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U.S. Welfare Structure Review Research Paper

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Updated: Aug 24th, 2021

The structuring of the current U.S. system of welfare was intended to ease the circumstances of poverty for single-parent households.

Though the welfare system does help to provide greatly needed assistance for low-income persons and their children, it also has brought unintended outcomes. TANF, its predecessor AFDC, in addition to the welfare system as a whole, has been the subject of much debate for many years regarding not only how but if it should be implemented. This discussion examines the U.S. welfare system, including its history, the issues surrounding it, and documents the failures and successes which have resulted.

The national welfare system was created in the New Deal era of the 1930s and expanded into the 1970s. This extensive system was initially the result of the intersecting interests of the labor unions and reform-oriented capitalists in the depression years and, in later years, expanded further as a direct result of the Civil Rights Movement. The welfare system of the New Deal established workers’ compensation and unemployment insurance in addition to an assortment of public programs in an effort to assist those living in impoverished conditions. President Johnson’s ‘War on Poverty of the 1960s introduced programs such as Medicaid and Medicare and the Aid to Families with Dependent Children (AFDC). However, when the Reagan administration came to power in 1981, federal programs that previously provided assistance to the poor via the many forms of welfare were contracted and restructured in an effort to reverse the public policies of the New Deal and War on Poverty. With the stroke of a pen, the social gains achieved through intense political struggle were all but eliminated. (Coven, 2002).

Welfare reform has transformed what was a federal hand-out program into more of a help-up system. It has decreased the number by half of those on the public dole and has enabled many to secure employment which not only alleviates child poverty but stimulates the economy as well. It accomplished this by instituting incentives for welfare recipients to seek employment, including the requirement to work, ending the financial incentive to have more children, and putting a time limit on the period of payments, so the program is a temporary stop-gap for families instead of a lifelong occupation. A work-oriented program, TANF is unlike the previous welfare system that was designed during the Depression to assist single mothers but grew into a massive entitlement program. The evidence of its success lies in the incredible decrease of persons participating in the welfare system. More than five million families participated in the AFDC just prior to the enactment of the TANF. This number decreased to approximately two million by the end of 2004.

President Clinton signed the Personal Opportunity and Work Responsibility Act in August 1996. This law marked the end for the (AFDC) and substituted in its place the Temporary Assistance for Needy Families (TANF), which was reauthorized in 2006to extended to 2010. Under the terms of this legislation, welfare assistance to an individual was limited to a lifetime maximum of five years; required the recipients to seek employment as well as aiding them in the endeavor; banned immigrants both legal and illegal from getting Social Security Insurance (SSI) and Food Stamps; required teenage mothers to live with their parents and restricted food stamp allocations to a maximum duration of three months every three years to single, unemployed adults who are physically able to work. By 2001, those families receiving TANF fell by almost three million, from five million to just over two million. The legislation also provided grants to states which in turn made the decisions on the method those funds are to be distributed and the various eligibility requirements for receiving services and benefits. (Coven, 2002).

Welfare programs in the U.S. were reduced dramatically by Congress and state legislatures during the Reagan/Bush administrations. These programs served primarily those who worked but still fell below the poverty line, the unemployed and single parents, and thus, their children. Some of the public benefits that suffered major reductions were the Food Stamp program, Medicaid, school lunch subsidies, SSI, community development and energy assistance grants, jobs and training programs, and subsidies for low-income housing.

During this period of reduced assistance to the poor, corporations in the public services business, such as those that catered to hospitals, childcare facilities, and nursing homes, profited considerably. These businesses were contracted by the government and paid primarily from the ‘excess’ of public funds realized following the cutbacks. These funds were originally raised for and previously allocated to poor families. (Piven, 1998, p. 70).

The U.S. welfare system is not designed to lessen the effects of poverty for its citizens. It is designed to give poor families employment opportunities in hopes that this will breed financial success (Alesina et al., 2001, p. 10). TANF requires that welfare recipients be employed in order to obtain monetary grants from the federal government. This fundamental feature of the reform legislation is not an innovative concept.

The Welfare Incentive Program of 1967 applied the same policy as did the 1988 Family Support Act. However, the funding for sufficient job training and childcare, an essential factor in the program’s success, is woefully inadequate.

“Motivational and job-search sessions constituted the extent of training. Childcare funding never matched need and the wages of welfare lagged behind rises in the cost of living” (Boris, 1998, p. 30). TANF, however well-intentioned, increased welfare recipients’ employment obligations but did not provide sufficient federal funding so that the program could be properly implemented. (Finder, 1998, p. 72).

The current welfare system’s insufficient job training programs serve only to further saturate a low-income labor market. This greatly diminishes the earnings, thus buying power for many thousands of poverty-stricken women, a considerable sector of the workforce. It is a cruel irony. The U.S. is the most powerful economic society in the history of the world yet is not willing to ease the miseries of those in desperate poverty residing within its own borders. European countries that have had their economies decimated by two world wars over the last hundred years yet still take care of their own.


Alesina, Alberto; Glaeser, Edward & Sacerdote, Bruce. (2001).

“Why Doesn’t the United States have a European-style Welfare State?” Brookings Papers on Economic Activity.

Boris, Eileen. (1998). “When Work is Slavery.” Social Justice. Vol. 25, N. 1.

Coven, Martha. (February 14, 2002). “An Introduction to TANF.” Center on Budget and Policy Priorities.

Finder, Alan. (April 12, 1998). “Evidence is Scant that Workfare Leads to Full-Time Jobs.” New York Times. Piven, Frances Fox.

(1998). “Welfare and Work.” Social Justice. Vol. 25, N. 1.

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