Welfare Reform & Beyond
PowerPoint Presentation
The Brookings Institution
Spring 2002
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
1
Session 1
Overview and History of Welfare Reform
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
2
Poverty Rates for Children in the U.S. Have Been
Higher than Those for Other Age Groups
35
30
65 years and over
20
Under 18 years
16.2
15
18 to 64 years
10.2
10
9.4
5
00
20
98
19
96
19
94
19
92
19
90
19
88
19
86
19
84
19
82
19
80
19
78
19
76
19
74
19
72
19
70
19
68
19
66
0
19
Percent in Poverty
25
Year
Source: U.S. Census Bureau
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
3
Two Views of Poverty
• The poor are victims of their circumstances
and do not have opportunities to advance
• The poor are responsible for their
circumstances and do not take advantage of
available opportunities
• The emphasis of antipoverty policy in the
U.S. has shifted between these two views
• The Personal Responsibility and Work
Opportunity Reconciliation Act of 1996
emphasizes the second view
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
4
The Measurement of Poverty
•
The Census Bureau uses a set of money income thresholds that
vary by family size and composition to determine who is poor
•
The poverty thresholds do not vary geographically; they are
updated annually for inflation but they have not kept pace with
rising real incomes
•
In determining who’s poor the Census Bureau counts money
income before taxes and does not include non-cash benefits, the
EITC, or work-related expenses. The National Academy of
Sciences has recommended changes to deal with these and other
issues. The thresholds in 2000 were:
1-person under 65
$8,959
3-person family (adult and 2 children) 13,874
4-person family (adult and 3 children) 17,524
Source: U.S. Census Bureau
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
5
Countries that Spend More on Social Welfare
(as percent of GDP) Have Lower Child Poverty Rates
Cash and noncash social expenditures exclude health, education, and social services, but include all forms of cash benefits and near-cash
housing subsidies, active labor market program subsidies, and other contingent cash and near-cash benefits. Nonelderly benefits include
only those accruing to household heads under age 65.
Source: Institute for Research on Poverty (IRP), University of Wisconsin-Madison
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
6
Government Benefits Lift Children Out of Poverty
Work Pays Better than Welfare
$20,000
Annual Family Income (2000 dollars)
$18,000
2000 Poverty Threshold for a Single-Parent,
Two-Child Family
EITC
$16,000
Food Stamps
$14,000
EITC
$12,000
Food Stamps
$10,000
$8,000
Food Stamps
$6,000
$4,000
Net Earnings
Net Earnings
Full-time, minimum-wage job
Full-time job at $7.50 an hour
TANF
$2,000
$0
$0
Source: Sawhill/Thomas Brookings
(2002)
Annual Family Earnings (2000 dollars)
Source: Center on Budget and Policy Priorities; U.S. Census Bureau
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
7
Poverty is Related to Work and Family Structure
80%
Poverty Rate (2000)
70%
70%
60%
50%
40%
30%
21%
20%
10%
6%
0%
Female head, no worker
Female head, with worker
Married couples
Source: U.S. Census Bureau
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
8
Political Background to the 1996
Welfare Reform Legislation
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
9
Overview of the Aid to Families with
Dependent Children Program (AFDC)
• Established in 1935 as part of the Social Security Act
• Shared cost program between federal government and states
• Originally intended primarily for widows, AFDC increasingly
served never-married mothers
• States had discretion primarily over setting income eligibility
limits and benefit levels
• Activity requirements were weak and generally focused on
education and training rather than work
• States were not allowed to time limit beneficiaries
• Beginning in early 1990s, states increasingly used waivers to
try new approaches to reducing welfare dependence
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
10
Characteristics of the AFDC Caseload
• Majority are racial and ethnic minorities
• 4 percent of mothers in 1995 worked full-time,
and another 5 percent worked part-time
• Total expected duration of all Awelfare spells@
was 13 years; more than 76 percent were
expected to stay on for more than 5 years total
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
11
Efforts at Comprehensive
Welfare Reform Usually Failed
• Nixon’s Family Assistance Plan (1969-1972)-failed to pass Congress
• Carter’s Program for Better Jobs and Incomes
(1977)--failed to pass Congress
• Reagan’s 1981 Budget Act changes--moderate
cutbacks
• Reagan’s New Federalism (1982)--never
introduced in Congress
• Family Support Act (1988)--incremental reform
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
12
Why Did Welfare Reform Legislation
Pass in 1996 After Many Previous Failures
• Dramatic caseload increases after 1988 fostered perception
that program was “out of control”
• Public opinion
– Public opinion had not united around all of the
proposals in PRWORA: public had shifted to
overwhelming support for work requirements for
custodial parents, while remaining more divided on
“hard time limits” and family caps
– Republicans in Congress were not trusted more than
President Clinton on welfare reform issues in 1996
– The AFDC program was very unpopular because seen
as anti-work and anti-family. The public was willing to
accept almost any alternative to the status quo
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
13
Why Did Welfare Reform Legislation
Pass in 1996 After Many Previous Failures Cont.
