price_of_citizenship.jpg (9774 bytes) The Price of Citizenship

Chapter Four

Chapter Four: Governors as Welfare Reformers

In the 1990s, state governors proved to be the most aggressive welfare reformers, ushering in a new era in public policy characterized by the devolution of authority from the federal government.

The Centralization of Social Welfare

  1. Tenth Amendment - which reserves powers not granted to the federal government to the states.
  2. tradition of public assistance as a state responsibility throughout the nation's past.
  3. reputation of states as the pioneering laboratories for innovation during the formative years of American social policy.

In the early years of the twentieth century, state governments began to professionalize the administration of public assistance and to spend accordingly. But with the Great Depression of the 1930s and facing bankruptcy the states appealed to the federal government for help. The Economic Security Act gave the federal government permanent and unprecedented responsibility for the economic security of the elderly, the unemployed, and dependent children. The federal government did not impose its will on the states; rather, it offered them money they could not afford to refuse, and attached conditions to it. In the process, the New Deal redesigned American federalism. It is this profound and enduring shift in the nature of federalism that governors in the 1990s tried to modify or reverse.

In the 1930s, the laboratories of policy innovation also moved decisively from the states to the federal government. States became the drag retarding progress in public policy.

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The Origins and Early History of Devolution

Nixon introduced General Revenue Sharing - federal funds sent directly to states to use as they saw fit - and new block grant programs that greatly increased state and local government authority over the allocation of funds.

Reagan's policies gave state and local governments more authority and less money as budget cuts fell with special severity on AFDC and on programs that assisted (ended benefits for) the working poor. By the 1990s, in contrast to the early 1980s governors began to clamor for control over entitlement programs. Governors wanted to implement their own policies. These "captains of conservatism" believed that "economics rules all and everything has a price tag".

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John Engler: From the Abolition of General asssistance to Welfare Reform in Michigan - "New Republicanism"

John Engler was a disciple of:

Conservative philosophers: Russell Kirk, Edmund Burke.

Engler drew on a bowdlerized version of history to place the blame for accelerating social disintegration on the Great Society. A system that rewarded ignorance, idleness, and illegitimacy - the absolute antithesis of the qualities you want a free citizenry to possess.

... order, justice, and freedom are mutually dependent on one another... So that it is not just freedom, but ordered freedom that we strive to preserve. Ordered freedom flourished in small communities - "the little platoons we belong to in society", which "enrich our lives and humanize our relations with one another". "Return authority and responsibility where they ultimately belong - to the 'little platoons' of civil society - to our families and neighbours, churches and charitable organizations." Government is "not just too big in size. It intrudes where it shouldn't and interferes with our lives". Washington also blocked "freemarket reforms".

Engler promised and delivered on promises to lower property taxes, increase funding for education, get tough on crime, and cut government spending - especially welfare (concentrating on the poorest of the poor).

After draconian cuts to General Assistance it was discovered that it did not, after all, foster dependence and an unwillingness to work. "GA itself did not hamper incentives to work. Rather, it provided a legitimate safety net for those times when people were unable to be self-supporting."

Engler's experience and subsequent popularity proved to him that, "you survive by doing what is right and making the tough decisions".

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In 1962 Congress authorized waivers of AFDC requirements to allow states to experiment with improved ways of administrating and delivering services. At the same time, Congress did not intend the use of waivers to curtail benefits or limit entitlements.

In the late 1980s state governments began to use waivers as vehicles for welfare reform. Thus, waivers opened the door to the neglect and punishment of the poor as well as to more flexible and constructive policies.

During the 1990s, waiver requests led to a wide array of changes. The goal of Michigan's welfare reform seemed to be to move people off the rolls, not to lift them out of poverty. Michigan's experience underlined something welfare reformers preferred not to address: cutting public assistance rolls and reducing poverty were not synonymous. 

Tommy Thompson and the Abolition of Welfare

Together with John Engler, Wisconsin's governor Tommy Thompson led the campaign to devolve public assistance to the states. He attributed his success to listening to the problems of voters and asking for their solutions. :And I really listened to each and every suggestion I receive. We took all of these ideas and came up with policy proposals that I believe could really turn our state around.

Thompson bypassed Washington and went directly to the U.S. Department of Health and Human Services proposing a package of welfare experiments. By cutting benefits he saved the federal government money which in turn was returned to Wisconsin. Thompson's first five major welfare reform policies were:

1-3. were focussed on improving incentives for recipients to graduate from public assistance and on extending medical assistance.

4. to extend work requirements to mothers of preschool children.

5. Learnfare

"the single most widely shared value in this country is that people ought to be responsible for their actions".

"Paternalistic reform is popular and effective, but it means continued big government, (public policies enforcing personal responsibilities) not an escape from it. Thompson attacks bureaucracy in Washington, but at home his reform is government led.

Thompson designed the first time-limited public assistance program in the nation. Fear, more than an anticipated escape from poverty, underpinned the incentives used in the tough new world of welfare reform.

W-2 (Wisconsin Works) was "less about welfare, dependency and assistance, and more about opportunity, responsibility, and incentives". By ending entitlements, Wisconsin deliberately shredded the safety net that guaranteed protection to its neediest citizens.

Four level employment ladder:

  1. 24 months (total time on any step of the ladder)
  2. 5 years (max. time on ladder)
  3. emphasis on supports: training, child-care, job placement, etc.
  4. intensive case management and heavy spending on the program

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Chapter Summary

State governors sought freedom from federal regulation, tried to use welfare reform to reduce the dependence associated with out-of-wedlock births, and stressed the reduction of entitlements inherent in market-driven social policy. It did not increase the profitability of work by raising wages or improving benefits; rather, it made welfare more restrictive by cutting off benefits.

The new consensus, tougher and more punitive than the understanding that led to the Family Support Act in 1988, rested on a dislike of welfare, hostility to its recipients, and faith in mandatory work as the key to its reform. It emphasized the stick, rather than the carrot, and it wanted to use government not just to reduce costs, but to change people's behaviour.

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