‘Make Work Pay,’ and Kids Benefit
A groundbreaking report on the effects of welfare reform shows that children fare best when parents continue to receive supplemental cash from the government after going to work.
When programs “make work pay” by rewarding working parents with continued cash allowances or other earnings supplements, the children tend to perform measurably better in school and have fewer health and behavioral problems, the report found.
The Manpower Demonstration Research Corp. report synthesizes studies of 11 welfare reform programs--including one adopted by the city of Riverside, Calif. The report compares participants in those programs to a control group that remained on the old cash welfare system. The programs examined in the report all were begun before national welfare reform was enacted in 1996, but they featured many of the same elements.
The researchers also found that any effort to move poor parents from welfare to work without supplementing their income had little effect--negative or positive--on their children.
The study is likely to be a starting point for Congress as it considers reauthorization of the welfare reform law in the next few weeks. “This is the first strong information about what a difference the type of welfare reform model makes when it comes to kids,” said Gordon Berlin, president of the research firm.
“What’s really striking about these findings is that where states both mandated employment and made work pay, there was a real improvement in school readiness and school achievement.”
National reform has resulted in a dramatic decline in the welfare caseload, with one-third to one-half of the families who once received cash benefits now off the welfare rolls.
That in turn has meant a drop in government spending on cash programs for the poor. However, a drop in dollars spent does not tell policymakers much about whether ending the welfare entitlement has been a success, because the results have differed markedly in different states.
Welfare reform was not a single program. Rather, every state put together a different mix of incentives to move parents from welfare to work--and allotted different amounts of money to help them obtain child care and health care. Some programs were more generous than others.
The report issued Monday suggests that if lawmakers want welfare to do more than reduce the amount of money government spends on the poor and move people into low-wage jobs, it must make a concerted effort to help augment poor families’ incomes.
Indeed, that question is likely to be at the core of the most heated debates in Congress over the next few months, according to conservatives and liberals.
“The studies surveyed are good studies . . . that all produce a similar finding: that if the family’s income is supplemented and the family works, then that has a measurable impact on the children that is really quite impressive,” said Ron Haskins, a senior fellow at the nonpartisan Brookings Institution and a former top aide on welfare reform to House Republicans.
“This [report] raises a very big issue that will be hotly debated. You could draw the conclusion . . . [that] we have to get these families to a certain income level to have this positive effect [on children], and the Democrats will like that a lot.”
Similar views were expressed by Wendell Primus of the Center on Budget and Policy Priorities, which studies programs that affect the poor.
“The next part of welfare reform needs to be on how to increase income,” said Primus, who was a top aide to the Democrats during the welfare reform debate.
The report found that in Minnesota, two Canadian provinces and in Milwaukee--where parents were permitted to continue to get government cash benefits after leaving welfare--their children’s school achievement increased. That corresponded in some programs with an increase of five percentage points in standardized test scores.
However, relatively few states provide earnings supplements as generous as those in Minnesota and in Canada.
In other findings, the report suggested that there appeared to be no harm to children whose mothers went to work.
In Riverside, the pilot program at the time of the study required that families participate in basic education activities and a job search as a condition of receiving welfare. But there was no earnings supplement, and families could be sanctioned if they failed to play by the rules.
The result was a decline in children’s health, but no perceptible change in their school achievement.
The most generous of the programs so far show little sign of being able to lift former welfare recipients into jobs that pay above the poverty line. Even those who are working full time for minimum wage and are collecting the earned-income tax credit and food stamps--which many of the poor have not been receiving--are still below the poverty line of about $17,000 a year for a family of four.
