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House Budget Plan Proposes Commonsense Welfare Changes


September 19, 2023

The House Budget Committee, headed by Chairman Jodey Arrington (R-TX), today released a draft budget proposal detailing the majority’s spending priorities and proposed changes across a range of government benefits and programs.

Several policies would promote higher levels of work among welfare recipients, which is especially necessary while benefit rolls remain elevated despite plentiful job openings.

According to recent research by our AEI colleague Angela Rachidi, less than one-third of households collecting SNAP benefits in 2019 included a current worker, and just 6 percent of SNAP-collecting households included a full-time worker. Since then, SNAP caseloads and especially benefit levels and program costs have grown considerably, and most current SNAP household heads are working age and not disabled.

Meanwhile, labor force participation rates remain historically low, especially for US natives. For example, the Center for Immigration Studies recently reported that, for US-born men ages 25 to 54 without a bachelor’s degree, labor force participation declined from 89.4 percent in 2000 to just 84.4 percent in April 2023, when the US unemployment rate was 3.4 percent, matching lows last seen in the 1960s. Better connecting current benefit recipients with work will increase their earnings and, coupled with generous tax credits for low-income workers, significantly raise their household incomes. That combination—earnings plus benefits—is the key to reducing poverty and ensuring that our welfare system promotes hope and upward mobility—not a lifetime of dependency.

Here’s how this proposal seeks to achieve all of that.

First, it would strengthen work requirements for recipients of cash welfare, food stamps, and public housing subsidies. That’s a familiar call from conservatives, and for good reason. In the past, work-based reforms of the nation’s cash welfare program successfully helped millions of low-income single parents increase their earnings, reducing their levels of poverty and dependence on welfare checks. But similar policies were either never applied to other programs, or have been regularly waived, and even the work requirements for cash welfare lost their bite over time. The bipartisan Fiscal Responsibility Act enacted in May adjusted some work requirements for cash welfare and food stamps, but other Republican-proposed reforms were left out. More needs to be done to connect millions of current benefit recipients with work, and that’s what these proposed reforms seek to do.

Other changes assumed in the budget also promote more work over welfare and other benefit receipt. For example, we understand the budget assumes extending the current-law requirement that child tax credit claimants have valid Social Security numbers that authorize them to work in order to claim those work-based benefits. That requirement expires in 2025 and ought to be extended. The Congressional Budget Office in 2022 found that extending this requirement would yield over $24 billion in savings over 10 years. Other assumed changes would strengthen work search requirements for unemployment benefit recipients, close loopholes that inappropriately expand eligibility for food stamps, and narrow benefit eligibility for noncitizens, consistent with longstanding US law.

As the Budget Committee considers these incremental changes, they should also review more comprehensive changes proposed in American Renewal: A Conservative Plan to Strengthen the Social Contract and Save the Country’s Finances. That AEI publication, edited by Rachidi and former House Speaker Paul Ryan, was released last fall. A chapter in that volume authored by Rachidi, Scott Winship, and one of us (Matt Weidinger), titled “A Safety Net for the Future: Overcoming the Root Causes of Poverty,” suggested a series of changes to promote more work and stronger families, backstopped by reforms to the financing of welfare programs. Those changes would reduce current financial incentives for state governments to prioritize bigger caseloads and instead financially reward states for realizing smaller caseloads and a larger number of recipients working. Other proposals in the volume focus on reforms to health care and disability benefits, as well as the tax code. These should be of interest to the Budget Committee, too, as it continues its important work.

Increasing upward mobility means helping more of our neighbors make the transition off the benefit rolls and into work. The Budget Committee is doing the right thing to seek more upward mobility and is off to a good start. But even if the changes in today’s proposal are enacted, there will still be much more left to do.