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January 30, 2008 Preliminary questions Get your i-clickers ready.

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Presentation on theme: "January 30, 2008 Preliminary questions Get your i-clickers ready."— Presentation transcript:

1 January 30, 2008 Preliminary questions Get your i-clickers ready

2 Questions about Last Class?

3 Introduction to TANF Presentation 6 January 30, 2008

4 Sources Sharon Parrott and Arloc Sherman, TANF AT 10 Program Results are More Mixed Than Often Understood, 17-06tanf.htm. Surf around, making sure to examine the Guide to TANF Reauthorization Issues 17-06tanf.htm Martha Coven, An Introduction to TANF, Center for Budget and Policy Priorities, November 22, 2005

5 Temporary Assistance for Needy Families (TANF) Created by the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 Replaced AFDC as part of President Clinton’s drive to “end welfare as we know it.”

6 Problems with AFDC (Aid to Families with Dependent Children) 1.It discouraged work 2.It discouraged marriage 3.It encourage illegitimate births 4.It was an entitlement (guaranteed support) 5.1 - 4  AFDC encouraged dependency (caseloads to large) and prolonged poverty 6.It was too expensive

7 Goals of TANF Restored the American family? –Decrease divorce and cohabitation and increase marriage Reduced illegitimacy? –reduce the number of children born to unmarried mothers Controlled welfare spending? –Reduce the amount of money spent on welfare Reduced welfare dependency? –Decrease caseloads

8 Missing Goals?

9 Alternative criteria Does TANF reduce poverty? (adequacy) Does the program encourage personal responsibility? (work incentives) Does the reform treat participants and non- participants fairly? –Does it treat persons in similar situations similarly? (horizontal equity) –Does it treat people in different situations differently? (vertical equity)

10 Alternative criteria, cont. Does it target just the poor? (target efficiency) Are the rules easily understood by all? (participants and tax payers) Can be the programs be easily accessed by those eligible? (hassle factor) Can the program be administered without error or fraud?

11 Features of TANF Block grant to states to fund their own welfare programs –50 different welfare programs –End of entitlements –Grants are not indexed for inflation Real value fell by 20% between 1997 and 2005.

12 Source: Coven, 2005

13 Features of TANF, cont. Citizenship –Legal immigrants are ineligible until they have been in the US for 5 years Work requirements –Must be engaged in work or a work-related activity for 30 hours per week Time limits –No family may receive federally-funded assistance for longer than five years. Family caps –States have an option to refuse to increase benefits if new children come into the family

14 Is TANF Successful? What are the prospects for valid evaluation? 50 different programs in fifty different States No federal funds allocated for national evaluations States are not required to conduct TANF evaluations

15 How are conclusions drawn? Federally funded demonstration projects –State experimental programs authorized by the Family Support Act of 1988 Spotty privately sponsored analyses Evaluating Trends in: –national data bases (CPS) –State/National administrative data Limitations –Cross-sectional data--snap shots –Data do not reflect what happened to families when they left welfare

16 Did TANF Restore the American Family ? National Healthy Marriage Resource Center (Go to Research and Trends) Marriage rates Attitudes toward Marriage Attitudes toward Cohabitation

17 Marriage and Divorce Rates, 1950-2000

18 DID TANF Reduce illegitimacy ? total number of live births to all unmarried women  number of births to black unmarried women  percentage of births to unmarried mothers  percentage babies born outside of marriage –  for whites –  for blacks percentage of low birth weight babies  slightly Source: Births: Final Data for 2005, National Vital Statistics Reports, Vol 56, No. 6 (December 5, 2007). Center for Disease Control and Prevention

19 Hamilton BE, Ventura SJ, Martin JA, and Sutton PD. Preliminary births for 2004. Health E-stats. Hyattsville, MD: National Center for Health Statistics. Released October 28, 2005. 02

20 Did TANF Reduce illegitimacy ? Also see: National Healthy Marriage Resource Center arch_stats/index.cfm arch_stats/index.cfm

