Welfare Programs - Welfare Reform

Although history shows that efforts were made, in particular decades and through particular political administrations, to address the effects of poverty, homelessness, and hunger on American citizens, there has always been controversy about the effectiveness of the means-tested programs, such as AFDC, food stamps, and Medicaid. Furthermore, the growth of AFDC, which had reached a peak of 14.2 million recipients by 1994, concerned many Americans. Consequently, in 1996 a sweeping welfare reform package entitled the Personal Responsibility and Work Opportunity Act (PRWOA) was passed by Congress and signed into law by President Bill Clinton. It effectively eliminated the nearly sixty-year-old entitlement welfare program initiated by Roosevelt. PRWOA remanded the responsibility for certain welfare programs back to the states. Block grants, in the amount of $16.5 billion, representing funds that would have been part of AFDC, were distributed to states in hopes that more effective and creative programs would be developed, based upon the particular needs of each state.

Within the PRWOA legislation, the new welfare program is called Temporary Assistance for Needy Families (TANF), and it differs significantly from the old AFDC program in many ways. One significant difference is that recipients are no longer guaranteed or entitled to receive assistance. Furthermore, TANF stipulated that eligible recipients of cash assistance must be working within two years of receiving benefits. Likewise, in an effort to address concerns about long-term welfare dependency, TANF placed a five-year, lifetime limit on receiving assistance except for a certain 20 percent of recipients who are considered to fall within a "hardship" category. Many states have opted to reduce the five-year cap to an even fewer number of years, which is allowed under the PRWOA legislation. The TANF policy is clear that only pregnant women and families with children are eligible for the assistance, although states have been given a certain amount of latitude in determining how they spend their federal block grant monies.

Since the enactment of TANF, the number of people on welfare has been reduced dramatically. By 1999, only 7.2 million recipients remained on welfare, compared to the 14.2 million of 1994. This 7.2 million figure included 2.6 million families and 5.1 million children. Policy analysts contended that several factors contributed to the decline in welfare numbers, including an improved American economy and tougher work requirements of the welfare programs. From the late 1990s into the initial years of the twenty-first century, recipients moved more quickly off of welfare than in the past, and fewer people began receiving benefits for the first time.