THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Sunday, March 17, 1996 TAG: 9603160006
SECTION: COMMENTARY PAGE: J4 EDITION: FINAL
TYPE: Opinion
SOURCE: By DAVID STOESZ
LENGTH: Medium: 86 lines
President Clinton's veto of congressional welfare reform gives Virginians a chance to reflect on how public policy should affect poor families.
The conservative version of welfare reform largely emulates recent state welfare-reform experiments. Most of these ventures have focused on Aid to Families with Dependent Children and include greater rigor in collecting child support. They require school attendance (``learnfare'') as a condition of obtaining benefits, deny additional aid for children born after relief is granted (``family cap'') and limit assistance to two years. Conservative fervor not withstanding, research on state welfare experiments boils down to this: It isn't working very well.
Welfare-to-work, requiring AFDC recipients to enter the labor market, has yielded increases in earnings from $250 to $750 per year, hardly enough to vault families off public aid. Nor do states save substantial revenues because it costs money to mount welfare-to-work programs. Republican governors trumpet significant accomplishments in welfare reform that often fade under closer scrutiny.
Wisconsin's Tommy Thompson claimed to have used waivers to reduce the state's AFDC caseload by one-fifth, yet later review indicated most of this decline occurred before waiver initiatives had begun, suggesting the state's vibrant economy accounted for much of the drop.
New Jersey's Christine Todd Whitman cites the state's ``family cap'' for a reduction in births of children in welfare families, yet research indicates this conclusion is unwarranted.
At best, welfare-to-work programs are a humbling lesson in the difficulty AFDC parents experience in stabilizing family life, obtaining job skills and locating employment. At worst, a congressional plan requiring states to place 50 percent of AFDC heads-of-households in jobs by the year 2002 and imposing a two-year limit on benefits flies in the face of state welfare-reform experience. No state initiative has come close to this level of performance.
If the version of welfare reform constructed by the 104th Congress were introduced in Virginia, as many as 25,000 poor, predominantly minority children would be dumped from public assistance into the underclass.
Instead, Virginia legislators should consider strategies that accelerate upward mobility of the poor, empower families and communities and deconstruct the welfare bureaucracy. Complementing welfare-to-work, these would effectively eliminate welfare:
Individual Development Accounts are tax-exempt accounts that can be used for finishing college or vocational school, buying a home, starting a business or supplementing a pension. IDAs would elaborate the Virginia savings-account proposal advanced by Gov. George Allen. Under IDAs, though, individual contributions would be matched according to the account-holder's income from a Human Capital Development Fund.
While traditional welfare has emphasized income support, these accounts encourage the poor to accrue assets, the most effective means to rise from poverty. A distinguishing feature of nonpoor families is that they are buffered from poverty by assets, which they can liquidate during economic hardship.
Financial Maintenance Organizations are private organizations that help the poor with income-tax preparation (to optimize Earned Income Tax Credit refunds), with child support, education and training benefits and long-range financial planning.
The evolution of FMOs would be facilitated by contracting out the income-maintenance division of local welfare departments. In 1993, the administrative costs per AFDC case in Virginia was $607, more than enough to entice private financial agencies to recruit poor families as members. Significantly, FMOs would be the repositories for governmental assistance benefits that would be used for capitalizing community-development projects.
Children's Service Authorities would consolidate local social services, health and juvenile-services departments. Authorities could contract for an array of human services to establish school-based Family Resource Centers that would provide child day care, child protection, family preservation, maternal and child health and cultural and recreational activities.
In restructuring welfare so that it is a productive activity consonant with Virginia's emergent, post-industrial economy, welfare-to-work is an essential beginning. We have yet to empower the poor, speed their upward mobility and dismantle the welfare bureaucracy. Those objectives are within reach. In a real sense, all that stands between us and social justice for the poor is a poverty of imagination. MEMO: David Stoesz is the Samuel S. Wurtzel chair of social work at Virginia
Commonwealth University and the author of several books on social
welfare. by CNB