NC Budget and Tax Center, TANF 20 Years Later

TANF at 20: How it contributed to a tattered safety net for struggling families

This blog is the first post in a series that will detail how lawmakers have weakened Temporary Assistance for Need Families (TANF) over the last 20 years, explain why TANF is a cautionary tale rather than a model for other work and income support programs, and map out a better way forward.

Come Monday, Aug. 22, it will be 20 years since President Bill Clinton signed into law what’s widely known as welfare “reform”—an overhaul of the nation’s main assistance program for families struggling to make ends meet. Lawmakers created Temporary Assistance for Needy Families (TANF) to, as President Clinton pledged, “end welfare as we know it.” And the 1996 welfare law did just that—the reforms created a harsh hole in the nation’s safety net for the most vulnerable families across the U.S.

The welfare law imposed a five-year limit on benefits—ending the legal right to basic assistance—with the expectation that recipients who can work do so. Policymakers also expected states to maintain a temporary safety net to help families weather short-term troubles and a bad economy. The law gave states a great deal of spending flexibility over programs when it converted federal aid to a fixed block grant, but many states like North Carolina have significantly reduced basic assistance without using TANF to help parents prepare for or connect to work.

The result: TANF does little today to help families regain their footing on the economic ladder or to connect them to work to reduce their need for supports—thus violating the purported intention of the law to move people off welfare to work. In fact, Peter Edelman and Barbara Ehrenreich, two of our nation’s foremost experts on poverty, warned President Clinton and Congress at the time that this would happen, as they recall:

“We argued that the low-wage jobs available to former welfare recipients would not pay the bills. We warned that the legislation didn’t provide adequate child care for single mothers thrown off welfare. And we cautioned that many welfare recipients faced serious barriers to success in the job market.”

Their warnings fell on deaf ears and in the end accurately depicted the fallout of TANF 20 years later. TANF caseloads in North Carolina actually fell over the course of the economic downturn when jobs plummeted—a time when one would expect safety net programs to work overtime to help families make ends meet until the labor market improves. Now under TANF, few Tar Heel families with children who struggle to afford the basics actually receive cash assistance and, for those who do, the benefits are inadequate and are losing purchasing power. This has contributed to a rise in deep poverty, which can hurt children’s healthy development over the long-term.

Welfare reform considerably harmed the most vulnerable families in our country, despite former President Bill Clinton’s recent remarks that welfare reform “did far more good than harm.” But he and other backers of welfare reform (including Hillary Clinton who called for support of the 1996 law) admit that policymakers ought to review TANF. Indeed, the data supports the case that policymakers should strengthen TANF and make the block grant more accountable.

It is now time to re-envision what it looks like to ensure all North Carolinians have a clear pathway out of poverty and the supports that can sustain their journey.  That means making sure that there are good, quality jobs for people to connect to and supports for parents to stay in the labor force like child care and income—either in increased earnings or temporary cash assistance—to meet the basics of food and housing.

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Redesigning TANF to lift more families out of poverty

The 1996 welfare law that created Temporary Assistance ...

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