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The Neoliberalization of Social Welfare Programs: Personal

Responsibility and Work Opportunity Reconciliation Act

(PRWORA) of 1996 Fifteen Years Later

By Luz Baez

Fall 2011: Market, Power and People

Division of Interdisciplinary Studies at the Center for Worker Education

The City College of New York, CUNY

MA Study in the Americas

November 23, 2011

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On August 22, President Clinton signed into law "The Personal Responsibility and

Work Opportunity Reconciliation Act (PRWORA) of 1996‖ with a promise ―to change

welfare as we know it‖. Each State was charged with developing strategies, programs and to

implement back-to-work incentives in an effort to decrease dependency on public welfare

programs and promote self-sufficiency. What were the historical antecedents and the

philosophical ideology of the modern welfare state? How have specific eras of welfare

programs reshaped these understandings? What role should the state in a modern society play

and what are the obligations of the citizens toward the state, and the welfare programs?

August 22, 2011 marks fifteen years, since the passage of the PRWORA. The

caseloads on families receiving temporary assistance to families ―TANF‖ have dropped

dramatically. In 1996, New York City for example approximately 1million city residents

were receiving public assistance. The number has dropped as of September 2011 to 347, 300.

The same occurred nationwide.

This research document will provide an overview of the historical social welfare

programs introduced and the philosophical perspective associated with each. The ―New

Deal‖ and the inception of the Aid to Family with Dependent Children changed the urban

space. Why the ―war on poverty‖ under the ―Great Society‖ failed and the public’s view of

welfare dependency. The new federalism of the 1990s and programs implemented to reform

welfare programs. Finally, a review the Personal Responsibility and Work Reconciliation

Act of 1996 signed by President Clinton on August 22, 1996 and whether it can be hailed as

a success or just another failed government program.

History of Social Welfare Programs

To get a full understanding of how the welfare program has changed through the

years it is critical to provide a brief history of the social welfare, as well as the underlying

public sentiment. ―The basic tenets and programs of any social welfare system reflect the

values of society in which the system functions. Like all other social institutions, social

welfare systems do not arise in a vacuum; they stem from customs, statutes, and practices of

the past‖ (Trattner, 1). These practices of assisting those in need have been discussed since

the days of the ―ancient Greeks and Romans‖ (Trattner, p.1). During the Medieval times the

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churches provided for the poor. ―The dissolution of feudalism and the manorial system,‖ in

which it was understood that the poor had to be provided for, and the inception of capitalism

created both a social and economic instability (Trattner, 6). The uncertainty and lack of

employment created a large population affected by poverty. To alleviate the situation the

government had to intervene to restore social order and restore the community life.

―In 1536 with the passage of the Act of Punishment of Sturdy Vagabonds and

Beggers – the Henrician Poor Law—the government excerised further responsibility for the

relief of the person in economic distress‖ (Trattner, p. 9). This act set in motion many

provisions to ensure the economically distress were provided for, however, the act also allow

for local officials to tax the citizens, if the church collections were insufficient, and ―the

authority to take children under the age of fourteen years of age and above the age of five

years, in begging or idleness, and appoint them to masters of husbandry or other crafts or

labor to be taught, by which they may get their living when they come to age‖ (Trattner,

p.9). As the societal needs changed different acts were introduced whichrequired the

employment of the abled-bodied, unemployed. Some of the Elizabethan poor laws passed

were punative. For example:

Parents insofar as they had means -- were legally lible for the support of their

children and grandchildren. Likewise the children were responsible for the care of

their needy parents and grandparents. More important, vagrants refusing work could

be committed to a house of correction; whipped, branded or put in pillories and

stones; or even put to death. (Trattner, p. 11)

In addition to the punative measures the law also ―defined three major categories of

dependents, children, the able-bodied and the impotent and direct authority to adapt their

activities to the needs of each: For children – apprenticeship for the abled-bodied – work and

for the incapiciated, helpless or ―worthy‖ poor, either home or institiutional relief.‖ The

implementation of ―the law firmly established the principle of local responsibility, at the

lowest level, for the care of those in need‖ (Trattner, p. 11).

