Is this the return of welfare wars?
The final compromise of the economic stimulus bill includes $5 billion for states that anticipate a larger than expected increase in welfare claims. But to give states maximum flexibility, Democrats have written in a provision that would allow states to increase the number of welfare caseloads while holding steady the percentage people getting Temporary Assistance for Needy Families (TANF) benefits that would be required to work or look for jobs. Before we get into the details, a word about the politics: a number of conservatives and even liberals have written to me wondering why the GOP isn't making more of a fuss about this. The answers are fairly simple: they want to avoid being seen as poor-people bashers, they know that Americans still associate welfare with minorities, and there are different sensitivities they must consider when making political claims about the priorities of the first black president.
States get "casework reduction credits" for the number of people they move off of the rolls; these credits help states meet a mandated 50% threshold for their TANF recipients to perform some type of work-related activity. The idea here -- if I'm reading the bill correctly -- is that the caseload reduction credit would effectively be "updated" to account for economic emergencies. State would get more welfare funds without letting their threshold dip below 50%. Again, I think this is what's happening. Not 100 percent sure.
It's this rule change that has raised the ire of conservatives, who argue that one of the main reasons why TANF is considered a success is because it removed the incentize for states to inflate their caseloads; it required them -- or incentivized them -- to push welfare receipients into the job force.
Democrats respond, forcefully, that in ordinary recessions, unemployment benefits might tide families over, but during a mini-depression, there are no jobs to push welfare recipients into, many needy families would be forced to apply for benefits once their unemployment runs out, and, in crisis times, theories about welfare reform should be subordinated to stimulus. In much the same way as the Obama administration jettisoned stricter state requirements for SCHIP funding, this provision would help states with larger caseloads avoid having to cut benefits and be able to accept more cases as economic conditions warrant.