1996 Welfare Reform: Failure

Paul Ryan: Welfare reform can be a model for the rest of the safety net by Brad Plumer

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"How that reform fared is still subject to much dispute. States did manage to shrink their caseloads significantly. And, during the 1990s, the poverty rate fell. It looked like the program was working. Yet critics have argued that the booming economy and the Earned Income Tax Credit deserve most of the credit here. Meanwhile, the poverty rate rose again in the 2000s and TANF didn’t respond. One reason welfare reform is cheaper today is that it simply helps fewer families in poverty."  

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"On the pro side is Ron Haskins of the Brookings Institution, one of the architects of the 1996 law. He generally supports the idea of block grants and adding work requirements to food stamps, though with one big caveat. “It’s a lot more difficult to get a job now than it was back in 1996,” he says. “Our timing with welfare reform could not have been better—there were jobs galore in the late ’90s.” 

As such, Haskins says, Congress would have to be careful this time around about things like work requirements and time limits. To take one example: The number of people on food stamps, he notes, “tends to be very responsive to the state of the economy.” If a recession came around and states were limited on how much they could spend, they might simply end up cutting benefit levels."