Lecture 10: Means-tested cash programs Flashcards
Political and social context
It is most useful to consider programs within a social context
- One might consider: How do beliefs about who a program supports influence support for or against it? How might historical events, changing norms or social change affect these opinions?
Means-tested cash assistance
Temporary Assistance for Needy Families (TANF)
Supplemental Security Income (SSI)
General Assistance (GA)
Earned Income Tax Credit (EITC)
Means-tested, near cash assistance
Supplemental Nutrition Program (SNAP)
How does TANF differ from these other means-tested benefits?
Who is eligible
Opinions about “deserving” vs “undeserving poor”, evolution over time
Changes in norms around women/work/childcare
Changes in the composition of poor women/children over time on the program
Political support for the program has been more volatile
- Poor mothers and children versus
- Poor elderly (SSI) or
- Working poor (EITC)
How benefits are set and programs are funded
History of Welfare
The Social Security Act, as part of the New Deal legislation created under President Roosevelt, established two types of cash benefits
- Social insurance
- Public assistance
Social insurance programs included
- A pension for retired workers (informally called Social Security)
- Unemployment Insurance (UI)
Public assistance programs for the poor included
- Aid to Dependent Children (ADC), Old Age Assistance (OAA), and Aid to the Blind (AB)
Evolution over time…
In 1956, Aid to the Permanently and Totally Disabled (APTD) was added
In 1962, ADC became Aid to Families with Dependent Children (AFDC)
While, by 1974, Old Age Assistance (OAA), Aid to the Blind (AB) and Aid to the Permanently and Totally Disabled (APTD) were consolidated under SSI, Supplemental Security Income
AFDC came to be regarded as welfare
In 1996, with the introduction of welfare reform, Congress ended the federal entitlement to welfare by replacing AFDC with Temporary Aid to Needy Families (TANF)
Personal Responsibility and Work Opportunity Reconciliation Act of 1996
PROWRA marked a major change in US social policy by repealing AFDC (a federal entitlement) and replacing it with TANF (a state block grant)
PROWRA “eliminated the 60-year old federal guarantee of ongoing cash assistance to all qualifying poor families and replaced it with time-limited benefits, for which recopients must work, provided through capped block grants to the states. It also transferred primary responsibility for the operation of welfare programs from the federal government to the states”
What is an entitlement?
Government program, good, service or benefit that provides individuals with personal financial benefits
- Special government-provided goods or services to which an indefinite number of potential beneficiaries have a legal right (enforceable in court, if necessary) whenever they meet eligibility conditions that are specified by the standing law that authorizes the program
AFDC: What did the program do?
Cash to families
- Modified state by state (eligibility levels; benefit levels)
Low levels of cash assistance
- Below poverty
An Entitlement
Automatic eligibility for Medicaid and other “in-kind” benefits
Modest Work Requirements
- Jobs mandated 20% of recipients in a state be mandated to work
Modest Work Supports
- Jobs program mandated higher “earnings disregards”; transitional child care and Medicaid; as well as job training, basic education and community work experience
Welfare Reform
Replaced AFDC with TANF
Primary goals of TANF
Provide assistance to needy families so that children
may be cared for in their own homes or in the homes
of relatives
End the dependence of needy parents on
government benefits by promoting job preparation,
work, and marriage
Prevent and reduce the incidence of out-of-wedlock
pregnancies and establish annual numerical goals for
preventing and reducing the incidence of these
pregnancies
Encourage the formation and maintenance of two-
parent families
TANF Highlights
Eliminated entitlement to benefits
Work requirements (work activities)
Time limits
- 5-year maximum life time limit on benefit receipt
- States can exempt 20% of caseload
Funding in block grants to states ($16.5 billion/year)
- A pot of money vs. increased federal money to match need
States now design their own programs
Delinked “welfare” w/ food stamps and Medicaid
Increased funding for child care
Increased income eligibility for Medicaid and other
transitional benefits
Strengthened child support enforcement
Family caps and sanctions – allowed states to impose
Others not eligible for federal benefits: illegal immigrants; new legal immigrants (w/ < 5 yrs of residence); those convicted of certain drug felonies; minors living independently
Summary of Findings from Longitudinal Studies on Welfare Reform
(Slack et al.)
On average, household income, earnings, and wages
improved among former and current welfare recipients,
although such improvements appear to do little to lift families out of poverty. Strong labor markets are important for gains to be realized
Most former welfare recipient families continue to experience economic hardship and to rely on other types of public benefits (e.g., Food Stamps, SSI).
Health insurance coverage for respondents remained relatively stable over time
What is an entitlement?
Some examples of entitlement programs, at the federal level, in the United States, would include:
- Social Security
- Medicare
- Medicaid
- Most Veterans’ Administration programs
- Federal employee and military retirement plans
- Unemployment compensation
- Food stamps
- Agricultural price support programs
What is a block grant?
A block grant confers monies to the state from the federal government
The state has discretion, under certain broadly stated federal goals, in the dissemination of these funds
