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Sunday, April 08, 2012

"Welfare Limits Left Poor Adrift"

Welfare reform left far too many people with nowhere to turn for help when the economy turned downward:

Welfare Limits Left Poor Adrift as Recession Hit, by Jason DeParle, NY Times: Perhaps no law in the past generation has drawn more praise than the drive to “end welfare as we know it,” which joined the late-’90s economic boom to send caseloads plunging...
But the distress of the last four years has added a cautionary postscript: much as overlooked critics of the restrictions once warned, a program that built its reputation when times were good offered little help when jobs disappeared. Despite the worst economy in decades, the cash welfare rolls have barely budged.
Faced with flat federal financing and rising need, Arizona is one of 16 states that have cut their welfare caseloads further since the start of the recession — in its case, by half. Even as it turned away the needy, Arizona spent most of its federal welfare dollars on other programs, using permissive rules to plug state budget gaps.
The poor people who were dropped from cash assistance here, mostly single mothers, talk with surprising openness about the desperate, and sometimes illegal, ways they make ends meet. They have sold food stamps, sold blood, skipped meals, shoplifted, doubled up with friends, scavenged trash bins for bottles and cans and returned to relationships with violent partners — all with children in tow. ...
The old program, Aid to Families with Dependent Children, dates from the New Deal; it gave states unlimited matching funds and offered poor families extensive rights, with few requirements and no time limits. The new program, Temporary Assistance for Needy Families, created time limits and work rules, capped federal spending and allowed states to turn poor families away. ... Many leading Republicans are pushing for similar changes to much larger programs, like Medicaid and food stamps. ...
Mitt Romney ... said he would place similar restrictions on “all these federal programs.” ...

This is one of the reasons the number of people receiving food stamps swelled so much during the recession (more here). If Republicans manage to limit that program too, it will be much worse than it already is:

...the number of very poor families appears to be growing. Pamela Loprest and Austin Nichols, researchers at the Urban Institute, found that one in four low-income single mothers nationwide — about 1.5 million — are jobless and without cash aid. That is twice the rate the researchers found under the old welfare law. More than 40 percent remain that way for more than a year, and many have mental or physical disabilities, sick children or problems with domestic violence.
Using a different definition of distress, Luke Shaefer of the University of Michigan and Kathryn Edin of Harvard examined the share of households with children in a given month living on less than $2 per person per day. It has nearly doubled since 1996, to almost 4 percent. Even when counting food stamps as cash, they found one of every 50 children live in such a household.
The Census Bureau uses a third measure, “deep poverty,” which it defines as living on less than half of the amount needed to escape poverty (for a family of three, that means living on less than $9,000 a year). About 10 percent of households headed by women report incomes that low, a bit less than the peak under the old law but still the highest level in 18 years. ...

[Jared Bernstein has more comments on the article.]

    Posted by on Sunday, April 8, 2012 at 09:35 AM in Economics, Social Insurance | Permalink  Comments (39)

          


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