• Social Science knowledge and evaluation studies
– increased policymaker concern about intergenerational
transmission of welfare receipt and length of welfare
spells
– gave support to “work first” approaches
• Budgetary considerations: Republicans needed to find
budget savings (especially from cuts in Food Stamps and
benefits to legal immigrants) in order to finance tax cut and
budget balancing promises in the Contract with America
• State experiments under waivers increased confidence in
innovative capacity of states
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
14
Why Did Welfare Reform Legislation
Pass in 1996 After Many Previous Failures Cont.
• Critical role for political bargaining:
– Bill Clinton promised to “end welfare as we know it”
– Republicans in Congress committed to welfare reform
by Contract with America
– Moderate Democrats in Congress followed President
Clinton to the right in order to avoid being seen as more
liberal than President Clinton on welfare issues
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
15
Session 2
A Primer on the Major Programs
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
16
Overview of the 1996 Welfare Reform Law
• Temporary Assistance for Needy Families
• Non-marital Births
• Supplemental Security Income for Children
• Child Support Enforcement
• Welfare for Non-citizens
• Child Care
• Food Stamps
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
17
Five Components of TANF
1.
End Cash Entitlement
2.
Block Grant Funding
3.
Work Requirements
4.
Sanctions
5.
5-Year Time Limit
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
18
Purposes of TANF
1.
Provide assistance to needy families with
children
2.
End welfare dependency by promoting job
preparation, work and marriage
3.
Prevent non-marital pregnancies
4.
Encourage formation and maintenance of
two-parent families
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
19
Provisions in Welfare Reform
Law Designed to Reduce Non-marital Births
•
•
•
•
•
•
•
•
•
•
•
•
•
•
Congressional findings on the negative effects of non-marital births
Three of four TANF purposes address family formation
Performance bonuses tied to purposes of law
Illegitimacy reduction bonus
Require teens to attend school
Require teens to live at home or other supervised setting
Abstinence education
Child support enforcement
Paternity establishment
National goals to prevent teen pregnancy
States establish numerical goals for reducing non-marital births
Annual ranking of states on non-marital pregnancy ratios by HHS
Allow family cap
Allow reduction in cash benefits for non-marital births
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
20
Elements of the Work Support System
• Earned Income Tax Credit (EITC)
• Food Stamps and Child Nutrition
• Medicaid and SCHIP
• Child Care
• Housing
• Child Tax Credit
• Child Support Enforcement
• Workforce Development & Job Advancement
Services
• State Income Supplements
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
21
Support for Working Families
Increases Dramatically, 1984-1999
51.7
Billions of 1999 Dollars
50
Child Care
SCHIP
40
30
Child Tax Credit
Medicaid
EITC
20
10
5.6
0
Spending in 1999 under:
1984 Law
1999 Law
Source: Congressional Budget Office
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
22
Session 3
How States Have Responded
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
23
Under TANF States Have Discretion To:
• Set eligibility limits and benefit levels for cash
benefits (as before)
• Define who receives various benefits and services
• Set income supplements for working families
• Offer other “carrots”
• Set stricter “sticks” than those in federal law
• Spend funds on a variety of services other than
cash benefits
• Save block grant funds for economic downturns
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
24
States Have Very Different Resources Under
the TANF Block Grant
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
25
Most States Have Allowed Maximum Benefit
Levels to Continue to Decline with Inflation
Between 1994 and 2000 maximum benefits
for a family of 3:
• Declined more than inflation in 7 states
• Declined equal to inflation in 29 states
• Declined less than inflation in 12 states
• Increased in real terms in 3 states
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
26
Many States Have Enacted Earnings Supplementation
Policies to Help Low-income Working Families
