The Nation

Welfare Series: Time for Congress to Act

Wednesday, September 15, 2004

As reported in the Women's eNews series, recent research indicates that the 1996 welfare law is failing many women raising children alone. In response, Waller calls on Congress to act quickly on improvements that have been stalled for two years.

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Living Without a Net(WOMENSENEWS)--On Aug. 23, eight years and one day after President Clinton signed the historic welfare legislation, the current secretary of the Department of Health and Human Services celebrated the anniversary by announcing a welfare caseload decline of 1.8 percent.

"American families are improving their lives by leaving public assistance and entering the workforce," Tommy Thompson insisted.

But, the following Thursday, our U.S. Census Bureau announced the 2003 poverty estimates. Poverty increased overall, and unfortunately, children accounted for most of the overall increase and more than a third of all poor people.

Even more bad news: 43 percent of all poor people were living in "deep" poverty with income below half the poverty line, about $7,500 for a family of three.

Poverty is up, and welfare is down. What's going on? We expect more people to get emergency help when poverty increases.

Part of the explanation for why welfare rolls are declining while poverty increases is simple. More poor parents who qualify for such assistance simply are not getting it. As another Health and Human Services report published earlier this year showed, the percentage of eligible families getting temporary welfare assistance has declined a lot--from nearly 80 percent in 1996, to less than 50 percent by 2001.

Something Wrong

We don't know exactly why that's happening. But we do know that's not the way it should work.

Although the 1996 welfare law has a broad set of purposes and a strong focus on work as the method of reducing dependence, it retains the old program's role of assisting needy parents. Albeit with more strings, and time limits in most places.

Of course, 90 percent of the adult recipients are women living with children. At the same time, the recent poverty data reveal that children account for most of the increase in poverty, and most of those children live in a household with their single mother.

While many poor households include a worker, the income they earn isn't enough to leave poverty. And even though many single mothers went to work in the mid-1990s, the employment rate of single mothers declined from 73 percent in 2000 to 69.8 percent in 2003, more than that of the rest of the population. Job loss and slower job growth in industries that employ former welfare recipients likely contributed to that drop.

It turns out that welfare reform is not recession-proof.

Measuring Poverty

Unfortunately, the poverty report released in August doesn't fully reflect the number of low-income families facing hardship.

Margy Waller

The experts agree: Our poverty measure is out of date. It hasn't been changed to reflect major societal changes. Like: the percentage of mothers in the work force has increased significantly since the measure was adopted in the 1960s. For single mothers of young children, work almost always requires paying for child care. And that takes a big bite out of household income.

Isabel Sawhill and Adam Thomas--colleagues at The Brookings Institution--looked at the impact of child care expenses on the poverty rate using 1998 data. They found that when income is reduced to reflect these expenses, 1.9 million additional people are thrown into poverty.

Moreover, the poverty line doesn't reflect increases in housing expenditures, or regional differences in costs, and these days many working-poor households spend more than half their income on rent.

Hardship among low-income families is even worse than official statistics suggest, making congressional action on social-welfare policy that much more urgent.

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