Welfare Debate Driven by Half-Truths, Distortions : Poverty: After 20 years of haphazard ‘reforms,’ the system mainly serves single mothers and children.

The distance from the 50th floor office of the elite downtown law firm of Gibson, Dunn & Crutcher to the Harbor Interfaith Shelter in San Pedro is, socially and economically, about as far as you can go in this country. It is no surprise, then, that among their occupants you can find the opposing poles of a raging national argument over why America’s welfare rolls have grown during the past three years.

At Gibson, Dunn, one finds partner Daniel M. Kolkey, the lawyer who successfully defended placing Gov. Pete Wilson’s Proposition 165 on the November ballot. If it passes, poor women and their children who have been on welfare for more than six months will have their government payments cut by 25%. That reduction, Kolkey says, will “encourage people to move from the welfare rolls to the employment rolls.”

His assumption, which is echoed in the Republican and Democratic national campaign platforms, is that overly generous welfare payments make people dependent on the system and unwilling to take available jobs. “Presently, the system actually encourages welfare,” Kolkey contends, “because benefits exceed prevailing wages for the working poor.” In other words, cutting benefits will make minimum wage jobs more attractive.

But at the Harbor Interfaith Shelter, a run-down 1940s military barrack converted to one-room apartments, director David Christiansen says, “Welfare is mostly a program for kids and there is no room to cut without driving them further into poverty. The recession is so severe that our people just aren’t finding jobs. And when they do, they get paid so little, with no medical benefits, that a family can’t afford rent.”

National data reported by the states supports Christiansen’s view that most welfare recipients are children: One American child out of every seven is on welfare--9.3 million at last count, enough to populate three cities the size of Los Angeles.

Mothers, Children

In the popular imagination, welfare is a government handout to able-bodied adults who can’t or won’t work. But 20 years of haphazard, bipartisan--often contradictory--”reforms” have reduced it to a system that, today, serves mainly single mothers and their children.

Of the 13.7 million Americans on welfare, 68% are just kids, like 8-year-old Sharon, searching for a pet lizard in the construction rubble near the San Pedro shelter where she lives in a one-room apartment with her mother and sister.

Sharon’s mother, who doesn’t want her name used, is out looking for a job but doesn’t quite know what she would do with her children if she finds work in this recession-ravaged economy. Meanwhile, the family survives on welfare--Aid to Families With Dependent Children--the 57-year-old program which accounts for most of the nation’s welfare spending.

Even though California is spending 5% of its total state budget on AFDC in 1992-93, the maximum grant permitted a family of three is just $624 a month, half of which comes from federal funds. If you add the average $171 per month in federal food stamps to which the family is entitled, they received 82.5% of a poverty-level income.

Aid for AFDC families is slimmer in most other states. Each state sets its own maximum benefit levels. In January, 1990, a majority set it at less than half the federally defined poverty level. One-third set it at less than one-third of the poverty line.

Call to Require Work

AFDC rolls, which held steady as a percentage of the population for most of the past two decades, have lengthened dramatically in the last three years but are still below early 1970 levels. Although the cost of this aid still accounts for only 1% of the federal budget and an average 3.4% of state spending, there is a rising clamor that people like Sharon’s mother ought to be compelled to find a job.

Polls indicate that more Americans want to force welfare mothers to work than want to execute prisoners on Death Row. As a national political issue, welfare “is a winner,” says political analyst William Schneider. “Welfare is catching on. It’s a national mood, a national movement.”

Across the country, politicians of both parties have taken notice.

“Get a job or get off the dole,” President Bush exhorted early in the campaign.

Bill Clinton has called for an “end to welfare as we know it.”

Ross Perot has suggested incentives to help “millions of people struggling to get off welfare.”

James J. Florio, the liberal Democratic governor of New Jersey, and Pete Wilson, his conservative Republican counterpart in California, have proposed cutting aid to mothers who won’t work and disallowing additional aid for children born to women who are on welfare.

Facts About System

While the facts about welfare are not easy to come by, the current debate often is driven by half-truth and, at times, outright distortions. These facts are documented in the 1992 “Green Book,” the basic information source published by the House Ways and Means Committee:

--Welfare payments have not become more generous. Over the past two decades, the median purchasing power of benefits, per family, declined 43%.

--The program has become more restrictive over the years. A lower percentage of poor children are now eligible for AFDC. In 1973, 80.5% of poor children could qualify, but by 1990 only 59.9% were eligible.

--Most people who sign on for welfare use the system for relatively short periods. The average stay on welfare nationally is less than four years.

--Welfare mothers do not have more children than other mothers. The typical welfare family has two children; in Los Angeles County it is 1.9 children per welfare mother.

--There is scant incentive for women to have more babies to increase benefits. On the national average, a welfare mother who has a second child will receive only $2.27 a day in additional benefits.

--Most children raised by mothers on welfare do not remain trapped in the system. The evidence indicates that only one in five daughters raised in welfare families will also become a long-term dependent of the system; three out of five will not use it at all.

--African-American women make up a disproportionate share of long-term welfare cases, but their numbers have declined as a percentage of the overall welfare population. The largest class of welfare recipients is non-urban and white. The fastest-growing group is Latino.