• 47 states have changed earnings disregard policies
• 16 states have adopted state earned income credits
And enacted other policies to help them work:
• All states adopted more generous auto asset policies
• 44 states increased asset limits
• 40 states ended 100-hour work limit for two-parent
families
• 11 extend Transitional Medicaid eligibility beyond 12
months
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
27
TANF and State EITC Policies do not Provide Substantial Earnings
Supplementation to Many Low-income Working Families
In the 13th month of benefit receipt:
• 4 states would give a family of 3 working 20 hours per week
at minimum wage nothing, 21 less than $200 per month,
and 26 more than $200 per month
• 22 states would give a family of 3 working 35 hours per
week at minimum wage nothing, 21 less than $200 per
month, and 8 more than $200 per month
• 42 states would give a family of 3 working 35 hours per
week at $8.00 per hour nothing, 7 less than $100 per month,
and 2 more than $100 per month
All figures are for 2000
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
28
Many States Have Enacted “Sticks” to Encourage
Work Stronger than Those Required by TANF
Initial Work Requirements:
• 43 states require work activities in less than 24 months
• 20 states do not exempt caregiver of youngest child of 6
months or older
Sanctions:
• 15 states have 100% sanction for first-time violators
• 21 states have worst case sanction of 100% for at least
three months
• 22 states apply sanctions to food stamps or Medicaid
Time Limits:
• 6 states have lifetime time limits less than 60 months
• 14 states have intermittent time limits less than 60 months
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
29
States are Responding to
Time Limits in Very Different Ways
• A few states (e.g., MI, NY) will pay for those
hitting time limits out of state funds
• Some states will use state funds to pay benefits
to children in families hitting time limits
• Some states (e.g., WA) will exempt most families
hitting caseloads
• Ohio uses outreach to ensure that families hitting
time limits retained eligibility for Food Stamps
and Medicaid
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
30
But Many States Have Also Been More Reluctant to
Impose Strong “Sticks” to Discourage Non-marital Births
 23 states adopted family caps, all by 1997
 No states adopted teen mother exclusions
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
31
What Factors Explain Overall
Patterns of State Policy Choices?
• Little evidence of race to the bottom
• Some evidence of emulation of best practices
• For “sticks” policies, political factors are
associated with more conservative policy choices
• States that receive larger TANF grants per poor
person are likely to have more generous income
supplementation policies
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
32
States Have Shifted their Funding
Priorities Away from Cash Assistance
Emergency
Assistance:
$3.2
11%
$ in billions
$31.1
JOBS:
$1.6
5%
$22.8
Other:
$4.3
19%
Child care:
$2.3
10%
Admin:
$3.4
11%
Work activities:
$2.3
10%
Cash:
$21.9
73%
Admin:
$2.4
11%
Cash:
$11.5
50%
1995
2000
.
Source: Congressional Research Servive
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
33
Proportion of TANF Funds
That Were Left Unspent, 1997-2001
Source: Center on Budget and Policy Priorities
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
34
Implications for TANF Reauthorization
• Absence of “race to the bottom” weakens case
for increased federal control of TANF choices-but things may change during a recession
• States may respond to time limits in very
different ways
• Poorer states need more resources to carry out
more effective work support policies
• States will need more resources to carry out both
safety net and work support policies during a
recession
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
35
Session 4
Welfare Reform Results to Date I:
Caseloads
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
36
AFDC/TANF Caseload, 1960-2001
Millions of Familie s
TANF Caseload, 2001
5
2.1
2.05
2
O N
D
J
F M A M J
J
A S
Month
4
3
2.103*
2
1
2001
1999
1997
1995
1993
1991
1989
1987
1985
1983
1981
1979
1977
1975
1973
1971
1969
1967
1965
1963
0
1960
Millions of Families
6
2.2
2.15
Year
*Based on nine month average (October 2000-June 2001); Recessions are noted by shaded area.
