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Jobs Bill Actually Expands the Welfare State

Posted By Kiki Bradley On March 24, 2010 @ 10:25 am In Economics | Comments Disabled

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Today the U.S. House of Representatives will take up a new “jobs” bill, HR4849, that includes a $2.5 billion provision to expand the size of welfare rolls and pay states when they add people to their caseloads. The Senate defeated a similar amendment by Senator Patty Murray (D-WA) earlier this month. However, it has been resurrected in the Ways and Means Committee and added to the “jobs” bill now before the House.

The provision is actually a one-year extension of a new welfare program created as part of last year’s infamous stimulus package. Known as the Temporary Assistance for Needy Families (TANF) Emergency Fund, it was a new $5 billion program intended to be a “temporary” measure for a one-year period. However, the President’s 2011 Budget requests an expansion of the program and Congress has readily acted to fulfill the request.

This anti-reform fund actually pays states ‘bonus” money for increasing the size of their welfare caseloads without any incentives to place people into jobs and move them off of the dole. The fund undermines the great success of the 1996 welfare reform law [2], which gave states incentives to move people into jobs and job preparation activities by allowing them to keep the savings generated from moving people off of welfare and into jobs.

Welfare reform ended the practice of reimbursing states on a per capita basis and instead gave a fixed block grant to the states that didn’t fluctuate according to caseload size. Strong work requirements turned welfare offices into job placement offices. As a result, the national caseload shrunk by over 2.8 million families between 1996 and 2009. In addition, child poverty dropped and employment increased for never married mothers [3].

The TANF Emergency Fund being extended by President Obama and Congress will have the effect of reversing welfare reform. Caseloads will increase as states pad the rolls with more recipients at the cost of billions of taxpayer dollars. The welfare state will grow decisively and lead to tens of thousands of more people dependent on the government.


Article printed from The Foundry: Conservative Policy News from The Heritage Foundation: http://blog.heritage.org

URL to article: http://blog.heritage.org/2010/03/24/jobs-bill-actually-expands-the-welfare-state/

URLs in this post:

[1] Image: http://www.foundry.org/wp-content/uploads/welfare1.jpg

[2] undermines the great success of the 1996 welfare reform law: http://www.heritage.org/Research/Reports/2010/02/How-President-Obamas-Budget-Will-Demolish-Welfare-Reform

[3] child poverty dropped and employment increased for never married mothers: http://heritage.org/Research/Welfare/wm1183.cfm

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