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WithdrawallRedaction S/Iheet
Clinton Library
DOCUMENT NO.
AND TYPE
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SUBJECTfflTLE
DATE
RESTRICTION
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OOL. list
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Welfare Meeting attendees (partial) (1 page)
12107/1994
P6/b(6)
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COLLECTION:
Clinton Presidential Records
Domestic Policy Council
Carol Rasco (Issue Papers)
ONBox Number: 8506
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FOLDER TITLE:
[Welfare Legislation] [6]
RESTRICTION CODES
Presidential Records Act· [44 U.S.C. 2204(a)J
PI
, P2
P3
P4
National Security Classified Information [(a)(l) of the PRA)
Relating to the appointment to Federal office [(a)(2) of the PRA)
Release would violate a Federal statute [(aX3) of the PRA]
Release would disclose trade secrets or confidential commercial or
financial information [(ale 4) of the PRA]
P5 Release would disclose confidential advice between the President
and his advisors, or between such advisors [aX5) of the PRA)
P6 Release would constitute a clearly unwarranted invasion of
personal privacy [(a)(6) of the PRA]
C. Closed In accordance with restrictions contained in donor'S deed
of gift.
PRM. Personal record misfile defined in accordance with 44 U.S.C.
2201(3).
RR. Document will be reviewed upon request.
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20 I0-0 198-S
Freedom of Information Act - [5 U.S.C. 552(b»)
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b(l) National se~urity classified information [(b)(1) of the FOIA)
b(2) Release woJld disclose internal personnel rules and practices of
an agency [(b)(2) of the FOIA)
b(3) Release would violate a Federal statute [(bX3) of the FOIA)
b(4) Release wohld disclose trade secrets or confidential or financial
Informatloh [(b)(4) of the FOIA)
b(6) Release wJuld constitute a clearly unwarranted invasion of
personal privacy [(b)(6) of the FOIA)
b(7) Release w6uld disclose information compiled for law enforcement
purposes r(b )(7) of the FOIA)
b(8) Release wpuld disclose information concerning the regulation of
financial institutions [(b)(8) of the FOIA)
b(9) Release ~ould disclose geological or geophysical information
concernirig wells [(b)(9) of the FOIA)
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kc234
�54076
TO
NAVSUPPFAC THURMONT
FROM
DEC-20-1994
P.02
CABIN ASSIGNMENTS
CABIN
SUNDAY
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----------------------------------------------------r-------------------
BIRCH
' I
SATURDAY:
MSTR (K)
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BR (2 T)
;'
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,
-----------------------~-----------~~--------------T------------~-------"
,
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DOGWOOD
MSTR (K)
I
BR (2 T)
;;~;-----------------------------------"---------:-~r---------------------
MSTR (K)
I"
"
BR (2 T)
""
"
iip-Qii-------------------------------------------l---------------------
MSTR (K)
"/
BR (2 T)
i
~:~~~:~----------~--------------------------T--------------------BR (2 T)
I
c.,
;;~;;;;;-------------------------------~---------l-----------------------
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BR (1 Q)
-------------------------------------------------------------------------
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SOUTHERN PINE
BR (1 Q)
;;;;;Q;;-----------------------------------------i----------------------
MSTR (K)A
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BR (2 T)B
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;;~~~:~:-------------------------------------l-----------------------BR (2 T)A
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;
~~~;~:-~--------------------------------------i-----------------------""
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"
;iLNYT------------------------------------------r-----------------------
BR (2 T)
BR (~ '1')
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;;:;i~rr--------------------------------r----------------------
-----------------------------------------------1-------------------------
HilLOCIt
BR (l Q)
I I ,
,
,
-----~------------------------------~~----~---------~~---~-------------Key: MSTR = Master
BR .. Bedroom
K ... King size bed
, I
T = Twin size bed
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TOTAL P.02
�THE WHITE HOUSE
CLINTON UBRARY PHOTOCOPY
�--
...
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PHOTOCOPY
PRESERVATION
�, Comparison of Work and Responsibility Act and the Personal Responsibility Act
,
ACT
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Work and Responsibility Act
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Personal Responsibility Act'
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WORK
"
Job Searchl
Training
ReqUirements
Employable recipients req~ired
to participate in job: search,
. education, and trainirig activities
immediat~ly .
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'.
None: State option.
..
..
,
,
Work
Requirements
Work required :of ALL
employable'persons after 2
years.
Sanctions and
Benefit Cutoffs
No benefits for persons who.
No benefits for persons who
refuse to work in subsidizedjob refuse to Iwork or who refuse a
or who refuse a private' sector
private sector job offer. All
'
I
job offer: Persons 'willing to
persons. p,ermanently cut off'.
I
work who cannot find a private
after 5 years (state option 2
sector job can 'get help, but only . years) e~en if they are willing
if willing to work for benefits.
to work but can't find a job, or
"
.
unabl e to work due to
Fifty percjbnt of all recipients
must eventually pe in workfare
,or other torkactivi'iY.'
",
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.. "I
,dlsablhtJ; .
Protections for
Disability
'None.
Persons with disabil,ities or
parents caring for disabled ch~ld
exempted until able to work .
. RESPONSmILriY
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Few child support provisions
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and a cap which would,
actually!I reduce resources for
.
enforcement (child support
bill protnised, later.)·
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Child Support
Enforcement
Dramatic improvements in child
support, including central state
registries, license revocations,
etc.
Paternity
Establishment
"No AFDC benefits for child
No AFDC benefits until state .
certi,fies applicant has
until pdternity has been
cooperated' fully in paternity
established - whether or not
es.tablishment. State then
motherl has cooperated fully
required to locate father 'within ' and wnetheror not state has
,j
. ,
1 year.
made a senous. effort to locate
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the fatller.
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Fraud
Improved. information systems
and data collection to reduce
welfare fraud and catch those
who owe child support.
None.
Penonnance
Measures
New state performance
measures based on placement
rather than pr<?cess.
No changes.
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�n:\-l~f\ .
~E
~
r--------·----.-·_·~----~~------~--~_r------~+I----~--------_,
TEEN PREGNANcy,REACHING
NEXT GENERATION··
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Mothers under 18 must live at . Children b6ni to 'mother under! '.
home, identifY their child's. ' ... ' . 18 (st~te '(jption under 21)
·father, and stay in school to get
permanentI.)'.: denied aid for
l
benefits. C()mp~el1erisive case
their entire. Chi,I,.dhoOd..... .
managers for teens,:'
Teen Parents
r
Community based pregnancy
prevention initiatives in"! 000
schools.. Comprehensive
pr.egIlancy prevention
Teen
Pregnan'cy
Preventio~
Initiative
· ~emonstrati·ons.
None
,,'
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State option to. provide no
additionl;ll" benefits' for. children
conceived while the mother is
on welfare.
Phas~-in
State .re~~;irementt~ provide
no additIOnal benefits for .
children donceived:while the .
.
mother is Ion welfare..
.Youngest recipients phased-in
first.
'. .
Family Caps
States endourageCi.to. phase-iri .
recipients l with oldest children.
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ornER PROVISIONS
Legal" imbigrant~ barred from
virtually lall public benefits.
Sponsors held financially
accountable for legal
, irrunigrants .
Legal .-.
Immigrants'
.
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Food stamps, WIC;' child
.
nutritionlprogr~ms converted
into. single block grant with
.
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very fewcond~tionsand cut by
None
Nutntion
Cutsl Block
Grants
.
I... ,'.. .,'
12%.
State option' for AFDC' block
." ...... ' .
grant. '. ./
'.
· Eligible persons' c~· always
enroll..
Benefit
Protections
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..... ,.,.
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<
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·0
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Entitlement to AFDC, SSI, and
1
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nutritiQ~ programs ended,'
Programs become .'
discreti~nary.· Aid ~ight' •.be
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denied because annual budget
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'
is exhausted..
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.MEDICAID FOR WELFARE SWAP
.:
ImpactonFederal and State Budgets
•
'Trends in Welfare and Medicaid Costs
•
Coverage and Cost Issues for Medicaid Program
'
•
Impact I Issues for Welfare
�·
Expenditures For the Swap: 1996
, ,
$80·
T
State Medicaid:
'$78 billion
Fed. Welfare:
;' ,,$48, billion'
'
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DSH: $9b
(J)
c:
,$60 '
, .- 0
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L..,
Kids & Adults: ~
$22 b
'Acute:
,$43 b
Aged &.
Disabled:
$47 b
WIC:$4 b '; ,
.!:$40 "
(J)
Non.:.acute:
$25 b'
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Food
Stamps:
$27 b
,
':0 $20
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,$0-+-
By.Services
B.y Recipients
�-
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Federal We-Ifare & -State Medicaid
Comparisionof Expenditure Trends
-
-
-
-... :- _
$200
'
-
-.-------,;-------'-------~~~----~----:---,--..,...,
- $175
-$180
~-$160
o
-;: .$140
1
-m
.~$120
-en
-,
- ~$100
£3 -$80
I
$70-
$60t$~
$40 r .1 ...
$42
····:1
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1993
- '1995
·1
-1997
.
-1999
1
1 .
1.
2001 - - 200.3
;;
FStatervledicaid . -
1
FederaiWelfare
'
-2005
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�•
Estimated State Fiscal Effects of
Medicaid for.AFDC/F~~d Stamps!WIC Swap'
..
.
.
'
(state fiscal effects in millions)
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..
Fiscal Year 1996
. State Gain
Projected State
Projected
Costs on Acute: Federal Costs(Loss).
Care Medicaid _ --AFDC +FNS
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State
Fiscal Year 2002
- Projected State
. Costs on Acute
Care Medicaid
Projected·'
Federal Costs
AFDC +.FNS
State Gain
(~oss) _
'.
$647 '
$3,540'
($428)
($1',492)
, $410
$3,830
$48,297
' ($5,147)
, :$6,882.
"$478
$778 -r
- $2,086
,$219
$2,048
U.S. Total.
"
>
$12,979$835
. $1,388 $2,962
$6,941:"$446 .
$742 $1,584
Missi'ssippi, '
Texas
-
-
$59
-'($32)
- ($36)
($502)
California.
Connecticut
Indiana
Michigan
, $43,150 ,
$8,838
$614
$999
'
u
'$831
$4,546 '
, ,$80,700
$62,022
• Medicaid estimates for 1996 were calculated by HCFA; estimates for 2002 Burne the I\8tiona1 growth rate fot acute care ~ .
.. Food &
~ prograin estirnati..
2000
calculated by AsPE staff.
:'. .
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,
Nu1rition
Past
were
:3..
-,:
(
,
$2.67~
$4,141
$221 -'
' $389
$283
($421)
($716)
. $18,678
�"
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STATE 'FLEXIBILITY AND WELFARE REFORM
.
,
,
Broad Range
ofStra~egies
~
Uniform riational system -"e.g. Food Stamps"
~
National fra'mework with st,ate flex'ibility - e.g. Work a:nd
Responsibility Ac~
~
Block grants'to states - e.g. likely Republican
,~,
,Medica,d for
.",
w~lfare
proposa~
swap -, e.g. Kassebaum, pr~posal
.
Key Issues
~
National reform objectives
"
,
Promote work and par,ental responsibility, reduce
teenage pregnancy, support families
'.. ,' ' Protections and u'niformity,'
~'
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,Fiscal and economic
~
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Preserve a s'afety net, prevent hunger· among children
and adults, prevent discrimination ,
stab~lity
'Ensure stability in funding over time, cushion ,states
against economic cycles
" Accountability
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Minimize fraud and waste, ensure efficient u~e of ,
resources
/
�~,
INDICATORS OF STATE COMMITMENT TO NATIONAL 'OBJECTiVES
EVIDENCE FROM WAIVERS
/
California
Connecticut
Indiana
Michigan
Y
Y
Y
Y
Y
N
Demonstrations
Requiring Work
N
N
N
Y
Small
Subset
N
Demonstrations Promoting
System-Wide Culture. Change
N
Y
Sub-State
Y
Sub-State
N
Demonstrations Providing
Financial Incentives to Work
Y
Y
N
Y
Y
N
Demonstrations Speaking to Child
Support, Teen Pregnancy, or Family Cap
Y
Y
Y
N
Y
N
Demonstrations Incorporating
.
Time Limits
y
N
Y
N
N
N
,
'
, Waiver Demonstrations
Operating or Requested
'
"
Mississippi
III-
Very few state demonstrations require work.
111-,
Even with waivers, many states are not pursuing national objectives.
