This August marks the 20th anniversary of Temporary Assistance for Needy Families, the $16.5 billion federal program theoretically devoted to helping low-income families with children escape poverty.
Nationally, the number of people on assistance has dropped drastically in the past 20 years, from more than 12 million in August 1996 to 2.9 million at the end of 2015. In Maine, TANF rolls have dropped by more than 60 percent in the past four years.
The problem is, it’s become clear that TANF isn’t doing its job.
The fact that fewer people receive government assistance would signal success if the people no longer receiving help were working and making enough money to escape poverty. But that’s not the case.
Since TANF has largely disappeared as a safety net for millions of Americans, the ranks of extreme poverty in the U.S. — those living on incomes of less than half the federal poverty level — have grown, including a subset of households getting by on less than $2 per day. In Maine, the rate of extreme childhood poverty grew by 50 percent between 2010 and 2014, and Maine fell five spots this year in the Annie E. Casey Foundation’s annual state rankings on childhood well-being.
States have no obligation under TANF to track whether former recipients are better off and working. And, in order to meet work requirements prescribed in the federal law and avoid penalties, states have every incentive to simply reduce caseloads instead of ensuring people first find work.
Then there’s the story of how states are actually spending TANF money. Since the 1990s, states have spent progressively less of it on the core purposes that drove a Republican Congress to pass TANF into law — basic assistance and support to help people join the workforce. They’ve spent a growing portion of it on a variety of other state programs, freeing up state tax dollars as a result.
In 2014, states spent just more than a quarter of TANF funds on direct assistance for families, compared with 63 percent in 1998. (Maine traditionally has spent a substantial portion of its TANF funds on assistance, though the state has spent progressively less on the program over the past four years.) When combined with activities meant to help parents enter the workforce — such as child care and transportation — states spent just half their allocation on TANF’s core purposes, according to the Center on Budget and Policy Priorities, with significant state-by-state variation.
Sen. Angus King recently introduced legislation — with the support of one Democratic and two Republican co-sponsors — that responds to many of these flaws in the nation’s 20-year-old welfare reform law.
The EMPOWER Act would require that states, by 2021, spend at least 60 percent of TANF funds on the law’s core purposes and would bar states from spending the money on families with incomes greater than 200 percent of the poverty level. States would no longer be able to count money from third-party sources — such as charities — toward their required state spending on TANF.
The legislation would offer states an incentive to help TANF recipients enroll in education programs long enough to attain a post-secondary degree. Currently, TANF recipients can participate in educational activities for only 12 months before they count against their states’ work requirements.
“It’s somewhat a recognition of the changing economy,” King said. “Jobs today require more education. The full point here is to help people get off of welfare but to do it in such a way that it’s real.”
The legislation also includes a requirement that states work with TANF recipients to establish individualized employment plans, and there’s a requirement that states track and report outcomes for TANF recipients. Are they working and on their way out of poverty?
“One of the problems with the current law is, it has people counting the wrong things,” King said. “We’re counting other things that take a lot of time for the state people, and they really aren’t right.”
The time could be approaching for a welfare reform debate in Congress. Republican House Speaker Paul Ryan recently made anti-poverty programs a centerpiece of his caucus’ policy agenda. The EMPOWER Act proposes needed fixes to ensure the money we spend on the nation’s chief assistance program actually is put to work fighting poverty.