At Budget Hearing, Sessions Presents Moral Case For Welfare Reform

“Since President Johnson’s Great Society, the federal government has spent $15 trillion dollars in the war on poverty. Yet the poverty rate has remained largely unchanged… Welfare is now the single largest item in the federal budget. It is larger than Medicare, larger than defense, larger than Social Security… Today, like in 1996, opponents of reform label any attempts to change the way these programs operate as cruel, uncaring, and dangerous. But what is actually cruel and uncaring is to oppose reforms that will help lift millions of Americans out of poverty.

It is time to return to the moral principles of the 1996 welfare reform. That reform was guided by the principle that, over time, unmonitored welfare programs were damaging not merely to the Treasury but to the recipient… No longer can we measure compassion by how much we spend on poverty but how many people we help to lift out of poverty.”

WASHINGTON—U.S. Sen. Jeff Sessions (R-AL), Ranking Member of the Senate Budget Committee, delivered an opening statement today at Committee hearing on “the impact of federal budget decisions on families and communities.”

Sessions’ remarks, as prepared, follow:

“Thank you, Chairman Murray, for holding this important hearing today. I would also like to extend my sincere thanks to our witnesses today for offering us their expert guidance.

We have a great American tradition of helping those in need, but we also have a great American tradition of self-reliance and independence. Federal policy should encourage both of those.

We’re going to hear from Gary Alexander, Secretary of the Pennsylvania Department of Public Welfare, who will show that we have drifted from away from the principles of the 1996 welfare reform and how our complex welfare bureaucracy tends to penalize work and promote dependency.

Bob Woodson, from the Center for Neighborhood Enterprise, came down to one of Alabama’s poorest counties and had some fabulous ideas to help people there improve their lives. Thank you for your contribution to Alabama, Dr. Woodson. I know how deeply you care about poor people and how to help them advance and move out of poverty.

Our goal is to help more of our fellow citizens find good-paying jobs that can support them and their families. Our goal is to strengthen the human networks of family, charity and community.

Back in 1965, economist James Tobin wrote that “it is almost as if our present programs of public assistance had been consciously contrived to perpetuate the conditions they are supposed to alleviate.”

Since President Johnson’s Great Society, the federal government has spent $15 trillion dollars in the war on poverty. Yet the poverty rate has remained largely unchanged, and has even increased during the last several years. During the last several years we have also seen a historic surge in federal poverty spending. Welfare is now the single largest item in the federal budget. It is larger than Medicare, larger than defense, larger than Social Security.

Today, like in 1996, opponents of reform label any attempts to change the way these programs operate as cruel, uncaring, and dangerous. But what is actually cruel and uncaring is to oppose reforms that will help lift millions of Americans out of poverty.

Consider the results of the 1996 reform. There were so many dire predictions at that time. But as Ron Haskins of the Brookings Institute reported:

“Until the mid-1990s, never-married mothers seldom worked outside the home, had poverty rates over 60% and were at least five times more likely than married couples to by poor…Between 1996 and 2000, the percentage of never-married mothers in jobs increased by about a third, while the poverty rate for those mothers and their children declined by about a third. For the poorest of the poor, this large an improvement based on their own efforts was unprecedented. Since then, two recessions have reduced these gains somewhat… Yet even in the worst recession since the Depression, more are employed and they are less poor than they were before the 1996 law.”

Unfortunately, the gains made in 1996 have been slipping away. Welfare spending has increased every single year, regardless of whether the economy was declining or improving and, based on CBO data, is projected to increase another 80 percent over the next decade. Let me repeat: spending on means-tested federal aid will increase another 80 percent over the next 10 years.

Including state contributions, we already spend a trillion dollars a year on federal means-tested poverty programs—more than any other program in the federal budget. Converted to cash, we spend enough on federal welfare to mail every household living beneath the poverty line a check for $60,000 each year. Can anyone honestly say this huge sum of money is being wisely and effectively spent, that no improvements are needed?

Spending on food stamps has more than quadrupled since 2000 and the federal government actively promotes food stamps to those who say they do not need them. The USDA created a Spanish-language radio ad in which an individual is pressured to enroll against her will. She protests, “I don’t need anyone’s help. My husband earns enough to take care of us.” Eventually, she succumbs and signs up.

This is only one of many controversial promotions where individuals are pressured to enroll even if they insist they do not want or need benefits. One recruitment worker was even awarded for overcoming “mountain pride.” The agency laments that communities “lose out” when people choose not to go on food stamps: “Each $5 in new SNAP benefits generates almost twice that amount in economic activity for the community… Everyone wins when eligible people take advantage of benefits to which they are entitled.”

Clearly, we need to think more about the social and economic consequences of encouraging people to accept welfare who do not wish to receive it. No longer can we measure compassion by how much we spend on poverty but how many people we help to lift out of poverty.

One consequence of the massive surge in welfare spending has been the creation of a growing penalty for working. Experts have dubbed this the “welfare cliff.” Welfare recipients reach a point where every additional dollar earned can result in a more than 50 cent reduction in benefits.

CBO estimated that for every dollar in additional earnings through work, many households on welfare stand to lose 60 cents to either taxes or lost federal benefits. With a high penalty to earning more by working, CBO finds that a strong incentive is created to “put in fewer hours or be less productive.”

A paper presented at the American Enterprise Institute by Secretary Alexander found that because of the stacking of welfare benefits, many individuals receiving welfare stand to lose financially by increasing their income. In one example, the study demonstrated how a single parent with two children earning $29,000 would have a net income, including welfare benefits, of $57,000. Therefore, the individual would need annual earnings to jump from $29,000 to $69,000 (pre-tax) to maintain the same standard of living without welfare benefits.

I just want to add in closing that I grew up in the country. I recently had some work done on the little house I grew up in. It was 900 square feet—it seemed bigger at the time—and never had central air and heating. The fireplace was where we had our heating.

My father ran a country store and later struggled with a small farm equipment dealership. I was taught to work hard. Pell grants did help me in college. I grew up with people who didn’t get to go to college, had less money than we did. I think I understand something about human beings who work hard and try to do the right thing, and how to help them improve. So let’s work together, bring our values to the table, and see if we can’t make this system work better for America.”

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