Facts

In 1996, "welfare as we knew it" went through a massive overhaul, putting caps on how long welfare recipients could stay on the dole and requiring they work and/or study along the way. Now that we've hit the 10th anniversary of welfare reform, most pundits are revelling in the success of reform, while some wonder if the drop in welfare roles doesn't have a dark side (see poverty). Here we only offer a brief fact backgrounder.

What is it?

“Welfare” welfare:

When someone says “welfare”, what probably jumps to mind is a government cash hand out to the non-working poor. That's the most common use of the term and refers to a program under Temporary Assistance for Needy Families (TANF), which gives federal money to poor families based on need. TANF was passed in 1996 to update an earlier law, Aid to Families with Dependent Children (AFDC); the new law set a time limit on how long a family could get assistance, requiring states push TANF recipients toward work and education, and giving states a lot of leeway on how to go about that task.

Other types of welfare:

TANF's “welfare” is only one example of ways the government provides support to the poor and out of work – and only accounts for a small percentage of that support. There are many other sources of government assistance. Two ways that the feds look at it are:

“Income tested benefits.” One larger understanding of “welfare,” which the Congressional Research Service keeps track of, includes all assistance and aid that goes to help Americans based upon need .
This includes not only “welfare checks,” but also food stamps, housing and education benefits, medical services for the poor and other services. (CRS - pdf)

“Income security.” The Congressional Budget office tracks another category of spending which may better fit your sense of what counts as government assistance. In CBO terms, “income security” includes the “income tested benefits” we list above - minus medical services but plus unemployment checks. (CBO)

"Welfare" welfare

Cash assistance for "welfare" welfare (from states and feds), percent of Americans who receive welfare assistance:

sources: ACF, CRS, Census

Income tested benefits

Total spending on "income tested benefits" (2002):

• $522 billion, of that:

  • $373 billion is from the feds (17% of budget);

  • $149 billion is from states and localities.

What's included in income tested benefits

source: CRS
(pdf) notes: “Medical aid” is almost all Medicaid. “SSI” is
Supplemental Security Income. “TANF” includes only direct TANF cash payments – other TANF funds go toward other supports, like job training. EITC is “earned income tax credit” checks for low income workers. “Education aid” doesn't include funding for public schools.

Change in income tested benefits over the years

source: CRS (pdf)

“Income security”

Total income security from the feds:

• $191 billion (8% of the total federal budget)

Income security over the years - as a % of national income (GDP)

Where the facts are from:

• ACF - Administration for Children and Families - government site

• CBO - Congressional Budget Office - government site

• Census - U.S. Census Bureau - government site

• CRS - Congressional Research Service for House Ways and Means

Other good sources:

• GAO - For an excellent chart on all federal and state welfare assistance programs and who's in charge of what, see page 12 of this GAO report.

• CBO – trends in means-tested programs

• CRS - discussion of effects of Welfare Reform

• Chapin Hall's study on the effects of welfare reform

• Fed website on all government benefits: govbenefit.gov

Did we miss something, let some slant slip in, lose a link - or do you just have something to say? Drop a line below! In the spirit of open dialogue, cJ asks you keep it civil, keep it real and keep it focused on the message, not the messenger. See our policy page for more on what that all means.