--Claims that high benefit levels attract recipients from other states and significantly increase a state’s welfare load are not supported by the data. Of the 10 states that had the largest welfare roll increases in the last three years, seven had benefit levels below the national median.

Those are facts. Much else that is said about welfare and its recipients is murky and open to debate.

“Part of the reason we’re getting all of this craziness about welfare reform is that we know so little about it,” says Paul Offner, legislative aide to Sen. Daniel Patrick Moynihan (D-N.Y.), a welfare expert.

Even in California, which is a national leader in record-keeping, the data collection is spotty, since Sacramento gets all its information from the counties, whose methods of collecting and reporting data vary widely.

This imprecision has fed the debate over Prop. 165, which would cut welfare payments in order to force mothers into the work force. The proposition also would encourage teen-age mothers to study, allow for working welfare mothers to retain a higher percentage of their earned income and deny additional funds for babies born to mothers already on welfare.

But California’s health and welfare secretary, Russell S. Gould, concedes that the state is often at a loss for hard data on the welfare problem, because Sacramento has no computerized system for monitoring the statewide caseload.

In response to questions about why welfare rolls are growing, Gould and his aides suggested consulting Los Angeles County officials, who supervise 35% of California’s welfare cases and have the state’s best computerized system for tracking them.

The Times asked L.A. County officials to respond on the basis of their statistics to the Wilson welfare reform proposal. Their reply, prepared by County Public Social Services Director Eddy S. Tanaka and research director Paul Fast, contradicted nearly every assumption behind the governor’s proposed constitutional initiative.

Wilson, like Kolkey, argues that welfare payments need to be cut in order “to reduce the incentive to choose welfare over employment.”

But L.A. County officials say the primary problem is that the jobs welfare recipients are expected to take don’t exist. Hard times, not “dependency,” have pushed up the welfare rolls, they say.

In Los Angeles County, where an estimated 200,000 jobs have been lost in the last year alone, one person in six now is on welfare. The jump in the number of cases, Tanaka and Fast say, “can be due only to the impact of the recession . . . .

“The increase in poverty in Los Angeles County between 1980 and 1991 can fully account for the AFDC caseload increase during this period . . . . The estimated AFDC dependency rate for people below the poverty level is virtually unchanged from 1980.”

Mistakes on Causes

What this means is that the percentage of poor people using welfare has remained constant, undermining the argument that welfare itself breeds poverty. In 1980, 54.6% of county residents living in poverty were on welfare. In 1991 that percentage was 54.5%, virtually the same.

The governor has singled out an increase in teen-age pregnancy as a major cause of the rise in welfare loads. The initiative seeks to “discourage teen pregnancy” by allowing minor parents to receive aid “only if they remain at home with fit parent(s) or a legal guardian.”

Gould, the governor’s health and welfare secretary, has written, “The major caseload growth in the AFDC program has less to do with the overall economy and more to do with factors . . . such as teen births.”

Yet the most up-to-date figures from an April, 1990, study, conducted by Gould’s own department, show that for the state “very few cases contained a teen-age custodial parent,” and that overall only 2.6% of welfare cases fall into this teen-age parent category.

Another often-blamed villain in the welfare roll increase is the single mother, whatever her age. But the gradual increase in single mothers over the last two decades does not explain the growth in welfare cases over the past three years.

The most rapid rise in the nation’s female-headed households was from 11% to 19% in the decade of the 1970s. In the past decade, the increase was only 5%. In any case, three-quarters of single-mother families do not, contrary to popular impression, live below the poverty line, let alone on welfare.

Los Angeles County officials also confirmed that “the correlation between increased births to unwed mothers and AFDC caseload growth is poor.”

Under current federal law, people receiving welfare payments are discouraged, in effect, from going to work because they are docked $1 in benefits for every $1 earned at a job. This “reform” was ushered in by the Ronald Reagan Administration in 1981 as part of the Omnibus Budget Reconciliation Act, in a campaign to make sure only the “truly needy” received aid.

Before the act was passed 17% of AFDC heads of household in California worked, earning an average of $540 a month. A year after it was implemented, only 5% were working and they earned only an average of $295 per month.

Now the pendulum has swung back in favor of welfare recipients working. Critics and supporters of the Wilson initiative tend to agree that welfare recipients ought to be permitted to keep more of their earned income.

But a major barrier to taking work when it is available is the loss of Medicaid, the federally funded health care program to which AFDC recipients are entitled. Many of the jobs available to those leaving the welfare rolls for work do not provide medical benefits. The loss of those benefits combined with the low pay of the new jobs and the cost of child care will often push a family deeper into poverty than it was while on welfare.

Cheating the System

A recent study by the Washington-based Institute for Women’s Policy Research indicates that as many as 40% of welfare mothers sometimes try to stay on welfare and work while concealing their income. If officials knew about their wages, they would be docked benefit payments and perhaps taken off the rolls, losing all medical support. Many mothers choose honesty, but the incentive is clearly on the other side.

Take Lisa Valdez (not her real name), a single mother who is much better educated, more employable and more highly motivated then the vast majority of recipients.

