April 24, 2006
Back When Republicans Enacted Their Ideas...
Remember "Welfare Reform?" Want to know how well it worked?
What about concern number two-that welfare mothers would sink deeper into poverty? Shortly before TANF (Welfare Reform) passed, the Urban Institute released a report, solicited by a wavering Clinton administration, warning that welfare reform could impoverish an additional 2 million people. Reform Jeremiahs waved the report around as scientific proof of their worst fears. Even if some welfare mothers did find jobs, they argued, they would merely be stocking shelves at Duane Reade or making hotel beds, the proverbial "dead-end jobs" that would leave them worse off than on the dole.
Though a lot of women did take low-paying service jobs, the unreformed got this one wrong, too. For one thing, they failed to consider the Earned Income Tax Credit, whose expansion in 1993 meant a 40 percent boost in annual earnings for a minimum-wage worker with two kids. Most leavers, though, were doing better than minimum wage. In 2002, the same Urban Institute that had predicted TANF disaster found that the median hourly wage for working former recipients was around $8 an hour. Moreover, O'Neill and Hill discovered that, just as with most other people, the longer recipients were in the job market, the more they earned; four years off welfare, only 4 percent of working single mothers—and only 8 percent of high school dropouts who were single mothers—were earning minimum wage or less.
As a result, most welfare leavers had more money than when they were on welfare. The poverty rate for single women with children fell from 42 percent in 1996 to 34 percent in 2002; before 1996, it had never in recorded history been below 40 percent. This was the first boom ever where poverty declined faster for that group than for married-couple families. Nor did leavers disdain their "dead-end jobs." Studies consistently found that ex-recipients who went on to become waitresses, grill cooks, and security guards took pride in being salarywomen.
Posted by Bruno Behrend at April 24, 2006 03:00 PM