The Industrial Revolution and the introduction of factory created upheaval to the

economic and social structure of the country. The shift from agrarian means of sustenance to

urbanization and mass production ―led to the decline of rural handicraft and the rise of urban

masses with limited skills‖ (Trattner, p. 6). As conditions in England worsen, the need to

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provide for the needy and ―stabilize community life‖ became crucial. ―It was in this contest

that the modern institution of social welfare emerged‖ (Trattner, p.7). These very laws were

brought to the new world by the early settlers and instituted in the framework of the

government who according to the poor laws had a ―legal responsiiblity to aid those in need‖

(Trattner, p. 214).

In addition, the change in the economic conditions led to mass immigration to the

new world. Throughout the years the changing government and public sentiment of the

programs which adminster to the poor have undergone drastic changes. Bills that were

introduced to provide for the welfare of the citizens, specifically the Dix Bill requesting

―Congress to appropriate ten million more arces [of land] to the states to help pay for the

consturction and maintenance of mental hospitals‖ were vetoed by both the Congress and

President Franklin Pierce in 1848 (Trattner, p. 66). Pierce stated ―I cannot find any authority

in the Consititution for making the Federal Government the great almoner of public charity

throughout the United States‖ (Trattner, p. 67). This shift in public policy and sentiment led

to the an increase privatization of welfare programs. As the need to As ―private citizens,

either individually or in groups, undertook the providing of aid and services to the

dependent‖ (Trattner, p. 214). Private organizations and charities in which volunteers would

visit the poor began to collect and analyze data. The data compiled provided a grime analysis

of the dependent. The data revealed that causes of poverty cannot be attibuted to idleness or

character but to ―involuntary unemployment, low wages, and industrail accidents‖ (Trattner,

p. 100). This revelation led to the development of a comprehensive approach of dealing with

the societal issues prevalent in the poor communities.

During the 1920s’ ―everyone seemed to be making money, one way or another‖

(Remini, p. 213). The unemployment rate in 1929 was 3.2% however; sixty percent of the

country was living at or below the poverty level five years prior to the market crash. ―Only

farmers were excluded from the rich harvest. […] Farmers appealed to the government but

received little‖ help (Remini, p. 212). Appeals for federal aid to assist the unemployed also

went unheeded. At the peak of the depression unemployment rose to 24.9% in 1933 and did

not decline until the early 1940s’. President Hoover did not think that it was the

government’s responsibility to intervene in the lives of the people. President Hoover stated

―You cannot extend the mastery of government over the daily lives of the people without

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making it the master of their soul‖ (Trattner, p. 277). Just as his predecessor, President

Pierce, the overarching sentiment was that the responsibility of the dependent was not the

federal government’s responsibility. ―The Nation magazine asked him [Hoover], ―Shall

America Starve?‖ and ― Must Americans perish miserably because of your fear that their

character may be sullied by a dole?‖ (Trattner, p. 277).

The efforts made by the Hoover adminstration were shortlived, to late and didn’t help

the economy. As private local agencies tried to provide services they found ―ordinary

middle-class people who had worked all their lives but who were unemployed, penniless and

hungry, the new so-called poor, were clearly beyond their means‖ (Trattner, 273). The

question is who should the responsible for providing for relief be private or public? This

question is still being debated today.

New President, New Deal – Restoring Faith in the Government

Franklin D. Roosevelt in his inaugural address stated ―this great nation will endure as

it has endured, will revive and prosper‖ (Remini, p. 221). Roosevelt, unlike his predecossors,

believed the government in a civilized society had a social and moral obligation to ensure a

minimun standard of living for it’s citizens ―and that liberty and security were synonymous;

thus the very existence of a democratic state depended upon the health and welfare of it’s

citizens‖ (Trattner, 281). This federal government instituted the Public Work Programs

which created thousands of jobs for the unemployed and passed of the Social Security Act in

1935 which ―provided cash payments in case of unemployment, old age, and loss of the

family breadwinner –some of the causes of poverty—it not only helped prevent destitution

and dependency but did son in a way that did not threaten individual freedom and dignity‖

(Trattner, 293). The question of whether it’s a private or public responsibility to take care of

the dependent was finally addressed. The government has some responsibility to its citizens.

