More About LaDonna Pavetti

LaDonna Pavetti

Dr. LaDonna Pavetti is the Vice President for Family Income Support Division at the Center on Budget and Policy Priorities.

Full bio and recent public appearances | Research archive at CBPP.org


Data Show TANF Didn’t Respond Adequately to Need During Recession, Contrary to New Study’s Claims

September 10, 2014 at 2:56 pm

A recent study from researchers at the Brookings Institution and the University of Nevada concludes that the Temporary Assistance for Needy Families (TANF) program responded to increased need during the Great Recession in the majority of states as a good safety net program would.  This conclusion, however, is based on seriously flawed analysis, as we explain in a new paper.

A number of assertions made by the authors — Ron Haskins and Kimberly Howard of the Brookings Institution and Vicky Albert of the University of Nevada — wilt under scrutiny.  Consider, for example, one such claim: that TANF responded to a greater degree in the 2000 and 2007 recessions than the Aid to Families with Dependent Children program (AFDC), TANF’s predecessor, did in previous recessions.  But this claim rests on inappropriate use of data.

The authors arrive at this conclusion by averaging the percentage increase (or decrease) in the AFDC “caseload” (families who received benefits) during the 1980, 1981, and 1990 recessions and comparing that to the average percentage change in the TANF caseload during the 2000 and 2007 recessions.  This metric produces highly skewed results, however.

The AFDC caseload at the start of all three of the early recessions was much larger than the TANF caseload at the start of the 2000 and 2007 recessions, making a percentage-change comparison highly misleading.  From the beginning to the end of the 1990 recession, the number of unemployed individuals rose by 1.7 million, while the AFDC caseload increased by 350,000 families.  From the beginning to the end of the 2007 recession, the number of unemployed individuals rose by 7 million, while the TANF caseload increased by just 124,000 families.

Put another way, during the 1990 recession, the AFDC caseload increased by 21 families for every 100 additional unemployed individuals, while the comparable figure for the TANF caseload during the 2007 recession was an increase of only two families for every additional 100 unemployed individuals (see chart).

We’ve monitored TANF carefully since the start of the recession and have a far less sanguine assessment of the program’s responsiveness to the recent recession than Haskins, Howard, and Albert do.  We conclude that the program fell well short of how we would expect such a basic safety net program to respond during tough economic times.

In spite of its shortcomings, TANF is often held up as a model for altering other safety net programs.  The Haskins, Howard, and Albert study is likely to be cited as evidence that TANF performs fine in recessions, so other programs (such as SNAP) can be changed to a similar block-grant structure.  But that would be a highly inappropriate conclusion based on flawed use of data.

Click here to read our full paper.

TANF at 18: A Weakened Role and Not a Model for Safety Net Reform

August 22, 2014 at 10:08 am

Eighteen years ago today, President Clinton signed into law the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 — commonly known as “welfare reform.”  A key component was its creation of the Temporary Assistance for Needy Families (TANF) block grant to replace Aid to Families with Dependent Children (AFDC).

Since then, TANF has played a shrinking role as a safety net for poor families (see chart), serving a small share of poor families and lifting many fewer families out of “deep poverty” (with incomes below half the poverty line) than AFDC did, as we explain and illustrate in our revised chart book.

A close look at TANF’s track record makes it clear that the program needs retooling to ensure that a strong safety net and sufficient employment assistance is available when people need them most.

Yet some policymakers claim that welfare reform was such an extraordinary success that we should use it as a model for reforming other safety net programs.  But the facts don’t make that case.  For example, in TANF’s 18-year history, never-married mothers with a high school education or less made substantial gains in employment in only the first four years — largely due to the roaring economy of the late 1990s — and those gains have almost entirely eroded in the subsequent 14.  It is wishful thinking to assume that we could see the same employment gains we saw in TANF’s early years in today’s sluggish labor market.

The safety net (other than TANF) plays an extremely important role in reducing poverty and deep poverty in this country — a role that should be maintained.  The evidence from TANF suggests that applying TANF-like reforms to other safety net programs would likely cause more families to join the ranks of the deeply poor and cause some who are already deeply poor to become even poorer.

