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Chapter 5

Designing an Opportunity-Based Safety Net

By Matt Weidinger and Angela Rachidi

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One word summarizes the federal government’s policy response to the COVID-19 pandemic as it relates to safety-net programs: more. More programs, more benefits, millions more recipients—and ultimately far more costs for taxpayers to bear. While a government reaction to the pandemic was certainly warranted, the United States’ unprecedented response resulted in high inflation and interest rates,1 paradoxically eroding families’ ability to support themselves long after the worst of the pandemic subsided. That erosion is poised to continue in the years ahead as federal debt levels continue to increase,2 creating ever-growing pressure for new revenue required to fulfill politicians’ promises of still-greater benefit expansions.

The authors of this chapter reject the grim vision of ever-deepening dependence on government benefits and offer an alternative vision for the safety net’s future. Underlying this alternative view is the fundamental belief that the federal government has a role in assisting the most vulnerable Americans but that it must do so efficiently and effectively for all Americans.

In pursuing this goal, policymakers must recall reforms that successfully promoted work over welfare and encouraged the creation of strong, resilient families. Those pillars of work and family have long been the cornerstones of financial security among US households, and there is no time to waste in reinvigorating them so more families can realize the American Dream. These efforts must focus on fiscal sustainability, unlike alternative agendas that promise greater government benefits without admitting the increasingly obvious harms to our economy through higher public debt.

In this chapter, we review the US safety net, identify key concerns about its efficacy and sustainability, and offer recommendations for reorienting it to improve outcomes for families in need and, ultimately, all of society. Our recommendations provide an immediate pathway to boosting low-income households’ well-being while laying the groundwork for additional reforms that would enhance those outcomes for coming generations.

The State of the Safety Net

Despite liberals’ claims to the contrary, the US safety net continues to expand. Indeed, in the six decades since President Lyndon Johnson declared a War on Poverty, the federal government has created dozens of additional assistance programs to address a variety of needs, including cash, housing, food, and health care.3 The result has been a safety net that is large and growing, in not only programs but also annual spending and the number of individuals being provided assistance.4 As displayed in Figure 1, the nonpartisan Congressional Research Service estimated that in 2018, there were over 80 federal programs providing food, housing, health care, job training, education, energy, and cash assistance to low-income Americans.5

Figure 1. Federal Benefits and Services for Low-Income Individuals, Fiscal Year 2018

Source: Authors’ depiction using data from the Congressional Budget Office, Congressional Research Service, and agency budgets.
Note: The numbers indicate annual program budgets, in millions of US dollars. * Programs have annual obligations of less than $100 million, according to the Congressional Research Service. WIC stands for “Special Supplemental Nutrition Program for Women, Infants, and Children.”

Federal spending on benefits and services for low-income individuals has increased substantially. For example, between 1990 and 2019, federal spending on children in select programs that primarily served low-income populations nearly quadrupled in real terms, with the largest increases coming from refundable tax credits and health-related spending (Figure 2).6 The pandemic only accelerated those expansions, leaving real federal spending on children in 2023—that is, after most temporary pandemic expansions had ended—13 percent greater than its 2019 pre-pandemic level.

The spending growth on children is not limited to those with low income, notwithstanding claims that the US is stingy about dedicating funds to children.7 Federal spending on all children in the US topped $710 billion in 2023—a nearly fourfold increase since 1980 in constant dollars.8

Federal safety-net spending supports a wide range of populations, not only children. Figure 3 summarizes total federal expenditures on major safety-net programs serving all low-income populations, based on recent budget submissions and tax reports. In 2024 dollars, spending across federal means-tested programs reached an all-time high of $1.231 trillion in fiscal year (FY) 2022. Even though spending fell to $1.095 trillion in FY2023 as pandemic-era programs ended, it was still $220 billion, or 25 percent, above its pre-pandemic level in FY2019.

Figure 2. Real Federal Spending on Low-Income Children in Select Categories, 1960–2023

Source: Heather Hahn et al., Kids’ Share 2024: Report on Federal Expenditures on Children Through 2023 and Future Projections, Urban Institute, October 2024, 13–14, table 1, https://www.urban.org/sites/default/files/2024-10/Kids-Share-2024_0.pdf; and Urban Institute, Annual Kids’ Share Annual Chartbooks, 2007–24, https://www.urban.org/policy-centers/cross-center-initiatives/kids-context/projects/kids-share-analyzing-federal#chartbooks.
Note: Cary Lou and Heather Hahn provided the historical Kids’ Share data in nominal dollars. We converted them to 2024 dollars using the Bureau of Economic Analysis’s personal consumption expenditures implicit price deflator.

