What Obama Really Did to Welfare Reform

Republicans charge the president with 'gutting' the landmark 1990s legislation. That's hardly the case -- but the proposed change could give more people access to benefits.

The story so far in the 90s-tinged fight over welfare reform in the current campaign is this: A few weeks ago, the Obama administration issued a memo telling states they could apply to have some aspects of the law's work requirements waived. Some on the right were outraged by the supposed attempt to weaken the law's emphasis on getting people off welfare and into employment, which the administration denied would result from its order. This week, Mitt Romney's campaign turned the controversy into an ad that claims, "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."

The administration disputes that characterization, and the memo in question explicitly requires states that apply for waivers to propose plans that would increase, not decrease, the amount of welfare recipients working. But if that's the case, why waive any aspect of the work requirements? What, exactly, would the waivers in question -- none of which have yet been issued -- do?

The answer is that the states, and the Obama administration, do want to be able to give benefits to more people who aren't working as currently defined. But they say the problem is that the current definitions are too restrictive, and that loosening them would lead to more people getting jobs and being self-sufficient in the long run.

"The law sets forward a very complicated measure of work participation that pretty much all sides agree should be changed," said Liz Schott, an expert on the Temporary Assistance for Needy Families program for the left-leaning Center for Budget and Policy Priorities. "It's too complicated and it doesn't measure the right things."

Under welfare reform, to get their block grants of federal TANF money, states have to show that 50 percent of welfare-receiving families -- and 90 percent of two-parent families -- are involved in work activities. What constitutes "work activities" is not necessarily a job; training, job-search assistance, volunteer work, vocational and skills training, and some forms of education and child-care work are included. But being counted as working is not as simple as checking one of those boxes; it's a complicated formula that allows some activities only for a certain number of hours per week, or a certain number of weeks per year.

Those advocating more flexibility say they could get more people into jobs if they had more freedom to get them there in the time allotted, generally two years from the start of receiving assistance. Utah, under Republican Gov. Gary Herbert, was one of five states to ask the federal government for more flexibility in determining work participation; the others were Republican-led Nevada and Democrat-governed California, Connecticut and Minnesota. "The expectation to participate fully in specific activities leading to employment is not the issue," Utah's director of workforce services wrote to the federal Department of Health and Human Services. "Full engagement is a powerful process that can lead to work. It is the narrow definitions of what counts and the burdensome documentation and verification processes that are not helpful."

Nevada, in its letter to HHS, had some specific suggestions. Instead of benchmarking one-parent versus two-parent families, its director of health and human services wrote, why not sort families according to the barriers they face -- obstacles such as disabilities, lack of education or language skills? The state also proposed to "exempt the hardest-to-employ population for a period of time (i.e. six months) to allow time for their barriers to be addressed and their household circumstances stabilized" and to "index TANF performance measures to the state's unemployment rate."

The Republican architects of the welfare law, though, say they made the work requirements ironclad and unwaivable because of the potential for abuse. The predecessor to TANF, Aid to Families with Dependent Children, actually had a work requirement too, but it was so loose and laxly enforced as to be basically meaningless. And prior to welfare reform's reauthorization in 2005, a GAO report found some states were taking liberties with their definitions of work activities to include "personal care" activities like writing in a journal or getting a massage. (The new HHS memo explicitly forbids such redefinitions.)

"We know that work is essential for people to rise out of poverty," former Sen. Rick Santorum, who helped draft welfare reform as a congressman in the 1990s, said on Thursday. "We how hard it is to get people off the welfare rolls and into work. That's why we put [the requirements] there."

The crux of the problem, and the grain of truth to Romney's allegation, is that the states that want more flexibility, and the administration that wants to give it to them, are essentially seeking to give welfare benefits to more needy people. By doing so, they say, they can eventually put more people to work. And they're willing to be held accountable -- the states applying for waivers say they'll prove more people are getting into jobs this way or take a penalty.

The country's economic situation is starkly different than it was when welfare reform passed in 1996, yet fewer people than ever are getting welfare benefits, as Jordan Weissmann has described. To liberals -- including, perhaps, then-state Sen. Barack Obama, who opposed federal welfare reform at the time -- this is just what they feared welfare reform would do: make sorely needed government benefits less available to those who need them most.

Welfare reform reduced the number of people on welfare by kicking them off the rolls, not by getting them into jobs, CBPP's Schott says. "In the late '90s, the economy was strong, and many people leaving [welfare] were leaving for work," she said. "When the economy turned down in 2001 and 2002, unemployment rose and people lost jobs, but caseloads didn't rise back. Then, when the big recession came in December 2007, caseloads only rose a little bit." The upshot, she says: "More and more people have neither welfare nor work." They're just poor and on their own.

But to conservatives, the fact that fewer people are on welfare now proves that reform has worked. "This was a success," Santorum said. "Even today, welfare rolls, in spite of the recession and the pathetic recovery this administration has presided over -- still, welfare rolls are lower than they were in 1996."

Further, any attempt to get benefits to more people, however well-intentioned, will only end up hurting them by making them dependent on government. "The hard left has an unending desire to create a dependent America," said former House Speaker Newt Gingrich, who led the charge for welfare reform. "There is a sense of noblesse oblige to take care of the poor by giving them money."

The political potency of the welfare debate is clear -- welfare reform was enormously popular, and despite Obama's initial opposition to the federal law, he campaigned for the presidency in 2008 on having co-sponsored Illinois' state legislation to implement it. "I passed laws moving people from welfare to work," Obama boasted in a 2008 campaign ad touting his "values straight from the Kansas heartland." It's not surprising that the Obama campaign -- backed up by former President Clinton, who signed welfare reform into law -- is fighting back hard, and with justification, against the distorted charge that the president wants to give welfare recipients a blank check.

But it's not much of a stretch to conclude that the waivers the administration is soliciting, if they come to pass, would result in more people getting welfare benefits. The question is whether that's a good thing, and where you stand on that depends on your politics.