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Executive Summary

The welfare reform law of 1996 marked a turning point in national welfare policy. The new policy aimed to encourage personal responsibility by promoting work, reducing nonmarital births, and strengthening and supporting marriage. No longer could able-bodied adults remain on welfare year after year without working. Individuals were given strong financial incentives to leave welfare for work; families were given essential support for child care and health care to facilitate the transition to work; states were given equally strong incentives to help parents prepare for and find jobs. And state and local governments were given more control over welfare than ever before.

The result has been an historic decline in the welfare rolls, substantial increases in employment by low-income mothers, unprecedented increases in earnings by low-income females heading families, and a sustained decline in child poverty, particularly among African-American children. In addition, for the first time in several generations, the percentage of children born outside wedlock leveled off and has remained nearly flat for the last five years.

But there is plenty of work left to do as Congress reauthorizes the 1996 legislation. The Bush Administration’s detailed plan for reauthorization is explained in this document. The plan has four major pillars, all of which build on the achievements of the 1996 law.

Promoting work is the key to both the 1996 reforms and the Administration’s reauthorization plan. Although nearly three million families have left welfare, most of them for work, there are still over two million families remaining on the rolls. Policymakers and welfare administrators have an obligation to help these families follow in the footsteps of those who have already abandoned welfare for work. The Administration’s plan makes a $22 billion per year Federal commitment to cash welfare, work preparation, and childcare through the Temporary Assistance for Needy Families and Childcare and Development block grants.

Strengthening families is the second major element of the Administration plan. One of the hardest jobs in America is being a single parent. Yet millions of the lowest income single parents have shown over the past several years that they are capable of achieving self support through work. But their earnings are often modest and leave their families below the poverty line. Thus, it is vital that Federal policy continue to provide supports to low-income working families and even expand these supports. The Administration’s plan continues the current high level of spending for childcare, maintains the commitment to providing health insurance to the children of low-income working families, and expands the child support enforcement program so that more payments by fathers will be given directly to mothers and children. In addition, the Nation’s most important program for assisting low-income working families with children, the Earned Income Tax Credit, will continue to provide income supplements of up to $4,000 per year to single mothers leaving welfare for work.

Although our policy must and does continue to support single-parent families, national policy must do a better job of promoting healthy marriages. Research shows that both adults and children are better off in two-parent families. Children reared by married parents in intact families are more likely to complete high school and are less likely to be poor, to commit crimes, or to have mental health problems than are children reared in single-parent families. It is no criticism of single parents to acknowledge the better outcomes for children of married-couple families. Rather, it is simply wise and prudent to reorient our policies to encourage marriage, especially when children are involved. For this reason, the Administration plan commits up to $300 million per year for states to design and implement programs that reduce nonmarital births and increase the percentage of children in married-couple families. The states have established a strong track record of innovation in helping dependent adults move to work; there is every reason to believe that states will find new and effective ways to encourage healthy marriage in appropriate circumstances. The Administration’s approach to promoting marriage is to provide financial incentives for states, often working together with private and faith-based organizations, to develop and implement innovative programs. These demonstration programs will be carefully evaluated and successful programs will be disseminated to other states.

Acknowledging the immense capacity of states and localities to design and conduct effective social programs is the third foundation of the Administration’s plan. The Federal Government devolved a great deal of authority and responsibility for social programs to states as a fundamental part of the 1996 reforms. Now the Federal Government’s primary responsibilities are to set broad goals for social programs, help fund them, evaluate their efficiency and effectiveness, and provide assistance to states trying to implement programs that have a proven track record. This revolution in Federal and state roles should be continued and expanded. Specifically, the Administration’s plan includes legislation that would allow cabinet-level agencies to have expanded authority to grant waivers to states for the purpose of improving the efficiency and effectiveness of cash, housing, nutrition, and especially workforce programs. The primary goal of the expanded state flexibility is to improve coordination across programs so that more adults can achieve independence from welfare while attaining greater financial and social security for themselves and their children.

Finally, the Administration’s plan includes an important restoration of nutrition benefits for legal immigrants. The 1996 reforms imposed a five-year ban on most welfare benefits for legal immigrants and a permanent ban on food stamps and Supplemental Security Income. Federal policy should strive to find a balance between the needs of poor immigrants and the obligation to ensure that welfare policy neither attracts noncitizens to the U.S. to take advantage of welfare programs nor induces welfare dependency among immigrants who receive welfare benefits. Thus, the Administration supports continuation of the five-year ban but proposes to align food stamp rules with the rules for cash welfare and Medicaid by allowing legal immigrants to receive food stamps after five years. This policy helps ensure adequate nutrition among children and other vulnerable immigrant groups, while continuing to require new entrants to the country to support themselves and their families through work.

Taken together, the elements of the Administration’s plan represent a balanced approach to continuing the immense success of the 1996 reforms. America has made great progress in welfare reform. Doors of opportunity that were shut and sealed have been opened – in no small measure because of the efforts of welfare recipients themselves. But there is no acceptable level of despair and hopelessness in America. We will not abandon people in need to their own struggle. The successes of the past few years should not make us complacent. They prove what is possible when we press forward with bipartisan reform efforts. And the Bush Administration is determined to press forward.

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