[Congressional Record Volume 140, Number 13 (Thursday, February 10, 1994)]
[Extensions of Remarks]
[Page E]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: February 10, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
                             WELFARE REFORM

                                 ______


                          HON. LEE H. HAMILTON

                               of indiana

                    in the house of representatives

                      Thursday, February 10, 1994

  Mr. HAMILTON. Mr. Speaker, I would like to insert my Washington 
Report for Wednesday, December 29, 1993 into the Congressional Record.

                             Welfare Reform

       In his first address to Congress President Clinton promised 
     to ``end welfare as we know it.'' The President's pledge 
     reflected the frustrations and hopes of the many Americans 
     who dislike the welfare system. They think it costs too much, 
     encourages prolonged dependence on public assistance, and 
     fails to address the causes of poverty. The combination of 
     raising welfare caseloads and dissatisfaction with the 
     current system has produced initial reforms and momentum 
     toward significant changes in the national welfare system. A 
     presidential task force has been working since June to 
     produce the complete legislative proposal, which is expected 
     to be ready when Congress convenes in January. It is likely 
     that welfare reform will join health care as one of the key 
     legislative efforts in 1994.
       Welfare Programs: Welfare is comprised of programs of need-
     based benefits, in cash and noncash forms, principally Aid to 
     Families with Dependent Children, the Earned Income Tax 
     Credit, Medicaid, and food and housing benefits.
       Most of the welfare reform effort focuses on the Aid to 
     Families with Dependent Children (AFDC) program, which is the 
     major cash welfare program for families. Established in 1935, 
     it provides assistance to needy families in which one parent 
     is either absent, disabled, deceased, or unemployed. States 
     administer AFDC and set eligibility standards and benefit 
     levels. States and the federal government share the cost of 
     the program.
       After showing little growth for almost two decades, the 
     nation's AFDC rolls surged to record levels between 1989 and 
     1993, in response to the recession and other factors. Last 
     year the program served a monthly average of nearly 5 million 
     families and a total of 14 million people. AFDC benefit 
     payments totalled $22.5 billion in 1993 with an average 
     monthly family benefit of $377. In 1992 Indiana's AFDC 
     program cost $252 million in state and federal funds and 
     served over 69,000 families with an average monthly payment 
     of $262. The real value of purchasing power of AFDC benefits 
     nationwide declined 40% from 1970 to 1992.
       Recent Reforms: The Family Support Act of 1988, the most 
     recent overhaul of the program, requires that all states 
     operate a Job Opportunities and Basic Skills (JOBS) program. 
     The goal is to transform AFDC into a program of preparation 
     for work. The state-designed programs must include 
     educational services, job skills training, and help in 
     finding a job. AFDC teenage mothers without a high school 
     diploma must attend school to receive benefits. Child care is 
     also provided.
       Early evaluations of JOBS initiatives, while positive, are 
     tentative due to the recent origins and partial 
     implementation of many state programs. Studies have found 
     limited success in key states such as California and Florida. 
     Florida's pilot version of JOBS, for example, has reduced the 
     number of recipients by about 5 percent with comparable 
     savings in welfare expenditures. My impression is that these 
     programs are working, but require stronger implementation. 
     Indiana's program, known as IMPACT, has placed over 70% of 
     its participants in longer term educational and vocational 
     training programs, and so will require more time before its 
     effects can be assessed.
       The JOBS programs have been supplemented by initiatives 
     undertaken in several states to reduce welfare dependence. 
     Among others, California, New Jersey, Wisconsin, and Utah 
     have received exemptions from federal regulations for such 
     changes as ending additional benefits for mothers who have 
     new babies while on aid and relaxing work hour limits that 
     sometimes penalized those just starting to work again. 
     President Clinton favors the continuation of such monitored 
     state initiatives. Also with the President's support, 
     Congress took some steps toward reform in 1993 by sharply 
     expanding the Earned Income Tax Credit (a program targeted to 
     the working poor) and increasing enforcement of child support 
     payments.
       President Clinton's Plan: President Clinton's welfare plan 
     will build on the Family Support Act, and will change 
     fundamental aspects of AFDC. His proposal embodies the 
     following goals: make work more financially rewarding than 
     welfare; improve child support enforcement; expand and 
     improve education and training; create a new combination of 
     time-limited benefits and a jobs program.
       The key to the President's plan is the proposal to move 
     welfare recipients into the work force as quickly as 
     possible. The Clinton plan is expected to mandate a two-
     year limit to AFDC benefits for those physically able to 
     work. This limit is then tied to a program of public 
     employment for those who have not found a job by the end 
     of the two-year period. Employment would come largely in 
     the form of community service work and some subsidized 
     private employment. The plan also is likely to include 
     funding for several important components of the JOBS 
     programs, including child care and education, and further 
     efforts to enforce paternal support and reduce teenage 
     pregnancy.
       Conclusion: There is significant bipartisan agreement on 
     this new approach to welfare, which emphasizes the reciprocal 
     responsibilities of the system, in which society's obligation 
     to help those in need is balanced by the recipients' 
     obligations to society. This consensus includes the critical 
     importance of education and training, assuring that work pays 
     more than welfare, encouraging two-parent families, 
     strengthening child support, and allowing states flexibility 
     over the administration of policy.
       Difficult questions will have to be addressed as Congress 
     takes up the legislation. While nearly everyone wants the 
     two-year limit, the tough part is what happens after that. 
     For example, what will be done for children whose parents 
     refuse to work? Will there be a limit on the eligibility for 
     the jobs program? How much will this program cost compared to 
     present policy and who will pay for it? Should there be a cap 
     on the overall annual growth of welfare spending? Despite 
     these and other important problems, the level of agreement on 
     the basic proposals is encouraging.
       This opportunity for significant bipartisan reform could be 
     delayed if welfare reform is pushed aside by the more 
     divisive and difficult debate over health care, but 
     successful welfare reform is important enough that the 
     President and the Congress should proceed only when they are 
     free to give welfare reform the attention it deserves. 
     Nevertheless, the opportunity is there to produce substantial 
     improvements in the welfare system, improvements that could 
     save money over time, not by curtailing our commitment to 
     help those in need but by enhancing the ability of those in 
     need to end their dependence on welfare.

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