Welfare Policy (Issue)

WELFARE POLICY (ISSUE)


There is no one single date that can be assigned as the beginning of the welfare system in the United States. Instead, both the ideology and the institutions of the welfare state have grown like weeds, cut back occasionally, only to reappear and to establish themselves again. There are, for instance, elements of the welfare ethic in the notion that people have an obligation to look out for one another's welfare going all the way back to the Puritan communities of New England. The "covenant" that each person had with God and with his or her immediate family also extended in some measure to all the inhabitants of the village. This is not to deny that the Puritans expressed the Protestant fixation with individual salvation, and that in this important sense they would make their peace with the competitive individualism of capitalism. But, especially before the rise of a systematic ideology of competitive capitalism in the eighteenth and nineteenth century, the social solidarity of the medieval village also informed the way that people looked at each other. It prompted the expectation that they could look forward to a certain helpfulness from each other. Even when this village world-view was in decline with the rise of the cities, there were still back-water religious communitiesthe Shakers, the Quakers, the Moravians, the Amish, and the Utopian communitiesand the general frontier neighborliness of cooperative labor exchanges the barn-raisings, corn husking, or quilting parties that represented a much older tradition. This older, cooperative heritage, mediated by the labor movement and by the socialist tradition, contributed an alternative ethic that formed part of the welfare system in modern U.S. history.

The strength of the dominant ideology of competitive capitalism in the United States has meant that welfare policy has had countless critics. In spite of these attacks, in the twentieth century this welfare movement has been sustained by the great reform movements of the age: the Progressive Movement (19001920), the New Deal (19331940) and the Great Society (19641968). Each of these reform movements looked to the government as the instrument of reform. The cornerstone of the welfare tradition in the twentieth century was the Social Security Act of 1935. This reform came out of popular demands for a national pension system for the elderly. The "Townsend Plan" was the brainchild of Dr. Francis E. Townsend, a retired California physician. The essence of the plan was that the federal government would make monthly payments of $200 to all citizens over the age of sixty. The sole stipulation was that the money had to be spent within one month. This would stimulate the demand for goods and pull the country out of depression. Five million mostly elderly citizens joined the Townsend Clubs in support of the plan. Although it was unrealistic in its approach to funding the proposed system, the Townsend Plan prompted President Franklin Roosevelt's administrationespecially Secretary of Labor Francis Perkinsto consider the plight of the elderly and the Social Security System was the result. This mandatory system of government administered pensions (paid for by contributions from both the worker and the employer) expanded to include a program for unemployment insurance (funded solely by the employer) as well as aid to disabled people and to children.

President Lyndon B. Johnson's (19631969) Great Society and his War on Povertywent on from there in its expansion of the welfare system. The War on Poverty set out to reduce unemployment by helping the poor to improve their education, skills, work efficiency, and in general, equip themselves for success in the modern economy. In an effort to get local citizens to involved themselves in the programs, local governments or private nonprofit organizations were required to prepare plans, administer them, and pay 10 to 25 percent of their cost. In the ensuing years, the Job Corps, the Neighborhood Youth Corps, the College Work-Study Program, Project Head Start, Foster Grandparents, Upward Bound, Volunteers in Service to America (VISTA), and the Office of Legal Services were all initiated as the War on Poverty's arsenal.

Almost as soon as the programs began, they were met with open opposition. Critics claimed that training costs for VISTA programs averaged more than $8,000 per graduate, and that nearly half of the graduates failed to find jobs. Others claimed that only a fraction of the poor ever received any benefits. Senator Walter Mondale once chided that the War on Poverty "authorized dreams and appropriated peanuts." Defenders claimed that the policies were stifled by the war in Vietnam.

During President Richard M. Nixon's (19691974) administration, the welfare system, partly federal and partly local in character, posed especially difficult problems. Throughout the 1960s there had been a marked expansion of relief rolls, especially in the category of Aid to Families with Dependent Children (AFDC). Between 1961 and 1970 the AFDC caseload rose from 921,000 to 2.2 million families, with an increase of almost 30 percent in 1970 alone. The federal welfare bill grew from $2.1 billion in 1960 to nearly $18 billion in 1972, while the number of persons on welfare rolls increased from 7.3 million in 1961 to 14.9 million in 1972. Fifteen percent of the population of New York, 25 percent of the population of Newark, NJ, and about six percent of all U.S. citizens were on welfare. Of those families receiving welfare in 1971, 49 percent were white while 46 percent were black; 55.5 percent were children, 15.6 elderly, 9.4 percent were blind or disabled, and less than one percent were employable males.

