Welfare doesn’t keep up

The Federal welfare program, Temporary Assistance to Needy Families (TANF), has not kept up with the growing number of poor people in need of assistance. The Obama stimulus plan included $5 billion to help states cover increasing TANF costs expected with the recession, but only $1 billion have so far come through.

TANF rolls fell continuously from 2006, when President Clinton’s welfare reform tightened eligibility restrictions, all the way until July 2008 – more than a year after unemployment rates started heading upward. Now TANF numbers are climbing rapidly. Given the onerous restrictions, stingy payments, and heavy social stigma, this truly reflects the desperation of those with nowhere else to turn.

Source: My chart from U.S. Department of Health and Human Services, various tables.

The Wall Street Journal suggested three reasons TANF enrollment was slow to respond: (1) The extension of unemployment benefits by Congress, which are easier to collect and pay better, for those who lost jobs; (2) the concentration of job losses among men, while most TANF families are led by single mothers, and; (3) the low income eligibility cutoffs, many of which haven’t been adjusted upward in years, and other eligibility hurdles that make other forms of assistance more available. The Food Stamp program, on the other hand, has proven more responsive, adding nearly 10 million people in the last two years; 6 million Food Stamp recipients have no cash income.

I previously wrote:

From 1996 to 2007, the number of single-parent families with children living below the poverty line fell by a whopping 2.5%. Who says there’s no progress in America? During the same period, however, there was a 60% drop in the number of families receiving welfare under TANF. Some of them got jobs during the roaring 1990s, and some of them got the boot when they reached their term limits.

As unemployment lags the recovery, the job market is crunched. The women on TANF may not fare well in the labor queue with all the more-experienced people trying to get back to work. What will happen to them when they reach their term limits?

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