Updated 12-2-97

Introduction

Background

The New Law

Timeline

Trends
California
Wisconsin
S. Carolina

Challenges

Appendices
State Links
State Caseloads
Block Grants

Related Stories

The Great American Welfare Lab Wisconsin has cut its rolls by half. Many former recipients are working, but where have the rest of them gone? By Adam Cohen/TIME (4/21/97)

A Blue-Ribbon County Marquette County, Wisconsin, sheds its welfare load. By Adam Cohen/TIME (4/21/97)

Let Them Eat Birthday Cake Clinton's welfare reform dismays the President's favorite poverty scholar By Jack E. White/TIME (9/2/96)

Ripping Up Welfare With not a little drama, Clinton grudgingly approves the G.O.P. bill, and the U.S. starts a vast and risky experiment By George J. Church/TIME (8/12/96)

Related Sites

The Department of Health and Human Services Welfare Reform Page

Health and Human Services Welfare Reform Fact Sheet

More...

Counterpoint

Should Congress restore welfare funds for legal immigrants?

Navigation

Infocus

Challenges Ahead

states

While programs in many of the states seem to have had a dramatic effect on the welfare rolls, many are still plagued by obstacles.

Some problems are old problems: Fraud, lack of adequate child-care services, lack of local jobs and lack of public transportation have always been a problem for welfare recipients.

But the new welfare law has added some new wrinkles.

Labor unions object to hiring welfare recipients for entry-level jobs, to little avail so far. Overall, at least 50,000 people are performing such jobs as picking up trash and filing paperwork for city and state governments in return for aid and food stamps.

Labor, fearful of a new crop of very cheap labor replacing union workers, is increasing its pressure on Washington to assure that welfare recipients are paid at least minimum wage and receive other benefits normally provided to union members.

State-subsidized private-sector jobs for welfare recipients are also causing some problems.

In Baltimore, for example, 13 temporary housekeepers working at a hotel are receiving both welfare benefits and a small stipend from the hotel. At the end of a three-month trial period, the hotel determines whether or not to hire them on full-time at a rate of $6.10 per hour.

The hotel's 300 unionized but low-paid kitchen workers, bellmen, housekeepers and doormen feel the welfare-to-work participants are a threat -- they are a cheaper labor force performing essentially the same tasks.

But the welfare-to-work workers are in some danger as well. The hotel is under no legal obligation to hire them at the end of the three-month period, and has little incentive not to let them go and hire a new crop of cheap labor instead.

Economists say a battle is brewing between the working poor and the dependent poor because there's a finite number of entry-level jobs and the new welfare law is providing more than enough people to fill them.

Also, Congress has weakened federal safeguards against using welfare-to-work workers to replace permanent workers. Fired permanent workers now have to prove they were intentionally forced out by a replacement worker.

The exceptions and loopholes in the new welfare law are also causing confusion -- and occasionally collisions.

Take the welfare waiver for abused women. The new welfare law allows states to exempt abused women from the federally mandated five-year cap on benefits.

But the states find themselves in somewhat of a Catch-22. If they exempt all abused women from the cap -- and between 14 to 20 percent of those on welfare are thought to be victims of domestic violence -- they could violate another provision of the new federal law that says states can exempt a maximum of 20 percent of their aid recipients. This endangers others, such as those with disabilities, who could be exempt from the welfare law for other reasons.

Some provisions of the new law have already attracted the attention of the courts. A federal judge in California has blocked a major provision of the new law that permits states to pay lower benefits to newer state residents. The provision was aimed at preventing states that pay high benefits from being inundated with new welfare recipients from less-generous states. Eight states have or soon will have "second-tier" payment systems in place.

Lawsuits have also been filed in New York by civil rights groups and New York Mayor Rudolph Giuliani, who say the new law violates the Constitutional rights of legal immigrants who will lose federal disability and food stamp benefits.

The new welfare policy known as the "family cap" is in place in at least 19 states, denying benefits to children born to mothers already on public assistance. Pushed by conservatives as a way to reduce out-of-wedlock births, liberals say it does nothing but hurt innocent children and increase the number of abortions.

Early returns are not encouraging. Even in states like Massachusetts, which gave welfare mothers a ten-month grace period, the number of children born out of wedlock since the cap went into effect is actually up slightly.

States have heavy-duty incentives to make this provision work. They can receive an extra $25 million in federal money for pushing down out-of-wedlock birthrates -- an "illegitimacy bonus."

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