A quarterly magazine of urban affairs, published by the Manhattan Institute, edited by Brian C. Anderson.
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The poverty industry renews its attack on welfare reform.
26 January 2010
Throughout his mayoralty, Mike Bloomberg admirably resisted poverty advocates pressure to roll back New York Citys work and responsibility requirements for welfare recipients. The recession, however, has given the advocates a specious new pretext for loosening welfare rules. Should they succeed, New York would quickly reclaim its status as the countrys dependency capital, hurting taxpayers and the poor alike. Unfortunately, the Obama administration is not supporting Mayor Bloomberg in this battle; to the contrary, the White House is emboldening its base by signaling its pro-welfare intentions.
Several dependency-promoting bills are gathering steam in Albany. In theory, current state law requires putatively homeless single mothers with an income to contribute a small portion of that income to the costs of their taxpayer-funded apartments. For instance, a single mother with two children and a monthly income of $1,000 could be asked to contribute around $160 a month for her private apartment. But when the city tried to enforce the contribution rule last spring, homeless advocates went ballistic, and the administration backed off. The city wants to start enforcing the rule again, but a bill sponsored by state senator Daniel Squadron of Brooklyn would forbid it.
The requirement is both fairother low-income New Yorkers put far more of their income toward rentand good policy. The absence of any rent requirement creates a powerful incentive to enter and stay in the system. It also undermines the reciprocity contract between taxpayers and welfare recipients that lies at the heart of welfare reform. The result: a nearly half-billion-dollar annual bill to house single mothers claiming homelessness.
Other pending legislation would forbid the city from medically evaluating a recipients claim that she was incapable of working; it would also allow enrollment in a four-year college to fulfill welfares work requirements. The first bill opens up a wide arena for fraud; the second ignores decades of pre- and post-welfare-reform experience showing that the best way for an unskilled worker to enter the workforce is actually to start working, rather than spend years in often fruitless education and training programs.
If the Albany dependency brigades werent dangerous enough, the Obama administration has been conducting its own campaign for expanded welfare eligibilitynot surprisingly, perhaps, given that some of the nations most influential welfare advocates now occupy key positions in the federal bureaucracy. For now, the city has fended off a Washington push to eliminate its requirement that food-stamp recipients establish their identity through finger-imaging, but the pressure to discard that key anti-fraud measure continues. An early draft of the stimulus bill sought to forbid the city from asking able-bodied, childless food-stamp recipients to spend a few hours a week working or looking for work. And when states across the country were slow to increase their welfare caseloads and spending with federal stimulus dollars, the Obama administration loosened the rules in the final bill for doling out additional welfare money.
This double-sided attack on New Yorks welfare reform lacks all empirical basis. Since 1995, the citys welfare rolls have dropped nearly 70 percent, from 1.1 million to 350,000. Rather than increasing, as opponents of welfare reform warned, the child poverty rate in New York City dropped 34 percent during the same period, compared with a 5 percent drop nationwide. In 2008, New York City had the lowest child poverty rate26.5 percentand the lowest total poverty rate18.2 percentof the countrys eight largest cities.
Work, even at minimum wage, remains the best route out of poverty. When tax credits and medical and housing benefits are included, an average single mother of two with an $8.25-an-hour job in New York City receives a $63,000 annual income. On welfare alone, that same mother would pull in $43,000 a yeara whopping amount for non-work, to be sure, but still less than work provides.
The recession is no excuse for changing the responsibility philosophy that has lowered poverty in New York City. Entry-level work has remained available even as the middle-class employment situation has worsened. The city placed 75,000 welfare recipients in jobs in 2009; on average, about 70 percent of people who leave welfare for work are still off the rolls 12 months later. Even if the entry-level job market significantly tightens, the citys workfare program acts as a backstop for people who cant find private-sector jobs.
Powerful political forces are trying to make dependency acceptable again. Mayor Bloomberg is right to resist them.
Heather Mac Donald is a contributing editor of City Journal and the John M. Olin Fellow at the Manhattan Institute.