Texas
�INDICATORS OF STATE PERFORMANCE
V
V
v
.~
Connecticut
Percent of Adult AFDC Recipients
Participating Monthly in JOBS (1993)
8
10
6
20
8
10
% of Adult AFDC Recipients Participating
in OJT, Work Supp. & CWEP (1993)
.3
.2
.5·
.6
.7
_, ,.05
Paternity Establishment Rate (1991)
28
39
26
68
65
35
Percent of IV-D Cases
with Collections (1992) .
14
20
14
18
9
13'
5.8
4.1
7.5
8.0·
QC Error Rate (1991)
I .
3.5
I
2.7
I·· fudiana
I~ichigan
.1· California .1
I
,;.
States vary greatly on basic indicators of performance.
..
Some 'States perform po~dy, even with federal requirements.
�FISCAL CAPACITY AND NEED
.OF SELECTED STATES IN 19,92
State
_ Per Capita
Income
Poverty Rate
Mississippi
$14,050
-24.5% ,
Indiana
$18,384
_11.7%
Texas
-Michigan
$18,449
$19,~81
-
,
17.8%
13.5%
,-
California
Connecticut
- $21,599, _'
$27,154
15.8%
9.4%
..
U.S. Tot8J. '
-~
$20,131
14.5%
Both fiscal capacitY, and need -vary dramatically across ,states.
�~'
BENEFIT VARIATION ACROSS PROGRAMS
AFDC and Food Stamp Monthly Benefits
.For a one-:-parent family of three persons, July 1994
AFDC & Food
Stamps Combined
(State Contribution)
AFDC
Benefit
Food Stamp
Benefit
Mississippi
$120
$295
$415
Texas
$188
$295
Indiana
$288
:M;icbigan
$459
California
$607 '
Connecticut
$680
State .
Percent of Total
Benefit Provided
By State,
($25) ,
6%
' ,$483
($67)
14%
$278
$566
($105)
19%
$227
. $686
($200)
29% .
·$183
$790
. ($304)
38%
$161
$841
'($340)
40%
.II
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r-
There are, sizable variations in AFDC benefits by State,even though Federal match rates are
much higher in States'like Mfssissippi and Texas. '.
iii-
Because Food Stamps is a uniform national nutrition program designed to ensure that adults
and children do not go hungry in any' state, .it helps fill in the gap in lower benefit states.
iii-
In low benefit states, virtually all of the money spent on AFDC and Food Stamps comes
from the Federal goveriunent.
'
�TRENDS IN MAXIMUM BENEFIT LEVELS
OVER THE PAST 25 YEARS
(Percentage changes reflect changes in real dollars)
100% Federally Funded Programs
. Food Stamps
3%
Basic SSI
6%
Shared State and Federal Programs
.
AFDC
1~0% State Fnnged
-47%
~rograms
SSl Supplement (elderly individuals)
_SSI Supplement (elderly couples)
General Assistance
-63%
-75%
NA
Federal Block Grants
Title XX
.II .
(l975~
1994) -
Puerto Rico Nutrition (1982 - 1994)
-58%
-6%
Benefit levels in 100% Fe9.eral entitlentent programs have generally kept pace with inflation.
Food Stamps has been a critical nutrition safety· net.
II-
II-
.
II-
.
Benefit levels in programs with a heavy state contribution have fallen dramatically over time
when adjusted for inflation ..
Block grants may be more vulnerable to budget cuts.
�. EXAMPLE :OF A DISTRIBUTION FORMULA BASED ON NEED
.
~.
.-.
Effects of a Nutrition Block Grant in the
Personal Responsibility Act (itllocated by the number of "needy persons" in the state)
on USDA Food Assistance Programs by State in Fiscal Year 1996
(Dollars in millions)
.
... Level' of Food.Assistance .
State
Proposed
.California
.
Connecticut .
.
Indiana ....
$4,'170 .
,
$297' .
..
Percent
$4,820
Ctirrel1:t
,
+i6%
$248
-17'%
,
Michigan
Mississippi
$713 .
State Gains and Losses
$691
$1,390
$1,1.09 " .
$730
$603 .
.
r •
.
-3%
.
-"20%
-17% '
'.'
Texas
US
..
~
$3;819
$40,764
rOTAL
$2,665
' $35,600'
-30%
.'-13%
Block grants 'allocated according to' need create la~ge state winners and"
losers relative to the current system.
'.
�EXAMPLE OF
DISTRIBUT~ON
FORMULA BASED ON PAST EXPENDITURES
Hypothetical Effects of AFDC Benefit and Administration Expenditure
Block Grant if Personal Responsibility Act had been adopted in 1988
(Block Grant set at 1030/0 of FY 1987 expenditures)
(Dollars in millions)
I
FY 1993
State
California
Connecticut
Indiana
Michigan
Mississippi
Texas
US TOTAL
~
Current Law .
. $3,197
-
$207
$158
$751
$75
$384
$13,843
,
Block Grant
Percent Chan!!e
$2,157
$124
$111
$777
$69
$207
-33%
-40%
-30%
4%
-8% - -46%
$10,243
-260/0
Block grants set according to current spending can create unpredictable and highly
variable impacts due to inflation and changipg economic and demographic conditions.
�POSSIBLE APPROACHES TO 'KEY ISSUES
National Objectives·
'.. . St~te plan requirements - e.g., work and cooperation with
. . child ~upp~rt
...
Program performance standards geared to national objectives
Protections and Uniformity
..
National safety net against hunger
..
Individual protections within a more flexible welfare program
. Fiscal and Economic Stability
.
..
.
Individual entitlement structure with more state flexibility
Adjustable spending c~ps for states
Accountability
.Audit and reporting requirements
Fiscal performance standards
�,
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, '.THE' WHITE, HOUSE
,I
" 'Office rof the Press Secretary'
December
Embargoed for Releas,e
66 A.M.'
Saturday, : pecember 10 ;1994'
',until~6:
...
v
1994
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RAI?IO, ADDRESSB¥ THE PRESIDENT',.,:~', THE' NATION
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'The Oval Office
\"
,5,:,36 P.M,. ,EST
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,< '
,: THE PRESIDENT:' Goodmo~ning'. , Earlier' this w~ek, , I' '
signed the GATT ,agreement, the most far-reachip.g international trade
,pact in ,our history':, And'this weekend/in: Miami, we in, the United
States are hostiilg ,the ,Summit of the Americas, where the' lead,ers .. of
,34,?Ounti"ies have' gCllthered to p,romotfa,: trade in' our 'o~n hemispher,e,., '
This ,suuit of th'e Am~r ic:as, 'and GATT,' and everything
we've, done' to, expand international, trade ,is 'rea,Lly about, opening up
,foreign lllarkets ,to America's gooq.sand', services, so' ,that we can
"
,create, high-wage j'obs.'and new opportu:rtities for our people here at
hqme. '
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,But despite all the progress we've made, despite th~"
fact, that we have'over '5 million ne~ jobs in theiast22 mop.,ths,"the'
biggest' expansion o~ trade in history, we've had more new ,
construction j~bs tchis IY~ctr tha:rt in"the, last nine years ,'c9mbined" ' and
we,'ve had:a year.'ofmanufacturing' 'job growth for 'the first time in a
,'decade.' ::In'~p±te of all ~that, millions, ofhardworking"people are ,
sti1:!. ,out': the;-e' killing themselves, working longer ,hours, for lowex;:
pay, paying more for health care -- ,or l'osing thei.r health coverage
: than' eV,er ,before .J'More,\and 'more' Americans, eV,en in this 'recovery,
~~,e 'worried that, 'they' cO\lld lose: th~J;.r j'ob,; o~ their ,'be,nefitsat any
t~me. '
.
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."''; ,
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, T h e r e ' s ~iess disposabie ,incpmefor' most wQrking' ,>
Americans, than there was just ,a decade ago.' 'Melny people can~t even
,image ~eing' able "to aff'ord a vacation anymore , let alone send their
childre,n' 'to ,college ~ , ' And I' ,m tal~ing, ab,?uthard~orking, Americans, "
who' play by the rules'1 they're, tired' of watching th~ir' earnings'
benefi t people wht;:> don't.
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" There's 'no greater gap 'betw,een ma,instream American
,
'value,s and modern government than we find in: .the welfare,system. The
welfare system was. set up'for all the' right 'reasons; ~- tqhelp peopie :'
, who had fallen on hard times temporarily, to give them a hand up for
,a little while so they could put their lives back in o~der and, move
on. And it st,ill works that, way, fo~ ap:awful lo~ ~ofpeople.,
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But for mill'ions and millions; ~f·pe9ple, : the >systfanl is"
broken badly ,anQ. it undermines. the/'very' values ~~:work;' family and
respons:i,bility.;..- tha:t:people, need to put themselves back on track.',,'
. The people who are'stuqk on 'welfare, permanently ,will be the first to
'tell,you,that i'f we're going. to fi~ it,. 'Ne have, to return to those
values; ,and we l1aveto put them fr9nt and center. ' ~eople' who, ,have, '
wc)rked,their way offofw~lfat='e; 'after-being afraid they 'dbe on -it' ,
'forever, will be the .strong'est ,in sa:yi'ng~. we.' vegot' to put work, '
family and res'ponsibility back into', '
the system._ " ,
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,:Wehave to cha'nge.welfa:t:'e so that it, d:tiV,es people
toward 'the' freedom of -work~, ,not: the confines ,of dependence.. Work 'is
'still the best social 'program ever invented. Work ,g~ves,.hope an,d'
structureq.nd mean~ng;
pe"ople" s 1 i ves.· And, we won't have ended:;,
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to
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welfare as we ,know it;' until its central focu's is to'l,l\ovepeopl,e ,off:' '
· ,welfare.and into .a. job 'so ,that they can ~upport themselves and .their
, families;' '"
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We' have .to' change ~elfareto ,that ,it ~trengthens"
, families arid notwea'ken them .. There'is no, substitute" -- none --: ,for
the ioving devotion and equ'allylovingdiscipline of "car,~ng paFerit's ".
Governments don't raise children" parents' do. " Th~re' s s.ome people
out there 'who argue that ~e should le,t 9 0me sb~t of 'big,'· new, ' .
. , institution take .pa,rents' ,place, that' we sh9uldevEm take children
away from parents' as 'we cut them. off welfare,eveni:f, .their .doing a,
" good job as parent~, and, put the; children,' iIi" orpl,lanages.· .Well tp.ose:
people' are dead. wrong.: We ,need less. governmental 'ihterferencfi,
family life; not inore,~ ,'.' ,:.:. .' "
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in
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'" We have to change the- w~ifare:-Syst;:ein'sothat' it"'demandS
the:same,resPQnsibility alreadyshi:;)Uld~red by" milli,(~ms, and millions .
ofAm~:t;icanswho 'already.getup every'daygo to work. and ~truggle·to
,'make ends meet and raise their, children." Anyone .who ~ dan work should
do.'so. Anyone,who ,brings ,. a' child int,o. this world ought to take'"
'.
responsibility.' for that child. .'And no one-:--:-.no'one' ~-' should, get '
pregnant ',or father a child Who iSri'. t prepared to' ra~se the .child~: "
love the child· and take financial ,and persQnal responsibility ,for,the"
'child's future.,' ,
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.", That 'SWhY'~elfare,refo~ must ',J..nclude . a 'national, \,
campaign 'against teen pregnancy'; 'arid' the.. toughest possible' .'.
· enfo~cement of ou~child, ,support laws; 'along with .the reqllirement ,
. that people' on welfare .will'have to get, of,fof . it. and go to work '
aftei: a specified' period, of time ~ , It also 'mei:lns ,: that if you' re,going ,
to requi,re that ,t~erehas, to be . a -j,obthere f,or them, and. support., .
fOr people who .are wor]{i l1 g' te,rais'e their' chiidren in the prop~r '. way.
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..... " ,I've'worked ontl),i8 .:welfare reform issue for 14, years,
since I first.'becatne 'Governor "of my state. ,I'.ve worked.'with other
Governors,. with members of Congress· from both parties', but ,most
'impo~tantly, with 'pepple, on .welfare and people, who" ve' worked their
way 6,ff of ,ft. 'I know that most ,peop1e ,out th.ere' on wel~are qon't
. like' ita bit, would, give, anything to ,get' off,. and, reaJ,ly warit. to be' ,
"good" 'hardworking 'citizens and' successful. . '
parents.· ,:. .", " .