TANF reform is long overdue.  We should fix its problems before embarking on reforms that will repeat its failures.

Click here for the full chart book.

Ryan’s “Opportunity Grant” Would Likely Force Cuts in Food and Housing Assistance

July 29, 2014 at 11:59 am

House Budget Committee Chairman Paul Ryan maintains that consolidating 11 safety-net and related programs into a single “Opportunity Grant” would give states the flexibility to provide specialized services to low-income people.  But providing these additional services would require cutting assistance funded through the Opportunity Grant to other needy people.  And because SNAP (formerly food stamps) and housing assistance together make up more than 80 percent of the Opportunity Grant, the cuts would almost certainly reduce families’ access to these programs, which are effective at reducing poverty — particularly deep poverty.

SNAP is an entitlement, which means that anyone who qualifies under program rules can receive benefits, and is heavily focused on the poor.  Over 91 percent of SNAP benefits go to households with incomes below the poverty line, and 55 percent goes to households in deep poverty — that is, households with cash incomes below half of the poverty line (about $9,800 for a family of three in 2013).

As a result, SNAP kept 4.9 million people out of poverty in 2012, including 2.2 million children.  It also lifted 1.4 million children out of deep poverty, more than any other benefit program.

Similarly, housing vouchers and other rental assistance lifted 2.8 million people — including 1 million children — out of poverty in 2012.

Chairman Ryan’s proposal to add new work requirements and provide individualized services to recipients of Opportunity Grant-funded assistance would surely require new staff and significantly raise administrative costs.  States would likely turn to SNAP for at least some offsetting savings:  it alone makes up more than half of the resources in the Opportunity Grant, and the Ryan proposal ends SNAP as an entitlement, eliminating eligible families’ guarantee to food assistance.  Rental assistance, which makes up nearly a quarter of the Opportunity Grant, is another likely target of cuts — though even today it serves only one in four eligible low-income families due to limited funding.

Whatever merit Chairman Ryan’s proposal for personalized services has, his Opportunity Grant could not possibly reach as many families as these existing programs serve.

Cutting food and housing assistance that lifts millions of people out of poverty and is effective at reducing hunger and homelessness in order to provide additional services to a smaller number of poor households isn’t a sound way to reduce poverty.

Why Ryan’s Proposed Work Requirements Are Cause for Concern

July 25, 2014 at 3:30 pm

House Budget Committee Chairman Paul Ryan’s new poverty plan predictably showcases the 1996 welfare law, which replaced Aid to Families with Dependent Children (AFDC) with Temporary Assistance for Needy Families (TANF), as a model for reforming other safety net programs.  For example, states would have to impose work requirements on all recipients of assistance funded through the “Opportunity Grant” — the block grant that would replace 11 safety net and related programs — who are not classified as unable to work.  There are four key concerns about this proposal:

  1. It would divert funds that help families put food on the table and keep a roof over their heads to pay for programs that, at best, produce modest employment increases.  Even the most successful welfare employment programs usually don’t enable more than half of participants to get steady jobs, and the success rate for typical welfare employment programs is much lower than that.  In contrast, SNAP (food stamps) and housing assistance lift millions of people out of poverty.  As I explained yesterday, the way the Ryan plan would provide more resources to impose and monitor work requirements would largely be by cutting food and housing assistance that now goes directly to needy individuals and families.  If that assistance is taken away, poverty will rise and the long-term benefits of SNAP and housing assistance will be diminished.
  2. It ignores the realities of today’s labor market.  Low-skilled individuals looking for work today facing a daunting reality:  the economy still isn’t operating on all cylinders, and employers are increasingly looking for skills that these individuals generally don’t have.  Imposing work requirements won’t itself create new job opportunities for people who are struggling to find work.  In addition, millions of Americans work hard for little pay — 28 percent of workers in 2012 had wages too low to support a family of four at the poverty line through full-time work, the Economic Policy Institute has found.   Government assistance that helps working-poor families meet basic needs shouldn’t be diverted to pay for work programs that will be of little value to them.  Yet that’s likely what would occur under the Opportunity Grant proposal.
  3. It may reinforce the mistaken belief that most public benefit recipients don’t work.  More than half of SNAP households with at least one working-age, non-disabled adult work while receiving SNAP — and more than 80 percent work in the year before or after receiving SNAP.  Similarly, nearly three-quarters of non-elderly, non-disabled households receiving one of the major forms of rental assistance work (or recently worked) or participate in a program through which they likely face a work requirement.
  4. States haven’t shown a commitment to investing in work programs.  Although caseloads in most states’ cash assistance programs for poor families with children fell sharply in the late 1990s, states generally haven’t used much of the freed-up resources to improve the job prospects of poor parents who have barriers to employment.  Only 8 percent of state and federal dollars under TANF directly supports employment activities for cash assistance recipients.  Even when you count funds that support families with jobs, like child care assistance and the refundable part of state earned income tax credits, states spend only one-third of their federal and state TANF dollars to promote and support work.

