 8% in the past decade” (“When a Job is not Enough”).

Despite there being less Americans relying on financial assistance, these statistics demonstrate that welfare reformations have been ineffectual. Poverty rates were amplified as a result of Clinton’s TANF model and now, families across America find themselves surviving paycheck to paycheck, void of governmental aid.

 Therefore, the welfare reformations introduced through President Clinton have failed to meet their intended goals. The U.S.’s current welfare policy engenders exploitation from states and dismantles the economic safety net for recipients to fall back on. Moreover, asset limits financially cripple welfare recipients and diminish their ability to tackle financial difficulties. Family caps are a discriminatory policy which is ultimately ineffective and unnecessary. The welfare system is a poorly designed program that discourages labour and expedites the poverty cycle.

Works Cited

• Arloc Sherman and Danilo Trisi, “Deep Poverty Among Children Worsened in Welfare Law’s First Decade,” Center on Budget and Policy Priorities, July 23, 2014, http://www.cbpp.org/files/7-23-14pov2.pdf.
• Carcasson, Martín. “Ending Welfare as We Know It: President Clinton and the Rhetorical Transformation of the Anti-Welfare Culture.” Rhetoric and Public Affairs, vol. 9, no. 4, 2006, pp. 655–692. JSTOR, JSTOR, www.jstor.org/stable/41940106.
• Ehrenfreund, Max. “How Welfare Reform Changed American Poverty.” The Washington Post, WP Company, 22 Aug. 2016, www.washingtonpost.com/news/wonk/wp/2016/08/22/the-enduring-legacy-of-welfare-reform-20-years-later/?utm_term=.1b4de847dcbd.
• GAO. “Fewer Eligible Families Have Received Cash Assistance Since the 1990s, and the Recession’s Impact on Caseloads Varies by State.” Temporary Assistance for Needy Families Report, Feb. 2010, pp. 1–71.
• Andrew, Glass. “Clinton Signs ‘Welfare to Work’ Bill, Aug. 22, 1996.” POLITICO, POLITICO, 22 Aug. 2018, www.politico.com/story/2018/08/22/clinton-signs-welfare-to-work-bill-aug-22-1996-790321.
• Haskins, Ron. “Welfare Reform, Success or Failure? It Worked.” Brookings.edu, The Brookings Institution, 28 July 2016, www.brookings.edu/articles/welfare-reform-success-or-failure-it-worked/.
• McKernan, Signe-Mary, and Caroline Ratcliffe. “The Effect of Specific Welfare Policies on Poverty.” Urban Institute, The Urban Institute, 2 Feb. 2017, www.urban.org/research/publication/effect-specific-welfare-policies-poverty.
• Office of Family Assistance. (2017, September 26). 2015 Federal TANF & State MOE Financial Data [PDF]. Washington, D.C: Office of the Administration for Children and Families.
• Schott, Liz. “How States Use Funds Under the TANF Block Grant.” Center on Budget and Policy Priorities, 2 Apr. 2018, www.cbpp.org/research/family-income-support/how-states-use-funds-under-the-tanf-block-grant.
• Vallas, Rebecca, and Joe Valenti. “Asset Limits Are a Barrier to Economic Security and Mobility.” Center for American Progress, 10 Sept. 2014, www.americanprogress.org/issues/poverty/reports/2014/09/10/96754/asset-limits-are-a-barrier-to-economic-security-and-mobility/.
• Wiltz, Teresa. “Growing Number of States Repeal Family Welfare Caps.” PBS, Public Broadcasting Service, 13 July 2016, www.pbs.org/newshour/nation/growing-number-states-repeal-family-welfare-caps.
• “When a Job Is Not Enough.” The Economist, The Economist Newspaper, 25 June 2016, www.economist.com/britain/2016/06/25/when-a-job-is-not-enough.