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'. 'Th(a~e, are a- lot 'bf. i(ieas out ',there: 'fbi:' reforming welf~re
:--,some are, J;ea+ly good;, and some 'are just, political attentio~ : ' , . ,
. g etters. . Since', I. became ·'President, I "veworked hard on' 'this . I've' , ,
already ..'introduced- we'~fare:- ref,orm iegis'lation in the' 'last session of
Congress. 'We Ive' also' given' 20 ,states', relief, f;rom' cumbersqme fed~ral'"
bureauc:racyrules,so. that,tlley' 9an pur'su,e w:elfare' reform pn thei,r :'
own. We've' done. that. for, more, states, than, .th~ previous two '.. ' . '
administrations combined.. '
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Th~re 's $,till' soin~' disagr~emEmt abdut what ,we ought ,to
, '"
, do, bu't',ev'erybodyagrees that, .the 'system i,8' bad;Lybroken,and needs' to
"be Jixed.lf's a bad-,deal' ·forthe taxpayers who pay'the,bills~and'.'
~t's a ".l0;-se deal for, th~,famili~s who are permC!lnen~lystU:Ck on it.
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.' '. TW~ days ago., after meetin'g with, governors:frotn both the
· Democ:t;at.l.c. 'and, Republican '.Parties , ·'r announced that' we're going to
, 'ho~ta 'national,'bi'part;isan,working: s'ession on' welfar~reformat the
'WhiteHouse in; January. I call for this, session as' a' first.step in,
an honest and "forthright discussion about', America! s"welf.a:r;-e sYE1tem'
'and"how: to'.fix it. "It's nqt going't,o beeqsy,:~ but our responsibility
.tothe.American'people is to put aside partisan diffeI'~rices,' and to'
turri' o:ur full attention tot~e:problemsat hand.'. The :Americanpeop'!'e
iiese:;v'e a· gove:.r;nment that. honors their, val4es' and,spends ,th,e~r ,~.ohey .
wisely, and a country that ,rewards ',people .who work' hard'.:and pl,ay' by
the rules ; working.Jtogether ,'" that's ·what we can, give ,them.
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Tha,nks,for ,;Li:st,en.j.ng.
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�THE WHITE HOUSE
Office of the Press Secretary
December 8, 1994
Embargoed for Re1ea~e
Until 10:06 A.M.
saturday, December 10, 1994
RADIO ADDRESS BY THE PRESIDENT TO THE NATION
The Oval Office
5:36 P.M. EST
THE PRESIDENT: Good morning. Earlier this week, I ,
signed the GATT agreement, the most far-reaching international trade
pact in our history! And this weekend in Miami, we in the United
States are hosting the Summit of the Americas, where the leaders of
34 countries have gathered to promote ,trade in our own hemisphere.
This Summit of the Americas, and GATT, and everything ,
we've done to expand international trade is really about opening up
foreign markets to America's goods and services, so that we can'
create high-wage jobs and new opportunities for our people here at
home.
'
But despite all the. progress we've made, despite the.'
fact that we have over 5 million new jobs: in the last 22 months, the
biggest expansion of trade in' history, we"ve had more new
.
construction jobs this year than in the last nine years combined,. and
we've had. a year 'of manufacturing job growth for the first time
a
decade. In.spite of all that, millions ot hardworking people are ..
still out there killing themselve~, working longer hours for lower
pay, paying more for health care -- 'or losing the,ir health coverage'
.1;:han . e'ler befoJ:i:::.,: More and lll0'reAmericaris; even in this recovery,
. are worried .thatthey could lose their job or their benefits .at'''any
time.
in
There's 'less . disposable income for most working'
",
Americans. than there ,was just a:decade ago. Many people can't':. eVen'
image being able to afford a.vacation anymore, let alone send,their~
children to college. And I'm: talking ab~ut hardworking Americans,
who play by the rules; they're tired of' watching' their' earnings --.
benefit people who don't~
.
There's no greater gap between ma,instream American:
,
values and modern government than we find in the welfare system. Tne
welfare system was set up' for all the right reasons -_·to help people
who had fallen· on hard times temporarily, to give them a hand up.,-for·
a little while so they could put. their lives back in' order. and move
on. And it'still works that way for an awful lot· of people.
. But for millions and millions of people, the system is.
broken badly, an4 it undermines the very values --work., family and
responsibility -- that.people need to put 'themselves back on,track.
The people who are stuck on welfare permanently will be the first to
tell you that if we're going to fix it,' .He have to return to those
values, and we have to put them front and center. People who have:
worked their way off of welfare; after being afraid they'd be on it
forever, will be the strongest in saying, we've got·to put work,
family and responsibility back into the system.
We have to change welfare so that it drives people
toward the freedom of work, not the confines of dependence. Work is
still the best social program ever invented. Work gives hope and'
structure and meaning to people's lives. And we won't have ended "
MORE
'"y,.
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welfare as we know it, until its g:J~D,tral focus is to move people of~'
welfare and into a job sO.that they can support themselves and their
families.
We have to change welfare to that it ~trengthens
families and not weaken them. There is no substitute -- none -- for
the loving devotion and equally loving discipline of caring parents.
Governments don.' t raise children, parents do ~ There's some. people
out there who argue that we should let some sort of big, new,·
institution take parents' place, that we should even take children
away from parents as we'cut them off welfare, even if their doing a,
good job as parents, and put the children in orphanages. Well those'
people are dead,wrong. We need less governmental interference in
family life, not· more.
.
We have to change the welf~re system so that it demands
the same responsibility already shouldered by millions and millions
of Americans who already get up every day go·to·work·and st!uggle·to
make ends meet· and raise their. children. Anyone who can work should
do so. Anyone who brings a ',child into this world ought to take
responsibility for that child. And no one -- no one -- s~ould get'
pregnant or father a child who isn't prepared to raise the child,:
love the child and take financial. ana personal responsibility for-the
child's'future.
.
That's why welfare reform.mustinclude a national
campaign against teen pregnancy, .and the toughest possible'
,
enforcement of our .child support laws, along with,the requirement .
that people on welfare will have.toget off.ofitandgo to work
after a specified period of ,time. It- also means that if ,you're: going'
to 'require that, there has to be a job there for themi'and support"':
,for people who are working to raise, their children in' the prope.r'way.
;< ,. '•.
I;! ve' worked on this welfare reform issue for 14 years,
since I. first bec~urie Governor of my state. I've .worked with other"
Governors, with members of Congress from both parties, but most··
-l_.............- ... n+·' .1.
T.r.;+..... p""o-l'" 0··....,.... ,~ w .... ·....... d .t'....
.............;.,'" T··hol .. ,.~:.r.... -'II-od tho ..·....·.,.
.....1:'"" ............. - .... ..."
...
g
I:"
w_ ... .......way off of' i t·~ . I'''kriow that most'. people out ther.eon welfare don't:::.. '
.like it· a . bit; would give anything to get off, and really want.:..to..:be::',
'. " . . ' ..
good,. hardworking citizens and successful parents.
. i,
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flY.,.
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There are. a 'lot of ideas .out·there for, reforming weIfare ,-:
some are re,ally .good, and some are just':. political ,attention" .'..,..
getters'~
since I' became president·, I'.'ve worked hard on "this. I:~,ve;;·,
already .introduced welfare reform"legislation' in the last' session::of~:.
Congress. We've also given 20 states relief from cumbersome' federal'
bureaucracy rules, so that --they can pursue welfare reform on their:':
own'. We've done that ,for' more states' than the previous two
administrations combined.
.
. There '·s still some disagreement about what we. ought::.to:, , .
do, but everybody.agrees that· the system is badly broken and needs ;·to~:
be fixed.· It" s a bad deal for the taxpayers who pay the· bills~and
it's a worse deal for the families who are permanently stuck on i~~
.
.
.
'
Two days ago, after meeting with governors from both:the
Democratic and Republican 'Parties, I".announced tha.t we're going. to~; .
host a ,national, bipartisan working session on welfare reform at···the .
White House in. January. I.·call for this session as a first step .in--;
an' honest and forthright discuss'ion' about America I s welfare,. system.·..,
and. how to fix it~ It.' s not going to 'be easy, but our responsibility'
to the Americian people is to put.aside partisan differences, and to_
turn our'" full attention to the . problems at hand. The American' people
deserve a government that honors their values and spends their'money.
wisely, and a.country that rewards"people who work hard and play by
the rules; working together, that's what we can give .them.
Thanks for listening .
. END,
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'STATE FLEXIBILITY AND WELF'ARE REFORM
Broad'Range of Strategies
.. '.' Uniform national system - e.g., Food Stamps
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' ,Mixed nationallstate system, ~ ,e.g. AFDC
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..Block grants to states - e.g. 'Personal: Responsibility Act
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Medicaid for welfar.e swap" - e.g .. KassebaupJ proposal
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Key Issues
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National objectives:" "
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Promote work and 'pc:uent'a~ re'spons,ibility, reduce tee~age
pregnancy,support.families
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Protections and uniformity
..~reserve
a safety': n~t, prevent hunger, prevent ,
discrimination, avoid competition to lower benefits:
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,Fiscal and econo'mic stability, ,',
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,Ensure stability in funding over time, cushion states,
, against economic cycles,
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Accountability
l,VIinimize fraud and' waste, ensure efficient use'of'
resources
December 15. 1994
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Indicators of State Co~itment to National.Objectives
Evidence from Waivers
-
Mississippi
Texas
Indiana
Michigan
California
Connecticut
Y
N
Y
Y
Y
Y
Small
Subset
N
N
Y
N
N
Sub-State
N·
Sub-State
y
N
Y
N·
Y
Y
N
Y
,
Waiver Demonstrations
. Operating or Requested
Demonstrations.
Requiring Work
Demonstrations Promoting
System-Wide Culture Change
. Demonstrations Providing
Financial Incentives to Work
Y
Demonstrations Speaking to Child
·Support, Teen Pregnancy, or Family Cap
Y
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N·
N
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Y
N
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Indicators of State Performance
'.
Mississippi
Texas
Indiana
Michigan
California
Connecticut
JOBS Participation Rate (1993)
13
. el2
. 15
19
10
16
Percent. of JOBS Participants in
OJT, Work Supp; and CWEP (1992).
4.0
0.4
2.8
4.1
4.3
1.2
Paternities/Non-Marital Births (1991)
65
35
26
68
28
39 .
9
13
14
18
14
20
7.5
8.0
5.8
4.1
3.5
2.7
Percent of IV-D Cases with Collections
QC Err~r Rate. (1991)
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Need and, Capacity of
Selected States in 1992
,"
Poverty Rate
Per"Capita·
, Income
State"
Mississippi '
$14,050' ,
Texas
$18,449
J7.8%
Indiana',
$18,389
11.7%
$19:681
. 13.5%·,
California
$21,599
15.8%
Connecticut
$27,154
9~4%
... .;.
24.5%
.
Michigan
IU.S. Total
"
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' $17,387.
I
14.5%
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"Trends in Maximum Benefit Levels
Over the Past 25 Ye-ars
(Percentage changes reflect changes in real dollars)
~,
100% Federally Funded Programs
Food Stamps
Basic SSI
3%
6%
. Shared State and Federal"Programs
AFDC
-47%
100% State Funded Programs
SSI Supplement
elderly individqals.
elderly couples
General AssIstance
Federal Block Grants
Title xx (1975-1994)
Puerto Rico Nutrition Block Grant (1982-1994)
;.63%
-75%
NA
-58%
-6%
.....
�.
BENEFIT VARIATION ACROSS
PRO~RAMS
.
:AFDC and Food Sta'mp Monthly Benefits
For a .One-parent family of three persons, July 1994
AFDC
Benefit
State
Mississippi
Texas
'Indiana
Michigan
California
Connecticut
Food Stamp
Benefit
.
.
$120
$188 '
$288
$459
$607
$680
$295
'$295
$278
$227
$183
. $161
:
AFDC & Food Starn
% of Total
Combined
Benefit Provided
(State Contribution)
By State
,6%
415 (25)
483 (67)
14%'
566 , (105)
19%
: ,686" (200)
29%
790 (304)
38%
.40%
.841 (340)
".
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Effects of the Nutrition Block Grant in.
tl1e. Personal Responsibility Act (Contract with ~erica)
·on USDA Food A~sistance Programs by State in Fiscal Year 1996 .
(Dollars in, millions)
..
. State Gains and Losses
Level of Food Assistance
'State'
Total
Percent
$603
Loses $127
~r7%
$3,819
$2,665
Loses· $1,154
-30%
$713
$691
M.ichigan
$1,390
$1,109
Loses $281
-20%·
California·
$4,17.0
$4,820
Gains $650 .
