TANF Turns 20, Still Failing Poor Families

Next Monday is the 20th anniversary of Temporary Assistance for Needy Families. The celebration, if we should call it that, has already featured more than the customary annual bashing. And I plan more than that too.

But I do think it’s worth a fresh look at how poorly poor families with children have fared since TANF replaced welfare as we knew it — and why it’s done so little to help enrolled parents move on to steady, decent-paying work.

These two are closely related, of course. And the evidence for both dates back to some time around TANF’s fifth anniversary, when parents with minimal marketable skills and little or no work experience could no longer get jobs because the very tight labor market loosened up.

Yet some leading Republican policymakers seem invincibly ignorant, as Catholic theology terms it, or willfully so, since they’re still proposing safety net program overhauls based on the TANF model.

A summary then of where things stand now — not for them, but for you who might advocate for a better TANF program, both nationwide and in your state (or would-be state if you live in the District of Columbia).

Fewer Poor Families Aided

The Center on Budget and Policy Priorities — my main source here, as often for TANF data — shows what’s happened to poor families and their children in several different ways.

We see, for example, that TANF served only a third as many families in 2014 as the program it replaced did in its last year.

We’re reminded that TANF enrollment barely grew during the Great Recession, while SNAP (the food stamp program) responded well to the large increase in households without the income jobs had provided.

Families With Benefits Still in Deep Poverty

CBPP also updates figures on cash assistance — basically, still shrinking as a percent of the federal poverty line, though some states and the District have increased benefits.

The maximum for a three-person family leaves it in deep poverty, i.e., below half the FPL, no matter where it lives.

Adjusting for inflation — and thus purchasing power — benefits have shrunk in all but three states. They’ve lost more than 30% of their value in nearly half.

These figures, recall, are based on the maximum a three-person family can receive. Very poor families may receive less because the parents — and necessarily their children — have been punished with benefits cuts.

The District has made three across-the-board cuts for families that have participated in TANF for 60 months or more. A three-person family up against the rigid time limit now receives $154 a month — 9% of the FPL.

Little Spent to Move Families From Welfare to Work

The assumption behind CBPP’s analyses (and others) is that TANF is supposed to reduce poverty among families with children. That’s not among the purposes the law specifies, however much it should.

But it does name reducing dependency. This means, among other things, enabling parents to get jobs that pay at least enough to push their families over the income eligibility threshold for their state’s TANF program.

The law requires states to have a set percent of parents engaged in “countable” work-related activities for a set number of hours each month. But states can spend whatever they choose on programs and services to prepare parents for work and help them find it.

They, by and large, choose to spend very little — on average, 6.5% of their block grant share, plus the funds they must spend to get it. This is even less than what they spent the year before.

They spent, on average, an additional 16.9% on subsidized child care — obviously a necessity for most parents who must participate in programs to ready them for gainful work.

But those childcare funds may not have benefited only TANF families, current or former. States may transfer up to 30% of their TANF funds to the Child Care and Development Block Grant.

They may use that block grant’s funds, plus (again) what they must spend to get them to subsidize child care for families with incomes up to 85% of the median for all families of the same size.

Needless to say (I trust), that’s a whole lot more income than any TANF family can have. Probably more than most who’ve moved into the workforce too.

A Lot Spent to Shore Up Other Programs

Child care is only one — and not the best — example of how states have used the flexibility TANF law gives them to fund programs and services that don’t help only poor families.

In 2015, states, on average, spent more than half their block grant, plus their own required share on things other than cash benefits, work activities and child care.

An average of 8.1% went for refunds from states’ own Earned Income Tax Credits — arguably a legitimate anti-poverty expenditure. But about a third shored up programs that have nothing to do with work or help for parents who don’t have it.

In some cases, CBPP says, they’ve used their TANF funds to replace what they’d previously spent — or would have had to spend — for programs that may benefit poor families, but not them exclusively, e.g., child welfare services, pre-K.

Much More to This Story

This post, simple as it seems, was hard for me to write because the simple kept getting swamped in exceptions, explanations, etc.

On the one hand, the summary figures obscure wide variations among states. You can see some of them in the CBPP analyses I’ve linked to and in this core-purpose spending map from HHS.

On the other hand — and what you can’t see — is that the federal law gives states more perverse incentives to cut their caseloads than the flexibility to use TANF as a slush fund, e.g., a way to avoid penalties for not meeting their work activity targets.

At the same time, it effectively deters them from letting parents pursue a work activity that would lift a goodly number of families out of poverty — participation in a postsecondary education program for long enough to get a degree or specialized certificate.

And, as I’ve written, who knows how often, Congress has put the squeeze on all states by funding the block grant at the same dollar level for what’s now 20 years. It’s now lost a third of its real-dollar value.

In short, it’s well past time to reform welfare reform. Perhaps we’ll have something real to celebrate next year.

 

2 Responses to TANF Turns 20, Still Failing Poor Families

  1. […] of Temporary Assistance for Needy Families has occasioned more than the usual bashings, as my own bashing post noted. We’ve had a spate of proposals for reform — and not only from […]

  2. […] would have poverty reduction as a purpose. But TANF doesn’t. The closest the law comes, as I remarked before, is reducing […]

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