Off the Dole But On the Take: How Bill Clinton Made Us a Nation of Paupers by ‘Ending Welfare as We Know It.’

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“If hard work is all it took to get ahead in America, black people would own this country lock, stock, and barrel.”Stokely Carmichael

Promising work and not welfare, President Bill Clinton signed into law the Personal Responsibility and Work Opportunity Act 25 years ago this month, abolishing the widely unpopular, 61-year-old cash entitlement program known as Aid to Families with Dependent Children, or AFDC. Clinton’s social policy ovehaul was intended, at least putatively, to fulfill his campaign pledge to reduce poverty by nudging the urban poor –especially African Americans – off the dole and into jobs and lives of self-sufficiency. Said Clinton at the time:

“I signed this bill because this is an historic chance, where Republicans and Democrats got together and said, ‘we’re going to take this historic chance to try to recreate the nation’s social bargain with the poor. We’re going to try to change the parameters of the debate. We’re going to make it all new again and see if we can’t create a system of incentives which reinforce work and family and independence. We can change what is wrong... Today we are ending welfare as we know it.”

Clinton replaced AFDC with Temporary Aid to Needy Families, a block-grant program that drastically cut benefits and requires applicants to jump through so many hoops that many simply don’t consider it a worthwhile endeavor. By any objective measure, TANF is a failure.

See Also: Peter Edelman Interviewed on Democracy Now! in November 1996 Explaining His Resignation from the Clinton Administration Over Welfare Reform

For starters, the labor force participation rate–which measures the percentage of workers over the age of 16 with jobs-– has continued its 60-year-slump, declining from every two in three workers in 1996 to six in ten today, even before the onset of the COVID-19 pandemic. And those who are fortunate enough to find work have seen no increase in pay; when adjusted for inflation, the federal minimum wage is about a dime more per hour than it was in 1996. And African Americans are poorer than we were a generation ago; the ratio of black households who own their own home has dropped to its lowest number, 42 percent, in more than 50 years, homelessness has exploded in cities that span the width and breadth of the country, we are up to our eyeballs in debt and for many of us, just keeping the lights on is a challenge.

None of this is by accident. Much has been made of Clinton’s unimaginative efforts to woo racist Democrats who abandoned the party for Ronald Reagan’s GOP. But what is seldom discussed is that Clinton was the first U.S. president to govern in a post-industrial context. Reagan loosened the cap but it was Clinton who let the genie out the bottle, shipping decent-paying, manufacturing jobs overseas  

To be sure, that lowers employers’ wage bills but it raises even more troubling questions such as how can capitalists turn a profit when they make almost nothing of value, and how can the bosses squeeze more cash from workers who have less and less?

Slick Willy had a plan that included locking up the black unemployed for a profit, deregulating the banking industry to allow for what is essentially loan-sharking, privatized education that forked over taxpayer money to private entrepreneurs and abolishing welfare to expand the pool of surplus labor and lower wages even further.  In fact, virtually everything that Clinton did in his eight years in office can best be understood as an effort to create new opportunities –what the French call rent-seeking–for investors, or rentiers, to extract money from their employees, blacks most of all.

Consider this 1997 Washington Post article I wrote about Maryland’s welfare reform efforts:

Ada Thompson’s entry into the labor force comes as something of a bargain for the hotel where she works –and a bit of a threat to her co-workers. During her 90-day probation, Thompson will wipe, dust and vacuum on eight-hour shifts, five days a week, the same as any other housekeeper. In return, she will get $410 a month in welfare benefits from the state and a $30 weekly stipend from the Omni Inner Harbor Hotel.
After probation, the hotel’s managers will decide whether to hire Thompson permanently for $6.10 an hour. But the company is not legally obligated to do that for her or any of the 13 temporary, taxpayer-subsidized housekeepers drawn from the city’s public assistance rolls.
The city’s efforts to move Thompson off the dole and into the workplace have pushed her smack-dab into the middle of a long and acrimonious labor dispute between Baltimore’s largest hotel and its 300 bellmen, housekeepers, doormen and kitchen workers.
‘The situation at the Omni should be a warning for all working people that welfare reform was never intended to lift poor people out of poverty,’ said the Rev. Douglas Miles, former co-chairman of Baltimoreans United in Leadership Development. ‘It was intended to provide greater subsidies to corporations, and this brand of welfare repeal has merely shifted taxpayers’ subsidies from the neediest to the greediest.’

