Far from gutting welfare reform, as Mitt Romney ads are infamously proclaiming, the rule changes recently announced by the US Department of Health and Human Services uphold the spirit of reform. The changes would allow states to use temporary assistance funds more creatively, to experiment with new ways to help people who’ve been unable to bounce back from the economic downturn. While Romney insisted in USA Today this week that President Obama is fiddling with the welfare rules in order to “shore up his base” of voters, that’s just not so.
The 1996 reform was intended to guide welfare recipients into the workforce. But Ron Haskins, the Newt Gingrich policy aide who worked on the legislation , has said the program was always meant to adapt during a downturn, when needs rise and the number of jobs available shrinks. Unfortunately, it hasn’t. Over the past four years, temporary assistance enrollment has barely increased, even as unemployment grew. People who need help aren’t getting it.
Part of the problem is the program’s rigid work rules, which might make sense when the economy is humming but are counterproductive now. Currently, a state must have a sufficient percentage of its welfare recipients working in order to qualify for federal funds. When jobs are few, as in the current economic climate, that means states have a perverse incentive to cut otherwise deserving recipients off assistance in order to reach the work-participation threshold. In Ohio, officials have slashed temporary-assistance rolls by a third since last year in order to avoid losing aid. That’s a sign of inflexible rules, not a sudden increase in employment.
Tweaking the rules to account for the lack of jobs in the private market is consistent with the aims of welfare reform. It would allow states to use different approaches, for instance by extending a private-sector jobs programs subsidized by President Obama’s 2009 stimulus. In the program, HHS provided stimulus dollars to states that subsidized the hiring of temporary assistance recipients by private companies. The program was a wild success; for less than 1 percent of the cost of the $787 billion stimulus, it created 260,000 jobs in 39 states. Even states with very conservative Republican governors, including Haley Barbour of Mississippi and Rick Perry of Texas, took part in the program before it ran out two years ago.
Dealing with the grim unemployment landscape requires a multi-faceted and creative use of welfare dollars. It’s conceivable that some states would use the new waivers in ways that violate the spirit of welfare reform — and that would be the proper time to raise a political ruckus. Right now, though, the Obama administration is acting responsibly to give states the flexibility they need to address the crisis.