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August 10, 2012 7:49 AM Welfare Reform Is Predicated on Full Employment

By Ryan Cooper

When welfare reform was implemented back in the nineties, the idea was that if people on welfare are incentivized to work, they can be slowly moved into the workforce and off the government rolls. Liberals liked it because it seemed like a technocratic, free-markety way to get people out of poverty, and conservatives liked it because they think everyone on welfare are dependent parasites who just don’t know the value of a hard day’s work and don’t deserve any government money. (Traditionally, this is loaded with a lot of race-baiting about “welfare queens,” “strapping young bucks,” etc.)

For awhile in those high-velocity times, it seemed to work. Welfare rolls plunged, and the unemployment rate crept lower and lower. Hooray, bipartisan success.

Left unsaid in the whole formulation for welfare reform is that it is utterly dependent on full employment to have even a chance to work. That is, it has to be the case that (roughly speaking) everyone who makes an honest effort to find a job can get hired. But there are times when that isn’t the case: depressions, when there are way more job-seekers than jobs for a prolonged period. That ratio has been over 4.3 for 29 consecutive months.

Welfare recipients, in general, are at the back of the employment line. If there are four people apiece ahead of them after four years, it is mechanically impossible they’ll be employed in significant numbers. All the incentives in the world are only going to result in people rooting through the trash for recycling, selling their blood plasma, and their children starving.

True to form, conservatives are uninterested in the actual outcomes of any policy. Instead, they remain fixated on government policy making the correct moral gesture. Welfare recipients, they say, though welfare rolls have plummeted even in the midst of a depression, are even lazier than ever. Romney’s new ad is a lying, Nixonian, race-baiting throwback darkly insinuating about how those people are getting free money from the government. (It would be nice, by the way, if Obama would stop embracing the conservative frame on this.)

If I had my druthers I’d pick full employment before fixing welfare, because it would help the poor and everyone else at once. But since we’ve picked depression, it is monstrous to have children growing up hungry and stunted in the richest country on earth.

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Ryan Cooper is a National Correspondent at The Week, and a former web editor of the Washington Monthly. Find him on Twitter: @ryanlcooper

Comments

  • Ron Byers on August 10, 2012 9:19 AM:

    Full employment might not be possible anymore. Robots and advanced information technology has permanently eliminated millions of jobs. We are going to have to figure out how to make sure people have the money they need to purchase the stuff needed to keep the few workers still working employed.

    Maybe we should be thinking about a 32 hour work week, a one month vacations, free education through college, or earlier, not later, retirements. Maybe all of the above. Society is going to have to change to meet the challenges of the productivity gains we have "enjoyed" since the 1990s.

  • DAY on August 10, 2012 9:42 AM:

    Ron makes a valid point, but it is too "French" to fly in our country.

    FDR created the CCC (Civilian Conservation Corps) and the WPA (Works Product Administration- aka We Poke Along).
    Anyone driving on New York's Meritt Parkway can admire the stonework the bridges and overpasses today.

    But roads were built with picks and shovels and manpower. Today it is a guy with a backhoe and three helpers to stand and watch. And "Meaningful Work" is a dream for most.

  • Shane Taylor on August 10, 2012 9:50 AM:

    Speaking of "moral gestures," what does it mean for a magazine to identify with Jacobins, brandish (at least, when it first appeared online) a raised guillotine, and publish Slavoj Zizek's reply to critics of his briefs for "redemptive" violence and "emancipatory" terror?

    http://www.nybooks.com/articles/archives/2012/jul/12/violent-visions-slavoj-zizek/

    This question is anything but academic, given the Occupy left's recent history of violence:

    http://abclocal.go.com/kgo/story?section=news/local/east_bay&id=8761493

  • c u n d gulag on August 10, 2012 10:03 AM:

    Look, to be honest about it, the reason we had those booming economies from WWII until the early 70's, was that we were one of the few nations left standing, with infrastucture intact to build upon, after that war.

    All of Europe was a mess, as was Japan. And intelligently, we decided to help ourselves in the future by helping them to rebuild.
    The USSR was devastated.
    So was SE Asia.
    So was China, who was also having a revolution.

    So, who was our competion, beside Canada and Mexico? South and Central America - and for most of the 20th Century, they were client states to US companies like United Fruit, so their leaders were dependent on American largesse to become independint economic entities - just then. Plus, they had no useful infrastructure.

    So, we had the run of the world. And the world was our customer for 20+ years.

    And then, the rest of the world started to catch up. We, the whole world, had become very dependent on oil, and so, the Mid East nations got togeher, and decided to see how much power they had.
    A lot, as it turned out. They threw America and the West in recessions several times.

    The USA had a virtual monopoly on the world. And, we briefly reclaimed that as the Soviet block fell, and those nations needed help.
    Then, the information bubble kept the US afloat for awhile - until other nations got into the act.