The Social Security Act of 1935:

established a new alignment of responsibility in the field of public welfare. It marked

the beginning of a policy of federal aid to the states upon a permanent basis for

regular recurring social work, closing the door on three centuries of poor laws and it

principle of local responsibility. For the first time in American history, funds to

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finance all or part of the needs of selected groups in the population became a major

permanent item in the federal budget, one that has continued to grow each year

(Trattner, p. 294).

The passage of the Social Security Act shaped the American welfare system through-out

twenty-first century and has been the subject of debate since its inception.

The Great Debate and the War on Poverty

The Social Security Act provided for the elderly, aged, and under Aid to Dependent

Children program for children of widows and/or families in which a parent deserted.

―Between 1935 and the early 1950s’ the elderly received the bulk of the federal and state

welfare funds. By the middle of the decade recipients of A.D.C. outnumbered all others

receiving such assistance‖ (Trattner, 309). Primarily provided to white women and their

children, as the ―increasing number of single black women with illegitimate children‖

became the primary participants opponents of the program began to attack its effectiveness

(Trattner, p. 309).

The debates on whether government should be responsible for its’ needy citizens

arose again. Alfred L. Joesph Jr. the his article Welfare Reform: Forward to the Past, states

―Progressive believe that the essential role of the state is to provide assistance to the with the

least power and priviledge who for whatever reasons are not able to access resources. The

opposite view is that the state should play a limited role in the distribution of resources‖.

Furthermore, if the state is responsible for distribution of resources than how can are these

programs be part of the means of production and the wage system? As the politicians in

Washington were debated the question the American public comfortable in their restored

prosperity ―knew little and cared less about them [the aged, sick, disabled, women with

children and no husbands or were deserted by their husbands] and the needy‖ (Trattner,

312). Many administrative reforms were to be instituted to further regulate who can recieve

and under what conditions assistance will be provided.

Poverty, whatever the public may have thought had not been eradicated and the

American Dream of owning a home and obtaining financial stability not been realized for

many of the citizens. Who were these invisible people? ―The 1960 census figures provided

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scholars and withers with the raw material‖ to identify these individuals who were

marginalized and living in the fringes of the affluent Americans. (Trattner, p. 316) ―The

literature on poverty grew large and demonstrated that, beneath the layers of American

affluence there were strata of deprivation…and the deprived could be found in all sections of

the country, in all parts of the population, in all age groups‖ (Trattner, p. 316).

The age old question again re-surfaced and ―by putting the power of the White House

and the federal bureaucracy behind welfare reform—the Kennedy shattered the relative

complacency of the characterized the previous decade‖ (Trattner, p. 321). As President

Kennedy’s administration ended, by his assissination, his successor, Lyndon B. Johnson

continued to enact the necessary welfare reforms to help the needy. Under Johnson

presidency such programs as the Food Support Acts were enacted under the administration of

the Secretary of Agriculture. The Food Stamp program is not seen as an entitlement program

since ―economic, rather than social welfare, policy determined its operations‖ (Trattner, p.

325). These programs were designed to increase the food purchasing power and nutritional

needs of the poor. By ―March, 1993 food stamps were helping to feed close to 27 million

Americans or about 10.5 percent of the population‖ (Trattner, p. 325).

As opponents of the social welfare programs began to request reform the images of

the poor were a far cry from reality. The recipients of the social welfare programs were

depicted as ―underclass…most visible in the urban slum settings and is about 70 percent

nonwhite, but includes many rural and white people, especially in Appalachia and the South.

