Welfare and Social Security
excerpted from the book
Against the Conventional Wisdom
by Douglas Dowd
The United States has the highest poverty rate of any industrialized
country and the stingiest and meanest welfare system. Poor people
aren't popular anywhere, but nowhere are they so neglected and
demeaned as here; nowhere are welfare programs run so punitively
and inefficiently-as measured by cost per person or by "efficiency"
in getting people off welfare and back to self-support: in Western
Europe, antipoverty programs pulled from 10 to 60 percent of recipients
up and out of poverty in the 1980s; in the United States, the
relevant rates varied between 0.3 to 0.5 percent, even though
our unemployment rates were always lower. Furthermore, regressive
taxes on low income groups here pushed more people into poverty
than income transfer programs pulled out; the opposite was true
The welfare system now undergoing change, besides being clearly
inadequate to its task, has long been a form of punishment, degrading
to its recipients-intentionally so-although such intentions, covered
over by habituation, are not seen as such. The observations of
two veteran scholars of welfare help to clarify this easily confused
Most such social welfare activity has not greatly aided the
poor, precisely because the poor ordinarily have little influence
on government.... However, some social welfare programs do benefit
those at the bottom of the economic order. The most important
are old-age pensions and unemployment insurance.... As for relief
programs themselves, the historical pattern is . . . a record
of periodically expanding and contracting relief rolls as the
system performs its two main functions; maintaining civil order
and enforcing work.... But much more should be understood of this
mechanism than merely that it reinforces work norms. It also goes
far toward defining and enforcing the terms on which different
classes . . . are made to do different kinds of work; relief arrangements,
in other words, have a great deal to do with maintaining social
and economic inequities.
Those observations apply with special strength to the administration
of welfare; but the Social Security Act of 1935, legislation setting
up our "relief" system for the past sixty years (AFDC),
also provided for the aged (Old Age and Survivors Insurance [OASI]).
There have been and remain shortcomings for both the poor and
the aged (and their survivors); but there is a substantial difference
in the nature and gravity of those defects-a difference worth
pursuing for a moment for the light it sheds on our social legislation.
Welfare, providing for those defined as poor, is confined
to a relatively low percentage of the population at any time;
OASI affects everyone over time, directly or indirectly. Because
that difference means there could be diminished numbers of poor
among us, but that there are always-increasing numbers of the
old, there have been diverse political implications. There is,
however, another defining difference: AFDC is paid for out of
general taxation, OASI (now OASDHI) from the prior payroll deductions
of its beneficiaries. Those differences alone explain why the
provisions for the aged, although inadequate and foolishly arranged,
are at least not punitive. Because the poor, in the Malthusian
tradition, are seen as having defects of character that make them
responsible for their own condition, it is an easy step to believe
they should be punished while being assisted. The old are not
punished for their condition, but they are treated unjustly: The
better off you were while working, the better off you will be
when you work no longer; the greater your unfulfilled needs earlier,
the greater they will remain in retirement-if you receive anything
Having earlier discussed the extent of poverty, now we examine
the ways in which the needs of the poor are met-or, more accurately,
not met. One should remember that the word need does not occur
in economic theory; it is hardly ever heard in the halls of our
legislatures. Were we at least to use the word, and were its application
pondered sufficiently, perhaps what has happened to the children
of the United States, which nowadays worsens their lives, would
not have occurred. In the disdainful discussions of welfare and
its recipients, the blunt fact that about two-thirds of AFDC recipients
are children is seldom mentioned. Therefore, we turn to the poverty
and the conditions of American children first, thence to the errors
of omission and commission of the recent and emerging welfare
Suffer the Little Children
Among the rich societies, ours has by far the highest rate
of children living in poverty-four times the rates in Western
Europe-and it is the children's rate that rises most rapidly,
condemning them to an inhuman life and unnecessary deprivation.
Jonathan Kozol (who has spent several decades studying the lives
of poor children, especially in their schools) has awakened us
to this matter. Here he is speaking of a neighborhood in the South
In the drabness of the neighborhood, the friendliness and
openness of little kids ... seem like the sunshine that has not
been seen in New York City during many months of snow and storm
and meanness . . . show[ing] us something very different from
the customary picture we are given of a generation of young thugs
and future whores. There is a golden moment here that our society
has chosen not to seize.... [It is not until later] that the sense
of human ruin on a vast scale becomes unmistakable.
