Read Clinton's lips: No more welfare: America
President Bill Clinton's pledge to 'end welfare as we know it' was one of the most popular lines in last year's election campaign. His idea of a strict two-year time limit on welfare cheques appealed to voters (especially 'Reagan democrats') not just as a way of cutting government spending and thus reducing taxes, but as a solution to the nation's most pressing social problems. In the American mind, welfare has become synonymous with such evils as urban decay, fatherless children, drug abuse and violent crime. By promising radical welfare reform, Mr Clinton was sending a powerful subliminal message: he would wage war on all the diseases that are ravaging urban society. Since becoming president, Mr Clinton has barely mentioned the word welfare, raising fears that his grandiose promise will prove as cynical as former President George Bush's 'read my lips: no new taxes' pledge. The White House insists that welfare reform is not forgotten but has just had to take its turn behind two even more urgent priorities: the deficit reduction plan finally approved this month and the healthcare reform scheduled for September. It claims both measures will help shift people off welfare by 'making work pay.' The budget advanced this cause by expanding the earned income tax credit (a kind of negative income tax). This gives poor working families a cash bonus of up to Dollars 2,500 a year, increasing the incentive to take low paid jobs. If healthcare reform guarantees health insurance for all workers, welfare recipients will no longer be able to reject jobs on the grounds that they stand to lose their health care benefits. In addition, the administration promises to bolster the economic position of welfare mothers by strictly enforcing laws requiring absent fathers to support their children financially. Such measures should help. But they are hardly going to solve America's welfare problem, which differs substantially from that in Europe. In keeping with Franklin Roosevelt's dictum that a permanent dole is 'a narcotic, a subtle destroyer of the human spirit', the US has never provided permanent welfare support for single, able-bodied adults. When pundits talk of a 'culture of welfare' they are referring mainly to the Dollars 20bn spent on Aid for Families with Dependent Children, a benefit received by 5m single-parent families. The objection is not that some families in straitened circumstances need AFDC as a short-term prop, but that half of those on welfare behave as though they have a meal ticket for life. So what should Mr Clinton do? Many conservatives favour the concept of a strict time limit. Once people accept that benefits are not going to be paid indefinitely, they argue, behaviour will change. Teenagers will stop having babies and start recognising the economic advantages of marriage. Those whose welfare benefits expire will face a stark choice: accept low-paid employment or hand over children for adoption. At first the adjustment will be horribly painful but in the longer term society will gain enormously because destructive lifestyles will no longer be underwritten. With its economic life support system (welfare) ripped away, the underclass will shrivel. But no modern president would contemplate so brutal a social experiment. If welfare stops, something has to take its place. One suggestion is that Mr Clinton should follow the example of Roosevelt's Works Progress Administration, an agency that at its peak created over 3m public sector jobs. After two years, welfare cheques would thus be replaced by the offer of a government job at slightly below the private sector minimum wage. Mothers with young children would also be offered state child care facilities. According to one advocate, this would amount to replacing the welfare state by the 'work ethic state'. This solution is more appealing than a mere cessation of benefits. But it would involve a huge expansion of public sector employment and cost perhaps Dollars 50-60bn a year, far more than the Clinton administration is willing to spend on welfare reform. Fortunately there is a fall back position for Mr Clinton: the bipartisan Family Support Act of 1988, which he helped steer through Congress. This recognised the impossibility of ending welfare overnight and instead set targets for the gradual introduction of 'workfare'. Next year states will receive federal assistance only if they ensure that at least 15 per cent of the 'employable' welfare case load is working or in training programmes; by 1995 the required ratio rises to 20 per cent. These seemingly undemanding targets require a much larger fraction of the welfare population to take jobs at some point during the year. Mr Clinton could tighten the definition of 'employable', so as to include mothers with children under the age of three, and set more demanding workfare participation targets, for example that 50 per cent of welfare recipients should be working or in training by the year 2000. Such a gradualist approach would be both humane and cost effective. The only trouble is that it falls far short of the presidential promise to 'end welfare as we know it'. Like Mr Bush, Mr Clinton may have raised expecta-tions that simply cannot be met.
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