The End of Public Welfare:
Eroding the rights of women and
children or encouraging selfsufficiency?
Dan Meyer
Research: Joint with Maria Cancian
November 2003
Overview
• Brief history of policy changes affecting
women and children with low incomes
• 1996 welfare reform
• Wisconsin’s response
• How are TANF recipients in Wisconsin
faring?
• Broader context
• Issues for the future
Brief History
• 1935 Social Security Act establishes Aid to
Dependent Children (ADC), federal-state
partnership in providing cash to single-parent
families that have low incomes, primarily widows,
so that mothers don’t have to “work”
• Disenchantment throughout. Major reforms in
early 1980s, late 1980s, early 1990s, 1996
National Welfare Reform
• Sense that old policy wasn’t working:
–
–
–
–
Some chose welfare over work
Long-term recipients
Inflexible program
Based on rights rather than mutual social contract
• Personal Responsibility and Work Opportunities
Reconciliation Act (1996)
– Replaced AFDC with TANF
•
•
•
•
Work requirements
Time limits
State discretion (block grant)
No entitlement
1996 Welfare Reform: Other
Features
• Limitations on assistance to immigrants
• Limitations on food stamps to working age
single adults without a disability
• Changes in the definitions of disability for
children in eligibility for SSI
• Child support reforms
Wisconsin’s Response: W-2
• Philosophy: Parents without a disability should work and
face conditions faced by other working poor:
• First check should follow work
• Payments should not vary by family size
• Participants should receive all child support paid on behalf of
their children
• Self-Sufficiency Ladder
•
•
•
•
•
Unsubsidized Employment
Trial Jobs
Community Service Jobs, $673/month
W-2 Transitions, $628/month
Caretaker of Newborn, $673/month, 12 week limit
How are W-2 Recipients Faring?
• Improved employment and earnings
– mean wages for workers: $7.30/hr in 98, $8.10 in 99
– mean earnings overall: $4350 in 98, $6000 in 99
• Moving off benefits quite quickly
• Family income increasing
• But…
Benefits Decreasing
1
0.9
0.8
0.7
0.6
0.5
0.4
0.3
0.2
0.1
0
1
2
3
4
5
6
7 8
9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36
TANF Cash
Months after Entry
Food Stamps
Medicaid (including Badger Care)
Family Income of Wisconsin
TANF Participants Increasing
16,000
14,000
Annual Income
12,000
10,000
8,000
6,000
4,000
2,000
0
1998
Child Support
Mothers' Earnings
1999
Food Stamps
W-2
Mothers' Other Income
Sam ple: 1,088 resident mothers for 1998 and 1,035 for 1999 (experimental group only). Data: Survey of Wisconsin Works Families.
Partners' Income
But…
• Improvements in income and poverty, but
levels still very high
– In 1999, 67% with family incomes below
poverty
• Economic hardship levels high
High Levels of Economic Hardship
Often or sometimes
not enough to eat
1998
Gas/electricity turned off
because couldn't pay the bill
1999
Moved in with others because
couldn't pay rent
Lived in shelther
Homeless and living on street
Time without phone
or disconnected because
couldn't pay bill
0%
10%
20%
30%
40%
50%
Sam ple: 572 resident mothers for 1998 and 1,081 for 1999 (experimental group only). Data: Survey of Wisconsin Works Families.
60%
Consumer Perspective
• W-2 participants report limited satisfaction
– 68% of mothers disagree with the statement:
“W-2 helped me get a job or get a better job”
– 46% disagree with “I think I’ve been treated
fairly on the W-2 program.”
Broader Context
• TANF only a small part of welfare system
• Welfare only a small part of governmental
support for families with children
Participation Rates and Average Benefit for Cash
and Noncash Programs in Third Year after Entry
TANF Cash
29%
35%
Child Care Subsidies
Food Stamps
74%
EITC
75%
Medicaid
83%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
% Participating
Sample: 22,552 W-2 participants.
$3,000
TANF Cash
$7,500
Child Care Subsidies
$2,300
Food Stamps
$2,300
EITC
$4,700
Medicaid
$0
$1,000
$2,000
$3,000
$4,000
$5,000
Average Benefit Amounts
$6,000
$7,000
$8,000
To think about…
• TANF reauthorization this year
– Marriage promotion – work requirements – funding
levels – child care
• Results achieved in best economy on record;
recent downturn has affected recipiency but
outcomes not clear
• Employment not only goal: economic well-being,
broader measures of well-being
• For more information:
– http://www.ssc.wisc.edu/irp/csde/phase1-tocs.htm
– http://www.ssc.wisc.edu/irp/focus/foc213.pdf