Although the country currently spends $800 billion each year on 92 federal programs targeted at lower-income Americans, Ryan noted, poverty is at its highest level "in a generation." "There is a lot of good that's going on in this country," he said. "It is time to bring in reinforcements."
To do so, Ryan is introducing a block-grant-type system to replace the federal safety net: States would receive the exact amount of federal funding for lower-income citizens that they take in now, but each state would have full flexibility over how to use it. Ryan bristled at the term "block grant," however, terming his idea "Opportunity Grants." Block grants, he said, are too open to abuse. Under his new vision, every cent of the Opportunity Grants would have to go specifically to lower-income individuals—not roads, for example. "No funny business," he said.
States would volunteer for the trial program by submitting a plan to the federal government, and a few would be selected to engage in the experiment, creating a sort of "Race for the Opportunity Grant." A neutral third party would then evaluate how the states are doing.
For individuals, Ryan's plan would allow those living in states with the grants to choose one office and one individual caseworker to handle their needs, rather than multiple federal agencies. The grants would have to be used to offer both private and public organizations for individuals to work with, which will then provide each with a personalized plan to help get them out of poverty, based on their own skills and goals. Those who meet benchmarks under their individual plans will be rewarded, and those who do not will face consequences.
Pulling a key quote from conservative talking points on the issue, Ryan's plan also requires that "every person who can work, should work," a bullet point that is likely to draw the ire of Democrats on Capitol Hill.
But the plan also includes some bipartisan measures. In addition to the block-grant program, Ryan called for an increase in the Earned Income Tax Credit for childless Americans, nearly doubling the maximum payout to $1,000 and lowering the age of eligibility to 21—the same plan that President Obama proposed earlier this year—although the same section of his discussion draft dismisses Democrats' election-year push to raise the minimum wage.
In a conference call with reporters Thursday, Democrats praised Ryan's interest in expanding the Earned Income Tax Credit, but indicated that the parties would have difficulty in agreeing on offsets to pay for the expanded program. Additionally, they argued that Ryan's proposal is disingenuous, as House Republicans were slated to vote later Thursday to alter the child tax credit in such a way that would "put 12 million more Americans into poverty or deeper into poverty, including 6 million children," House Budget Committee ranking member Chris Van Hollen said.