Source: Congressional Research Service and
U.S. Department of Health and Human Services
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
37
Declines in Overall TANF Caseloads
Since the Early 1990s Resulted From
• Hot Economy
• Welfare Reform
• Policies to Make Work Pay
Source: Rebecca Blank, September 2001
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
38
Declines in Caseloads Have Varied
Dramatically Across States
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
39
Differences in Federal Food Stamp Payments Do Not
Compensate for TANF Funding Differences
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
40
Differences in States’ Rates of TANF
Caseload Decline Result From:
• State policy choices
– Strictness of work requirements, especially
• Immediate work requirements
• Strict policies on exempting mothers of
young children
– Strict sanctions policies
– Generosity of benefits and earnings disregards
• State economic conditions (e.g., unemployment
rates)
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
41
Caseload Change Has Been Inconsistent
Across States Over the Past Year
Source: Center for Law and Social Policy
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
42
The TANF Caseload is Changing Over Time
• increasing share of of cases are “child only”
• increasing share of cases live in large cities
But:
• national caseload does not show significant
change in characteristics of those remaining on
the rolls
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
43
Annual Average Food Stamp Participation, 1969-2001
25000
20000
18440 *
15000
Participants
(Thousands)
Monthly Food Stamp Participation
Rate, 2001
10000
18440
19000
18500
18000
17500
17000
16500
16000
J
5000
F
M
A
M
J
J
A
S
Months
Year
Source: U.S. Department of Agriculture
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
Note: Recessions are noted by shaded area;* Participation for January-October, 2001
44
2001
1999
1997
1995
1993
1991
1989
1987
1985
1983
1981
1979
1977
1975
1973
1971
0
1969
Number of Participants (Thousands)
30000
O
Participation Rate of All Eligible Children
Participation Rates in the Food
Stamp Program Have Fallen Dramatically
100
89.5
90
80
67.7
70
60
50
40
30
20
10
0
1994
1995
1996
1997
1998
1999
Year
Source: U.S. Department of Agriculture
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
45
Food Stamp Participation Rates Have Fallen Because:
• Low-income working families:
–
–
–
–
leave TANF without informing welfare office
unaware of eligibility
have trouble with office visits
are not willing to put up with “hassle
• State welfare offices:
– “divert” families
– erect barriers to avoid federal sanctions
– do not follow up with TANF leavers
• Federal policies, especially quality control
system
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
46
Annual Average Number of Unemployment
Insurance Claims, 1967-2001
Unemployment Insurance Claims, 2001
Monthly Average
(Thousands)
600
600
454
400
200
0
J
500
F M
A M
J
J
A S
O
367 *
300
200
100
Year
Source: U.S. Department of Labor
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
Note: Recessions are noted by shaded area; *Average for January-November, 2001
01
20
99
19
97
19
95
19
93
19
91
19
89
19
87
19
85
19
83
19
81
19
79
19
77
19
75
19
73
19
71
19
19
69
0
67
N
Months
400
19
Average Number of Claims (Thousands)
700
47
Annual Average Unemployment Rate, 1961-2002
Annual Average Percentage
10
8
6
5.55*
4
2
0
2002
Note: Recessions are noted by shaded area, *Average for January-February, 2002
2000
Source: Bureau of Labor Statistics
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
1998
1996
1994
1992
1990
1988
1986
1984
1982
1980
1978
1976
1974
1972
1970
1968
1966
1964
1962
Year
TANF Leavers Who Lose Their Jobs Often Do Not
Qualify for Unemployment Insurance Because:
• they leave work “voluntarily” because of child
care problems, illness, etc.
