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California Welfare Reform: How is it Doing?
By Eloise Anderson

In 1996, the Republican-controlled United States Congress abolished the well-known federal welfare program, Aid to Families with Dependent Children (AFDC), and replaced it with a new program that placed time limits on cash assistance and emphasized work. President Bill Clinton signed the reform bill after two vetoes and the outcry against the reform from many within his administration. The new law allowed states to change their welfare programs in ways that would encourage people to be self-sufficient and less dependent on government. It was the most important change in welfare policy in more than 30 years.

California passed its version of welfare reform in 1997. When Congress changed the law, 21 percent of all Americans on welfare lived in California. Democrats in the state Legislature resisted reforming welfare in a way that emphasized work requirements. The notion that mothers with children should be responsible for their children was a new concept for many California legislators. The resulting bill - a compromise forged by two Democrats, Senator Mike Thompson and Assembly Member Dion Aroner, and two Republicans, Senator Ken Maddy and Assembly Member Roy Ashburn - was more paternal and lenient than many welfare reform programs in other states. Republican Governor Pete Wilson signed the compromise into law in August 1997.

The results of the changes in the federal program so far have been dramatic. Nationwide, the number of Americans on the welfare rolls declined by 50 percent since Congress "ended welfare as we know it." But in California, the reduction has been just 28 percent.⁽¹⁾ Why? What can California do to achieve the great caseload reductions of such states as Florida, Indiana, Texas, Wisconsin and Wyoming? First, lawmakers and county officials need to change the way they think about welfare policy. Second, several policies that resulted from California's reformed program, CalWorks, should be reconsidered if the state ever hopes to meet the federal welfare reform goals that move families into the productive mainstream in a timely manner.

Welfare reform changed the nature of the program from one that encouraged mothers to stay home with their children to one that focused on maternal responsibility for children's material well being. The old program, AFDC, was created in the 1930s as part of the New Deal with a few modifications over the years. Policy-makers at the time intended the program to spare widows with children from having to work outside the home. Because of the nature of housework and the societal views regarding mothers working, it was thought that government aid should be used to keep mothers home with their children. The program policies were based on the assumption that the father of the children was dead. The long-term consequence of this policy assumption was to drive fathers away from their families, encourage poor single-parent families and unwed adolescent child bearing.

The 1996 federal reforms changed the entitlement nature of the program. Its very name - Temporary Assistance for Needy Families (TANF) - suggested the chief difference between the old program and the new. Aid would have a time limit. Along with that change, Congress established four new, often overlapping goals for welfare. First, assistance should be given to needy families so that children may be cared for in their own homes. Second, government should promote job preparation, employment, and marriage in lieu of cash aid. Third, government should promote programs that discourage and reduce out-of-wedlock and teen pregnancies and births. Fourth, government should encourage the formation and maintenance of two-parent families.

Eloise Anderson is director of the Claremont Institute's Program for American Families. She directed the Department of Social Services under former Governor Pete Wilson and, until 1992, was director of Community Services for Wisconsin Governor Tommy Thompson, President George W. Bush's nominee for Secretary of Health and Human Services.

CalWorks focused mostly on the federal goal to end dependency of needy parents on government support by promoting job preparation and employment. But state policy is silent on the issue of supporting marriage. California adopted time limits that appeared to follow the federal policy of ending welfare as an entitlement. California limits aid to 18 months for new applicants and 24 months for those already on the program. On their face, those time limits appear much harsher than the federal limit of 60 months. But there are some very large loopholes in the California law. First, the clock does not start until the recipient signs a Welfare-to-Work Plan, which may not happen until after she has searched for a job and had an assessment. This process can take quite some time. Also, the law allows counties to exempt recipients who have been unable to find a job. But, of course, a county welfare official has no idea whether a recipient has actually looked for work. Furthermore, the law allows counties to give aid beyond the California time limits.