Some of the dimensions of those ruins for today's children
in the United States (and an addendum concerning those elsewhere)
* Children in the United States are poorer than children in
most other Western industrialized nations because the gap between
rich and poor is so large and because welfare programs are less
generous here than elsewhere.
* Poor children are more than twice as likely as other children
to suffer from stunted growth, severe physical or mental disabilities,
fatal accidental injuries, iron deficiency, and severe asthma.
* Poor children are more than twice as likely as other children
never to finish high school, even when differences in family structure,
race, and ethnicity are taken into account.
* Poor children have significantly lower achievement test
scores than children of high-income families.
* In 1993,46 percent of all African-American children and
41 percent of all Latino children lived in families with incomes
below the poverty level.
* Poverty rates among children have increased since 1970 as
follows: 1970 15 percent; 1980, 18 percent; 1993, 22 percent;
those living in "extreme poverty-a family income of less
than half that of "plain poverty"-have doubled, to 10
percent, since 1975.
* Child poverty rates grew in all racial categories between
1979 and 1989 and again for white and Hispanic (but not black)
children from 1989 to 1994. . . [when] more than one out of every
five children was poor (21 8 percent). For children under six
years old, the rate was even higher, reaching 24.5 percent. Black
children have the highest poverty rates; in 1989 half of all black
children under six were poor. The rates were about the same in
* More than 60 percent of all AFDC families have a youngest
child under the age of five.
* Marian Wright Edelman, president of the Children's Defense
Fund, noting that over 16 million children live in poverty in
the United States, reports that "every 9 seconds a child
drops out of school, every 14 seconds a child is arrested, every
15 minutes a baby dies, every 2 hours a child is killed by a firearm,
every 4 hours a child commits suicide, every 7 hours a child dies
from abuse or neglect.''
And globally? UNESCO's 1995 International Forum on the Rights
of the Child reported that 1.4 billion children under age 18 live
in poverty and 100 million are homeless; in Europe 5 percent are
below the poverty line; in the United States, 20 percent. More
than 6.6 million children die yearly of diarrhea and pneumonia,
because of poor living conditions and, despite vaccines against
these diseases, close to 2 million children annually die from
measles, tetanus, and polio. In 1993, UNICEF reported that over
the globe, every day 36,000 children die from malnutrition and
disease (= 13 million every year)-a calamity that could be ended
at the cost of $1 a day per child.
President Clinton signed the new welfare legislation on August
22,1996. A bit more than two weeks earlier, Senator Daniel Patrick
Moynihan (D.-N.Y.), whose academic work had led to a governmental
career centering on the welfare system (beginning with a secretary-ship
in the Nixon administration), rose to speak to the Senate to warn
of the disaster they were creating: "Let me put that in terms
of how many children will be cut off.... The Urban Institute says
3,500,000 will be dropped from the rolls by 2001. By 2005,4,896,000
will have been cut off." And commenting on the unlikelihood
that government officials would make a good faith effort to meet
the work requirements spelled out in the bill, Moynihan went on
to summarize the estimate of the (nonpartisan) Congressional Budget
Office: "given the costs and administrative complexities
involved, the CBO assumes that most states would simply accept
penalties rather than implement the [work] requirements."
It would be bad enough if what we have already allowed and
now permit to worsen concerning children were an outcome of mere
heartlessness, shameful indeed for a society that presumes to
value the family. Moreover, there is no sufficient reason for
having done and doing all this damage. In the past it has been
costly not only to the direct victims but to the society as a
whole; Senator Moynihan is by no means alone in believing that
those costs will escalate both for all. This combination of pitilessness
and mindlessness in our society makes the heart to weep, the mind
Perhaps, however, the above is merely the carping of the soft-hearted,
based on misleading impressions; perhaps our leaders have acted
harshly in past and present because the facts demand it, perhaps
from this human and social morass there is no better exit? The
answer to that question is a resounding "No! "
... on August 22, 1996, Congress passed and the president
signed the welfare bill, with its reassuring title, "The
Personal Responsibility and Work Opportunity Reconciliation Act
Blueprint for a (Deeper) Tragedy
The new law mandates the following: an end to sixty-one years
of the federal guarantee of cash assistance for poor children
and a delegation of authority to the separate states to run welfare
programs with lump sums of federal money ("block grants").
