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Press Briefing by Deputy Assistant to the President for Domestic Policy Bruce Reed on Welfare Reform

February 02, 1993

The Briefing Room

1:30 P.M. EST

MR. REED: For the record, let me run through a little bit of Bill Clinton's background on welfare reform and what this working group will do, and then open it up for questions.

As many of you know, President Clinton has been involved actively in welfare reform for more than a decade. He was a leader with the National Governors Association and he headed a task force on welfare reform in the mid-'80s with Governor Mike Castle, and that led to his working with Senator Moynihan in writing the Family Support Act of 1988, the major piece of welfare reform legislation to date. And I believe we're handing out a statement from Senator Moynihan, which you should have, in support of what we did today.

In Arkansas, the President had one of the leading implementations of the Family Support Act, a program called "Project Success," which moved 17,000 people from welfare to work. And as the President referred to in his speech this morning, the number of people on welfare in Arkansas actually went down in the last recession at a time when the welfare roles were increasing dramatically across the country.

Let me give you some numbers on the state of the welfare crisis at the moment. As the President pointed out this morning, the welfare population increased five times faster over the last four years than it had increased in the previous 12 years combined. There were approximately 3.5 million cases on the welfare roles nationwide in 1976, 3.7 million in 1988 and 4.7 million in 1992.

That is primarily a consequence of the last four years' economic record, the slowest economic growth in the last 50 years. But it is also a demonstration of lingering problems with the longterm underclass, the welfare dependent population. One out of four people on welfare stays on the welfare roles eight years or longer, which means that 25 percent of the people who are on welfare now will still be on welfare in the year 2000 unless we take action.

Q: Where should we put those numbers -- 3.576, 3.788, 4.792 -- is that what you just said?

MR. REED: That's right. That's cases. The total number of people on welfare right now is about 13.5 million.

Q: Cases as a family?

MR. REED: Cases as a family. And in the background of the welfare crisis, there's also --

Q: Does that include food stamps?

MR. REED: No, food stamps is separate. There are I think 25 million people on food stamps.

Q: Can you define what welfare is?

MR. REED: Welfare is AFDC. And food stamps also skyrocketed as a result of the recession. There's also a problem that gets less attention, which is child support enforcement. There are approximately 15 million kids around the country whose parents could pay child support but don't, and there's up to $25 billion in unpaid child support outstanding.

Q: What was the number?

MR. REED: Twenty-five billion. That's an estimate. No one really knows a good figure.

Q: Twenty-five billion?

MR. REED: Twenty-five billion in unpaid child support.

Q: Over how long?

MR. REED: That's total debt. That's not an annual figure.

Q: You mean, that's sort of the national debt in child support?

MR. REED: Exactly.

Q: Since George Washington, you mean?

MR. REED: No, I think that's parents who are still alive.

Q: Do you have a source on that? Do you know where that number comes from?

MR. REED: Well, don't get hung up on the number. There are estimates that range from $5 billion to $25 billion, and the importance of the unpaid child support is that any of that money that can be collected will go a long ways towards ending the welfare crisis and lifting families out of poverty.

Q: The 50 million kids who you say are the parents who could pay but don't, how do you define that -- somebody who is working, or somebody --

MR. REED: That's just 15 million children of delinquent parents.

Q: But you don't know the status of those parents, whether they're --

MR. REED: That assumes that anyone who could pay.

Q: Sir, is it up to the states to enforce this?

MR. REED: To enforce the child support laws?

Q: Yes.

MR. REED: Well, all the AFDC programs -- child support enforcement and AFDC are programs that are administered at the state level. And in recent years, there has been relatively little national leadership on child support enforcement. Many states have stepped into the breach, and there are a number of good programs -- Texas, Arkansas and others -- where states have cracked down.

Q: During the campaign, Bill Clinton said that his program would cost about $6 billion in terms of job training. Is that -- added tax benefit -- why don't you tell me what it is, and then let me ask the follow-up question.

MR. REED: All right. Well, I'd rather not give you any budget estimates right now. The President is reviewing the budget with his OMB Director.

Q: I'm talking about the campaign proposal.

MR. REED: The campaign numbers, campaign estimates that once the various welfare reform steps that he referred to in the campaign were fully phased-in, an earned income tax credit would cost $4 billion, welfare reform -- excuse me -- in the campaign, he said earned income tax credit was $2 billion, welfare reform was $4 billion, and child support enforcement basically pays for itself.

Q: What did you include in the $4 billion -- training?

MR. REED: Yes, that's education training and work -- requiring people to work.

Q: That did not include the government jobs?

MR. REED: Yes, it does.

Q: Senator Moynihan has been quoted -- people on Moynihan's staff have been quoted as saying that to provide jobs for all of the people after the two-year program, if they were all public sector jobs, would be $30 billion a year.

MR. REED: Well, there are a number of job program proposals on the table. The way we described it in the campaign was that requiring people to work would actually not increase considerably the cost of the welfare program, because basically people would be working off their welfare benefits. It's not --

Q: But if they're public sector jobs, then they're taxpayer-financed jobs.

