Welfare Incentives That Aid Marriages

Article excerpt

Congress next year must decide what to do about the historic 1996 welfare reform legislation. Because most federal legislation expires after a certain period of time, Congress periodically must take up legislation anew and consider whether to continue it in its present form, change it or do away with it.

When it comes to the 1996 welfare reform legislation, the choice seems easy. Since 1996, welfare caseloads have plummeted in nearly every state. Overall, the caseloads have dropped nearly 60 percent. Few federal reforms can boast about that kind of success rate. Obviously, we should continue with the program as it is, right?

Well, not exactly. Welfare reform has been successful in moving millions of welfare-dependent single mothers off cash welfare and into the paid labor force. This, in itself, is not a bad thing. Indeed, it is far better for children who grow up in a single-parent household to have that parent in the paid labor force than on welfare.

Welfare reform, however, was not just about moving single parents off welfare and into jobs. It also was intended to reduce the number of children living in single-parent households. To accomplish this goal, the 1996 welfare reform did two things. First, it provided money to states to implement abstinence programs. (It's pretty hard to have a child out of wedlock if you're sexually abstinent.) Second, it directed states to implement programs to encourage the formation and stability of families with married parents.

So far, most states have implemented efforts to send an abstinence message to young people. No state, however, has implemented any serious effort to encourage the formation and stability of families with married parents.

One reason states cite for not taking on the marriage issue is that we don't know what to do to encourage marriage. A new evaluation of a welfare reform effort in Minnesota, however, suggests that we may know a little something about promoting marriage through welfare after all.

Known as the Minnesota Family Investment Program (MFIP), this welfare reform initiative, like most, was designed primarily to encourage work. On that score, the MFIP did pretty well. It substantially increased the employment status and earnings of families previously dependent on welfare, relative to a control group provided with a more traditional welfare program.

MFIP did something more as well. It also changed incentives within welfare in such a way that low-income married couples no longer were penalized financially for the decision to get or stay married.

Under traditional welfare rules, for example, there is something called the 100-hour rule. This rule says low-income couples are ineligible for welfare if one of the adults in the household worked more than 100 hours during the previous three months - even if that worker's earnings were not high enough to lift the family out of poverty. …