+16%
Loses $49
:17%
Mississippi
-.
Proposed
C\lrrent .
Texas.
Indiana
Connecticut
1 US
$730
' . $297
TOTAL-·I . $40,764
'"
.,
Loses $22 .
$248.
1
$35,600
I
Loses $5,164
1'
-3%
:'13%
I
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�Annual Federal and State 'Expenditures for AFDC and Food Stamps
Per Poor, Person in 1992
- - -...
Federal
~-
..
State
"
.,
. Total
,-,
Mississippi
,
Texas
Indiana
.
Michigan
California
AFDC
$771
$893
$900
$1,313
$1,117 ' '
IU.S. Total
$1,015
$651 '
$36 '
$769
$653
$717
$472 "
$5~6
$645
$683
$1,201'
I
'AFDC
$120
$114
$247
<
Connecticut
Food Stamps
I
" $374
$518
I-
$641
' . $75
$154
$493,
$645
$683 '
' I " $311"
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Federal Share of AFDC Benefit and Administrative Expenditures:
Comparison of Actual Payments with Payments Under a Hypothetical Block Grant Set at 103 Percent of FY 198i Federal Payments
FY 1989
Current Law
Block Grant
$10,648,492,503
$10,243,028.,639
$2,420,190,912
$2,157,472,766
$138,080,821
$117,917,791
$744,476,840
$73,576,531
. $249,810,477
15-Dec'
FY 1993
Difference
($405,463,864)
Percent
Change
-3.8%
. ($262,718,146) ·-10:9%
$124,080,435
($14,000,386)
-10.1 %
$110,512,970
($7,404,821).
-6.3%
4.4%
$777 ;378,236
$32,901,396
($4,275,521)
-5.8%
$69,301,009 .
($42,886,890)
-17.2%
$206,923,588
- Difference
Current Law
Block Grant
$13,834,160,000
$10,243,028,639
($3,591,131,361)
$3,196,720,479
$2,157;472,766
$206,853,692
$124,080,435
$157,526,485.
$110,512,970
$751,005,987
$777,378;236
$75,180,843
$69,301,009
$383,514,016
$206,923,588
($1,039,247,713)
($82,773,257)
($47,013,515)
$26,372,249
($5,879,833)
($176,590,428)
Percent
Change
-26.0
-32.5%
-40.0%
-29.8
3.5
-7.8
-46.0
.-41
�15-Dec~
Federal Share of Food Assistance Program Expenditures:
Comparison of Actual Payments with Payments Under the Personal Responsibility Act Food Assistance Block Grant
(if implemented in FY 89)
FY 1989 .
Current Law
ATIONWIDE.
Block Grant
$21.697,000,000
$18,941,000,000
FY'1993
Difference
,($2,756,000,000)
Percent
Change
~12.7%
Current Law
Block Grant
$35,397,000,000,
$23,369,000,000,
Difference
Percent
Change
($J2,028,000,000) -34.0
','
i
�t
The Personal ~l/'-'J/1""""""1.A
·'
Responsibility
"'().....;
ct
An Analysis
Summary
Dan Bloom
Sharon Parrott
Isaac Shapiro
David Super
CENTER ON: BUDGET
. AND POLICY PRIORITIES
777 North Capitol Street, N.E. Suite 705
Washington, DC 20002
November 1994
�Contents
Included in this packet are:
•
The summary of the Center on Budget and Policy Priorities' analysis of
the Personal Responsibility Act.
•
An appendix on the overall impact of the Personal Responsibility Act on
children, including a description of how the Center estimated the
numbers of children and families who would be denied AFDC benefits.
The Center's full report on the PRA will be available the week of November 28th.
.
�The Personal Responsibility Act: Summary
A new welfare reform proposal, the Personal Responsibility Act (PRA), is part of
the "Contract with America" unveiled in September 1994 by Republican members of
the House of Representatives and congressional candidates. The PRA differs in
important ways from other recent welfare reform plans. Key elements of the bill
include the following:
•
•
The bill would deny Aid to Families with Dependent Children and
housing benefits to many poor children bornto young unmarried mothers
for their entire childhood, diverting these funds to support programs such
as orphanages for poor children. In addition, children whose paternity
has not been established - 29 percent of all children currently receiving
. AFDC - would be denied benefits even if their mothers were fully
cooperating with state efforts to track down absent fathers and establish
paternity.
•
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The PRA proposes deep cuts in a broad range of programs for low
income households and eliminates the entitlement status of most major
low-income benefit programs, including the Supplemental Security
Income program for the elderly and disabled poor and the food stamp
program. The effect would be a net reduction in low-income programs of
at least about $57 billion over the four~year period from 1996 to 1999, with
the cuts escalating over time..
The bill would establish extremely stringent time limits and work
requirements. States would be required to terminate both cash assistance
and work opportunities for families who had received AFDC for a total of
1
�five years; regardless of their circumstances, these families could never
receive assistance again. States would have the option of ending welfare
assistance for families after they receive aid for a total of two years. The
PRA would not provide work opportunities for parents who reach these
time limits and are unable to find jobs even if the parents fully complied
with work requirements while on assistance and made faithful efforts to
find employment. During the period in which they would receive aid, a
large fraction of recipients would be required to work their benefits off at
"wages" that would equal $2.42 an hour in the typical state and range as
low as $0.79 an hour in Mississippi.
•
In combination, various PRA provisions that would prevent certain
categories of children from receiving AFDC benefits and the mandatory
time limit would ultimately deny assistance to a substantial majority of the
children who would be eligible for AFDC under current law. If the
provisions were fully in effect today, more than five million children
would be denied AFDC. At least 2.5 million fewer families would receive
AFDC benefits.
The Personal Responsibility Act represents a dramatic departure from the
principle of "mutual responsibility" that has guided bipartisan welfare reform efforts
such as the Family Support Act of 1988. Under this principle, welfare recipients are
expected to move toward self-sufficiency by participating in education or training, by
working, or by looking for work, while government agrees to maintain a basic safety
net beneath poor children and to provide services and supports to help recipients
improve their prospects in the labor market.
.
.
The PRA largely abandons the. government's side of this bargain. The bill would
deny basic income support to numerous poor families, including many families in
which the parents comply with all program rules and are willing to work but cannot
find a job. The bill also would weaken the safety net through deep cuts in programs
that provide food, cash, and housing assistance to the elderly and disabled poor, as
well as poor families with children. Further, the bill undercuts programs to improve
the earnings prospects of poor parents.
The PRA encompasses far more than what is usually labeled "welfare reform."
Under this rubric, it proposes sweeping changes that would begin to dismantle the
basic features of the safety net that provide vital support to people in need.
",
2
�Budget Provisions Would Reduce Benefits for Low-Income People
In addition to making specific cuts in AFDe, the PRA includes three provisions
that would make substantial cuts in a wide range of programs for low-income families
and individuals. The bill would: (1) merge federal food assistance programs into a
block grant and set the block grant's funding level several billion dollars below what is
needed to maintain current benefits; (2) place a number of other major programs for
low-income households under a spending cap that would require large cuts in these
programs and end their entitlement status; and (3) make poor legal immigrants
ineligible for nearly all government benefits and services.
.
Food Assistance Programs
The PRA would cut an estimated $18 billion over four years from food assistance
programs. Virtually all domestic food programs, including food stamps, WIC, and the
school lunch program, would be consolidated into one block grant, thereby ending
their "entitlement"status. The bill would set a ceiling on how much could be
appropriated for the block grant each year, placing this ceiling several billion dollars a
year below current funding levels. (Backup materials to the PRA estimate the
reductions from these provisions as $11 billion over the four-year period, but this
estimate appears to be significantly understated.)
A substantial majority of the cuts in food assistance would come from programs
targeted on the families that now receive food stamps; assistance to these families
would likely be cut almost $4 billion a year. The food stamp program currently
provides an average benefit of 75 cents per person per meal, and more than 90 percent
of food stamp households live in poverty.
.
In addition, ending the entitlement status of programs such as free school meals
for poor children and food stamps means these programs would no longer expand
automatically during recessions when unemployment and poverty rise and more
people qualify for such benefits. During economic downturns, states would have to
reduce benefit levels, establish waiting lists, make some categories of needy families or
individuals ineligible for benefits, spend additional state funds, or implement some
combination of these approaches.
.
The New Caps and the End ofEntitlement Status
.'
The PRA would impose a cap on aggregate spending for an array of important
programs for the poor: Supplemental Security Income (551); AFDC; the child support
enforcement program (which helps establish paternity, locates absent parents, and
collects child support from them); the at-risk child care program (which subsidizes
child care for low-income working families that are at risk of going onto the AFDC
3
�program if they cannot secure affordable child care); and low-income housing
programs. The cap governing these programs would be set at a level well below what
the programs would cost under current law.
/'
The impact of these,caps would first be felt in fiscal 1997. According to estimates
from the HouSe Republican Conference, the caps would cut spending by $18 billion in
the three-year period covering 1997 to 1999. The magnitude of the cuts would grow
ea~year.
The bill alSo would convert the programs in this group that are now entitlements
- such as AFDC, 55I, and the child support enforcement program - into non
entitlement programs whose funding level is set each year through the appropriations
process. 5ince the budget constraints governing non-entitlement programs are likely to
become much more severe in coming years - especially if much tighter discretionary
spending caps are enacted to help balance the budget'by 2002 - subjecting these
,programs to the appropriations process may result in deeper cuts over time than those
described here.
Eliminating the entitlement status of these programs would also undercut their
ability to cushion families and the elderly against economic shocks or other unexpected
developments. If funding proved insufficient during a fiscal year for AFDC or 55I
as could occur during an economic downturn or if a greater-than-expected number of
poor elderly people applied for 55I - either benefits would have to be reduced, some
eligible people would have to be denied assistance,additional state funds would need
to be spent, or waiting lists would be created.
.
'Ending these programs' entitlement status also is problematic because the PRA's
formula for adjusting the cap from year to year is flawed. The formula for setting the
cap includes an adjustment for changes in the size of the poverty population, but
because of data availability problems, this adjustment would lag almost three years
behind the actual change in the number of poor people. Had the PRA been in effect in
recent years, the cap governing these programs would have been subject to a
downward poverty adjustment in 1990, 1991, and 1992 - years in which
unemployment rose - to reflect the decrease in the number of poor people three years
earlier in 1987, 1988, and 1989, which were recovery years.
Legal Immigrant Provisions
Under current law, illegal immigr~nts are ineligible for benefits under most
major federal programs. Certain categories of low-income legal immigrants, however,
are generally permitted to participate in federally-assisted programs. The legal
immigrants allowed to participate include many permanent residents who have "green
4
.
-.
)
-.
�cards" as well as some categories of immigrants fleeing oppression abroad. Legal
immigrants are subject to the same taxes in this country as citizens are.
The PRA would make most legal immigrants ineligible for about 60 federally
funded health, education, job training, housing, social service, and income security
.programs. The main means-tested aid the PRA would allow these legal immigrants to
receive would be emergency medical services. Denying AFDC, SSI~ and most Medicaid
services to these legal immigrants would result in benefit reductions totaling
approximately $18 billion from fiscal years 1996 to 1999.
A few examples illustrate how broadly these blanket cuts would reach:
•
Poor immigrants granted political asylum or parole in the United States
because they face danger of persecution in their country of origin would
be denied all subsistence aid except emergency medical services.
•
Legal immigrants disabled on the job in the United States would be
denied SSI benefits; non-citizen migrant farm workers legally in the
United States could not have their children treated at migrant health
centers; and legal immigrants who are children would be denied access to
foster care payments if their parents died.
•
Some programs indirectly help American citizens by assisting
immigrants. Immunization and preventive health programs cover
immigrants partly to help avoid the spread of contagious diseases that
could infect U.S. citizens. Pre-natal care and nutrition benefits are
provided to pregnant women partly to reduce the likelihood that their
children - who will be U.S. citizens - will be born with significant
health problems and need costly health and special education services.
All such assistance, too, would be ended.
Net Effects
The reductions in the three provisions described above would total $54 billion
from 1996 to 1999. In combination with other provisions in the bill, the net reductions
in low-income programs under the PRA would total about $57 billion over four years.
The cuts would grow rapidly, equaling $21 billion in 1999 alone.