In reality, California's time limits are meaningless. The only real time limits are federal time limits. In fact, the U.S. Department of Health and Human Services levied a $7 million penalty on California in 1999 because the state failed to move 75 percent of its two-parent welfare families into the workforce under the time line specified by federal law. However, California has managed to undermine federal time limits by failing to implement any strong penalties. The California penalty system can be used to exceed the federal time limit.

What happens if welfare recipients don't comply with the rules? First, they face a reduction in cash assistance. Then what? If the recipient continues not to comply, the penalty is that the adult is "removed" from the grant. That means the checks keep coming, but they are only supposed to be for the children in the home. (Welfare recipients will continue to receive food stamps, medical care, and often a rent subsidy.)

California law undermines the notion that mothers, who make up a large majority of welfare recipients, are responsible for their children. California's law on child support is much, much harsher on fathers. California policy treats fathers who do not take responsibly for their children worse than mothers who do not take responsibility. Thirty-six states impose a full-benefit penalty when adults do not comply with the rules. That means the grant is cut off from the entire family. California does not. And we see the results.

Critics of welfare reform suggest that California is slow to reduce its caseload because the state's welfare population is so large. California's population in 1998 was approximately 32 million, of which 12.8 percent was on welfare. Texas, with a population of roughly 19 million had only 2 percent of its population on welfare that year. New York, with a population 18 million, had 5 percent of its citizens on the rolls. Florida, with 14 million people, had 2 percent of them on welfare. And Illinois, with its 11 million people, had 4 percent of its citizens on welfare. All of those are very large states, with large urban populations. Yet the percentage of their respective populations that receive family assistance is substantially smaller than that of California. One reason is the size of the grant - those states provide substantially lower cash grants than California does. The size of the cash grant is a state policy.

California's ethnic and cultural diversity is also given as a reason the state's caseload has declined more slowly than the rest of the country. California is indeed diverse, with 33 percent of the population of Hispanic origin, 12 percent of Asian descent, and 6.5 percent of African descent. Texas also has an ethnically diverse population with 30 percent of Hispanic origin, 12 percent of African descent, 2 percent of Asian descent - and a caseload decline of 49 percent. New York's population is 15 percent Hispanic, 15 percent African-American, 5 percent Asian - and has managed a caseload decline of 27 percent. That's similar to California's, for similar reasons. Florida's population is 16 percent Hispanic, 14 percent African-American, and 2 percent Asian - and has seen a 57 percent decline in its welfare caseload. Illinois' population is 10.5 percent Hispanic, 15 percent African-American, and 3 percent Asian - and has managed a 35 percent decline in its caseload.⁽²⁾

In reality, California's time limits are meaningless. The only real time limits are federal time limits.

Compared to Florida and Texas, California, New York and Illinois show slower declines in their caseloads. Why? Florida and Texas both have stronger penalties for uncooperative recipients. The reason may be that the welfare programs of California, New York and Illinois are all administered at the county level. County governments are dominated by strong unions of public employees. Government employee unions have a history of opposing welfare reform and their members have a vested interest in keeping caseload numbers high. Without strong leadership focused on the goals of welfare reform, families remain trapped in a union-dominated bureaucracy.

Change is very difficult for individuals and organizations. It is difficult to take people who have managed an organization going in one direction for over 30 years and ask them to take the organization in a completely different direction. No privately owned business would expect this of its management. It is important for California to have strong penalties for welfare recipients who do not follow through on their obligations. But that requires the state to move those county agencies in a different direction.

At this writing, California has a low unemployment rate of 4.7 percent. The economic picture remains good, despite some clouds on the horizon, such as high housing costs. Services are in place for families with problems. What is needed now is the political will within the Democrat-controlled state Legislature to make the necessary policy changes. Those changes should be based on the principle that parents, including mothers, are responsible for their children. Government should be out of the business of replacing fathers. This is a position that will be good for the children and the country.

1. U.S. Department of Health and Human Services. Change In Welfare Caseloads Since Enactment of New Welfare Law. Washington D.C. 1999

2. U.S. Bureau Of the Census. Estimates of the Population of State by Race and Hispanic Origin. Washington D.C. 1998