In his first State of the Union address, President Trump signaled his intent to bring welfare reform back to the forefront of the American policy debate. “We can lift our citizens from welfare to work, from dependence to independence, and from poverty to prosperity,” President Trump proclaimed. This language is familiar. Rhetorical arguments that poverty results from a lack of will – a resistance to hard work – have formed the backbone of conservative rhetoric for decades now. But in overhauling the American welfare system, the current White House and Congress will look to a law passed under a Democrat. On Aug. 22, 1996, President Bill Clinton signed the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) into law. President Clinton’s reforms stemmed from the same logic that runs through the rhetoric of President Trump and, more concretely, Speaker of the House Paul Ryan: that welfare is a trap that disincentivizes work. Only by restricting and diminishing welfare programs can we create a system in which needy families are driven to escape the culture of dependency and become self-sufficient members of the American economy. With this framework in mind, PRWORA radically reshaped the American welfare system, placing work requirements and time limits on a number of major programs for low-income families and children. With these policies once again coming to the forefront of the national policy debate, it is worth looking back on the effects of Clinton’s welfare reform.
PRWORA replaced the Aid to Families with Dependent Children (AFDC) program – which had been in place since 1935 – with Temporary Assistance for Needy Families (TANF), a new family welfare program. TANF, which provides cash assistance to poor families with dependent children, differed from AFDC through the inclusion of time limits and work requirements. The federal government suggests recipients receive a maximum of 60 months of benefits under TANF, though individual states can institute shorter periods. In addition, TANF recipients are required to find a job within 24 months of receiving aid. Most importantly PRWORA altered the child welfare system by making TANF a block grant program, which gives states greater authority over how and when to provide benefits. As you will see, states like Maine have used this power to drop benefits far below federal standards.
Maine is the most salient lens through which to view the effects of PRWORA because the law granted increasing leeway to states, many of which have followed Maine’s leadership on welfare policy in recent years. Prior to Governor Paul LePage’s election in 2011, Maine offered one of the nation’s most comprehensive welfare systems. In 2008, 13.8 percent of Mainers received benefits from the Supplemental Nutrition Assistance Program (SNAP), also known as food stamps, a figure that placed it second in the country. Meanwhile, 4.8 percent of Maine household received TANF benefits in 2008, which ranked second in the nation. Maine had the second-highest number of residents enrolled in Medicaid (27%) and appeared poised to adopt state expansion of Medicaid under the recently passed Affordable Care Act (ACA). Overall, Maine ranked second in the nation in total state welfare expenditures before LePage’s reform, using more than 30 percent of overall state expenditures to maintain the state’s safety net.
With PRWORA in place as the national standard, LePage was empowered to enact some of the nation’s most stringent welfare restrictions. LePage and the Maine State Legislature capped TANF benefits at 60 months – the federal standard under PRWORA – and eliminated most of the extenuating circumstances under which residents can receive lifetime benefits. They also lowered MaineCare eligibility to 133 percent of the federal poverty level (from 200) and instituted a series of penalties meant to discourage welfare fraud, though the state has prosecuted just ten fraud cases in 2010. Finally, LePage’s first budget required convicted drug felons to be drug tested as a condition of receiving welfare. “This budget encourages hard work and independence through needed welfare reforms,” LePage said in 2011.
To be clear, the decline in workload for Maine’s welfare is not representative of a decline in need. While TANF cases have steadily declined since 2011, the number of Maine children living in extreme poverty has increased since LePage took office. During this period, extreme child poverty in Maine has increased at a rate eight times faster than the rest of the United States. “Maine is the poster child for just cutting people off and not connecting them with jobs or other prospects, and that gets billed as success,” said Liz Schott, a senior fellow with the Center on Budget and Policy Priorities, a liberal think tank that specializes in poverty relief programs. “How can you call it success when poverty hasn’t gone down?”
Because of the discretion PRWORA granted to states to operate their own welfare systems, LePage has been able to implement his anti-welfare agenda simply by withholding benefits. Every year of LePage’s tenure, Maine has received a TANF block grant of $78 million. While TANF is primarily known as a program that provides cash assistance to low-income families with dependent children, there is no requirement in PRWORA that states use the money solely for cash assistance. Many states have used the TANF block grant to appropriate funds for education, child care and job training. Maine has simply chosen not to use the money at all. In 2011, when LePage took office, Maine spent more than 60 percent of the $78 million grant it was awarded by the federal government. But in 2016, it spent just 14 percent of that money. In Governor LePage’s five years in office, the state government has accrued $155 million in unspent TANF funds, an unused balance higher than any other state in that time.
Maine is the logical conclusion of a welfare system that allows each state to dictate standards, creating 50 distinct safety nets of varying strength and coverage. Republicans in Congress are once again attempting to undermine the welfare system by weakening national standards and creating additional barriers to aid. But Maine has demonstrated that states cannot be trusted to maintain a standard of support, that it is the duty of the federal government to provide aid when a family falls too far. Only when we establish a national floor of welfare standards will we, as a nation, begin to reach for the ceiling.