The Black Informant

The state of welfare in America

Below, you will find a few excerpts from articles that I have gathered from around the net that explains some of the details of the welfare system here in America. I may comment from time to time, but as usual you will be provided links to the full article.
===

Columns: The Growth of Government in America
By Stephen Moore (1993)

Stephen Moore is Director of Fiscal Policy Studies at the Cato Institute. This article is adapted from a study prepared by the Institute for Policy Innovation.

Welfare

A huge portion of our social welfare spending today is for Social Security. Social Security is the largest and most popular program in the federal budget. Some have suggested that it is only Social Security that is growing rapidly, not other income transfer programs, such as welfare. This is not so. The anti-poverty programs are growing too. Total Aid to Families with Dependent Children (AFDC) spending at all levels of government has increased dramatically over the past 50 years:

• In 1940 public assistance spending was $1.3 billion.

• In 1970 public assistance spending was $16.6 billion.

• In 1992 public assistance spending was $18 billion.

The primary reason that total welfare spending is growing is not that the benefit levels are substantially more generous, but rather that welfare caseloads continue to explode. The number of AFDC recipients continues to grow:

• In 1936 in the middle of the Depression there were just over one-half million recipients.

• In 1950 there were 2.2 million recipients.

• In 1970 there were 9.7 million recipients.

• In 1992 there were 13 million recipients.

Other public welfare programs show the same pattern of increase. For example, the food stamp program, started with a budget of less than $2 billion in 1970, now has a budget of $23 billion. Today there are roughly 25 million people collecting food stamps—or nearly one of every ten Americans. Millions of able-bodied Americans are now collecting government checks, making welfare one of the fastest growth industries in America today.

Despite the huge outlays on anti-poverty programs, this spending has done amazingly little to reduce poverty. One reason for this lack of success is that welfare spending is badly misallocated. Another is that welfare spending actually creates poverty.

• In 1990 government anti-poverty spending equaled $184 billion.

• In 1990 it would have cost only $75 billion to bring every family with an income below the poverty level up above that benchmark. Hence, government was spending two-and-a-half times what would be needed to end poverty in America.

• However, after that $184 billion was spent, some 30 million Americans remained below the poverty level.

• More than half of all welfare recipients had pre-welfare incomes above the poverty level.

• The welfare industry intercepts a huge portion of anti-poverty funds. In cities such as Milwaukee, there are now 62 separate welfare programs, each with its own bureaucratic costs.

All told, since the early 1960s, government at all levels has spent $3.5 trillion on programs for the poor. Yet there are more poor in 1993 than there were in 1963. Sadly, there is much truth to the adage that America has fought a war on poverty, and poverty won. (more…)

====

No Welfare Reform For The District

by Naomi Lopez and Michael Tanner

Naomi Lopez is an entitlement policy analyst and Michael Tanner is director of health and welfare studies at the Cato Institute.

Despite the fact that one of six district residents is on welfare, more than a third of district children still live in poverty. Out-of-wedlock births have reached alarming proportions. Of the district’s more than 50,000 children in welfare families, 83 percent were born out of wedlock and 10 percent come from broken homes. Only a mere 1 percent of Aid to Families with Dependent Children (AFDC) households contain two parents. Long-term dependency is increasingly the norm as is second and third generation welfare dependence.

The district has followed the liberal route of trying to solve its welfare problems with money. On a per capita basis, the district has the highest federal social welfare program spending in the nation. Of the 50 states and district, the district ranks

* first in per capita federal spending on AFDC, food stamps, Medicaid, housing assistance, job training under the Job Training Partnership Act, and community development;

* second on Medicare and state employment services;

* fourth on compensatory education for disadvantaged children;

* fifth on Supplemental Security Income and the social service block grant; and

* twelfth on child nutrition programs.

The value of the full package of welfare benefits in the district (including cash assistance, food stamps and nutrition assistance, housing assistance, Medicaid, and so on) totals more than $22,745 per year for a single mother with two children. Because welfare benefits are tax-free, a working person would have to earn nearly $14.00 per hour to take home an equivalent paycheck. Indeed, the district’s welfare package is the fifth most generous in the nation. Is it any wonder that so many recipients make the rational choice of welfare over work? (more…) (Hat tip: Larry Elder)

>>Because the above article was written back in 1996, you have to make the adjustment to 2006 standards (which in no doubt would be greater than the $22,745 or $14 per hour).

This is exactly why we will continue to have situations like this:

Hotel residents pocketing FEMA rent checks
January 17, 2006
By Mike Hasten
The Shreveport Times

BATON ROUGE — More than 85 percent of Hurricane Katrina evacuee families housed in hotels in Louisiana have received Federal Emergency Management Agency checks to pay for apartments or other housing, but have not moved from their hotel rooms.

Besides picking up the tab for hotel rooms, FEMA has approved checks totaling $2,358 — $786 a month for three months — for about 8,500 of the 9,890 households in 9,701 Louisiana hotel and motel rooms as of Monday morning. FEMA records show 18,789 individuals in the rooms.

“The first three months’ payments may not have been spent appropriately,” said FEMA public information officer Kelly Hudson, since so many families have not moved into apartments or houses. “We have gone the extra mile but they need to be participants in their own recovery.” (more…)
====