By 1999, the cuts in basic entitlement programs for the poor - AFDC, SSI, food \ \
stamps, and Medicaid - would be double the combined effects of the cuts in these
program enacted during President Reagan's first two years.
"
5
�This would exact a steep price from programs that represent a small portion of
federal spending. AFDC, 55! and food stamps combined account for about nine
percent of total spending on mandatory programs (excluding deposit insurance) and
about four percent of all federal spending.
The estimate here of the net reductions in programs under the PRA - $57 billion
over four years (fiscal years 1996 to 1999) differs significantly from the House
Republican Conference estimate of about $40 billion over five years (fiscal years 1995 to
1996). One part of the explanation is that the estimates for particular provisions - such
as the reductions resulting from the food assistance block grant requirement - are
higher here.
A second part of the explanation is that the Conference considers fiscal 1995 in
their estimates even though the PRA would not begin to take effect until fiscal 1996.
Naturally, the estimates for fiscal 1995 are therefore zero. 50 the Conference cost
estimates are themselves four year estimates. Under either method, five year estimates
that would include fiscal 2000 would be more than one-quarter higher since the size of
the reductions escalate each year. Because of data limitations, however, precise.
estimates for the year 2000 are unavailable.
Denying Assistance to Poor Children
The PRA includes several sweeping provisions that would deny cash aid, and in
some cases housing assistance, to poor children and their families .. The bill would deny
benefits to children born to young unmarried mothers, to children for whom legal
paternity has not been established, and to children whose parents received welfare at
any time during the 10 months prior to the child's birth.
Denying Aid to Children Born to Young Unmarried Mothers
The PRA would establish a complicated set of AFDC rules for children born to
young, unmarried mothers. Under the PRA:
•
Families in which a young unmarried mother had a child before her 18th
birthday would be denied AFDC and housing assistance. Because the
food stamp program is repealed and put into a discretionary block grant,
these families also could be denied food assistance if their state chose to
target them for some of the cuts it would have to make in food benefits.
•
States would have the option of denying cash aid and/or housing
assistance to families in which an unmarried mother had a child before
her 21st birthday.
6
'.
�•
In general, as long as their mothers re~ained unmarried, these children
would remain ineligible for cash assist~nce throughout all of their
childhoods. Such children could become eligible for assistance only if their
parents married or if they were adopted. The mother could receive
assistance if she had a subsequent chil~ when she was older, but the first
child would remain ineligible.
•
Women who, prior to the passage of tllis legislation, had children outside
marriage when they were young would be ineligible for assistance once
the bill took effect. Consider a mother who had a child when she was 17
years old, has worked ever since, and ,has never received AFDC. She is
now 27 years old and her child is 10. If after implementation of this
legislation she lost her job due to a company cutback and applied for
AFDC, she and the child would not b¢ eligible'to receive aid.
Because children born to young, unmarried mothers would generally be
ineligible for assistance throughout their childhoods~ a large proportion of AFDC
families would be affected. More than one in ten fCimilies currently receiving AFDC
was begun by an unmarried mother under the age :of 18. In states that took the option
to deny assistance to children born to unmarried mothers under 21, the number of
children denied assistance would generally more ~ double.
,
Paternity Establishment
Children for whom legal paternity has not been established would also be
denied cash assistance under this bill. Such children would remain ineligible even if
their mother was cooperating with state officials by providing all the information she
had about the father. (The mother would be eligible for AFDC benefits, as long as she
cooperated with the child support agency. Also, if the family included a mother and
two children, one of whom had paternity established, that child would be eligible for
an AFDC grant.)
,
Some 29 percent of all children receiving AFDC - or 2.8 million children - do
not have paternity established. If this PRA provision were now in effect, these
children, with very limited exceptions, would be ineligible for assistance.
c.
This provision would apply to children of all ages and to those already receiving
welfare. So a mother with a ten-year-old child wpo had not had contact with the child's
father for many years would be required to establish paternity in order for the child to
remain eligible for assistance. If the mother cooperated fully but the father could not be
located, the child would never be eligible to receive assistance.
7
�The process of paternity establishment often takes a long time evert if a mother is
cooperating. The state agencies charged with helping families establish paternity and
child support orders are often overburdened and unable to assist families in a timely
manner. Many child support caseworkers are responsible for as many as 1,000 cases.
Under federal regulations, a state child support agency has 18 months to establish
paternity after the father is located, and states often take longer than that; under the
PRA, children would be denied AFDC in the meanwhile.
Furthermore, state paternity establishment rates vary widely. At one extreme,
West Virginia established paternity in 85 percent of the cases that needed paternity
established. Oklahoma, by contrast, establishes paternity in only three percent of its
cases that year. These data suggest that state processes, rather than the cooperation of
mothers, largely determine state paternity establishment rates. Under the PRA,
however, children living in states which have poor records of establishing paternity
would be especially likely to be denied eligibility for AFDC.
Finally, while the PRA would deny AFDC benefits to children for whom
paternity was not established, the bill would also place the child support enforcement
system under the outlay cap described earlier. This would make it likely that this
already-overburdened program would be faced with reduced federal resources.
Child Exclusion
The bill also includes a IIchild exclusion" provision (sometimes called a IIfamily
cap") that denies AFDC to children born to families already receiving welfare or to
families that received welfare at any time during the 10 months prior to the child's
birth. This child excl usion provision would deny assistance even to some poor children
who were. conceived while the family was working and not on welfare. Consider the
case of a married pregnant woman who has one child. Suppose her husband deserts
the family, and she receives assistance from the AFDC program to meet basic needs
during the latter months of pregnancy. Her newborn would be ineligible for assistance
throughout his or her childhood even though the child was conceived while the mother
was married and not on welfare.
Child exclusion proposals are often based on the belief that AFDC families are
large. Some 73 percent of AFDC families, however, include two or fewer children.
Families receiving AFDC are no larger than other families with children, and the size of
the average AFDC family has dropped sharply over the past two decades.
Furthermore, research has shown that both benefit levels and the benefit increase
associated with an additional child have little bearing on the likelihood that a woman
will have another child.
8
','
�Orphanages and Adoptions
I
.
The bill allows states to use the money saved from denying assistance to
children born to young unmarried mothers to suppott orphanages and promote
adoption. The bill will likely drive some parents to relinquish their children not
because the parents are abusive or neglectful, but be~ause they are destitute. Their
destitution may simply reflect the fact that they live in a high unemployment area and
cannot find a job.
~
f
The Relationship Between AFDC and Out-oj-Wedlock Births
The above provisions stem in large part from!the view that welfare is the
primary factor behind out-of-wedlock childbearing in general and teen childbearing in
particular. While there is strong, justifiable concern:about the rise in the proportion of
children living in poor families without their father&, research does not suggest that
welfare is the primary factor behind out-of-wedlock childbearing. Out-of-wedlock
childbearing is a complex, society-wide phenomeno,n not limited to teenagers, the poor,
or welfare recipients.
This summer, a statement by 76 leading researchers addressed this issue. It said:
As researchers who work in the area of poverty,.the labor market, and family
structure, we are concerned that the research10n the effect of welfare on
out-of-wedlock childbearing has been seriously distorted. As researchers, we
are deeply concerned about the rising rates df out-of-wedlock childbearing and
the high incidence of poverty and welfare use among single-parent families.
However, the best social science research suggests that welfare programs are not
among the primary reasons for the rising nuinbers of out-of-wedlock births.
l
...ending welfare for poor children born out-bf-wedlock does not represent
serious welfare reform, and would inflict harm on many poor children. We
strongly urge the rejection ojany proposal that would eliminate the saJety netJor poor
children born o~tside oj17Ulrritzge. Such policies will doJar more harm thangood
[emphasis in &e original text].
:
Work and Time Limit Provisions
Like several other recent bills, the PRA would impose a time limit on AFDC
receipt and establish new work requirem~nts for AFDC recipients. However, the new
1
9
�bill's time limit and work provisions differ in important ways from those contained in
other welfare reform proposals, including some earlier Republican proposals.
Moreover, the PRA would likely lead to cuts in some programs which can help welfare
recipients earn their way off welfare and out of poverty.
A Different,Kind ofTime Limit
Under the PRA, each state would be required to place a time limit on AFDC
receipt. At most, a state could provide AFDC to a family for five years; after that point,
the family would be permanently removed from the welfare rolls. States would be
permitted to remove families permanently from AFDC after two years, as long as the
parent spent one of these years in a work program.
.
The PRA's time limit would be cumulative;that is, the "clock" would not be.
reset if an individual left AFDC, even for an extended period. Thus, in a state choosing
the more restrictive option, a mother who received welfare for two years in her early
twenties, left the rolls and worked for 10 years, and then needed assistance during a
. recession would be ineligible for any aid (as would her children).
One of the key differences between the PRA's time limit structure and the time
limits proposed in some other bills, such as the Clinton Administration's Work and
Responsibility Act of 1994, is in the definition of what would happen to families that
use up their allotted months of AFDC receipt. Under the administration's plan,
recipients who had received two years of cash assistance would be required to work. If
a parent was unable to find an'unsubsidized job, she would be provided a subsidized
10
�I
work slot and would be paid at least the federal minimum wage for the hours she
worked. As long as a parent was willing to work, she would be given access to a work
i
slot.
I
"
By contrast, under the PRA, the time limit would not be defined as the point
after which a recipient would be required to work; instead, time spent in a work
position would itself count toward the two- to five-year time limit. Upon reaching the
time limit, a family would be permanently barred from receiving both AFDC and a work
slot, The PRA's time limit provisions would require:states to remove families from the
AFDC rolls even if the parent was willing to work and had performed faithfully in a
work slot for a long period of time but was unable to find a job due to adverse
economic conditions or poor basic skills.
.
There would be no exceptions or extensions to the time limit; for example,
families headed by parents who are temporarily disabled or caring for disabled
children would be removed from the rolls upon reaching their state's time limit. In
fact, children receiving AFDC who live with elderly! grandparents would also be
subject to the time limit.
I
Recent studies show that two-thirds of the fainilies who enter the AFDC
program for the first time leave within two years, often because the parents find jobs.
However, the same data show that many of those who leave welfare subsequently
return, often because they lose the low-wage jobs they obtain. This means a large
fraction of AFDC recipients would eventually reach the PRA's time limit and be denied
assistance. One recent study found that 48 percent of the current AFDC caseload has
accumulated at least five years of welfare receipt. (This accumulation often occurs in
more than one spell; only about 14 percent of first-time welfare recipients stay on
AFDC for five or more years in one continuous spelL)
I
.The PRA's Work Program
,
Although the PRA would not offer jobs to recipients who. reach their state's time
limit and are unable to find work, it would require states to impose work requirements
on a growing proportion of AFDC recipients while ;they received assistance. An
estimated 1.5 million work slots would be required by.the year 2001. The conditions of
the work program are exceptionally stringent:
•
1
Most recipients placed in these slots would be required to work 35 hours
per week in exchange for their welfare grants;l since the maximum AFDC
The PRA would allow state work programs to provide wdrk supplementation (a program that uses
~!
11
(continued...)
�grant for a family of three in the median state is $366, this means most
recipients would be working at far less than the federal minimum wage of
$4.25 an hour. In the median or typical state, the work slot "wage" would
equal $2.42 an hour. In Mississippi, recipients would be "paid" 79 cents
an hour.
"
•
The PRA establishes no exemptions from the work requirement. For
example, states could require parents caring for disabled children or
infants to work full-time.
The PRA's work provisions would likely impose a large administrative and
financial burden on states. Federal matching funding for the administrative and child
care costs associated with the work program (an estimated $6,000 per year per slot)
would be included under the aggregate spending cap the PRA would establish for an
array of key low-income programs. This means the federal share of the work program
would need to be funded through cuts in the other capped programs. If Congress
decided not to cut the other programs, it would be necessary to reduce the size of the
work program or pass more of its cost onto states. In any case, states would need to
find enough money to finance their share of administering the work program and
providing full-time child care to participants. The administrative challenge of
developing 1.5 million or more work slots would be enormous, considering that less
than 20,000 AFDC recipients nationwide are currently in work positions.
Absence ofStrategies to Increase Employability or "Make Work Pay"
Many AFDC mothers lack employment-related skills; fewer than half have
. graduated from high school. Women with low levels of skills face high unemployment
rates and earn low wages when they work. Jobs that are temporary or part-time and
without benefits are often their only option. This suggests that many recipients need
help finding and holding jobs that allow them to support their families.