21 Did PRWORA Control Welfare Spending? Yes, and No See: Spending on Social Welfare Programs in Rich and Poor States, Key Findings, U.S. Department of Health and Human Services Office of the Assistant Secretary for Planning and Evaluation, August 2004 spending04/summary.htm

22 Source: ASPE, 2004

23 Did PRWORA Control Welfare Spending? Per Capita Spending on AFDC/TANF, FY1977-200 Source: ASPE, 2004

24 Control Welfare Spending? Per Capita Spending on Medicaid, FY1977-2000 Source: Source: ASPE, 2004

25 Control Welfare Spending? Per Capita Spending on Other Services, FY1977-2000 Source: ASPE, 2004

26 Did TANF Decrease Dependency ? Welfare rolls fell by around 60 percent between 1996 and 2000. Caseloads continued to fall after 2000 as poverty began to rise. –Caseloads did not increase with recession Personal responsibility –Employment rates for single mothers rose from 62% in 1995 to 73% in 2000. In 2005 they had fallen to 69%. Source: TANF AT 10 Program Results are More Mixed Than Often Understood, Sharon Parrott and Arloc Sherman

27 National Welfare Caseloads, March 1994-September 2004 Source: U.S. HHS, Administration for Children and Families,

28 Alternative Criteria: Work and Income, aka Personal Responsibility LFPR for single mothers rose from 44 to 66 percent between 1994 and 2001 ( Source: Blank, 2006) Employment rates –Rose from 62 to 73 percent, 1995-2000 –Fell to 69 percent in 2005 (Source: Parrot and Sherman, 2006)

29 Alternative Criteria: Work and Income, cont. Adequacy –Average incomes rose by about $5,000 –Earnings increases were larger than welfare benefits declines –Income is not adjusted for costs of working –Modest income growth over time (Source: Blank, 2006)

30 Work and Income, cont. Hardship? (Adequacy) –More single-mothers report not being on welfare and not working –Fewer poor children receiving cash assistance –Women involuntarily terminated have lower incomes and worse outcomes--how are they surviving? Source: Parrott and Arloc Sherman, 2006


32 Poverty Reduction Poverty fell initially Poverty rates for single-mother households fell to historically low levels by late 1990s  Slight increase in past 4 years Increases in employment greater than declines in poverty Share of the working poor rose and is higher than in early 1990s Share of the poor living in extreme poverty reached a historic high, 43 percent in 2005.

33 Poverty rates 199420002004 All ages All races14.511.312.7 Blacks30.622.524.7 Hispanics30.721.521.9 Under 18 All races21.816.217.8 Blacks43.831.233.6 Hispanics41.528.428.9

34 Especially for children... Poverty Rates Among Children Source: U.S. Census Bureau, Poverty1oct05b.gif Poverty1oct05b.gif

35 Poverty Rates Among Black Children, cont. Melissa G. Pardue, “Sharp Reduction in Black Child Poverty Due to Welfare Reform,” The Heritage Foundation Backgrounder #1661, June 12,2003

36 Extreme Poverty (<50% PL ) (Source: P60-231) Trends –1994-2000:  Fell from 5.9 percent to 4.5 percent –2001-2004:  Rose continuously to 5.4 –didn’t change in 2005. By age in 2005: –Persons 18-24 had highest rates--9.4 percent –Persons under 18 were next at 7.7 percent By family status: –Persons in unrelated subfamilies have highest rates of extreme poverty: 25.2 percent –Children under 6 years: 8.9 percent By race: –Blacks have highest rates (11.7 percent) followed by non-white Hispanics (8.6 percent)

37 Extreme Poverty Rates Among Children by Race Source: U.S. Census Bureau,

38 Alternative Criteria: Other effects Effects on Children –child abuse—down since early 1990s –Some positive achievement and behavioral effects on young children associated with use of center-based child care –Some small negative effects on adolescents associated with lack of parental supervision

39 What really caused the changes in work and income? TANF Work enforcement –Diversion effects. –Sanctions, time limits, messages?? Good economy –Many jobs, even for the unskilled. –Rising real wages. New benefits –Especially EITC –a higher minimum wage (Sept. 1997) Relative role of these factors is disputed.

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