Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SUNDAY, May 9, 1993 TAG: 9305090114
SECTION: NATIONAL/INTERNATIONAL PAGE: C-4 EDITION: METRO
SOURCE: The Washington Post
DATELINE: WASHINGTON LENGTH: Medium
Those familiar with the issue said substantial work already is under way on a plan to fulfill President Clinton's campaign promise to "end welfare as we know it," even though the White House has not yet named its promised welfare task force. The package could be unveiled by early fall, they said.
"This is pretty revolutionary," said Paul Offner, an assistant to Sen. Daniel Patrick Moynihan, D-N.Y., "because the emphasis on work is so different from what is happening" under the current system.
Driving the administration's effort is the belief that no one likes welfare as it is now designed, especially those who are on it.
"So many people stay on welfare not because of the checks," Clinton said in February, citing the low benefits relative to 20 years ago. "They do it solely because they do not want to put their children at risk of losing health care or because they do not have the money to pay for child care out of the meager wages they can earn coming from a low-education base."
The number of families receiving Aid to Families with Dependent Children has grown from 3.5 million in 1976 to 4.7 million last year.
In structuring a new system, the administration hopes to eliminate what is widely seen as a trap: If a welfare mother tries to go to work, her benefits are reduced - for every dollar she earns, she loses a dollar of support. She also is likely to lose medical coverage and must find child care.
David T. Ellwood, nominated as assistant secretary of Health and Human Services for planning and evaluation, has given this example in his writings: A woman in Pennsylvania working full time at the minimum wage would earn only $1.20 more per hour than she would receive on welfare. And half of that would come only at the end of the year if she submits a tax return to get the Earned Income Tax Credit.
As a result, experts argue, a woman must earn at least $6 an hour, work full time and receive full health coverage and cheap child care, or she is likely to fall back into the welfare system.
In hopes of ending this trap, the administration is likely to propose a four-pronged program. The cost is roughly estimated at $5 billion annually, with $2 billion expected in savings from reduced demand for welfare, leaving a net cost of $3 billion. That estimate does not include the much more expensive component of the plan, an expanded Earned Income Tax Credit, which is estimated to cost $25 billion a year by 1997.
The four basic elements are:
Making work more financially beneficial than welfare. This concept relies on the expanded tax credit, already proposed by Clinton, which is designed to lift working poor parents out of poverty.
Making work a desirable alternative for welfare families also relies on passage of health-care reform and universal access to coverage, which would guarantee that people leaving welfare would not lose medical coverage.
There may also be some proposals to raise the minimum wage, now $4.25 an hour.
Improving child-support collection. Just one-third of single parents receive any court-ordered child support, and the average amount is $2,200 a year, Ellwood wrote recently.
Expanding training and education. This step would build upon the provisions in the 1988 Family Support Act, which required states to move a portion of their welfare recipients into training and jobs. But the law has been implemented slowly, mainly because of state budget constraints, and any new requirements probably would have to be largely federally financed.
Instituting time-limited welfare. This final element, proposed by Clinton during the campaign, has drawn the most attention as the clearest departure from welfare policies of the past.
With other new supports in place, many beneficiaries would move voluntarily into the labor force, Ellwood has said. "The best time-limited welfare program is one in which no one hits the limit," he has written.
by CNB