Rigorous studies have shown that adequately funded programs offering a mix of
. employment-oriented education and training services can increase the number of
recipients who find jobs, reduce the number receiving AFDC and, in some cases, save
money for taxpayers. The PRA, however, provides no additional support for such
programs. The existing Job Opportunities and Basic Skills (JOBS) program - which
provides federal funding for state education and training programs for welfare
recipients - would receive no new funding under the bill, and states would not be
1 ( ...continued).
welfare grants to subsidize wages paid to recipients by employers) instead of or in addition to work
experience. However, this option has been available to states for some time but has rarely been used. Of
those participating in JOBS, 0.1 percent nationwide are in work supplementation programs.
12
�required to provide parents with these services. In fact, faced with the new
requirement to create a rapidly-growing number of work positions, states might be
forced to divert funding from JOBS training services to pay for the high cost of the
work slots.
.-
By contrast, most other recent welfare reforni proposals would expand funding
for work preparation services and require states to provide such services to large
fractions of their welfare caseloads.
i
Finally, the PRA does not contain measures to "make work pay" even though
many adults who leave welfare for work obtain low-wage jobs that are insufficient to
support a family. In this respect, too, the PRA differs from other proposals. The
previous House Republican bill supported by a large majority of Republicans would
have allowed states to change the current rules under which recipients who work lose
up to one dollar in benefits for each additional dollar they earn. Similarly, a bill
introduced by the Mainstream Forum - a group of moderate and conservative House
Democrats - would have mandated such a change and greatly expanded child care
subsidies for working poor families.
Indeed, the PRA would likely reduce assistance for the working poor. For
example, it places under the outlay cap - and the~eby makes susceptible to cuts - a
key child care program for working poor families that are not on welfare. Since the cap
would be set below current levels, funding for child care services for low-income
working families could be lowered even as cash assistance for many poor families with
children was being withdrawn. Furthermore, some of the nutrition assistance
programs that would be merged into the PRA's nutrition assistance block grant and
then cut back, such as the food stamp program, provide important supports to many
low-income working families.
The Overall Impact on Poor Children
The Personal Responsibility Act includes niunerous provisions that would deny
AFDC benefits to poor children and their families~ These features include the denial of
housing and cash assistance to families in which the child was born to a young
unmarried mother, the denial of assistance to children for whom paternity has not been
established, and the child exclusion and time limi,t provisions.
To estimate the total number of children aAd families who would be denied
benefits under the PRA, one cannot simply add up the independent effects of the
different provisions (such as 48 percent of the families being denied A.FJjC because of
the time limit plus 29 percent of the children denied benefits because of the paternity
establishment provision). Some of the provisioll$ would affect many of the same
13
�people. For example, some of the children who would be denied benefits under the
paternity establishment provision would also be affected by the time-limit provision.
An analysis of the effect of the various provisions makes clear, however, that the
impact of the numerous provisions to deny AFDC benefits to poor children and
families would be dramatic.
•
If the PRA were fully in effect today, well over half of the children who would
be eligible for aid under current law would be denied assistance. This translates
into more than five million - and perhaps as many as six million poor
children who would not be receiving AFDC.
•
At least half of all families receiving assistance today would be denied
AFDC if the PRA were fully in effect. This translates into at least 2.5
million families who would receive no cash assistance.
Among those families faced with large benefit reductions or made completely
ineligible for assistance, it is likely that many parents would be unable to provide basic
necessities for their children. Because food assistance is also cut substantially and
would no longer be an entitlement, some children made ineligible for AFDC might not
be assured even a minimal safety net to help them meet their nutrition needs. An
alread y-overburdened child welfare system would likely be asked to find foster care
and institutional placements - temporary and permanent - for many children whom
their parents are forced to relinquish.
An Imbalanced Approach
The public and policymakers from across the political spectrum agree that the
AFDC program needs fundamental reform. There is also wide support for further
efforts to reduce the federal budget deficit. The PRA, however, fails to strike a
responsible balance between these goals and the important need to maintain a basic
safety net beneath poor children, the elderly, the disabled, and other vulnerable
groups. The bill would make deep cuts in basic support without including strategies
for improving employability or making work pay. Increases in poverty, homelessness,
and hunger for millions of children would almost certainly result, and states would
. likely end up paying a greater share of the costs of programs for the poor.
14
�I
,
Appendix: The Overall Impact of the AFDC Proposals On Children
and Their Families
I
I
Thl? Personal Responsibility Act includes nmPerous provisions that would deny
AFDC benefits to poor children and their families. In combination, these features
the denial of housing and cash assistance to families in which the child. was born toa
young unmarried mother, the denial of assistance to children for whom paternity has
not been established, and the child exclusion and time limit provisions - would have
far-reaching consequences.
How Many Children Would Be Denied Benefits? :
" It is difficult to estimate the total number of children and families who would be
denied AFDC benefits under the PRA with absolute; precision, primarily because the
various provisions would affect many of the same people. 2 For example, some of the
children who would be denied benefits under the paternity establishment provision
would also be affected by the time limit proposal. Similarly, some of the children who
would be denied assistance because they were born to a:young unmarried mother
would also have been ineligible because they did nbt have paternity established .
Because of these "interactions," one can not simply add the number of children that
would be denied aid by each provision independently to determine the total number of
.children affected. (For a description of the assumptions about the behavioral responses
to PRA provisions and caseload effects, see the box on page X.)
.
,
2
This analYSis assumes that states do not choose the AFOe block grant option.
i
I
�Even though we were unable to determine the precise extent of these .
interactions, it is nevertheless dear that the PRA would ultimately deny basic cash
assistance to substantially more than halfof the children who would be eligible for aid
under current law. In 1993, an average of 9.5 million children received AFDCbenefits
each month. The PRA would ultimately deny AFDC to at least halfofall families who
would be eligible under current rules. In 1993, an average of almost five million
families· received benefits each month.
The steps toward this conclusion begin with an examination of the mandatory
time limit provision that would remove entire families - that is, poor adults and their
children - from the AFDC program, regardless of individual circumstances such as
parents' ability to find jobs.
.
•
As noted, the PRA mandates that states terminate assistance to families
that accumulate 60 months of AFDC receipt. While about two-thirds of
families who enter the welfare system for the first time leave welfare in .
less than two years, most eventually return to the program when they
again need assistance. 3 As a result, nearly half of all families now
receiving AFDC benefits would be affected by the time limit if it were
currently in place. (For a discussion of recent research on how. long
families receive welfare, see box on page XI.)
,
• -
Approximately 48 percent of families currently receiving AFDC have
accumulated at least 60 months of welfare receipt, with many
accumulating this time over several welfare spells.4
•
If the five-year time limit had been implemented before these families
first received welfare, an estimated 2.4 million families and at least 4.6
million children now receiving AFDC would be ineligible. s
;
•
The PRA gives states the option to set the time limit at as little as two
years. Many additional families would.be denied benefits if any states
3 LaDonna Pavetti, "The Dynamics of Welfare and Work: Exploring the Process by Which Women Work
Their Way Off Welfare," Doctoral Thesis prepared for Harvard University, 1993.
,
' . .
Harold Beebout, Jon Jacobson, and LaDonna Pavetti, "The Number and Characteristics of AFDC
Recipients Who Will Be Affected By Policies To Time-Limit AFDC Benefits/' presented at the Annual
Research Conference of the Association for Public Policy and Management, October 1994 (cited with
permission of the author.).
4
5 In fact, the number of children who would be affected is likely to be higher than 4.6 million because
larger families are more likely than smaller ones to remain on welfare for long periods of time.
II
�exercised the more restrictive option.: Approximately 73 percent of
families currently receiving AFDC -: or 3,.6 million families - have
accumulated more than 24 months of,welfare receipt. 6
While the time limit would always eliminat~ AFbc benefits for entire families,
the other PRA provisions would sometimes affect entire families and sometimes just
, the children in the families. Large numbers of additional children are likely to be
affected by these other prQvisions as well.
,
•
I
'
Some 29 percent of children - or 2.8 'million children - currentl y
-,
receiving AFDC do not have paternity established. These children would
be denied assistance under the PRA.7!
I
<
i
I
•
•
6
7'
i
About 12 percent of families currently receiving AFDC were begun by an
UItJ:riarried mother under the age of 18; allchi'ldren born to unmarried ,
mothers under age 18 are denied AFI?C u1!-der the PRA. 8,9 This provision
would affect many more families if states opted to deny AFDC to families
in which an unmarried mother gave birth before her 21st birthday (the
PRA would give states this option). I'
'
.
i
I
, Additional children would be denied; assis~ance because they were subject
, to the Child exclUsion provision. Poor legal immigrant families would
'
also be denied assistance under the provisions denying numerous forms
of aid to legal immigrants.
:
Beebout, op; cit.
,
I
U.S. Department of Health and Human Services, Charactef:;stics and Financial Circumstances ofAFDC
Recipients, FY 1992.
8 If the family consists of only an unmarried mother and a child she had prior toher 18th birthday, both
she and the child would be ineligible for assistance. If she has1an additional child when she passes her 18th
birthday, she and the second child would be eligible for assistance.
I
,
I
9 According to the May 1994 General Accounting Office report, Families on Welfare: Teenage Mothers Least
Likely to Become Self·Sufficient, some 42 percent of all families or AF:OC were begun by a mother under the
age of 20. The report also notes that about tw~thirds of those mothers who started families as teens never
, married. Thus, approximately 28 percent of families now on AFDC were begun by an unmarried mother
under age 20. In 1992, approximately 44 percent of all births to unmarried teen mothers were among teens
under the age of 18. The 12 percent estimate in the text was computed by multiplying this 44 percent
figure by the estimate that 28 percent of all familieS receiving AFOC were begun by an unmarried mother
under the age of 20. The data on overall births to unmarried teens by the age of the mother is from the
National Center for Health Statistics report, Advance Report of Final Natality Statistics, 1992.
III
�Even after adjusting for overlap among these categories of families and children
who would be denied assistance, when those people affected by these provisions are
combined with the'48 percent of families who would be wholly ineligible for aid
because t~eir family hit the mandatory five year time limit, the effects are striking:
•
Well over half of the poor children who would be eligible for assistance
under current law would be denied aid once these provisions were fully
implemented. This translates into more than 5 million poor children-,
and perhaps as many as 6 million children - who would not receive cash
assistance to help them meet their most basic needs.
•
At least half of all families who would be eligible for assistance under
current law would be denied AFDC once the PRA was fully
implemented. This translates into at least 2.5 million families with
children who would receive no AFDCcash assistance.
'
It is interesting to note that even without the time limit provision, a large
proportion of children who would be eligible for assistance under current law would
be denied aid under the PRA. The paternity establishment provision alone would deny
,aid to 29 percent of children who would otherwise be eligible. In combination with
other provisions, it is likely that at least 35 percent of children who would receive
, AFDC would be made ineligible by this bill even without the time limit provision.
What Would the Consequences Be?
The consequences for the millions of poor families and children who would lose
their benefits would be serious. Most obviously, families that are already quite poor
would become even poorer.
•
Currently, for a single-parent fainily of three with no other income, AFDC
benefits in the median state total $4,400 a year, or 37 percent of the
poverty line. '
•
Families that become wholly ineligible due to the time l.imit provision or ,
the provision denyirig assistance to young unmarried mothers and their
children would, of course, receive no AFDC income. to
10 Under current law, the vast majority of AFOC families also receive food stamps. For the typical
. single-parent,famiIy of three with no other income and who lives in the median state, food stamps lift the
family's annual income to $7,580, or 64 of the povertY line. Under the PRA, the Food Stamp Program is
. repealed and placed within the nutrition assistance block grant. No family currently receiving food stamps
(continued ... )
IV
�,
•
\
Most of the children denied AFDC urlder the PRA would live in families
that would eventually become wholly ineligible for assistance, but in
other cases only the children in the family would lose assistance. If one
child in a typical AFDC family were denied AFDC benefits, the income of
the family would drop to $3,530 - a 20 percent drop in income. A single
parent family consisting of a mother and one child, would suffer a 28
percent drop in their cash income if the child became ineligible for
assistance. More than four out of 10 AFDC cases include two or fewer
recipients.
,
. Among those families faced with large benefit reductions or those made .
completely ineligible for any assistance, it is likely:that many parents would be unable.
to provide basic necessities for their children. SOIIJ,e rent would go unpaid and food
budgets would be cut back -~ homelessness and hunger could increase, particularly
among families made wholly ineligible for assistance. Because the food stamp program
is repealed under this bill and the money converted to a block grant, children made
ineligible for AFDC might not be assUred even th~ minimal 'safety net of food stamps to
help them meet their nutrition needs.
