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Did Welfare Reform “Work”? Maybe Not, But Something Did.

This year is the 25th anniversary of the great Welfare Reform act of 1996, which means we will all be treated to loads of thumbsuckers about whether "it worked." This is a conversation I'm eager to avoid, since the question of whether it worked is almost entirely a question of values.

But I was curious about one thing. The stated goal among Republicans was to push more single mothers into the workforce. So I wondered: by their own lights, is it fair to say it "worked"? Did it really push more single women to find jobs?

Here's a chart from the New York Times that shows what happened:

Welfare reform passed in 1996 and spent 1997 being implemented. So it's fair to say that 1998 is sort of the dividing line for "before welfare reform" and "after welfare reform." There are several odd things here.

First, as many people have pointed out, single mothers were piling into the workforce well before the welfare reform bill had a chance to have any impact. In fact, just a glance at the numbers makes it clear that welfare reform, at most, raised labor participation only slightly above where it was already at.

Second, the labor participation rate declined gradually over the next 15 years, and it declined at the same slow rate through both recessions and economic expansions. That seems weird. Then, in 2016, it suddenly shoots up for no apparent reason. What's up with that? Whatever it is, it hardly seems like welfare reform could be the culprit.

So did welfare reform "work" according the metric that conservatives themselves set out? It's hard to say. Something caused lots of single mothers to get jobs during the '90s—and to keep them through the first 20 years of the aughts (most of them, anyway). One possibility that's related to welfare reform is that in the early '90s lots of states were experimenting with tightening standards for welfare benefits, and talk of national welfare reform was in the air. Might that have something to do with it? I'd rate it fairly unlikely since the early efforts were weak and welfare recipients almost certainly had no idea that welfare reform was getting a lot of attention in Washington DC.

But if it wasn't welfare reform that did it, what was it? The burnout of the crack epidemic? A new generation of single mothers who were less lead poisoned than earlier generations? Some kind of weird statistical artifact? I don't know, but from the very beginning there's been something of a puzzle about why single mothers started entering the workforce in large numbers before welfare reform passed and before the economic boom of the late '90s started up. There are mysteries here that deserve a look.

11 thoughts on “Did Welfare Reform “Work”? Maybe Not, But Something Did.

  1. akapneogy

    "Something caused lots of single mothers to get jobs during the '90s—and to keep them through the first 20 years of the aughts (most of them, anyway)."

    It's the old story of capitalistic serfdom: The beatings continued and the morale improved.

  2. joshuawdavidson

    The period from 1995-1998 includes the tail end of the Head Start expansion to full year early education programs, as well as a roughly 20% increase in the federal minimum wage. Seems like either or both of these might have had an impact.

    The EITC formula was also increased for multiple children in the 1993 omnibus, which led to a big increase in average benefit over this period. EITC is based on hours worked.

    No similar spike in 2007-2008 though with the next minimum wage bump, so ...?

  3. Midgard

    This is where social nationalism laughs at conservatives. To SN's, the old welfare system worked as it should: it kept women out of the labor force and helped spur them to breed and do womenly duties. Conservatives run a system that needs women to be in the labor force. Pure and simple. It's a paradox for them. Not for SN's who see little value in the nuclear family or state run marriage scam. Welfare is as much industrial policy as it is transfers.

    Blacks absolutely must take a large part of the blame, in so their single mother boom was nuts from 75-90. But even then, many SN's quietly respect the macho and masculine energy behind it. But politically, it was a disaster for the old system.

  4. bharshaw

    What about just the hot economy--IIRC the last half of the Clinton years were good ones? Are there data showing how closely labor participation and the expansion of the economy are linked?

  5. Crissa

    I think the something was that single mothers stopped being demonized and stigmatized in the 80s. This let them find and keep work.
    (My mother raised me as a single mother when I was 2 to 6, and was the primary breadwinner until I was 13)

  6. skeptonomist

    In his previous post Kevin mentioned the US death rate from covid, 0.15%, as if it is something to be proud of. According to worldometers (link blocks post? google "worldometers coronavirus") this ranks the US as 213th best out of 221. On the basis of cases the US is no. 215. It is true that a few European countries did even worse, even though they don't have a Trump as President. But there are also many advanced countries all over the world which have done far better - look at the list in the link.

    Kevin's presentation of the data is highly misleading - it does not indicate at all what could have been done with a good response. The US did not need to have over half a million deaths. We need to find out exactly how Australia, New Zealand, Canada (societies similar to the US) and others kept cases down, and why Spain, etc. did not.

    As Kevin said in the previous post, people's complaint about vaccine distribution are not really justified since we have done as well on this as all but a very few countries. But this does not mean that the overall response was not bad.

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