The success of the recent tax reform gives the Republicans in Congress momentum going into the new year. Speaker of the House Paul Ryan has made it clear he wants to focus on welfare reform. This is perfect timing considering the strong job growth that is expected to follow the implementation of the tax reductions.
The Federal Government has kept a large number of flawed welfare programs in place for far too long. These welfare programs fail when they allow people to become dependent on the government. The goal of welfare should not be for people to live a less miserable life of poverty, but to help people escape poverty. A safety net catches you, but it doesn’t encourage you to jump back up. Government should tackle poverty with a trampoline.
In the Cato Journal, economist Lowell E. Gallaway and graduate student Daniel G. Garrett tracked the impact of public aid on poverty. By their calculations, small doses of government assistance are far more effective and beneficial than larger ones. In their findings, the poverty rate is reduced by 3.94 percent when the level of public per capita aid is $500. For $1,291 worth of aid, the poverty rate decreases 6.07 percent. However, when the aid reaches $2,407, there is no change in the poverty rate. And with aid at $3,000, the poverty rate actually rises by 6.28 percent.
When welfare benefits are too strong, the problem arises in which there is less of an incentive for people in poverty to go and find a job in order to earn their own income. It is particularly troubling for younger generations who are part of families that have been dependent on the government long-term. The modern welfare state has the power to change the attitudes toward work, and not for the good.
A study published in March 2015 by economists Regis Barnichon and Andrew Figura explored the impact of welfare on the desire to work from the late 1980s to the early 2000s. They found that the decline in the desire to work decreased the labor participation rate by 1.75 percent. Welfare benefits were a significant contributor to this fall. For example, disability insurance reduced the probability of wanting to work by 17 percent. There was only one good sign; it was noted that there was a decline in spending for ‘Aid to Families with Dependent Children,’ a program that was reformed in the 1990s. Unfortunately, this is just one of many programs. The damage to the American work ethic caused by a bloated government cannot persist.
Luckily, Republicans in Congress have a blueprint for welfare reform thanks to the work of many conservative governors across the country. No case is better than what has happened in my home state of Wisconsin. Under Governor Scott Walker and the Republican state legislature, reforms have been passed that have changed the state’s food stamps program.
According to a report by the John K. MacIver Institute, the state initiative, called the ‘FoodShare Employment Training’ program, has helped over 17,000 Wisconsinites find work. Walker’s reforms, passed in 2015, required able-bodied adults aged 18 to 49 without children to work, take part in job training, or a combination of the two, for eighty hours a month in order to receive food stamps.
Wisconsin isn’t alone. Maine too has enjoyed success through reforming their food stamps program. Under Governor Paul LePage, similar reforms were implemented on able-bodied adults without dependents, and the result has been a decrease of 80 percent in food stamp usage from that particular demographic.
On the international level, Canada provides a perfect benchmark of successful welfare reform. During the 1990s and early 2000s, reforms created stricter eligibility requirements, reduced the size of the benefits, and decentralized the social assistance (SA) system. Economists Nathan Berg and Todd Gabel have studied the impact of the reforms in Canada. They found that imposing stronger work requirements can be associated with a 27 percent decrease in use of Canada’s SA. They also calculated that the reforms reduced the probability of using welfare programs by a minimum of 13 percent.
Ronald Reagan once said, “I believe the best social program is a job.” This has always been true. Meaningful reforms that get people off the dole and into the workforce will have a marvelous impact on the economy and culture. It will also help taxpayers by reducing necessary government spending.
With a push for welfare reform on the horizon, Democrats will most likely claim Republicans hate the poor. In reality, studies show that welfare reform is not about hating the poor, but loving the poor. Conservatives want to help people find jobs that can pull them out of poverty. Republicans in Congress have a chance to do just that. For the wellbeing of Americans suffering in poverty, welfare reform must be a priority in 2018.
The views expressed in this article are the opinion of the author and do not necessarily reflect those of Lone Conservative staff.