Ryan’s Rhetoric Doesn’t Match His Proposal’s Reality

July 24, 2014 at 4:55 pm

House Budget Committee Chairman Paul Ryan left the impression today that his proposed Opportunity Grant will allow low-income individuals to get income assistance as well as help they may need to go to school, get off drugs, and succeed in the workplace.  That picture, however, doesn’t reflect the reality of his proposal.

Chairman Ryan spoke eloquently this morning about “Andrea,” a single mother who needs income assistance in the near term, help finding a job, assistance so she can go to college, and help paying for child care for her two young children while she works and attends school so she can reach her dream of becoming a teacher and climb into the middle class.  He implied that his Opportunity Grant would deliver the package of supports she needs to succeed.

In fact, under Chairman Ryan’s plan, neither Andrea nor anyone else would be guaranteed any assistance.  This means that Andrea could apply for services and be told that she cannot get any help.  Chairman Ryan doesn’t acknowledge that scenario.

To be sure, many kinds of assistance already are limited so that not everyone who’s eligible for assistance gets it — with one important exception.  Today, all eligible poor households can get help to buy groceries through SNAP (formerly food stamps), a form of income assistance that not only helps those households put food on the table but can free up resources so that families — not caseworkers — can decide how to direct their limited incomes.  Chairman Ryan’s plan would no longer guarantee that basic safety net.

And, nothing in Chairman Ryan’s proposal would make it more likely that families in Andrea’s situation would receive that full package of supports unless other needy individuals and families receive significantly less help.  Indeed, states already have flexibility to use Temporary Assistance for Needy Families (TANF, which provides basic income assistance to poor families with children) to put together precisely this package of benefits.  But TANF’s flexibility does not trump its limited resources, and that’s why many single mothers like Andrea can’t get the help they need to make ends meet, find work, go to school, and ensure that their children are safe and well cared for while they juggle work and school.

Today, just 25 of every 100 poor families receive TANF assistance, only 1 in 7 low-income children who qualify for help paying for child care receives it; and just 1 in 4 low-income households that qualify for help paying for housing get it.

Also of note, the service provider structure that Ryan envisions almost surely would require more staff and, thus, would generate higher administrative costs, leaving less funding for assistance and services.

In short, the only way that Chairman Ryan’s plan can provide more assistance, targeted or not, to families like Andrea’s is if some poor households receive significantly less help, with cuts likely coming in help to pay for food and housing — the two largest programs that Ryan would consolidate under the Opportunity Grant.

The case of “Steven,” whom Ryan also highlights, makes the point as well.  A single 19-year-old non-custodial father, Steven is jobless and needs help to get off drugs.  Ryan’s proposal indicates that the Opportunity Grant would help him get drug treatment, move him into transitional housing (a form of subsidized housing), and get him help with attending parenting classes, finding work, and pursuing further education.

These are all needed services, and limited funding keeps many people, particularly adults not living with children and who have the same needs as Steven, from obtaining that help.  But the Opportunity Grant structure would not provide additional resources (and as my colleague Robert Greenstein points out, could well provide fewer resources), so the only way to provide this richer set of supports for Steven is to cut the help that other families receive.

Chairman Ryan skirts this fundamental math.  Consolidating funding streams into a single “opportunity” grant allows him to say that individuals like Andrea and Steven will get a better-targeted suite of supports without saying which families will get less help and how that will affect them.