• they have not worked enough or have insufficient
earnings to qualify (most recent quarter issue)
• they are not available for full-time work
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
49
Small Percent of Eligible Families
Receive Child Care Subsidies
• Studies show Child Care subsidies are received
by only 12% of families who meet federal
income eligibility guidelines and by less than
half of those leaving welfare
• Many low-income families have access to
unpaid or informal care
• States ration care by:
– Setting eligibility below the federallypermitted 85% of state median income
– Establishing administrative processes and
waiting lists that discourage applications
– Co-payment requirements or limited
reimbursement of providers
Source: U.S. Department of Health and Human Services
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
50
Session 5
Welfare Reform Results to Date II:
Economic Well-Being
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
51
Percentage of Married, Single,
and Never-Married Mothers Working,
1985-2000
80
Married Mothers
75
70
Never Married
65
65.8
60
55
50
45
40
39.3
20
00
19
99
19
98
19
97
19
96
19
95
19
94
19
93
19
92
19
91
19
90
19
89
19
88
19
87
19
86
35
19
85
Percentage of Mothers Working
Single Mothers
Year
Source: Gary Burtless, The Brookings Institution, 2001
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
52
Overall Unemployment Rate Vs. Rate Among
Women who Maintain Families
9
8
7
6
5
4
3
2
Unemployment Rate Among Women who Maintain Families
Overall Unemployment Rate
1
Ja
nu
ar
y
20
Fe
01
br
ua
ry
20
01
M
ar
ch
20
01
Ap
ril
20
01
M
ay
20
01
Ju
ne
20
01
Ju
ly
20
01
Au
gu
st
Se
20
pt
01
em
be
r2
00
O
1
ct
ob
er
20
N
ov
01
em
be
r2
D
00
ec
1
em
be
r2
00
Ja
1
nu
ar
y
20
02
D
ec
em
be
r
20
00
0
Source: Bureau of Labor Statistics
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
53
State Leavers Studies:
Employed After Leaving Welfare
Percent of Welfare Leavers
80
74.7
70
60
56.8
50
40
30
20
10
0
Employed at Interview
Ever Employed
Source: Congressional Research Service
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
54
Work Pays Better than Welfare
$20,000
$18,000
2000 Poverty Threshold for a Single-Parent,
Two-Child Family
EITC
Annual Family Income (2000 dollars)
$16,000
Food Stamps
$14,000
EITC
$12,000
Food
Stamps
$10,000
$8,000
Food Stamps
$6,000
Net Earnings
$4,000
Net Earnings
TANF
$2,000
$0
$0
Full-time, minimum-wage job
Full-time job at $7.50 an hour
Annual Family Earnings (2000 dollars)
Source: Isabel Sawhill and Adam Thomas, Brookings Institution, 2001
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
55
Family Income by Source for Female Heads
with Children (Bottom Fifth), 1993-2000
8,597
7,690
8,080
7,866
7,759
7,447
Income
6,941
1,457
1,311
1,158
1,533
7,480
1,196
1,333
1,373
1,068
3,298
4,659
4,758
3,380
4,121
3,809
Other
3,681
Means-tested
4,448
Earnings
EITC
3,148
2,500
1,377
216
1993
1,774
1,906
1,890
1,998
395
495
582
570
598
740
888
1994
1995
1996
1997
1998
1999
2000
1,608
Year
Note: Components do not equal total because taxes are not shown
Source: U.S. Census Bureau
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
56
Family Income by Source for Female Heads
with Children (Second Fifth), 1993-2000
17,631
16,126
15,476
15,154
2,212
2,200
2,195
1,919
Income
2,328
15,359
14,649
13,653
16,567
2,636
2,433
2,089
3,289
1,927
4,080
5,678
4,901
5,605
6,415
Other
6,477
Means-tested
11,710
9,931
Earnings
EITC
8,671
7,069
6,898
6,675
1,121
1,349
1,421
1,615
1,942
2,040
2,084
1994
1995
1996
1997
1998
1999
2000
5,708
4,979
701
1993
Year
Note: Components do not equal total because taxes are not shown
Source: U.S. Census Bureau
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
57
Child Poverty Rates Have Fallen Since 1993
1996: TANF Enacted
25
Percent in Poverty, 1960-2000
20
20.5%
15
16.2%
12.2%
10
Percent in Poverty by Broader Definition, 1978-2000
9.6%
5
0
19
60
19
62
19
64
19
66
19
68
19
70
19
72
19
74
19
76
19
78
19
80
19
82
19
84
19
86
19
88
19
90
19
92
19
94
19
96
19
98
20
00
Percent in Poverty
30
Year
Source: U.S. Census Bureau
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
58
Measures of Food Insecurity
Have Not Increased for Children in Households
20
18
17.4
16
14.9
Percent
14
Percent of Food Insecure without Hunger
12
10
8
5.8
6
3.7
4
