IN 1996, PRESIDENT CLINTON KEPT HIS CAMPAIGN pledge to end welfare as we know it. By the time the bill finally passed, Republicans controlled Congress and the reform seemed draconian. Three senior sub-cabinet officials resigned in protest. The program ended welfare as an federal entitlement, substituted temporary benefits, and converted the entire emphasis to moving people off welfare and into paid work. It increased funding for child care, but not enough for every newly employed former welfare recipient.
However, the program did give states a good deal of flexibility. It also de-linked welfare from Medicaid so that losing welfare did not have to mean losing health benefits, and Congress increased the Earned Income Tax Credit, which increased the rewards for finding paid work.
The sponsors also got lucky. The shift coincided with a period of full employment, so most people leaving welfare could actually find jobs. It also meant a rapid reduction in the welfare rolls that left states with spare funds to redirect to work supports, such as child care and training. Most states gradually realized that investing in the education and skill levels of people leaving welfare was far more likely to increase their self-sufficiency and improve the lives of their children in the long run.
One other constructive side effect of welfare reform is that voters are no longer so inclined to scapegoat the poor. …