Social Welfare Programs

Chapter 7 additional terms• Poverty definition: problems with• Absolute vs relative poverty• Liberal and conservative views

external vs. internal locus of control• Types of programs:

– social insurance vs public assistance– Cash vs. in-kind

Social Welfare Programs

• Social Insurance (Social Security)• Employment Regulation• Public Assistance• Family Programs

CORE SOCIAL INSURANCE PROGRAMS:

• OASDHI–Old Age Pension, Survivors Insurance,

Disability Insurance, Health Insurance

• Workers Compensation• Unemployment Insurance • Sickness Pay • National Health Insurance

Dates of Enactment of Social Insurance Programs in Seven NationsWorkman's Pensio

nSickness Unemployment Health

Country Compensation

Insurance Insurance Insurance

Insurance

Canada 1930 1927 1971 1940 1972France 1898 1905 1930 1905 1945

Germany 1884 1889 1883 1927 1880

Italy 1898 1919 1928 1919 1945

Sweden 1901 1913 1910 1934 1965

United King. 1887 1911 1911 1948

1935

1908

United States 1935 ---- 1935 ----

Source: Robert Kurdle and Theodore R. Marmor, "The Development of Welfare

States in North America," in Flora and Heidenheimer (1981, 83)

European Family Programs:

• Family Allowance

• Strict Child Support enforcement

• Paid Family Leave

• Subsidized Child Care

Public Assistance Programs:

• AFDC• Food Stamps• Medicaid• SSI (formerly AB, APTD, OAA)• General Assistance• Poverty Programs:

• Meals on Wheels, School Lunch, Head Start, Job Training, WIC, Energy Assistance

US Welfare Programs: 1968

Program EligibilityFederal\State\

Local  

AFDC (1935) 1 or 2 parent families w\ children

F\S

OAA (1935) Elderly F\SSSI

(1972)AB (1935) Blind F\S

APTD (1950s) Disabled F\S

Medicaid (1965) Poor (varies) F\S

Food Stamps (1962) Poor F

General Assistance   S\L

Poverty programs (not entitlements)

Public Housing, Job Training, Food programs, Head Start, health care, energy assistance, social services, ….

F\S\L

Flaws in U.S Welfare: 1968 

·      Work disincentives

·      Family disincentives

·      Bureaucracy

·      Certifying eligibility; checking for fraud

·      Too many agencies and layers of govt.

·      Inequity

·      State to state variations in benefits

·      Arbitrary categories

·      Stigma

Finland

Denmark

Sweden

Norway

Netherlands

Switzerland

Belgium

Austria

France

Germany

Australia

United Kingdom

Canada

Ireland

Spain

Italy

United States

0 5 10 15 20

below 50%median income

below 40%median income

Relative child poverty rates, circa 2000

Italy

Switzerland

Spain

Netherlands

Belgium

France

Germany

Finland

Austria

Ireland

Canada

Norway

Denmark

Australia

Sweden

United States

United Kingdom

0 5 10 15 20

% Children in Single Mother Families circa 2000

Possible Solutions: Carrots and Sticks 

Sticks: Penalizing Recipients:Workfare (education also?)Reduce benefitsReduce EligibilityIncrease Penalties:

school truancy, drug testing, additional childrenCarrots: (major reforms)

Negative Income Tax Earned Income Tax Credit

(adjustments)Child Support exclusionChild CareTwo-parent familiesContinue MedicaidJob Training

Negative Income Tax$5,000

0

0 $10,000

Be

ne

fits

Family Income

1988 Family Support Act 

·      Increase Child Support Enforcement

·      Extended Child Care and Medicaid 9 mos .

·      All states cover 2-parent families

·      Workfare and Job Training

·      State Waivers for experimentation

1996 Personal Responsibility and Work Opportunity Reconciliation Act

·      AFDC becomes TANF·      2-year and 5-year limits

·      teenage mothers must live at home

·     legal aliens excluded

·      stricter workfare requirements

·      Federal funding: block grant

·      Much State discretion

·      SSI: ·     stricter disability standard for disabled children

·     legal aliens excluded

·     drug addiction and alcoholism not covered

·      FOOD STAMPS·     workfare requirements

·     legal aliens excluded

1960 '70 '80 '90 '00 '100

10

20

30

Children

Elderly

FIGURE 9.7U.S. Poverty Rates, by Age: 1959-2010

Source: Census Bureau, Historical Poverty Tables

Food Stamp (SNAP) Recipients (000s)

1960 1970 1980 1990 2000 20100

2,000

4,000

6,000

8,000

10,000

12,000

14,000

Families

Temporary Assistance for Needy Families (TANF), 1960-2011

(thousands)

Recipients

'59 '65 '71 '77 '83 '89 '95 '01 '070

10

20

30

children

elderly

US poverty rates

'59 '65 '71 '77 '83 '89 '95 '01 '070

5

10

15

20

25

US: % Children in female-householder families