Much of the Urban underclass is made up of street hustlers, welfare families, drug addicts,

and former mental patients‖ (Mead, 22). This portrayal of the recipients was not limited to

private citizens. ―In the 1980s Ronald Reagan called forth the stereotype of an African-

American ―welfare queen‖ who defrauded the welfare programs of millions (Abramowitz, p.

23). To that end the message reiterated in Washington and to the public was that ―Welfare

Reform was necessary, since only ―a tough love‖ approach would ultimately help the poor by

forcing them to take responsibility for themselves‖ (Kilty, p.115). Before Ronald Reagan left

office the ―education, health, housing, environment, food stamps, school meals, the National

Endowment for the Arts and Humanities, and urban aid programs were slashed‖ (Remini,

296).

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Dismantling the Welfare System through Devolution: Personal Responsibility and

Work Reconciliation Act of 1996

The public sentiment towards the poor and their contribution to the economic growth

of the country and the global economy continued. ―Bill Clinton took up the banner by

promising ―to end welfare as we know it‖ in 1992 (Kilty, p. 115). On August 22, 1996

Clinton signed into law the Personal Responsibility and Work Opportunity Reconciliation

Act (PRWORA). Some of the overarching components of the Act are the mandates to the

States to take on greater responsibility in administering the social welfare programs, the

expansion of the welfare to work initiatives, institution of a sixty month time-limits on cash

assistance, and greater accountability to federal government on how these initiatives are

implemented. ―TANF is a block grant program to help move recipients into work and turned

welfare in a program of temporary assistance‖ (Kilty, p. 115).

Since its’ inception in 1936 the Aid to Dependent Children, (which changed to Aid to

Families with Dependent Children in the 1960s’) and now under the Temporary Assistance

to Needy Families government programs have been providing benefits to families living

below the poverty level or with low income. As Figure 1 represents there has been a steady

increase in family participant in these programs. The number rose steadily until the passage

of the PRWORA in 1996.

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Millions of recipients left the rolls, the underlying premise that any job was a good

job. In New York City the number of individuals and/or families receiving AFDC in 1996

was approximately 1.5 million and the Food Stamp participation at 798,396. The transition

from AFDC to TANF, with the work first concept resulted in a drastic drop in the number of

participants, however, because of the low wage jobs the number of participants in the Food

Stamp Program has increased dramatically. Figure 2 represents the shift in assistance from

TANF participation to a greater dependency on Food Stamps benefits, which are not

considered an entitlement program, in New York City, since the inception of the PROWRA.

Figure 2: New York City, Years 1996 - 2010

0

1,500,000

353,722

798,396

1,832,667

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

1,600,000

1,800,000

2,000,000

1936 1996 2010

TANF/AFDC Paricipation Food Stamp Participation

As recipients were placed in low-wage jobs, without health insurance, adequate child

care or chance for advancement ―the number receiving food stamps, unemployment

insurance, in poverty and homeless have skyrocketed during the past decade‖ (Hutchinson, p.

2). These statistics are also reflective of the decreased in TANF participation in the rest of

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the nation. The states were given the responsibility of designing how PRWORA would be

implemented. Some states opted for the maximum sixty months of times limits for cash

assistance and others implemented other limits. Figure 3 represents a sample of selected

States and the lifetime limits for Family Assistance. Some terminate the entire family unit

and others terminate only the adult head of household as illustrated.

Figure 3 Selected States and Lifetime FA Time Limits Selected

State Lifetime limit Whose Benefits Are Terminated

Entire unit Adult only

Arkansas 24 months X —

California 60 months — X

Colorado 60 months X —

Connecticut 21 months X —

Delaware 36 months X —

Florida 48 months X —

Georgia 48 months X —

Hawaii 60 months X —

Idaho 24 months X —

Illinois 60 months X —

New York 60 Month* X

North

Carolina 60 months X —

North Dakota 60 months X —

Ohio 60 months X —

Oklahoma 60 months X —

Texas 60 months X —

Utah 36 months X

Source: Administration for Children and Families 8th

Annual Report on TANF

The ADFC administered by the Federal government until the new federalism had one

one set of rules, under PRWORA there are now fifty different set of rules for the families

and/or individuals seeking assistance. New York State, for example, has opted for 60 month

time-limit on Family Assistance, has a Safety Net program which provides non-cash

assistance benefits for families who have reached their 60 months lifetime limits. Other

states do not have a safety net and families that have used up the time-limits find themselves

in poverty and without any means of support. ―The realities of the labor market have had

