IN THE EARLY 1990s DEVOLUTION OF POWER TO ADMINISTER SOCIAL PROGRAMS AND services in the United States occurred from the federal to state and local governmental units. Devolution -- defined in Webster's Ninth New Collegiate Dictionary as "the transference (as of rights, powers, or responsibility) to another; especially, the surrender of powers to local authorities by a central government" -- has proved to be a divisive issue in the United States. Supporters of devolution argue that governmental units that are closer to the people (whether state or local) are more knowledgeable about and better positioned to respond to people's needs and challenges with greater imagination and insight than are federal units (Borut, 1996; Buckley, 1996; Conlan, 1998; Kingsley, 1996). Those who oppose devolution contend that block granting of welfare programs to states is based on inaccurate premises and will hurt the poor and the nation at large (Caraley, 1996, 1998; Donahue, 1997a, 1997b; Goldberg, 1996; Kuttner, 1995; Steuerl e and Mermin, 1997; Weaver, 1996). Still others have mixed views regarding the merits of devolution of welfare programs to the states (Gold, 1996; Nathan, 1997). In this article we ask the following questions: How does the recent decentralization of welfare administration responsibilities to states and local governments fit within the context of evolution of welfare programs and services in the United States? Why did state and local political units support the welfare devolution legislation of 1996? How does this differ from earlier governmental moves to decentralize power? What is the true function of welfare in the U.S.? Are certain governmental units better suited to undertake the responsibility of welfare administration than others? Finally, what are the limitations of the welfare legislation of 1996?
There has been ongoing debate over the division of responsibilities between the federal government and the states since the 1700s, when the first federal grants were issued to states and localities (Brown and Corbett, 1997; Nathan and Lago, 1990; Rivlin, 1991). Between 1880 and 1910, pensions for Civil War veterans comprised over one-quarter of federal expenditures, with 90% of surviving Union veterans collecting pensions by 1910 (Skocpol, 1995). Besides the 28% of men aged 65 or more, over 300,000 widows, orphans, and other dependents of Union soldiers received federal benefits during this time. In contrast to the Civil War Pension Acts (Skocpol, 1995; 1998), local governments and charities in the U.s. were primarily responsible for providing poor relief through the time of the Great Depression (Brown, 1940; Nathan, 1997). During the 1930s, states took a more active role as they attempted to reduce the high rates of unemployment and to boost the economy through various work relief programs. Although these p rograms were federally subsidized, only after the passage of the Social Security Act of 1935 did the federal government begin to directly share the responsibility of providing relief to the poor through a variety of social welfare programs. Even today, most of our public assistance programs stem from this act (Gordon, 1994).
The passage of the Social Security Act reflected the general political sentiment that the federal government had a role in alleviating poverty among children, the elderly, and the unemployed (Brown and Corbett, 1997; Rivlin, 1991). Among the various programs established by this act were Supplemental Security Income (SSI), or old-age assistance, unemployment compensation, and Aid to Dependent Children (later known as Aid to Families with Dependent Children [AFDC]). The 11 public assistance programs established under the Social Security Act were aimed at different social groups and operated under different terms (Gordon, 1994). Due to discontent with perceived state neglect, many services that were previously regarded as a function of the states became the responsibility, or shared responsibility, of the federal government, including poverty alleviation programs, income transfer programs, and federal work training and manpower development programs (Rivlin, 1991). …