Bill Clinton: Radio Address on the Welfare Reform Act

Context

Roosevelt created the American welfare system with the 1935 Social Security Act. This legislation established a system of unemployment and retirement insurance funded by employer and employee contributions as well as federal grants to aid elderly, blind, and disabled adults and dependent children. The latter group was covered under Aid to Dependent Children (ADC), a minor component of the Social Security system. During the Depression, most ADC recipients consisted of children of single-parent families headed by widows. By the late 1950s, however, ADC recipients outnumbered those receiving other assistance and were primarily divorced and unwed mothers or those who had been deserted by their spouses.

During the 1960s presidents John F. Kennedy and Lyndon B. Johnson expanded the reach and volume of public assistance started by Roosevelt. Under Kennedy's watch, the 1962 Public Welfare Amendments Act dedicated more federal funds to welfare. ADC was renamed the AFDC to recognize that adults were also receiving benefits. Johnson increased the resources and services available to the poor and created community groups that had authority to decide how funds would best be spent locally. State laws that set criteria for welfare eligibility were increasingly challenged, resulting in a relaxation of standards and expansion of benefits. The number of welfare recipients increased from three million in 1960 to 10.2 million in 1971.

As the welfare rolls soared, Americans increasingly moved toward the political right. The massive social upheavals of the 1960s and 1970s, including the war in Vietnam; race riots; legalization of abortion; rising rates of crime, divorce, and out-of-wedlock births; gay rights; and a growing drug culture, created a backlash. A series of Republican presidencies, interrupted briefly by Jimmy Carter after the Watergate scandal that forced the resignation of Richard Nixon in 1974, indicated that the country was ready for change: a return to fiscal and social conservatism, including a reform of the welfare system. Charles Murray's book Losing Ground: American Social Policy, 1950–1980, published in 1984, served as the inspiration for President Ronald Reagan's changes to the welfare system. Murray characterized welfare (AFDC, food stamps, Medicare, and unemployment benefits) as rewarding irresponsible behavior. Reagan's cuts to AFDC reduced the percentage of poor families receiving aid from 88 percent in 1979 to 63 percent in 1984. Subsidized housing was cut more deeply, from $32 billion in 1981 to $6 billion in 1989. The Family Support Act of 1988 marked another important shift in welfare by establishing strong incentives for aid recipients to move into the workforce.

By the 1990s critics of AFDC focused on problems related to its incentive structure. A significant change to the welfare system under the Reagan administration was the reduction of so-called earning disregards. Previously, the government did not count low-income families' entire earnings in calculating eligibility for various benefits; a portion of the earnings was disregarded. After the reforms of the 1980s, welfare recipients who entered the workforce often found that, by the time they factored in lost cash benefits and medical coverage, they were actually worse off than if they had remained unemployed and on government aid. Without any incentive to leave AFDC and take low-wage jobs, many recipients understandably chose to remain within the system. Thus, although benefits in real dollar terms had declined over twenty years, the system itself seemed broken.

As Clinton entered the political scene in the early 1990s, he faced a changed electorate. The Reagan administration's focus on tax cuts, small government, and a return to traditional values resonated with voters. To win the 1992 presidential election and to stay in office, Clinton had to appeal to this more conservative electorate, and the broken AFDC system was one way to do so. In his 1992 election campaign, he promised to radically reshape the welfare system. However, health care reform, not welfare reform, was a priority after his election. The subject of welfare reform moved into the foreground again following the Republican sweep of the 1994 midterm elections. Speaker of the House Newt Gingrich led the Republican charge, introducing welfare reform legislation as part of the 1994 budget. Clinton vetoed the budget because it contained cuts in Medicare and Medicaid, two cornerstone programs in his emphasis on health care. The Republicans returned in 1995 with similar legislation titled the PRWORA, which was unattached to a budget. Clinton vetoed this as well, arguing that changes in the food stamp and school lunch programs were more focused on meeting budget goals than on implementing serious welfare reform. By the late summer of 1996, as Clinton faced reelection, the presidential adviser Dick Morris urged him to sign the bill; polls indicated that if Clinton did not, his fifteen-point advantage over the Republican candidate Bob Dole would plummet to a three-point deficit.

On August 22, 1996, Clinton signed the PRWORA in a Rose Garden ceremony. Clinton campaigned under the promise of welfare reform; although he despised several components of the bill, he delivered on his promise at the end of his first term as president of the United States. Clinton transformed America's welfare system from a federal cash aid program to one tied to work and other personal behaviors. His welfare reform speech exemplifies the way in which he sought to refashion the Democratic Party along more centrist lines, moving away from the party's traditional liberal policies. In Clinton's January 20, 1997, Inaugural Address, he stated, “The preeminent mission of our Government is to give all Americans an opportunity, not a guarantee but a real opportunity, to build better lives.”