MR. REED: Taxpayers are already paying that money. If you're on welfare, the long-term underclass are on welfare from eight to ten years. They are receiving a welfare check, whether they're -- currently they're receiving that and not working. If you require them to work, they would receive the same check. It's not --

Q: Doesn't that wash?

MR. REED: The administrative -- actually, the estimates of administrative costs are about the same. But please --

Q: Do they make minimum wage?

MR. REED: Workfare programs, which is one option -- people work the number of hours that it would take at the minimum wage to equal their benefit.

Q: The President said that he needs a time certain for the people who can't be on welfare forever. And then he said that two years after completing some job training they have to get off of welfare. Could you explain what he means by two-year -- what exactly is the two-year time limit, and what does he mean by a time certain that they can no longer receive welfare benefits, after what, and what are the exemptions to that?

MR. REED: The two-year time limit, which was the centerpiece of his campaign proposal on welfare reform, is based on a plan put forward by Professor David Ellwood at Harvard, and basically it would require people -- it would enable people to receive education and training for up to two years. And at the end of that two years, they would be required to work if they can work.

Q: Or their benefits are cut if they don't?

MR. REED: One of the objectives of the working group will be to study a number of aspects of the current Family Support Act, one of which is the sanctions involved for people who don't comply.

Q: What do you mean by people who can work?

MR. REED: The Family Support Act provides certain exemptions for people who are classified as unable to work. There's those who are disabled and cannot work, pregnant mothers who are in their second trimester, and the current law exempts mothers with children under three. Although, states are allowed if they choose to limit it to mothers with children under the age of one.

Q: What about the time certain -- people are going to have to get off of welfare -- he was referring --

MR. REED: He was referring to the proposal that he made in the campaign, which is a two-year time limit on welfare, after which people would be required to work, either in --

Q: Even if they didn't receive training? Does that only apply to people who receive training?

MR. REED: It applies to anyone who is involved in the -- the two-year time limit applies to anyone in the program. The question as to whether participation in education and training should be made mandatory is a whole other question. There's considerable debate as to whether, for example, a woman who has just been divorced and is temporarily on welfare, whether she should be required to take part in an education and training program when, in fact, she may be turning around and going into another job very soon. That hasn't been decided.

Q: I'm just a little unclear about the two-year. Is he saying that if you're on welfare, you have two years to receive welfare. After two years, unless you are disabled, unless you're a pregnant mother, or unless you're a mother with children under three, you no longer can receive welfare benefits?

MR. REED: You would still receive -- either you would be required to work if you're able to work either in public sector job or in the private sector. So you would still receive public benefits if you're in a public sector job.

Q: Well, what if you refuse to do that?

Q: How do you decide whether you get a private sector or a public sector job? If they go into public sector work, is there a time limit on how long the government is going to be paying them? Because, essentially, you could create a monstrous bureaucracy of people doing make-work jobs to meet the requirements.

MR. REED: Well, the answer to your question is that we currently have a monstrous bureaucracy. The welfare system, which is enabling people to remain on public benefits indefinitely, without any prospect of work -- the specific answer to your question is that the duration of community service, of public work requirement would be addressed by the working group.

Q: How many people do you envision covering with the $4 billion? How many out of that 13.5 billion?

MR. REED: Well, if I could back up a minute, those numbers are from the campaign. That does not -- the official OMB estimate of what we're going to spend -- that's not necessarily what's going to be included in the President's budget and --

Q: Was it a promise?

MR. REED: It was a -- yes. He pledged to implement this welfare reform program. We did not lay out a timetable during the campaign. And the budget, which will be released in the next several weeks will begin to address how quickly we are going to spend that money.

Q: If you've figured out the $4 billion, how many people did you think that was going to cover?

MR. REED: We assumed in the campaign that there would be about 1.5 million cases who would eventually be required to work.

Q: The President talked during the campaign very specifically of proposals that he would make. What is the function of the working group vis-a-vis those proposals? Why does he need a working group now to tell him what the proposals should be? And the other question is, based on this law, which he seems to feel is a good law, what other legislation is necessary? What other points specifically have to be legislated to make them happen?

MR. REED: The reason we need a working group is that the lesson that we learned from the Family Support Act was that no change is going to happen at the state level unless the states have a seat at the table in designing that change. We can't simply mandate welfare reform from Washington. The governors and state officials have formed their own advisory group that will be working with us. It's made up of five governors, two state legislators and three social service commissioners from around the country representing 10 states. And we will be sitting down with them to design a welfare reform plan that can work at the state level.

Q: Who is in charge of the working group?

Q: And which specific legislative changes are necessary to implement these proposals? Which will go further than the Family Support Act?

MR. REED: Well, the proposals that he made in the campaign that go further than the Family Support Act are the two-year time limit and the work requirement.

Q: If I could follow up on an earlier question -- if somebody goes into the public work force, the government-paid work force, and you say that the length of time they're on that is determined by the government, at the end of that period of time -- or determined by the working group -- I'm sorry -- at the end of that time are they then off all benefits and out of a job?