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deleterious effects on job seekers, included many affected by welfare restructuring, and

poverty and hardship have grown. Between 2000 and 2002 the official poverty rate rose .8

points‖ and has been raising continuously (Morgen, et al. 2006).

According to the latest information from the Census Bureau, the 46.2 million

Americans living below the official poverty line, $22,314 for a family of four was the highest

number in the 52 years the bureau has been publishing figures on it, while the percentage

living in poverty is now 15.1, the highest since 1993. This also represents the impact the

1960’s War on Poverty had in reducing hunger in America. There was a steady decline and

by 1975 the poverty rate was at 10%.

Figure 5: Poverty Rate and Number Poverty: 1959 to 2010

Source: U.S. Census Bureau, Current Population Survey, 1960 to 2011 Annual Social and Economic

Supplements.

After Reagan’s ―trickle down economy‖, globalization and the new federalism the

poverty rate began to show a steady increase and in 2011 there are approximately 46.2

million Americans living in poverty. The attack on the working poor and the dismantling of

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the welfare program which administered to the needs of the aged, disabled, and children and

those otherwise disenfranchised began. The misconception that poor people did not work and

lived on the dole was taking root. However, ―according to columnist, Bob Herbert, 9.2

million working families in the United States (one out of every four) earns wages that are so

low they are barely able to survive financially‖ (Kilty, p.116). Figure 6 illustrates that

nationwide including Puerto Rico the percentage of families living in poverty is 15.1. The

southern states have the highest level of families in poverty at 16%. Some of these states

opted for stringent time-limits, closing the case of the entire family unit without granting any

extensions and require intensive workfare participation. ―The welfare to work programs are

not miracle cures for family poverty‖ the authors continues by stating that ―many economist

find that former welfare recipients face great difficulties in finding employment wages that

adequately support their children‖ (Blank and Blum Spring, 1997).

Figure 6: Poverty rate per state, Mississippi leads the pack...along with all the Southern States

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In 2010, the poverty rate is an average of 15.1 there 13.9 million Americans who

remain unemployed, some have found other means of making money and others are trapped

in low wage and/or low productivity jobs the expectation to escape poverty is minimal. The

face of the poor is changing; and statistics are finding that the working middle class, who

because of the economic crises finds themselves unemployed and with benefits that are

running out, is now seeking benefits to feed their families. Tina Dupuy, in the article GOP –

Brings Back Corruption of Blood Laws states:

in this country the American Dream pivots on doing better than your parents by the

will of you and your metaphor—worthy bootstraps. In this country it doesn’t matter

from where or from whom you came, the dream can be yours too. I was raised in

foster care. The state not only protected me from my parents, they were my parents.

…the state was only concerned with my welfare and well-being. I benefited from a

humanistic policy that was not wrapped in the myopic frenzy of political theater

…Most importantly; we’re a nation that protects children- regardless of who their

parents are. (Dupuy, 2010)

In Hands to Work: The Stories of Three Families Racing the Welfare Clock the

author, LynNell Hancock narrates the story of Brenda Fields. Like Tina Dupuy, Brenda also

had to navigate through the foster care system her experience was quite different. The

narrator states, ―Brenda’s family, in contrast, was fractured from birth. She was raised by a

series of foster families, promised adoption that never happened, split from her siblings at

age fifteen…She depended completed on the vagaries of public aid in an unforgiving city

[New York City]‖ (p. 265).