    So, a housing bubble was created, to keep the US economy from crashing - which it soon did anyway.

    To make a very long story short - I agree with Ron Byers that we'll NEVER see anything like full employement ever again - short of some techonology or information innovation(s).

    And, at a time when we need to have existing workers retire earlier, to make room for younger generations, we're looking to cut/alter/privatize paid-for programs, aka: "entitlements," like SS and Medicare.

    If we wanted to see "fuller" employment, we should do the following:
    -Unprivatize a lot of what's been privatized. Governments are anwerable to voters, and not shareholders, so, more employment would make the voters happy. I'm not saying hire unnecessary people. It's just that what's been privatized is run as bare to the bones as possible, to increase profitability for shareholders, and salary for executives.
    -Free public education, if people want it, from pre-school to a BA or BS - and then some form of public service for a couple of years, like rebuiliding infrastructure, helping in elderly facilities, the military, and some other things someone smarter than me can come up with.
    Free public education will also provide teaching and administrative jobs.
    -Lower lower the retirement age to 60 - with eligibility for full SS.
    -And, most importantly, get single-payer for EVERYONE! This will free-up people to leave corporate jobs to try their hands at starting their own businesses, and get that "entrepreneurial spirit" going, that righties always talk about.
    This also has the advantage of creating job openings for younger people, coming out of public service and schools.
    -Train people who fall between the cracks to do some adminstrative work, or physical work, to work several hours a day - even if that work doesn't really need to be done. Having some sort of a job leads to improved self-exteem. And hopefully, those people will look to take additional training to find more meaningful work.

    And to pay for this?
    -Start to decrease military spending, AND STOP BEING THE WORLDS POLICEMAN!!! STOP INTERFERING IN EVERY OTHER NATIONS BUSINESS!!!
    -Raise FICA contributions by a few percentage points - WITH NO CAP!!!
    -Also, a progressive income tax system, with a return to Reagan-era rates on top earners.
    -Bring back much higher rates for estates - to eliminate the aristocracy we've had growing in this country for decades.
    -And also, create a small tra

  • T2 on August 10, 2012 10:05 AM:

    Here's how it works: Romney put out an add, falsely claiming Obama intended to change welfare so it was just a give-a-way. Everyone, including Newt Gingrich, said it was baseless. Now, this morning, I open my paper to find a "From the RIght" editorial saying Obama intends to change welfare to a give-a-way. Lies become general knowledge just like that. It is up to the Editors of the paper to chose what articles they print, and they knowingly choose to print lies. Fair and balanced?

  • c u n d gulag on August 10, 2012 10:10 AM:

    Ooops!
    Comment probably too long, so it got cut-off.

    Here are the rest of my idiotic word-turds.

    -And also, create a small transaction tax on stock and bond transactions.
    -Encourage companies to restart pension programs, to lower dependence on SS. Eliminate 401K plans, except for those who prefer those over pensions.

    All of this can then be used to INCREASE the monthly SS payments to those people over 60 - to make sure it's a liveable wage.

    This, of course, is WAAAAAAY to "Socialist" to ever be acceptable to the idiotic American people - too many of whom will be glad to watch other people starve to death, as long as they can get their last few crumbs before they starve to death themselves - particularly if those last crumbs came from a brown person. Then, they can feel superior as they die.

    Imagine...

  • millekat on August 10, 2012 10:22 AM:

    Seriously, what kind of country is this when, "Shows compassion toward the poor" is considered a brutal slander?

    I get it about the whole racist dog-whistle, really I do.

    But I suspect it's possible these ads will just backfire, and some viewers will say, "Sounds good, where's my check?" We might at least think, "Vote Obama, he MAY keep my unemployment checks coming a little longer."

  • emjayay on August 10, 2012 11:19 AM:

    c u n d gulag: You forgot:

    Figure out how to reduce our prison population to European/UK levels. Part of this would be by legalising marijuana and eventally all drugs, but we should also look at other countries for other reasons. This would save a ton of money to do all those other things and reduce cultures of crime etc. as well.

    Another part would be getting rid of all housing projects, where the culture of crime is fostered (no, I'm not condemning each person in every housing project -I'm talking about what the eventual inevitable results of the originally more or less seemingly good liberal idea.) Section 8 housing vouchers too - better, but not a good answer either. Knock 'em down or sell them to be rehabbed and rented out. Spend the vast amounts of money saved on other ways to help the same people, like the Nixonian minimum income idea, whatever it was called. (Boy those were the days when a Republican would talk about stuff like that.)

    Ending housing projects would not only be a long term benefit for the people in them and the society as a whole, but would allow for hiring a lot fewer police and courts and jails etc.

    OK, none of this or what c u n d gulag said is going to happen, just a nice wish list. We'll be freaking over bigger things like for instance the worldwide destruction of life as we know it caused by global warming way before that.