Continuing I wrote:

Six weeks into the program, Fitzsimmons said, Omni executives have agreed to hire two of the 13 housekeeping trainees. Peter A. Bheda, the hotel’s general manager, said the company’s only interest in collaborating with the city is ‘helping people to get a second chance in their lives. There is no profit for us with this program.’
But Bheda would not discuss the year-long labor dispute between the Omni, Baltimore’s largest hotel, and Local 7 of the Hotel Employees and Restaurant Employees Union. The Omni’s union contract expired in September 1995 after the workers voted not to accept a new contract with wage concessions and a reduction in benefits, said Paul Richards, the local’s executive secretary.
But the workers, acknowledging that they could not endure an extended walkout because of their low pay, decided not to strike and chose instead to picket the Omni intermittently and urge a public boycott. . .
‘They’re bringing in cheap help. That’s what they’re doing,’ said Ella Mae Walker, 60, who is paid $7.25 an hour and has prepared salads in the hotel’s kitchen for almost 24 years. ‘They’re just trying to break up our union, is all.’

Clinton’s overhaul of AFDC-–created by the FDR administration at the zenith of the New Deal-–is emblematic of Wall Street’s effort to reorganize an industrial economy that had increased the workers’ share of national income to half by 1973. Racial capitalism is the centerpiece of this counterrevolution. Today, investors pocket almost 60 cents for every dollar in Gross Domestic Product, leaving their employees to fight over the remaining 40 cents. Racism regulates this inequitable distribution of wealth by encouraging white workers to gobble up African Americans’ slice, rather than collaborating with us to seize the whole damn pie for the proletariat.

To that end, the most distinguishing feature of the TANF program is its restructuring of AFDC’s means-tested guarantee, which meant that everyone who qualified for the cash benefit, got it, at least in theory. Under TANF, the U.S. Department of Health and Human Services administers the program as a fixed block grant, reducing both the number of households served and the benefit amount. Since 1996, TANF’s average monthly caseload nationwide has fallen dramatically even as poverty spread. In 2019, 4.5 million families with children were living in poverty, yet for every 100 destitute families, only 23 received cash assistance, down from 68 families in 1996 when AFDC was repealed.

“If TANF had the same reach now as AFDC did in 1996,” the Center for Budget and Policy Priorities wrote in a recent report, “the program would have reached 3.1 million families living in poverty in 2019, 3 million more families than were actually reached by TANF.”

In fact, TANF’s maze of red tape, rigorous job search requirements and paltry payouts make the cash benefit so inaccessible that enrollment in the state of Pennsylvania actually fell by more than 15,000 since the start of the COVID-19 pandemic, despite the economic hardships caused by lockdowns.

Alisha Gillespie, 32, an unemployed hospital worker from a Philadelphia suburb with three children ages 6, 9, and 13, told the Philadelphia Inquirer earlier this month that she’d been on TANF for nearly five years, receiving about $400 per month in cash benefits, or roughly the same she would’ve received in 1990.

“It seemed like a form of slavery,” she told the Philadelphia Inquirer. “It wasn’t that much money. I wanted to use it to further my education, but they kept telling me to find a job.”

The inflexible work requirements “come from a legacy of enslavement and forced labor, and this belief that black people are lazy and undeserving of support,” Ife Floyd, director of TANF research and analysis for the Center on Budget Policy and Priorities told reporters earlier this month, “and if we don’t coerce them to work, they won’t. So, harsh TANF work requirements with difficult paperwork obligations and time limits served to punish rather than help families.”

The CBPP found that TANF benefits are lowest in Southern states with large black populations, with benefit levels either at or below 20 percent of the poverty line. (Minnesota’s benefit levels are among the highest in the nation, according to the CBPP report with benefit levels at 102 percent of the poverty line).

Reagan’s scapegoating of Cadillac-driving black welfare queens was always a tactic designed to cut off lines of communication between white workers and the country’s most liberal, and militant, bloc, African Americans. Perhaps the one advantage of Clinton’s repeal of the dole is that it represents one less weapon for the oligarchs’ to wield in the nation’s ongoing class war.

Or as Gillespie said of her decision to leave TANF: “I couldn’t always be at job centers looking for work when my kid was sick in the hospital with asthma issues. . . In the end, TANF was just a ball and chain.”


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JON JETER is a published book author and two-time Pulitzer Prize finalist with more than 20 years of journalistic experience. He is a former Washington Post bureau chief and award-winning foreign correspondent on two continents, as well as a former radio and television producer for Chicago Public Media’s "THIS AMERICAN LIFE." Jeter is a Knight Fellowship recipient – Stanford University’s highest professional journalism award — as well as author of FLAT BROKE IN THE FREE MARKET (WW Norton, 2009) and co-author of A DAY LATE AND A DOLLAR SHORT (Wiley & Sons, 2010). Jon works with both non-profit and for profit brands, utilizing his vast knowledge and experience in web, radio, and television content and production to drive communications strategies and develop stories that highlight the important work of these organizations. He is based out of the San Francisco Bay Area.