Percent of Food Insecure with Hunger
2
0
1995
1996
1997
1998
1999
Year
Source: U.S. Department of Agriculture
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
59
Child Victimization Rates, 1990-1999
Victimization Per Thousand
20
15 13.4
11.8
10
5
0
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
Year
Source: Congressional Research Service
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
60
Other Important Research on Impacts
• RAND Study Synthesizing Available Academic Research
– Positive impacts on caseload, employment, earnings, poverty, and family
income
– Negative impacts on the use of Medicaid and food stamps
– Uncertain but weakly positive effects on marriage and fertility
• MDRC Studies of Adult Outcomes Under State Waivers
– Work requirements increase employment and earnings but not income
– Work requirements combined with earnings supplements do increase
income
• MDRC Studies of Child Outcomes Under State Waivers
– No adverse impacts from work requirements
– Positive impacts when work requirements combined with earnings
supplements for school aged kids
– Some evidence of negative impacts for adolescents
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
61
Session 6
Welfare Reform Results to Date III:
Family Formation
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
62
Family Formation
• Reducing Teen Pregnancy and Childbearing
• Reducing Non-marital Childbearing Among Adults
• Encouraging Unmarried Parents to Get Married
• Helping Married Parents Stay Married
• Ensuring that Non-custodial Parents Fulfill their
Responsibilities
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
63
Poverty Rate for Children in
Female-Headed and Married-Couple Families, 1974-2000
45
36.4
35
27.9
30
25
Female-Headed
20
Married
15
10
5
5.3
4.7
00
20
98
19
96
19
94
19
92
19
90
19
88
19
86
19
84
19
82
19
80
19
78
19
76
19
74
0
19
Percent in Poverty
40
Year
Source: U.S. Census Bureau
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
64
The Impact of Changes in Family
Structure on Child Poverty Rates
25%
20%
18.3
15%
14.9%
Actual Child Poverty Rate
10%
13.9
Child Poverty Rate if no change in the percent of
female-headed families
5%
Source:
Sawhill
and Adam
Thomas,
PreparedIsabel
by The
Brookings
Welfare
ReformBrookings
& Beyond Initiative, Spring 2002
98
19
96
19
94
19
92
19
90
19
88
19
86
19
84
19
82
19
80
19
78
19
76
19
74
19
72
19
19
70
0%
65
Teen Birthrate, 1980-2000
62.1
53
48.5
50
40
30
20
10
2000
1999
1998
1997
1996
1995
1994
1993
1992
1991
1990
1989
1988
1987
1986
1985
1984
1983
1982
1981
0
1980
Rate per 1,000 Women 15-19
60
Year
Source: National Center for Health Statistics
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
66
What Has Contributed to the Decline in
Teen Pregnancy and Birth Rates?
• New or more effective efforts to prevent
teen pregnancy
• New messages associated with welfare
reform
• More conservative attitudes
• Fear of AIDS and other STDs
• New forms of contraception
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
67
What Do We Know About Effective
Teen Pregnancy Prevention Efforts?
• Two different multi-site programs with rigorous
evaluation reduced pregnancies by one half
• At least 4 different sex education curricula have
been carefully evaluated and found to be effective
• Programs that teach about contraceptives do not
increase sexual activity
• Jury still out on abstinence education
• Media campaigns are a promising new approach
Source: National Campaign to Prevent Teen Pregnancy
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
68
Number of Births, Birth Rate, and Percent of Births
to Unmarried Women, 1940-2000
1400
1345.9
Number of Births (1000s)
Birth Rate Per 1,000 Women 15-44
Percent of Births to Unmarried Women
60
1000
50
45.2
800
40
33.2
600
30
400
20
200
10
7.1
89.5
0
3.79
1940
0
1950
1960
1970
1980
1990
2000
Year
Source: National Center for Health Statistics
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
69
Rate or Percent
Number in 1000's
1200
70
Contribution of Teen Birth Rate to
Nonmarital Birth Ratio
35%
34%
33%
33.0%
32%
Nonmarital Ratio if no decline in teen
birth rate
Actual Nonmarital Birth Ratio
31%
30%
19
99
19
98
19
97
Year
19
96
19
95
19
94
19
93
19
92
29%
19
91
Nonmarial Birth Ratio
34.1%
Source: National Center for Health Statistics, 2000 and 2001.
