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Does Obama’s Plan ‘Gut Welfare Reform’?
Posted on August 9, 2012

A Mitt Romney TV ad claims the Obama administration has adopted “a plan to gut welfare reform by dropping work requirements.” The plan does neither of those things.

Work requirements are not simply being “dropped.” States may now change the requirements — revising, adding or eliminating them — as part of a federally approved state-specific plan to increase job placement.
And it won’t “gut” the 1996 law to ease the requirement. Benefits still won’t be paid beyond an allotted time, whether the recipient is working or not.
Romney’s ad also distorts the facts when it says that under President Obama’s plan “you wouldn’t have to work and wouldn’t have to train for a job.” The law never required all welfare recipients to work. Only 29 percent of those receiving cash assistance met the work requirement by the time President Obama took office.

Under the new policy, states can now seek a federal waiver from work-participation rules that, among other things, require welfare recipients to engage in one of 12 specific “work activities,” such as job training. But, in exchange, states must develop a plan that would provide a “more efficient or effective means to promote employment,” which may or may not include some or all of the same work activities. States also must submit an “evaluation plan” that includes “performance measures” that must be met — or the waiver could be revoked.

Ron Haskins, a former Republican House committee aide who was instrumental in the 1996 overhaul of the welfare program, told us the Obama administration should not have unilaterally changed the work-requirement rules. But Haskins said the Romney claim that Obama’s plan will “gut welfare reform” is “very misleading.”

“I do not think it ends welfare reform or strongly undermines welfare reform,” said Haskins, co-director of the Brookings Institution’s Center on Children and Families. “Each state has to say what they will do and how that reform … will either increase employment or lead to better employment” of recipients.

The Obama policy responds to state officials who say they can improve job placement and retention if freed from the time-consuming process of documenting and verifying that recipients are engaged in those work activities.

“In times of reduced funding, waivers may be the best method to allow states to find effective and efficient approaches to assist the unemployed to find and keep work,” the Utah Department of Workforce Services wrote to federal welfare officials last year.

Republicans criticized the new policy shortly after it was implemented on July 12. That prompted Utah Gov. Gary Herbert, a Republican who supports Romney, to issue a July 17 press release “defending Utah’s waiver request for state flexibility to achieve work-related outcomes for Temporary Assistance to Needy Families (TANF) recipients.”

Welfare to Work

The Romney campaign began airing its new TV ad on Aug. 7. Called “Right Choice,” the ad praises the bipartisan cooperation of President Bill Clinton and a Republican-controlled Congress to overhaul welfare. It then turns partisan and attacks President Obama.


Romney TV Ad, “Right Choice”: President Obama quietly announced a plan to gut welfare reform by dropping work requirements. Under Obama’s plan, you wouldn’t have to work and wouldn’t have to train for a job. They just send you your welfare check. And welfare-to-work goes back to being plain old welfare. Mitt Romney will restore the work requirement because it works.

It’s simply not true that the administration’s policy will allow states to “just send you your welfare check.” Under the policy, states must meet a whole new set of federal requirements in order to obtain and keep a waiver. Plus, states have an incentive to get people off welfare and into jobs, since that would free TANF funds for other services for low-income families.

“I think — and now remember I’m a Republican — that the ad is very misleading,” Haskins said.

We’ll go into more detail about the new policy later, but first let’s review how we got here — beginning with “The Personal Responsibility and Work Opportunity Reconciliation Act of 1996” that created the Temporary Assistance for Needy Families (TANF) program.

The welfare overhaul was designed to help move unemployed Americans from welfare to work. The federal government strengthened work requirements on families receiving cash assistance, and for the first time imposed lifetime limits (generally up to five years). After two years on TANF, the parent in the household must be engaged in “work activities.”

The law also generally requires states to document that 50 percent of all families receiving cash assistance are participating in such work activities. But work-participation rates peaked at 38 percent in 1999 and started to decline — prompting Congress to attempt to strengthen the rules when it reauthorized TANF as part of the Deficit Reduction Act of 2005.

Still, the work-participation rates remained low. The most recent data available show the rate was 29.4 percent in fiscal year 2009. Many states rely on options in the current law that allow them to be in compliance with requirements even though their rates are below 50 percent.

The new work-participation rules did have one impact on states: They were time-consuming to comply with and counterproductive to helping people find jobs, as documented by the nonpartisan Government Accountability Office in a 2010 report. GAO’s welfare experts were among those questioning the value of the work-participation rates as a measure of success.

“The emphasis on work participation rates as a measure of program performance has helped change the culture of state welfare programs to focus on moving families into employment, but weaknesses in the measure undercut its effectiveness,” Kay E. Brown, the GAO’s director of Education, Workforce and Income Security Issues, testified before a Senate committee on June 5. “Are the work participation rates providing the right incentives to states to engage parents, including those difficult to serve, and help them achieve self-sufficiency?”