Valdez has been on welfare since she became pregnant as a teen-ager with her son, now age 4. His father lives in another state and has yet to find a stable job. Valdez grew up in a middle-class family, which could support her but doesn’t. Although the governor’s proposals encourage teen-agers to live with their parents, in Valdez’s case that is no solution because, she says, she and her child were molested by her father.

So Valdez went it alone, refusing to surrender her child to her parents or an adoption agency. With the aid of her AFDC payments, she is striving to be a good mother. She is only a few credits from completing her degree at a major university, where she lives in student housing.

But she is also a welfare cheat, which is why she doesn’t want her real name used here.

Before the recent cut, welfare paid $535 a month, and if Wilson’s welfare initiative is passed by voters in November, it will be cut to $409. But even at the current rate, the arithmetic of welfare in California, one of the more generous states, adds up to a life well below the federal poverty line. Her student housing rent, which is federally subsidized, still takes up $195. That is a great break in California, where only one out of nine welfare recipients receive rent subsidies.

But as advantageous as Valdez’s situation may be, and despite the $70 a month she gets in food stamps, she still must pony up at least another $100 for food, leaving $240 for everything else, including transportation, clothes, children’s toys and entertainment. As she says, “When you add it up you’re going to come up with a negative balance, I know, because it happens every month and then I scramble.” Which is when she breaks the law.

To supplement her income, she baby-sits and sings in clubs. All told, she makes about $150 extra each month. If she reports it, the state deducts it from her payments, so there is no gain. If she doesn’t report it and the state finds out, she loses all, including the medical coverage that permits her to take her child to doctors at a health maintenance organization each month to treat a recurring ailment.

Still, Valdez, like many welfare mothers, does want to get off the rolls and hold a job. One reason, she says, is that “welfare is stigmatized. All the reports in the media make you feel that you are doing something wrong just raising your kid. And anyway, there isn’t enough money on welfare to properly raise a kid, so you have to work.”

So why doesn’t she just go out and get a job?

“I did. I got a good job as a statistician in a medical center for $9 an hour, interesting work which I really liked,” she replies. “But between child care costs of almost $800 a month and medical, which they didn’t provide, I came out too far behind.”

She did report her income from that job, around $1,000 per month, and was permitted to keep a good part of it without losing the whole welfare package--but only for three months. If she had stayed with the job after that, she would have lost welfare and medical. So after the three months, she quit the job and stayed securely on the welfare rolls.

Most welfare mothers are far less able to take a job than Valdez.

Working and Poor

Casey S. McKeever, directing attorney of the Northern California office of the Western Center on Law and Poverty, warns that “in the midst of a profound recession, forcing mothers off welfare to encourage them to find a job that doesn’t exist is a cruel hoax.”

But health and welfare’s Gould argues that “jobs do exist. The work experience is valuable training in itself, and entry-level jobs, while perhaps not paying more then the minimum wage, are valuable because they are a step up the ladder to better-paying positions.”

But a recent report prepared by the University of California School of Social Work argues that “after a decade of economic reorganization in the United States, during which high-paying jobs in the manufacturing sectors declined while low-wage service jobs grew, even employed families are now living in poverty and at risk for needing welfare.

“Work is no longer a guarantee that families can escape poverty. More than one-third of poor children under 6 live with single or married parents who work the equivalent of at least one full-time, full-year job.”

Federal statistics for 1990 indicate that two-thirds of poor families with children contain at least one worker. But having a full-time job no longer guarantees a life outside of poverty.

“A strong back and a strong desire to work no longer gets you a ticket to the good life,” is the way Cesar A. Perales, New York City’s deputy mayor for health and human services, puts it.

Perales, who was New York state’s commissioner of social services for eight years, has concluded that “welfare reform that is preparing people for work is just about meaningless in a system where work does not leave you better off than remaining on welfare.”

Times researcher Nina Green contributed to this story.

Next: Jobs and job training.

Separating Fiction From Fact

There is little evidence for many of the sweeping stereotypes about government support:

Assumption: Welfare rolls have mushroomed over the last two decades.

The reality: At about 5% of total population, the proportion of welfare recipients has remained steady.

The evidence: House Ways and Means Committee’s 1992 “Green Book” report.

AFDC recipients as a % of total population.

Assumption: Welfare mothers have inordinate numbers of children despite government help.

The reality: In 1990, nearly three-quarters of AFDC families had no more than two children, and family sizes have been decreasing since 1969.

The evidence: House Ways and Means Committee’s 1992 “Green Book” report.

Average welfare family size: 1990: 2.9 1988: 3.0 1986: 3.0 1983: 3.0 1979: 3.0 1975: 3.2 1973: 3.6 1969: 4.0 *

Monthly Benefits in 1992 Dollars 1970: $652 1980: $482 1990: $395 1992: $367 Assumption: Welfare benefits per family over the last 20 years have skyrocketed.

The reality: The current purchasing power of AFDC benefits, measured in 1992 dollars, has plunged to 56% of what it was in 1970.

The evidence: Figures from the Center of Budget and Policy Priorities.