I
I
Research Underscor~ Hannful Effects ofChildhood Poverty
I
Each of these propos~ls to deny AFDC eligibility to some children would
intensify child poverty which research has found,to be harmful to children in
identifiable ways. One recent study found that ''Poor children are more likely to be low
height-for-age [i.e., shoder thannonpoor children of the same age], low weight-for
height [Le. thinner than other childten of the same height], and to score poorly on
indicators of cognitive and socioemotional development than middle- and upper
income children. Long-term economic disadvant~ge is also associated with deficits in
rates of growth in height."11 In short, this study showed that poverty can dramatically
affect the physiCal and emotional health of children.
I
Furthermore, poor children are more likely to drop out of high school than more
affluent children. Among children with single and married parents, among blacks and
whites, and among families in which the mother is and is not high ,school graduate,
a
10 (...continued)
.
would be guaranteed to receive any nutrition assistance, let ,alone a food stamp increase if their AFDC
benefits fell.
I
Jane Miller and Sanders Korenman, "Poverty, Nutritional Status, Growth and Cognitive Development
of Children in the United States," Princeton University's Office of Population Research Working Paper
Series. June 1993.
11
v
�.
'poor children are far more likely to drop out of school than nonpoor children. ,For
example, among white two-parent families with a mother who has graduated from
high school, poverty increases the likelihood that children will not graduate high
school by 8 percentage pointS. 12 '
Some Parents Would be Forced to Give Up Their Children
Under the PRA, an already overburdened child welfare system would likely be
asked to find foster care and institutional placements (temporary and permanent) for
children whose parents - in the face of AFDC and other cuts - determine that they
are unable to feed, clothe, and house their children. Yet the child welfare system is
already overwhelmed with the task of finding appropriate placements for children who
have been abused and neglected; as a result, children often languish in inadequate care
for long periods of time. In 1993, about 460,000 children were in foster care, an increase
of more than 70 percent from 1982.13 The'system now would also have to find
placements for children whose parents are not abusive or neglectful, but who live in
families which.lack the income to care for them.
'
To place the massive cuts in AFDC eligibility into perspective, it is interesting to
note that the number of children who will ultimately be denied basic cash assistance is
more than 10 times the number currently in foster care. The child welfare system could
face a substantial increase in their caseload which could mean that it will have fewer
, resources to devote to assisting abused and neglected children.
In addition to an increased reliance on temporary out-of-home placements, some
parents could be forced to relinquish their children permanently. In fact, the sponsors
of the PRA appear to understand that this might occur. The bill allows states to spend
the money saved by the provision denying benefits to families in which the child is
born to a young unmarried mother on orphanages and program~ to foster adoption.
This increased emphasis on taking children from their parents and moving them
to foster care or other out-of-home arrangements including orphanages is in contrast to
the direction the child welfare system has taken to try to help families stay together and
to limit use of institutional care. The child welfare system has largely moved away
from group care settings, especially for younger children, in recognit?-on that such
12 Data are from tabulations of the Panel Study of Income Dynamics and are reported in Wasting
America's Future: The Children's Defense Fund Report on the Costs ofChild Poverty by Arloc Sherman. Some 4.8
percent of white children living in nonpoor, two-parent families in which the mother has graduated from
high school drop out of high school. Among children in families that have these same characteristics except
that they are poor, some 12.3 percent do not finish high school.
13
Data are from the Child Welfare League of America.
VI
�settings deny children the individual attention and continuity of care critical to their
development. Proposals to institutionalize childre~ are also in direct contrast to the
growing movement, based on clinical experience, to help families in crisis work out
their p~oblems so children can stay with their parep.ts rather than b~ placed in foster
care.
Many who talk about such provisions often :assume that the children taken from
their parents would be newborn babies whose parents are unable to care for them.
Many of the children affected by these provisions, ;however, would not be infants, but
children already attached to their parents.
"
}
'
•
Some 45 percent of young women tui.der age 18 who have children
outside of marriage do not go onto i\FDC in the year following the birth
of the child. 14 Many of these familie& eventually need cash assistance, but
when they do their children are no longer infants. The provision that
denies assistance to families in which a child is born to a young "
unmarried mother applies to all families that apply forAFDC after the
date the provision takes effect. Ther~fore, a 27 year-old 'mother with a 10- .
year-old child who has never before ;received welfare be,nefits - but who
loses her job and applies for AFDC after the bill's passage -"'would be' ~,.
ineligible for assistance.
•
Many of the 'children affected by theitime lirrut proposal will certainly be
older, as the time limit applies to families that have already received"
"assistance for five years.
"
i
i
•
The paternity establishment requirement would also deny assistance to
children of any age if their paternity. was not established. Establishing the
paternity of older children is often quite difficult 'and may, in many cases,
be impossible. The reduction in the !AFDC grant in conjunction with
other benefit reductions could lead some families to lose a significant
percentage of their incomes.
'
If a denial in benefits forces mothers to give up their children either temporarily
or permanently, the consequences could be serio4S. Psychologists ~ve long
recognized th~ importance of children's attachments to their caregivers (generally
,
"
14
1994 Green Book, Committee on Ways and Means, U.S. Jiouse of Representatives, pg. 454..
VII
:
j
�parents) and have noted that disruptions in the relatio~hip between the child and the
caregiver places the child at risk for serious developme~tal problems. 15
While many parents may ultimately be forced to,relinquish their Children on
either a temporary or permanent basis, it is also important to recognize that it is likely
that many parents will take extreme measures to keep their families together. Some
may move to dangerous, or more dangerous, neighborhoods to save on rent. Food
budgets might be cut back placing children at nutritional risk. SOllle mothers might be
forced to rely on an abusive boyfriend for help in meeting their children's basic needs.
It is, of course, impossible to know what mothers would do when faced with a sharp
reduction in or total elimination of cash assistance. It does seem plausible, however,
that many mothers would be faced with difficult choices - either break-up their family
or make decisions that might otherwise seem unwise such as living in an unsafe
apartment to save rent. .
~
Policies Would Cause Far More Harm than Good
In short, the negative consequences of the PRA would likely be extreme.
Poverty would deepen, homelessness and hunger could:rise, temporary and permanent
out-of-home placements and institutionalization of chilW'en could increase. Some
might argue that this is the price that must be paid to re~uce out-of~wedlock
childbearing and increase employment among welfare recipients. But, does the
research support the view that these policies are likely to work?
Research has shown that most welf~e recipients lbave AFDC in less than two .
years - many leaving to take low-wage, unstable jobs. This research suggests that the
most pressing problem is not forcing'AFDC recipients to leave welfare for work,'but
helping them move into jobs that are more secure and px:oviding them the necessary
supports so they are able to meet their families' needs.
The evidence also indicates that welfare is not the primary cause of out-of
wedlock childbearing in general or teen pregnancy in particular. In June 1994, a group
. of 76 leading researchers issu.ed a statement on the relationship between welfare and
out-of-wedloCk childbearing.16 The researchers concluded that welfare was not the
primary cause of out-of-wedlock childbearing:
Barbara M. Newman and Philip R. Newman, Development Thro;gh Life: A Psychosocial Approach.
Brooks/Cole Publishing Company, 1991. Children's attachment to their caregivers typically occurs in the
first one to two years of life.
15
16. The statement was organized by Sheldon DanZiger, professor of social work and public policy at the
University of Michigan. The Center on Budget and Policy Priorities provided technical assistance to the
researchers in this effort.
.
VITI
ec
�As researchers who work in the area of poverty, the labor market, and family
structure, we are concerned that the research on the effect of welfare on
out-of-wedlock childbearing has been serio\:lsly distorted. As researchers, we
are deeply concerned about the rising rates ~f out-of-wedlock childbearing and
the high incidence of poverty and welfare use among single-parent familie~.
However, the best social science research s4ggests that welfare programs are not
among the primary reasons for the rising nlfTIbers of out-of-wedlock births.
Most research exainining the effect of higher welfare benefits on out-of-wedlock
childbearing and teen pregnancy finds that benefit levels have no significant
effect on the likelihood that black women and girls will have children outside of
marriage and either no significant effect, or1only a small effect, on the likelihood
that whites will have such births. Indeed, cash welfare benefits have fallen in
real value over the past 20 years, the same period that out-of-wedlock
childbearing increased. Thus, the evidenc~ suggests that welfare has not played
a major role in the rise in out-of-wedlock quIdbearing.
.
The researchers' statement also addressed on the issues raised by proposals to
deny welfare benefits to families in which the chi,ld was born outside of marriage. The
researchers concluded that such a policy would be ill-advised:'
.
,
,
~.
,:"
.,...
"',
'"
'
. ·...ending welfare for poor children born o~t-of-wed:lock does not
represent serious welfare reform, and woUld inflict harm on many poor
children. We. strongly urge the rejection ofany proposal that would eliminate
the safety net for poor children born outside of:mamage. Such policies will do far
more hann than good [emphasis in the original text].
,
,
I
I'
�x
�.
~,
XI
�WithdrawallRedaction Marker
Clinton Library
DOCUMENT NO.
AND TYPE .
SUBJECTITITLE
·001. list
Welfare Meeting attendees (partial) (I page)
DATE
J2/0711 994
RESTRICTION
P61b(6)
COLLECTION:
Clinton Presidential Records
Domestic Policy Council
Carol Rasco (Issue Papers)
OAiBox Number: 8506
FOLDER TITLE:
[Welfare Legislation] [6]
2010-0198-S
kc234
RESTRICTION CODES
Presidential Records Act - [44 U.S.C. 2204(a))
Freedom of Information Act· [5 U.S.C. 552(b)]
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P2 Relating to the appointment to Federal office [(a)(2) of the PRA]
P3 Release would violate a Federal statute [(a)(3) of the PRA]
P4 Release would disclose trade secrets or confidential commercial or
financial information [(a)(4) of the PRA]
P5 Release would disclose confidential advice between the President
and his advisors, or between such advisors [a)(5) of the PRA]
P6 Release would constitute a clearly unwarranted invasion of
personal privacy [(a)(6) of the PRA]
b(1) National security classified information [(bXl) of the FOIA]
b(2) Release would disclose internal personnel rules and practices of
, an agency [(b)(2) of the FOIA]
b(3) Release would violate a Federal statute [(b)(3) of the FOIA]
b(4) Release would disclose trade secrets or confidential or financial
information [(b)(4) of the FOIA]
b(6) Release would constitute a clearly unwarranted invasion of
personal privacy [(b)(6) of the FOIA]
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purposes [(b)(7) of the FOIA]
b(8) Release would disclose information concerning the regulation of
,
financial institutions l(b)(8) of the FOIAJ
1,(9) Release would disclose geological or geophysical information
,
concerning wells [(b)(9) of the FOIAJ
C. Closed in accordance with restrictions contained in donor's deed
of gift.
PRM. Personal record misfile defined in accordance with 44 U.S.C.
2201(3).
RR. Document will be reviewed upon request.
�WELFARE MEETING
wednesday, December 7, 1994
1:30-2:30
OEOB 472
Donna Shalala - Nancy 690-6610
David Ellwood - Gerri 690-7858
Mary Jo Bane - Arlene 401-2337
Jerry Klepner - Bee 690-7627
Avis Lavelle - .
B~lle Sawhill - Marty 54844
Susan Brophy - Erin 62230
Marcia Hale - Jenny 67060
George Stephanopolous - Marlene 67105
Bruce Reed - Cathy 66515
Mark Gearan/Rahm Emanuel - Christen. 62531
Jeremy Ben-Ami
:
Alice Rivlin - Val 54840
Leon Panetta - Rose/Jennifer 54840 - FYI
Gene Sperling - Paul
Alexis Herman - Ruby 66455
Jen O'Connor - 62421
Laura Tyson - 55042
�CENTER ON, BUDGET
AND POLICY PRIORITIES
CONTACT: Michelle Bazie
Isaac ShapirO
(202) 408-1080
FOR IMMEDIATE RELEASE:
Tuesday, November 22, 1994
"CONTRACTU WOULD ULTIMATELY DENY BENEFITS TO FIVE MILLION POOR
CHILDREN, REPORT FINDS
I
The Personal Responsibility Act (PRA) in the ,House Republican "Contract with
America" would deny AFDC benefits to at least half the families and children that would receive
aid under current law, according to a report released today by the Center on Budget and Policy
.:
Priorities.
