Does Welfare Really Help the Poor?

Social Security, unemployment compensation, Supplemental Social Income (SSI), food stamps, Temporary Assistance to Needy Families (TANF), Medicare and Medicaid, Head Start; these are just some of the social programs that are often lumped together under the umbrella of "public assistance" or "welfare." While some of the programs are more controversial than others the real question is whether welfare programs effectively meet the needs of the poor.

From America's beginnings until the early part of the 20^th century, needy families generally relied upon assistance from religious organizations and private charities to provide a safety net during hard times. However, with the bank failures, massive unemployment, hunger and homelessness of the Great Depression Era these organizations quickly became overwhelmed and unable to cope with the great demand for their services.

The arguments for and against social programs during the early 1930s are not much different than the arguments for and against President Obama's economic stimulus programs and the much debated "public option" in the impending Health Insurance Reform bill of today. One side desires to cut taxes for the rich and eschews social welfare programs as being expensive debacles that encourage the poor to avoid work while the other side strongly believes that without social programs for the needy the ever widening gap between the "haves" and the "have-nots" will eventually erupt in the form of increased violence and crime.

Like many controversial issues however, the question of whether social welfare programs actually benefit the poor has no simple answer. It often depends upon the type of program, how well it is run and how its success is being measured.

Social Security, for example is now considered a mainstay among America's senior citizen and disabled population. However, at the time of its passage in 1935, opposition to the legislation ran high from those who considered it to be a dangerous foray of "big government" into private matters. But despite the precariousness of the Social Security system today, there is no doubt that millions of senior citizens who have received benefits over the last 75 years would have fared far worse without it.

Some 30 years later, Medicare faced similar opposition. 1965 Congressional Record accounts of the Medicare debate reveal the deep divisions in both houses of Congress, with one U.S. senator going so far as to denounce Medicare as "brazen socialism." But with rising healthcare costs and with some seniors still forced to choose between filling their expensive prescriptions and buying groceries even with Medicare and Medicaid coverage, how much worse would the situation be without such programs?

Head Start, a program initially designed to improve the readiness of low income children for school has also been criticized both for the expense and for the fact that as students progress through elementary school studies have been unable to demonstrate significant achievement gains for students who attended Head Start over those who did not. Yet, there are other examples, such as Geoffrey Canada's Harlem Children's Zone project, which clearly demonstrate that early childhood education programs aimed at poor children and their parents can result in significant and lasting achievement gains.

Finally, Temporary Assistance to Needy Families (TANF) created by the 1996 Welfare Reform to replace Aid to Families with Dependent Children (AFDC) probably remains the most controversial in spite of efforts to answer critics' charges against the effectiveness of welfare programs.

The lingering contempt that surrounds TANF may be the result of Ronald Reagan's vehement (but completely unsubstantiated) assertions that a "Chicago Welfare Queen" was becoming rich through systematic fraud against government welfare programs at the expense of hardworking Americans during his 1976 presidential campaign. Even though the Welfare Reform Act of 1996 implemented changes into the system that would make this type of abuse virtually impossible (if in fact it ever existed on a widespread basis at all) the myths surrounding this type of aid still persist.

Although social welfare programs in the United States are not perfect and likely need continuing reform to make them truly effective, dismantling the entire welfare system is certainly not the answer. In fact, when we compare the overall quality of life of Americans with that of the citizens of countries like Sweden, Finland, Denmark and Norway, which have far more generous social welfare programs an argument could be made that current U.S. welfare programs do not go far enough.

For example, a study by the Organization for Economic Cooperation and Development indicated that the U.S. is third-worst in terms of poverty and income inequality, with only Mexico and Turkey faring worse. Although Scandinavia and many western European nations have far higher tax rates than the U.S. there is some evidence that the resulting benefits may be worth the extra costs. The study indicated that European nations spend about 7 to 8% of their national income on social welfare programs, but only 5 to 8% of their citizens live below the poverty line.

By contrast, the U.S., Mexico and Turkey spend only about 2% of their national income on social welfare programs, but have 12 to 15% of their citizens living in poverty (13.2% for the U.S. according to 2008 statistics from the U.S. Census Bureau).

Poverty isn't the only measure by which European countries, which U.S. politicians have been denouncing as "socialist", outpace the United States. Mercer, a global consulting, research and investment services corporation conducts a Quality of Living survey in which it evaluates cities around the world based on thirty-nine components of quality of living including: political stability, crime, law enforcement, censorship, personal freedom, medical services, education, transportation, recreation, availability of consumer goods, and quality housing and climate. According to the 2009 study, European cities in Switzerland and Germany dominated the top 10 while the highest ranking U.S. city was Honolulu, Hawaii at number 29.

Even with a high price tag in the form of increased taxes these results do seem to suggest that social welfare programs are not the great evil that many Americans assume them to be. If the experience of our European neighbors is any sort of indicator then correctly implemented and conscientiously managed welfare programs may not only improve the lives of the poor but also, perhaps go a long way in reducing the ranks of the poverty stricken while improving the quality of life for the rest of us.