The welfare explosion was attributed to several factors. The poor were becoming more visible as they moved from isolated rural areas into cities. Rising violence and rioting in ghettos convinced many people of the necessity to do something to improve opportunities. VISTA workers, poverty lawyers, and the National Welfare Rights Organization made the poor more aware of their rights and instructed them how to get welfare payments. The Supreme Court overruled state laws that denied benefits to newcomers. And finally the growing productivity of the national economy made the continued existence of abject poverty a less defensible blot on the U.S. way of life.

The existing welfare system buckled under the new burdens thrust upon it. Critics everywhere condemned it because it required employed fathers to leave the household so that their families could qualify for public assistance. Its procedures were degrading and it helped only about a fourth of the poor. Some reformers proposed that the federal government pay the entire cost of all welfare programs. Some sociologists recommended a system of federal family allowances in which every family, rich or poor, would receive a monthly government payment for each child in the family. But critics of this system pointed to the cost (approximately $14 billion annually) and charged that it would give poor families an incentive to have more children. Moreover, they claimed that because it wasn't based on need, more than 70 percent of the money would go to families above the poverty line. Other reformers sought to reduce taxation of the poor, arguing that taxes could be brought more in line with ability to pay by reducing sales and social security taxes, and collecting more of the needed revenue through income taxes. But opponents of tax reforms argued that the poor should be made to pay taxes to make them aware of the costs of government, give them a sense of contributing to their country, and make them better citizens.

In 1969, Nixon called for the replacement of the AFDC with a Family Assistance Plan (FAP) that would give every family of four on welfare with no outside income a basic federal payment of $1,600 a year. There was also a "work requirement" in which recipients with school-age children could be referred to work or training on penalty of forfeiting a part of their FAP payments. Supporters of this path-breaking concept argued that a guaranteed annual income would stimulate economic growth. They claimed that putting money into the hands of the poor would raise consumer spending, stimulate production, and create new jobs, which would take many of the poor off welfare. Between 1968 and 1972, the Office of Economic Opportunity quietly conducted a test of the idea with seven hundred families in five communities in New Jersey and Pennsylvania. The results showed that nearly all of the families with guaranteed incomes worked at least as hard to add to their incomes as other families.

But the idea of a guaranteed income also had many critics. Some Democrats opposed it for partisan reasons (not wanting Nixon to take credit for the program), some because they deemed the benefits were too low and the work requirement too coercive. Some conservative Republicans opposed guaranteed income for being too liberal. Those already a part of the social welfare establishment opposed it because they had a vested interest in maintaining the existing system. After passing the House of Representatives in 1970, the proposed FAP legislation failed in the Senate. From that point on the Nixon Administration backed off from it, but the idea of a guaranteed income remained on the agenda for the future.

In 1974 a new Supplementary Security Income (SSI) replaced existing federal-state programs for needy aged, blind, and disabled who did not qualify for adequate Social Security benefits. Application of federal standards of eligibility doubled the number of persons eligible to 6.2 million. The federal government assumed responsibility for guaranteeing persons in these categories a minimum income from all sources.

During the 1990s increased pressures to reform the welfare system resulted in the federal government relinquishing a good portion of its administrative, regulative, and enforcement responsibilities to individual states. State legislatures, however, frequently implemented what some liberals claimed were draconian changes in the systemcutting benefits and squeezing the welfare system to the point where welfare recipients were allowed far fewer months of benefits and were pressed to get jobs even if the jobs were so lowpaying or so lacking in other necessary features, such as day-care provisions, that incentive to get the jobs was limited.

See also: Townsend Clubs, Social Security Act


FURTHER READING

Aaron, Henry J. Why is Welfare so Hard to Reform. Washington, DC: Brookings Institute, 1973.

Harrington, Michael. The Other America: Poverty in the United States. New York: Penguin Books, 1963.

Lens, Sidney. Poverty Yesterday and Today. New York: Crowell, 1974.

Levitan, Sar A. Progress in Aid of the Poor for the 1970s. Baltimore: Johns Hopkins University Press, 1969.

Wogaman, Philip. Guaranteed Annual Income: The Moral Issues. Nashville, TN: Abington Press, 1969.