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
70
Percent of Children Living with
Two Natural, Step, or Adoptive Parents
90%
85.2
80%
75%
69.9
70%
65%
60%
55%
99
19
97
19
95
19
93
19
91
19
89
19
87
19
85
19
83
19
81
19
79
19
77
19
75
19
73
19
71
19
69
50%
19
Percent of Children
85%
Year
Source: U.S. Census Bureau
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
71
Child Support Collections and Paternity Establishments Are Up
1,600
$17
1,555
1,400
$15
1,200
$13
$11
1,000
9.8
$9
800
676
$7
600
$5
400
$3
200
$1
0
1994
2000
1994
Paternities Established in
Thousands
Child Support Collections in Billions
17.9
2000
Year
Source: U.S. Department of Health and Human Services
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
72
Session 7
Issues for TANF Reauthorization I:
Funding and Program Goals
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
73
Issue: Overall Level of TANF Funding
Options:
• Maintain current funding level (TANF funding of
$16.5 billion per year; States required to spend 7580% of FY 1994 level)
• Lower funding
• Adjust block grant for inflation
• Add adjustment mechanism for economic
conditions
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
74
Issue: TANF Allocation Formula
Options:
• Do nothing
• Restore expired supplemental grant
• Gradually adjust funding formula to give greater
weight to number of poor children in a state
• Preserve grant levels for richer states, while
adding funding for poorer states to bring them up
to national median in per-poor-child allocations
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
75
Effect of Restoring Supplemental
Grant on State Funding Differentials
Note: Reinstated supplemental; total annual cost = $300 million
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
76
Effect of Adjusting TANF Grant for
Inflation on State Funding Differentials*
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
77
Issue: TANF Funding and Recession
Options:
• Do nothing
• Restore and improve contingency fund, and
change eligibility criteria to make it more
accessible for states
• Make TANF block grant explicitly counter-cyclical
(e.g., by tying it to the unemployment rate)
• Allow states to put TANF dollars in rainy day
funds
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
78
Issue: Goals of TANF
Options:
• Do nothing
• Rewrite purposes to include poverty reduction
• Rewrite purposed to include child well-being
• Rewrite purposes to give increased attention to
marriage, responsible fatherhood, and/or teen
pregnancy prevention
• Increase reporting on goals and outcomes
• Revise rewards and penalties for performance
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
79
Session 8
Issues for TANF Reauthorization II:
Family Formation
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
80
Issue: Teen Pregnancy
Options:
• Do nothing
• New emphasis on reducing teen pregnancy
– fund programs that work
– establish a national clearinghouse on programs that work
– make reducing teen pregnancy a purpose of the law
• Reauthorize abstinence education
– change funding level
– give states more flexibility to define program
– allow spending on programs that include information about
birth control
• Tie the “illegitimacy bonus” in current law more closely to state
efforts
• Experiment with complete elimination of welfare benefits for
young unwed mothers
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
81
Issue: Marriage
Options:
•Do nothing
•Require state plans to
–describe activities to promote family formation and
marriage
–review state programs’ treatment of single vs. married
parents
•Grants for promoting marriage and reducing out-ofwedlock births
•TANF set-aside for marriage
•Demonstration and evaluation fund
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
82
Issue: Responsible Fatherhood
Options:
• Do nothing
• Changes in child support enforcement,
including pass-through
• Education, training, employment programs
• Demonstration and evaluation fund
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
83
Session 9
Issues for TANF Reauthorization III:
State Flexibility and Tribal TANF
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
84
How Much State Flexibility?
•
•
•
•
Time Limits and Sanctions
Work Participation Standards
Job Retention and Advancement
Tribal TANF
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
85
Issue: Time Limits
Options:
• Do nothing: 5 year federal limit with 20%
exemption
• End 5 year federal limit: let states decide
• Stop clock or allow earn back of time for work or
other circumstances
• Provide public jobs after time limit
• Modify 20% exemption
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
86
Issue: Sanctions
Options:
• Do nothing: states must reduce or
terminate benefits for non-compliance
• Require full-family sanctions
• Prohibit full-family sanctions
• Require pre/post-sanction review and
services
• Ensure that sanctions can be cured
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
87
Issue: Work Participation Standards
Options:
• No change: 50% of families in work activities 30
hours/week (90% for 2-parent families). Limits on
education and training. Caseload reduction credit.