Adult recipients of the resulting state welfare programs will
be required to find work within two years; there will be a five-year
lifetime limit on benefits; aid to non-citizens will be curtailed.
1. Most immigrants arriving after the bill was signed have
become ineligible for most benefits and social services financed
by the federal government.
2. Strict new standards for granting Supplemental Security
Income (SSI) to disabled children are going into effect, with
the expectation that "several hundred thousand" disabled
children will immediately lose support.
3. States were given about a year to rework their welfare
programs to meet the new requirements.
4. Within the year after the bill's signing, most non-citizens
receiving food stamps and SSI will become ineligible for benefits
when their cases are reviewed.
5. As of October 1, 1996, "no individual or family shall
be entitled to any benefits or services" under the now defunct
federal program Aid to Families with Dependent Children.
6. Also as of October 1, 1996, new Federal rules for food
stamps took effect, reducing benefits previously paid.
7. As of January 1, 1997, states were allowed but not required
to cut off cash assistance, Medicaid, and social services for
non-citizens who were receiving such aid up to August 22, 1996.
There it is in black and white. Some of its meanings over
time can only be guessed at; others can be predicted fairly easily.
Among the latter, two stand out:
1. No one doubts the likelihood of a recession at some time
in the future. But that the legislation's hardships will be "manageable"
is predicated upon the assumption that the future fiscal conditions
of the separate states will be no weaker than those of 1996-the
fifth and most buoyant year of consecutive economic expansion.
As both Republicans and Democrats know, the separate states' coffers
fill as the economy expands and empty when it contracts; also
known by all is that states are prohibited b`,, their constitutions
from engaging in "counter-cyclical deficit financing":
when the economy weakens, therefore, state expenditures must decline,
unless-as is totally improbable-voters support the floating of
bonds for specific purposes (like welfare?), and a consequent
increase in their taxes. So, it's back to the fiscal policies
of the pre-New Deal era: Each for himself, and God for all.
2. It is generally acknowledged that the delegation of federal
funds for welfare to the states in the form of block grants-argued
for by its supporters in order to free states from "meddlesome
Federal regulations specifying how, why and where the Federal
money could be spent"-contains yawning loopholes for state
governments to use what are presumably funds for the poor for
those who are not. Indeed, in today's climate, such funds are
just as likely to be used against the poor, directly or indirectly:
for prison construction or anti-immigrant fences, for example.
There are two other matters to worry about: The first, as
recent conferences of mayors from around the nation have agreed,
is that the delegation of block grants to the states will almost
certainly lead to their delegation of responsibility, but not
of their grants, to the cities and counties. The latter will have
to scrounge up the money somewhere or, failing that (as is likely),
let the poor-two-thirds of them children, remember-suffer. The
other matter to worry about jumped into the news almost before
the ink was dry on the new legislation: "Giant Companies
Entering Race to Run State Welfare Programs: Powers like Lockheed
Martin Vie for Contracts." 34 Part of the story went this
way: "The jockeying [for welfare contracts] frightens longtime
social-service workers and public-interest lawyers. No company
can be expected to protect the interests of the needy at the expense
of its bottom line, least of all a publicly traded corporation
with a fiduciary duty to maximize shareholder profits."
Companies, giant or pygmy, are supposed to have the fabled
"bottom line" as their guide; although those firms lobbied
frenziedly for the new bill, it's not their fault but that of
Congress and the White House that their newest area for profits-prisons,
education, and health care having earlier been added-will be another
of the "uses of poverty."
So much for the poor, except for a final observation. Admirable
though the idea of "workfare" may be-and surveys show
that the poor also overwhelmingly prefer jobs (at a livable wage)
to welfare-sufficient jobs do not now exist, and to prepare people
for and create them would require an expenditure of time and thought
and money that exceeds the amounts previously spent on AFDC itself.
Few if any of those supporting the new act are prepared to devote
that much time, thought, or money. As long as that remains true,
and the "Personal Responsibility Act" reigns, we shall
have to anticipate "children sleeping on grates," in
Senator Moynihan's grim phrase. By comparison with the past and
present plight of the poor, what will now be shown regarding the
present and prospective situation of the old will seem downright
reasonable-though it combines unreason and inadequacy in substantial
the Conventional Wisdom