  • FlipYrWhig on August 10, 2012 11:23 AM:

    Friendly correction: avowed liberals in the Clinton era did NOT like "welfare reform." It was seen as Republican-lite triangulation and a validation of anti-government rhetoric with the goal of pleasing the mushy middle.

  • Robert Waldmann on August 10, 2012 11:56 AM:

    You are arguing that welfare reform was bad policy to begin with since we had no way of guaranteeing full employment forever. I stress that a large part of the problem was hatred of the word "entitlement". Before 1996, welfare (then AFDC) was an entitlement which means that there were benefit levels and eligibility requirements set by states and then whatever it turned out to cost, the Federal Government paid half of it.

    So they could say they ended the "Federal Welfare Entitlement" the reformers (including Clinton who signed the damn bill) gave TANF a fixed budget which does not automatically increase with need. Of course States whose budgets are hammered by recessions could increase their welfare spending in a recession when pigs fly.

    Clinton still brags that money for job training and day care etc went up with welfare reform. This is what happens when you decouple the welfare budget from need and need falls due to a boom. Similarly aid to job seekers, like cash for the very poor, is cut when there is a recession.

    But I mean really, if welfare reform only makes sense for full employment, if they could have written the bill to relax work requirements when unemployment is high, and if they could have at least written the bill so welfare doesn't become tighter when unemployment is high, then those who wrote (and signed) the bill were terrible policy makers.

    Your post is important, but the content was known in 1996 and anti-poverty experts made the argument you make here. But questioning welfare reform was anathema for decades, just because things went well (for former welfare recipients and everyone else) in the late 90s.

    I must resist temptation. I will not say where the people who made your point were anathematized as objectively pro Paul Ryan left deviationists who were grinding old axes and proved they were living in the past by reporting on the present. I will mention that you personally did not anathemetize Jason DeParle for reporting inconvenient truths.

  • mb on August 10, 2012 12:11 PM:

    "Liberals liked it..."

    I'm not sure it is fair or accurate to say that liberals "liked" welfare reform. Despite the current polarization, "democrat" does not equal "liberal." And, particularly during the '90s, liberals were not in charge of the Democratic Party. Clinton's welfare reform, like almost all his policies, was a DLC (read "conservative") initiative. And the DLC was clearly in control of the Democratic Party Agenda.

    The legacy of this conservative control of the Democratic Party is not pretty. It is not difficult to make a convincing argument that those conservative Democrats laid the groundwork for the destruction of our economy, to wit, Glass-Steagall repeal.

    "Liberals" didn't "like" Clinton's welfare reform -- conservative Democrats did. Liberals didn't like a lot Clinton did -- didn't particularly like his healthcare reform effort either. Entirely too conservative.

    The problem is (and always has been) conservatism. It is wise to always be wary of it and its proponents.

  • gus on August 10, 2012 1:30 PM:

    "Friendly correction: avowed liberals in the Clinton era did NOT like "welfare reform." It was seen as Republican-lite triangulation and a validation of anti-government rhetoric with the goal of pleasing the mushy middle.”

    Exactly.

    So many of those “Mend it but don’t End it” policies were so unbelievably short-sighted.
    The fact they passed them anyway made it seem like they didn’t care one bit.

  • gus on August 10, 2012 1:54 PM:

    I seriously can’t believe that Paul Ryan would be Romney’s VP candidate either. OK. I can believe it because he’d be that stupid and brazen that he would go with Ryan. But, Ryan’s Big Vision is a recipe for catastrophe. So, yeah, the GOP would be that tone deaf, brain dead and dumb to try to do it now. Just like they were stupid enough to do tax cuts during wartime.

    Another aspect of Ryan, by the way, if he does “bring the goods” conservatives “want” then that means Romney is ceding a lot to his second banana. Even a monkey isn’t that stupid. So, I can’t see Ryan being chosen. But, he and his “plan” are still there.

  • DHFabian on August 29, 2012 1:27 AM:

    With Clinton, we took a new approach to poverty -- we simply don't talk about it as an economic issue. We decided that people are poor because they're lazy, inferior, etc., and there is a very good reason for maintaining this illusion. We've watched the US steadily fall behind the modern nations, in virtually every respect, since the 1980s. Middle class jobs have been shipped out of the country by the hundreds of thousands. Co-workers get laid off, and we never see them again. They dare not take a close look at poverty and the poor today because if they did, it would scare the hell out of them. That's because so many of the "lazy, deviant, disgusting" poor WERE middle class workers until not so long ago, and they DID "work hard and play by all the rules." The reality for middle class Americans today is that they are only one or two job losses from losing absolutely everything, including their families, with little chance of being able to work their way back out of poverty. That is terrifying, and they absolutely despise the poor for showing them what might well be their own futures.