Podcast #97: Cities, Welfare, and Block Grants with Dana DeMaster

dana picThe podcast this week is a conversation with Dana DeMaster, a program evaluator who focuses on poverty and public health programs at the State and County level. Dana is also on the streets.mn board, and a long-time advocate for better bicycling in Minnesota. We sat down a while ago to discuss how cities and counties deliver welfare and financial assistance for poor families in Minnesota, and how those programs might change in the future.

It’s a fascinating topic that I was genuinely curious about, and during our conversation I learned a lot about the history of welfare in the US, how truly complicated government social programs have become, and what the political landscape of Federal and local government looks like today. I hope you enjoy this important and fascinating conversation.

The podcast this week is generously sponsored by HOURCAR: 

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[Rough transcript of some of the highlights below.]

On the history of Welfare in the US:

In 1935, we were in the middle of the great depression, and Keynesian economics were really big. The federal government was going to spend money and go into debt to stimulate the economy a lot of the programs that we know now today came out of that time. Big ones are unemployment insurance and aid to dependent children. That program was largely unchanged for many years if you were poor and you had kids, and you went down to the welfare office and applied and got money. When the economy went poorly, the program and spending expanded, and the federal government gave money to poor families. In the 90s a lot of people were unsatisfied with AFDC, and a lot of the criticisms were very legitimate. With AFDC, if you worked, every dollar you made was taken off your grant, dollar for dollar. Prior to 1996 there was a lot of experimentation about how to improve AFDC. When these programs it was largely white women that were on them, but in the 60s under Johnson, welfare became associated with Black women who had never been married, versus white women who had been married and lost heir husbands. It’s a great change and is something that has defined poverty policy in our country, about who is deserving and who is not.

On the definition of block grants:

In the 1990s, a block grant was a set amount of money that was given to the state to spend in a certain way. Welfare went from AFDC – more money, more poor people — to “here’s your state’s money that you get to spend in the 4 goal areas.” All states were given a set amount of money, and from the federal government’s perspective this is great budgeting. For TANF, states got a block grant based on state’s AFDC caseloads from 1994. This is still true today. In 1994 what your state spent and the share of the case load that you had determine your block grant. It has never been adjusted for inflation ever. In 2016 we get the same amount of money that we did in 1997 based in 1994 case loads.

On local control since the 90s welfare reform:

If you read Paul Ryan’s speeches this is exactly the language about local control, and there’s some truth to that. The TANF model, all of of it came off Minnesota’s early experimentation in the 1990s. The local control and the local experimentation have some really neat things about it. However, now we have this inconsistent environment where if you’re poor and travel from state to state your ability to receive benefits is going to be all over the map.

One of the things about block granting, before money went to “here’s a grant for this mom and her kids.” Now there are four goal areas that states can spend money on and it’s really broad. We will spend less than 20% of our TANF grant on welfare for families. We spend it on other things and they’re not bad things, but when people spend millions of dollars on welfare they think its going to that woman with kids. But really now 80% of welfare spending is on things like tax credits for working families and head start and pre school. TANF’s goal is to end dependence on benefits and promote marriage. So very explicitly in this legislation our solution to poor families is that those women need a man. And a lot of other states and MN spends a little tiny bit on marriage encouragement, and its mainly research. But 1996 Newt Gingrich, Bill Clinton, everyone was like “get these women married” and so some states spend a large portion of their grant on marriage counseling. This is where the concerns about Paul Ryan’s block grant ideas are really legit.

On the idea of local (state) control over block grants:

Right now, Paul Ryan’s thing is “there’s all these different programs, and they’re funded at different levels and they are confusing.” How you get on programs and how you receive them, it’s confusing. His vision is that if you’re poor and you need help, we’re going to have these block grants. We’re going to combine them into one, and the states are going to combine them and they’ll go to non-profits. You’ll go down to the non-profit and they’ll asses your needs, and you’ll get your housing subsidy, your food, whatever you need for your situation.

And it’s going to be much more flexible. I don’t disagree that it’s complicated now, and it should be easier, but i think it’s a little bit naïve that you can go to this nonprofit and here you go.

On Minnesota’s existing welfare system priorities:

In Minnesota, we fund almost 30% of our welfare cases with the state money, not TANF funds. So we’re still spending our TANF funds on other things, but we’re using our state money to fund the families who are not going to work with the work participation rate. So we do fairly well at helping poor families, as far as you can under this structure. We continue to fund them with our own money. But it’s very vulnerable. These 30% of families, they’re new immigrants, long-term families, families with physical and mental disabilities: those families are extremely vulnerable under a more fiscally hawkish administration. The majority of people on welfare get off quickly. But then there’s a certain amount that face more and more barriers and challenges, these 60-month families that are past the time limit. They have a ton going on.

On the idea of the “deserving” versus the “non-deserving” poor”

Whenever you talk about anti-poverty programs in the US, keep in mind the tension between what we’ve decided is the “deserving” versus the “non-deserving” poor, and a lot of policy choices become more clear if you’re looking through that lens. Who is getting the money? Are they people that we think are morally correct and poor for no reasons of their own, or are they poor for reasons that don’t agree with that “Horatio Alger” myth or how we think women should act.

On the current political debate at the State Capitol:

The last legislative session there as a big debate about raising the welfare grants, because they haven’t been raised in Minnesota since 1986. The same amount a family of 3 was receiving in 1986, they’re receiving today. The welfare rights committee was pushing to get grants raised by $100 by taking money out of the refundable tax credits and put it back into the basic assistance category. It sort of passed. For families that are rent burdened, some families are getting an additional $100 a month than they did last year. But that’s also very vulnerable.

Many thanks to HOURCAR, and if you or your organization is interested in sponsoring future podcasts, please don’t hesitate to contact me at blindeke@streets.mn.

Bill Lindeke

About Bill Lindeke

Pronouns: he/him

Bill Lindeke has writing blogging about sidewalks and cities since 2005, ever since he read Jane Jacobs. He is a lecturer in Urban Studies at the University of Minnesota Geography Department, the Cityscape columnist at Minnpost, and has written multiple books on local urban history. He was born in Minneapolis, but has spent most of his time in St Paul. Check out Twitter @BillLindeke or on Facebook.