The Center found that if the bill's provisions were fully in effect today, at least 2.5
million families and more than five million children currently receiving assistance would be
ineligible for benefits. This would result from a strict time limit on welfare receipt and
provisions denying aid to children born to young unmarried mothers, children whose paternity is
not legally established, and children born when their parents are receiving we~fare.
Cuts in a Wide Range of Poverty Programs Total Much Larger
than in the Early 1980s
I
The report also noted that the PRA contains reductions in a range of benefit programs for
the poor that substantially exceed the reductions enacted during the early 1980s. Among the.
programs subject to cuts, according to the Center, are the Supplemental Security Income (SSI)
program for the elderly and disabled poor, child care assistance for low-income working families
that are not on welfare, child support enforcement, and the school lunch program. The
"entitlement" status of these programs would also be ended.
According to the report, the net effect would~ be a reduction in benefits for low-income
families and individuals of about $57 billion over the four-year period from 1996 to 1999, with
the cuts growing with each passing year. By 1999, the cuts in basic entitlement programs for the
poor would be double the combined effects of the cl;lts in poverty programs enacted during
'
President Reagan's first two years.
The bill also would alter a key feature of the: safety net under which programs such as
food stamps and free school lunches for poor children expand during recessions when
unemployment and poverty rise, the study noted. Under the PRA, some low-income families or
elderly people could be denied benefits during such: periods. Alternatively, low-income families
could be placed on waiting lists or benefits for all eligible families could be cut across-the-board.
more:
I
...
777 North capitol Street, NE, Suite 705, Washington, DC 2(x)()2 Tel: 202·408·1080
Iris J. Lav and Isaac Shapiro, Acting Co-Dlrectors
'
"
fax: 202·408·1056
�PRA Analysis
November 22, 1994
Page 2
The Center's analysis also examined the new work requirements that the bill establishes.
By 2001, an estimated 1.5 million recipients would be required to work 35 hours a week for
their aid. In the typical state, these work slots would "pay" $2.42 an hour for a mother in a
family of three, the report said, well below the $4.25-an-hour minimum wage. In Mississippi,
recipients would be "paid" 79 cents an hour.
;
Time Limits
Of particular note, according to the report, is the :PRA' s time limit. Unlike President
Clinton'S proposal and other bills (including earlier Repbblican bills) that allowed or required
states to provide work slots to families that reached a tirr.e limit, the PRA would end eligibility
for both work slots and cash aid. Mothers who accumulated five years on welfare over their
lifetime (or as little as two years, at state option) would :be permanently barred from receiving
either further: cash aid or a work slot. Mothers willing to work but unable to find an
unsubsidized job to support their children - including mothers who had faithfully worked
nearly full-time for several years in a work slot - would be denied aid once they had passed the
time limit.
I
There would be no exceptions or extensions to the time limit, the report noted. This
means, for example, that families headed by parents who are temporarily disabled or caring for
disabled children would be removed from the rolls up~n reaching the time limit. Children
receiving AFDC who live with elderly grandparents would be subject to the time limit as well ..
,
,
In addition, in a state choosing a two-year time limit, a mother who received welfare for
two years in her early twenties, left AFDCand worked for 10 years but then needed assistance
during a recession would be ineligible for any further aid, as would her children. Recent studies
show that most people who enter the AFDC program leave within two years, often because they
find jobs, the Center said. The same data, however, s~ow that many of those who leave welfare
subsequently return, often because they lose the low-'rage jobs they obtain.
"The PRA differs in important ways from
and is much less balanced than - other
recent welfare reform plans, including anearlier planioffered by a majority of House
Republicans," said Isaac Shapiro, the Center's acting ico-director and co-author of the report.
"The Act begins to dismantle basic features of the safety net, even for poor parents who want to
work and have met all work requirements imposed on them."
-more-;
�"
PRA Analysis
November 22, 1994
, Page 3
Sweeping Provisions
In addition to the time limit, the bill's provisions include:
,
•
A denial of both cash and housing benefits:throughout their childhoods to poor
children born to young unmarried mothers j' States could use the savings to
support programs such as orphanages. Aniunmarried mother who had a child 10
years ago as a teenager, but who applies fdr AFDC after losing her job, would be
ineligible for aid under this provision.
•
A denial of benefits for children, whose paternity has not been legally established;
this includes 29 percent of all children currently on AFDC, These children would
be ineligible regardless of whether their mothers were cooperating with state
efforts to establish paternity. Paternity es~blishment is usually neither swift nor
certain, the 'report said, and state bureaucracies frequently take one to two years to
establish paternity in a case after a mother has provided the relevant information.
The children in question would be denied benefits during this lengthy process.
Children whose fathers cannot be located would never have paternity established
and, therefore, would never be eligible for assistance.
I
Looking at all of the provisions together, the report said, the PRA' s effect would be to
disqualify more than half the low-income children who;would be eligible for aid under current
law. Five to six million poor children would be rendered ineligible for any cash assistance. On
average, 9.5 million children received AFDC in 1993. ISimilarly, at least'2.5 million of the five
million families now receiving assistance would be made wholly ineligible for AFDC if the PRA
were fully in effect.
Many families made ineligible for assistance would likely be unable to provide basic
necessities for their children. There isa strong risk, the report warned, that an already
overburdened foster care system would then be asked to find foster care and institutional
placements for large numbers of children whose parents were forced to give them up because
they were destitute.
Reductions in Other Safety Net Programs
I
The Act would reduce other programs for the poor in addition to AFDC. It would:
merge federal food assistance programs for poor hou~eholds into a blol:.':k grant and set the block
grant's funding level several billion dollars below the levels needed to maintain current benefits;
place a number of other major programs for low-inco,'me households under an expenditure cap
that would require large cuts in these programs; and make poor legal immigrants ineligible for
nearly all government benefits and services.
-more-'
�PRA Analysis
November 22, 1994
Page 4
The PRA would cut about $18 billion over f~ur years from food assistance programs, the
Center said. Virtually all domestic food programs,including food stamps and the school lunch
program; would be consolidated into a block grant. the bill would set a ceiling on how much
could be appropriated for the block grant, placing this ceiling several billion dollars a year below
I
the funding level needed to maintain current levels of food assistance.
A substantial majority of the cuts in food assistance would be targeted on fa.rililies that
are now eligible for food stamps. Assistance to these families would be reduced almost $4
billion a year, according to the Center's analysis. Currently, the average food stamp allotment is
just 75 cents per person per meal. About two-thirds of food stamp beneficiaries are children or
elderly or disabled people.
In addition, the PRA would impose a cap on .total expenditures for an array of major
programs for the poor: the SSI program for the elderly and disabled poor; the child support
enforcement program (which helps establish paternity); a key child care program for working
poor families not on welfare; low-income housing programs; and AFDC. The cap governing
these programs would be set at a level well below what the programs would cost under current
law. This would require these programs to be cut $1:8 billion in the three-year period from 1997
to 1999, according to estimates from the House Republican conference. The cuts would grow
larger with each passing year, found the Center.
The bill also would convert low-income benefit programs that are now entitlements, such
as AFDC and SSI, into non-entitlement programs. Eliminating the entitlement status of these
programs would weaken their ability to cushion families and the elderly against economic
shocks or other unexpected developments. If funding proved insufficient during a fiscal year for
SSI or AFDC - as could occur during an economid downturn when poverty mounted or if a
greater-than-expected number of poor elderly people applied for SSI - either benefits would
have to be reduced, some eligible people would have to be denied assistance, waiting lists would
have to be created, or additional state funds would have to be spent.
Food stamp-type assistance and school lunch programs would lose entitlement status as
well. Funding for free school meals for poor childr¢n and food stamp-type assistance would no
longer expand automatically during recessions when unemployment and poverty climbed.
Legal Immigrants :Hit Hardest
The PRA also would make most legal immigrants ineligible for nearly all health, educa
tion, job training, housing, social service, and income assistance programs, the study said.
(Illegal immigrants are already ineligible for most programs.) For example, legal immigrants
disabled on the job in the United States would be ineligible for SSI benefits. Non-citizen
more-'
�c'
PRA Analysis
November 22, 1994
, Page 5
migrant farm worker families legally in the United states could not have their children treated at
a migrant health center. Legal immigrants who are children would be denied access to foster
care payments if their parents died and could not be screened for lead poisoning.
i
Legal immigrant children also would be ineligible' for immunization programs. These
programs currently cover immigrants partly to help avoid: the spread of contagious diseases that
could infect children who are U.S. citizens. Legal immigrants are subject to the same taxes as
. ,
U.S. citizens.
Net Budgetary Imp~cts
i
Overall, the bill would reduce safety net program's $57 billion over four years, the Center
said, noting that cuts of this magnitude are unprecedente,o in programs for the poor. The cuts in
AFDC, SSI, food stamps and Medicaid would be double, the size of the cuts made in these
programs by the budgets enacted in 1981 and 1982, when the previous deepest reductions in
poverty programs were made. The programs targeted for cuts represent a small fraction of
federal spending: AFDC, SSI, and food stamps combine;d accounffor 4 percent of federal
expenditures.
:
I
,
An Unbalanced Proposal
,
I
"People across the political spectrum agree that 'welfare needs fundamental reform,"
Shapiro said. "There is also wide support for further efforts to reduce the federal budget
deficit."
'
I
"The PRA, however, does not strike a responsible balance between these goals and the
need to maintain a basic safety net beneath poor childr~n, the elderly, the disabled, and other
vulnerable groups. The bill would make deep cuts in vital programs without helping welfare
recipients earn their way out of poverty. Increases in poverty, homelessness, and hunger for
millions of children almost certainly would result, and;states would likely be saddled with
,
significant added costs as they face the destitution cre~ted by these harsh policies."
The Center on Budget and Policy Priorities conducts research and analysis on a range of
government policies and programs, with an emphasis pn fiscal policy issues and on issues
affecting low- and moderate-income households. It i~ supported primarily by foundation grants.
####
�
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<a href="https://catalog.archives.gov/id/7763322" target="_blank">National Archives Catalog Description</a>
Identifier
An unambiguous reference to the resource within a given context
2010-0198-S Segment 2
Description
An account of the resource
Carol Rasco's Issues Series collection consists of records relating to affirmative action, health care and reform, Medicare/Medicaid, immigration, disability, children, families and seniors, education, welfare reform, Middle Class Bill of Rights, and state and local economic issues. This collection consists of memos, letters, reports, schedules, itineraries, talking points, copies of legislation, and organizational material such as flyers and pamphlets.
Provenance
A statement of any changes in ownership and custody of the resource since its creation that are significant for its authenticity, integrity, and interpretation. The statement may include a description of any changes successive custodians made to the resource.
Clinton Presidential Records: White House Staff and Office Files
Publisher
An entity responsible for making the resource available
Clinton Presidential Library & Museum
Extent
The size or duration of the resource.
92 folders in 7 boxes
Text
A resource consisting primarily of words for reading. Examples include books, letters, dissertations, poems, newspapers, articles, archives of mailing lists. Note that facsimiles or images of texts are still of the genre Text.
Original Format
The type of object, such as painting, sculpture, paper, photo, and additional data
Paper
Dublin Core
The Dublin Core metadata element set is common to all Omeka records, including items, files, and collections. For more information see, http://dublincore.org/documents/dces/.
Title
A name given to the resource
[Welfare Reform Legislation] [6]
Creator
An entity primarily responsible for making the resource
Domestic Policy Council
Carol Rasco
Issues Series
Identifier
An unambiguous reference to the resource within a given context
2010-0198-S Segment 2
Is Part Of
A related resource in which the described resource is physically or logically included.
Box 127
<a href="http://clintonlibrary.gov/assets/Documents/Finding-Aids/2010/2010-0198-S-IssuePapers.pdf" target="_blank">Collection Finding Aid</a>
<a href="https://catalog.archives.gov/id/7763322" target="_blank">National Archives Catalog Description</a>
Provenance
A statement of any changes in ownership and custody of the resource since its creation that are significant for its authenticity, integrity, and interpretation. The statement may include a description of any changes successive custodians made to the resource.
Clinton Presidential Records: White House Staff and Office Files
Format
The file format, physical medium, or dimensions of the resource
Adobe Acrobat Document
Publisher
An entity responsible for making the resource available
Clinton Presidential Library & Museum
Medium
The material or physical carrier of the resource.
Reproduction-Reference
Date Created
Date of creation of the resource.
12/4/2013
Source
A related resource from which the described resource is derived
2010-0198-Sb-welfare-reform-legislation-6