In both situations the state not only protected the rights of its most helpless citizens,

but also ensures their security. The role as the protectorate of children has changed

dramatically. The deep-set prejudices targeted at the poor seem to arise when the economy is

at its worst. Were the government aid programs in crisis? Was the crisis real or perceived?

―Friedman articulates that only a crisis –actual or perceived—produces real change. When

that crisis occur the actions that are taken depends on the ideas that are lying around. That

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our basic function: to develop alternatives to existing policies, to keep them alive and

available until the politically impossible becomes politically inevitable‖ (Klein, pp. 6).

PRWORA, unfortunately, was one such solution. The Act promotes marriage, intact

households, child support and work, however, the program’s time-limits and family sanctions

has had overarching negative results on children. In exploring PRWORA it is fair to ask

what the status of children in United States is. Are children faring better today?

According to the Department of Census between 2007 and 2010, as illustrated in

Figure 7, there were 25 percent of the children living in poverty and 48 percent live in

household with low income. The number of children under the age 6 which are living below

the poverty line or in low income families from 2007 through 2010 is increasing. It’s

apparent the underlying fabric of the welfare reform policy was harder on needy children.

This cruel reality as depicted in this graph provides a grim future for the United States and its

children.

Figure 7: Below Poverty and Low-Income Children under Age 6

The rise in poverty, as neoliberal programs are introduced and global markets open is

a worldwide phenomenon. According to the World Bank Group it is estimated that

approximately 202 million individuals world-wide are unemployed and millions are in low

productivity jobs. In analyzing neoliberalization it is important to ―specify the patterns of

related activities…within the global political economy that constitute and reproduce this

syndrome across otherwise diverse sites, places, territories, and scales‖ (Brenner, Peck and

Theodore, 2010). These specific patterns identify the widening gap between the classes and

failed programs which fail to meet their objectives.

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Fifteen Year Old TANF: Success or Failed Program

August 22, 2011 marked the fifteenth year anniversary since the passage of the

Personal Responsibility and Work Opportunity Reconciliation Act. The effects have been

felt by the young, old, poor or elderly. Is it cause for celebration? That would depend on

who is asked. The Washington Press columnist’s Bauer, on February, 26, 2010 in the article,

Ending Welfare Reform stated ―Welfare reform has been an overwhelming success. Since

1996, welfare caseloads have decreased 70 percent, which translates into 8.8 million fewer

people dependent on government‖.

On the other hand The GRIO columnist’s Hutchinson, August, 24, 2011, in the

article, Welfare Reform 15 Years Later: Clinton’s Worst Move Revisited ―The nation is

stuck with a reform that did indeed end welfare as we know it. The price for that was to

increase poverty for the millions that we also know.‖ Elizabeth Lower-Basch’s, of the

CLASP, testimony before the Senate Ways and Means Committee on TANF’s Role in

Providing Benefits to Struggling Families stated:

the program [TANF]was flawed and failed to provide a safety for families once the

time-limits were exhausted…even families in desperate need are failing to receive

help from the TANF program… [Additionally,] former recipients who lost benefits

due to permanent sanctions or lifetime limits on benefit receipt may not be eligible to

come back on the rolls. Others may incorrectly believe that they are ineligible to

receive additional assistance (Lower-Basch 2011).

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The Wall Street Journal on

Figure 8: Welfare States – Percentage change in welfare cases in the 30 most populous states, from between

2009 and 2010.

Fifteen years later or one hundred years later the contributing factors to poverty in

America remain the same. The analysis of the data compiled by the volunteer charity workers

revealed at the turn of the century, and analysis of data compiled today would come to the

same conclusions. High involuntary unemployment, low wages and lack of skills and not the

character of the poor contribute to the dependency on government funds. The poor are living

in the periphery, invisible, and frustrated as the find their way through the maze of social

welfare programs. ―There is no moral justification for the continued existence of poverty in a

nation with so much wealth‖ (Kilty, 115). What role should the state in a modern society play

and what are the obligations of the citizens toward the state, and the welfare programs?

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