• Raise work participation rates
• Increase number of required hours
• End higher rate for two-parent families
• Allow more education, training, and treatment
• Let states define allowable activities
• Replace caseload reduction credit with employment
credit
• Require assessments or universal engagement
• End state waivers
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
88
Issue: Education, Training,
Job Retention and Advancement
Options:
• Do nothing: Some flexibility in current law;
bonus for job entry, retention, wage gain
• Strengthen performance goals and
incentives
• Allow more education and training - alone
or combined with work
• Fund research and demonstration projects
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
89
Issue: Making Work Pay
and Supplementing Incomes
Options:
• Do nothing
• Raise the minimum wage and index it for inflation
• Add a second tier to EITC and integrate with Child Tax
Credit
• Provide federal incentive for states to expand their EITCs
• Encourage states to strengthen work supports by
increasing TANF funding
• Improve application for food stamps and other non-cash
benefits, provide incentives to increase access
• Expand Medicaid coverage to parents
• Increase funding for child care
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
90
Issue: Tribal TANF
Options:
• Do nothing: Tribes opt to run TANF; negotiate time
limits/work requirements; define service
areas/population. Funds transferred from state’s
federal block grant.
• Create separate federal tribal block grant
• Access to performance bonus and contingency fund
• Strengthen ‘equitable access’ for tribal members
served by states
• Research, evaluation, technical assistance
• Promote economic development
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
91
Session 10
Issues for TANF Reauthorization IV:
Work Supports
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
92
Work Supports
• Make Work Pay and Supplement Income
• Child Care
• Provide Safety Net for Unemployed
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
93
Existing Work Supports
51.7
Billions of 1999 Dollars
50
Child Care
SCHIP
40
Child Tax Credit
Medicaid
30
EITC
20
10
0
5.6
Spending in 1999 under:
1984 Law
1999 Law
Source: Congressional Budget Office
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
94
Issue: Making Work Pay
and Supplementing Incomes
Options:
• Do nothing
• Raise the minimum wage and index it for inflation
• Add a second tier to EITC and integrate with Child Tax
Credit
• Provide federal incentive for states to expand their EITCs
• Encourage states to strengthen work supports by
increasing TANF funding
• Improve application for food stamps and other non-cash
benefits
• Expand Medicaid coverage to parents
• Increase funding for child care
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
95
Issue: Child Care
Options:
• Do nothing; many new investments already
• Provide more federal funding for child care
• More funding for Head Start and universal
pre-K
• Allow states to spend a higher percentage of
TANF money on child care
• Increase quality set asides within child care
block grant
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
96
Issue: Providing a Safety Net for the Unemployed
Options:
• Do nothing
• Provide a contingency fund to pay for increase in
caseloads during recessions
• Reform Unemployment Insurance
• Encourage states to provide community service jobs
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
97
Session 11
Issues for TANF Reauthorization V:
Immigrant Issues
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
98
Non-citizen Declines in Welfare
Programs, 1994-1999
19.9%
14.8%
4.9%
2.0%
5.7%
17.0%
7.7%
3.9%
-15%
1994
-32%
1999
-48%
'94-'99 Decrease
(if significant)
-60%
TANF
SSI
Food Stamps
Medicaid
Source: Based on Urban Institute analyses of the 1995 and 2000 CPS Data
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
99
Issue: Non-citizens
Options:
• Status Quo
–
–
–
–
–
1996 dividing line
5-year ban and permanent ban
eligibility variations across programs
exceptions for emergencies, education and training, etc.
order of decline: SSI, food stamps, TANF, Medicaid
• Expand some or all benefits for pre-1996 entrants
• Expand some or all benefits for post-1996 entrants
–
–
–
–
food stamps restoration; about $.4 billion per year
TANF; no federal cost, but unfunded mandate
Medicaid; about $2 billion per year
SSI; about $1-1.5 billion per year (without Medicaid)
Prepared by The Brookings Welfare Reform & Beyond Initiative, Spring 2002
100
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