MR. REED: Well, I'll give you the answer that I gave you before, which is that's one thing the working group needs to address. Frankly, there is very little experience around the country with workfare programs and with welfare-to-work programs. There are a couple of different alternatives. There's something called Community Work Experience. There's another program called Public Service Employment, which is the Boren-Wofford proposal that the President referred to this morning. And we would like to see a number of states experiment with different approaches in hopes of finding the best answer to your question.

Q: What's your -- if you're two years on welfare and you get a job in the public sector, perhaps, are you then forever barred from coming back on the welfare roles? If not, what kind of a time limit --

MR. REED: Again, that's a question that the working group would have to decide. But our preference would be for the twoyear time limit to be a one-shot deal.

Q: You cannot come back?

MR. REED: That's right.

Q: The cost figure you mentioned from the campaign -- did they include the cost of fully implementing the 1988 legislation -- the education and training provisions?

MR. REED: Yes.

Q: -- working group and who is on it and --

MR. REED: Sure. This is going to be an inter-agency working group that will represent the various agencies who have a stake in welfare reform -- HHS; the Department of Agriculture, which oversees the food stamp program; HUD; Departments of Education and Labor, which both have an interest in education and training; OMB, obviously; the National Economic Council and the Domestic Policy Council; and I think that's it.

Q: Are you going to head the group or --

MR. REED: No, it's going to be coordinated out of the White House, and I'll be coordinating it. But the President may decide to chair it himself.

Q: Are the governors a part of this group, Bruce, or are they separate?

MR. REED: There are two separate groups. Our working group is going to develop a policy in consultation with the governors and with Congress.

Q: Bruce, I can't find any reference from Ellwood to any of the other people who have studied this who believe that you can do public sector jobs at the same cost as welfare benefits. And all the estimates -- and they range from $15 billion to $50 billion a year in additional costs in providing these kinds of jobs.

MR. REED: There are two kinds of programs, Andrea, which is what I've tried to explain.

Q: What was the question?

MR. REED: The question was about the cost of work requirements. Mickey Kaus and others have advocated public service employment programs that pay above the minimum wage and are 40-houra -week jobs or more. Those are obviously more expensive than community work experience program jobs, which basically would have people working to earn their welfare benefits.

Q: Well, Bill Clinton is talking about people working their way out of poverty, is he not?

MR. REED: Yes.

Q: Maybe I should ask you, which is Bill Clinton talking about? What is his conception?

MR. REED: I think -- I answered that question before, that we would like to see states experiment with several approaches.

Q: I understand that you've had this program for two years, requiring that they go to work and be trained to go to work. It has not been functioning. Would you tell us why it did not function? And would you tell us, are you planning any sort of program to train these women who have never been in an office before and have never gone to work, training them how to go to work?

MR. REED: As the President said this morning, the Family Support Act was a very good first step. It hasn't been fully implemented for a variety of reasons, one of which is that because of the recession, the states have been essentially broke. They only asked for $660 million out of the $1 billion that was authorized for education and training.

The key to long-term success in welfare reform is a growing economy. And I should also point out that the other pieces of the Clinton agenda will have a lot to do with our success in welfare reform. The best thing that you could possibly do to get people off welfare is to control the cost of health care and expand the availability of health insurance.

Q: Is there a level of economic growth that you assume to get to the estimates of how much this program is going to cost?

MR. REED: I haven't assumed any special --

Q: Do you have to, to get to a number? Doesn't the level of economic growth --

MR. REED: That's based on current welfare population.

Q: Oh, I see. So you assume current unemployment rate, current welfare population.

MR. REED: For the purposes of estimating how much welfare reform costs, but not --

Q: What's your estimate for state and federal spending on welfare at this point?

MR. REED: Additional spending?

Q: No, currently. What are we spending now for the programs you're trying to --

MR. REED: I think that final spending on AFDC is approximately $15 billion. The overall cost of income maintenance programs across the government, state and federal, is something like $150 billion.

Q: Would you clarify your numbers? You said that you're only anticipating 1.5 million cases being required to work. That's out of the 4.7 million cases which you say are currently on welfare?

MR. REED: Yes, that's right.

Q: Are those the people on for more than two years?

Q: So you're saying there are over 3 million, 3.2 million cases of welfare, however many actual bodies that works out to, you're going to let stay permanently on the welfare roles?

MR. REED: No, although there is a large welfare population -- more than half of the welfare population that is as the President said this morning, on welfare because they are unable to work.

Q: What's your target date for legislation? When do you expect to have it ready?

MR. REED: Welfare reform legislation and health care legislation go through the same committees on the Hill. Health care, we hope to introduce first; welfare reform would come shortly after that.

Q: Are we talking this spring, summer, when? May, June, July, next year?

MR. REED: When we announce the working group in the next 10 days, we'll put it a day on it for you.

Q: That's when you're going to announce the working group?

MR. REED: Yes.

THE PRESS: Thank you.

END 1:59 P.M. EST

William J. Clinton, Press Briefing by Deputy Assistant to the President for Domestic Policy Bruce Reed on Welfare Reform Online by Gerhard Peters and John T. Woolley, The American Presidency Project

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