The spending spike in FY2022 was attributable largely to pandemic-related spending on health and nutrition assistance and the expanded refundable child tax credit (CTC) disbursed in the latter part of 2021. Counting all federal means-tested spending shows that the US safety net in 2023 distributed the equivalent of nearly 4 percent of gross domestic product to low-income households. While not all of that went to people living below the official poverty line, it amounts to over $29,750 for each of the 36.8 million people in poverty that year, according to the Census Bureau’s official measure.9

None of these figures reflect large social insurance programs like Social Security, Medicare, and unemployment insurance, which generally provide benefits based on prior work and earnings.10 Spending on those programs has also grown markedly in recent decades, driven by the ongoing retirement of the large baby boomer generation, rising medical costs, and benefit expansions in response to employment disruptions, especially during the pandemic.11 Social insurance programs reduce poverty among important groups such as the elderly, disabled, and unemployed; however, since eligibility is not conditioned on being low income, these populations are often excluded from safety-net analyses, which typically count only means-tested programs.12

Also not included in means-tested spending figures are many pandemic-relief benefits. For example, federal stimulus checks in 2020 and 2021 went to 85 percent of US households (all but those with the highest income) and totaled $859 billion, offering families with two adults and two children $11,400.12 Nationwide and throughout the approximately 18 months when extraordinary federal benefits were available, unemployment benefits were so greatly expanded that a claimant receiving just average weekly benefits was provided $46,000 in state and federal checks—including an unprecedented $38,000 in federal benefits.13 Low-income households were eligible for this pandemic-related assistance, along with expanded Supplemental Nutrition Assistance Program (SNAP) benefits, the expanded CTC, rent relief, and more.14

Figure 3. Total Federal Spending on Means-Tested Benefits, 2008–23

Source: Author’s calculations using data from Office of Management and Budget, “Table 8.5—Outlays for Mandatory and Related Programs: 1962–2024,” https://www.whitehouse.gov/omb/budget/historical-tables/; Internal Revenue Service, SOI Tax Stats—Individual Statistical Tables by Size of Adjusted Gross Income (Publication 1304), Table 2.5, November 8, 2024, https://www.irs.gov/statistics/soi-tax-stats-individual-statistical-tables-by-size-of-adjusted-gross-income; and Internal Revenue Service, SOI Tax Stats—Individual Statistical Tables by Size of Adjusted Gross Income (Publication 1304), Table 3.3, November 8, 2024, https://www.irs.gov/statistics/soi-tax-stats-individual-statistical-tables-by-size-of-adjusted-gross-income.
Note: This figure includes spending on SSI, family and other support assistance, Medicaid, the refundable premium tax credit and cost-sharing reductions, the Children’s Health Insurance Program, food and nutrition assistance, housing assistance, the refundable part of the EITC, and the ACTC. The EITC and ACTC estimates are assigned to the filing year rather than the tax year. All other estimates are for fiscal years, with the tax credit amounts shown for the filing year. We adjusted these estimates for inflation to 2024 dollars using the personal consumption expenditures price index.

Even discounting the federal pandemic response, the safety net for low-income families had already been expanding over the previous few decades. Figure 7 shows that much of this growth came from increased refundable tax credits, specifically the CTC.15 In FY2024, just the CTC’s refundable portion and the earned income tax credit (EITC) totaled an estimated $104 billion, far exceeding federal expenditures on the traditional cash welfare program Temporary Assistance for Needy Families (TANF), which totaled $16.5 billion.16 In addition to the expanded CTC, rising participation in food assistance programs and larger benefits contributed to unprecedented levels of government support for low-income households.

This growth has reshaped safety-net assistance. Since the enactment of welfare reform in 1996, government assistance has increasingly targeted working families through refundable tax credits, public health insurance, and food assistance rather than traditional cash welfare. This has changed the underlying features of the safety net, which went from providing cash support for mostly poor, nonworking single mothers to today assisting more low-income families and individuals without children, including those who work.17

Figure 4. Recipients of Means-Tested Benefits, 1996–2023

Source: US Department of Agriculture, Food and Nutrition Service, SNAP Data Tables, May 23, 2025, https://www.fns.usda.gov/pd/supplemental-nutrition-assistance-program-snap; Medicaid and CHIP Payment and Access Commission, “Exhibit 10. Medicaid Enrollment and Total Spending Levels and Annual Growth,” December 2024, https://www.macpac.gov/publication/medicaid-enrollment-and-total-spending-levels-and-annual-growth/; US Department of Health and Human Services, Administration for Children and Families, Office of Family Assistance, Resource Library—Search TANF and Caseload Data, https://www.acf.hhs.gov/ofa/resource-library?f%5B0%5D=program%3A270&f%5B1%5D=program_topic%3A634&sort_by=combined_publication_date&sort_order=DESC&items_per_page=10; Social Security Administration, “SSI Annual Statistical Report, 2023,” https://www.ssa.gov/policy/docs/statcomps/ssi_asr/2023/sect02.html; Internal Revenue Service, SOI Tax Stats—Individual Income Tax Returns Complete Report (Publication 1304), Table A: Selected Income and Tax Items for Selected Years (in Current and Constant Dollars), April 4, 2025, https://www.irs.gov/statistics/soi-tax-stats-individual-income-tax-returns-complete-report-publication-1304; Internal Revenue Service, SOI Tax Stats—Filing Season Statistics, Mid-November Filing Season Statistics by AGI, March 17, 2025, https://www.irs.gov/statistics/filing-season-statistics; and Internal Revenue Service, SOI Tax Stats—Individual Statistical Tables by Size of Adjusted Gross Income (Publication 1304), Table 2.5, November 8, 2024, https://www.irs.gov/statistics/soi-tax-stats-individual-statistical-tables-by-size-of-adjusted-gross-income.
Note: Years shown are fiscal years, with the tax credit amounts shown for the filing year and SSI reflecting beneficiaries in December of
the calendar year.

Although its benefits take a different form today than they did several decades ago, the safety net still serves the vast majority of poor families with children.18 According to analysis of adjusted US Census data, over 85 percent of families with children in official poverty received some form of cash assistance or SNAP benefits from the government in 2019—even though the most common form was the EITC, rather than cash welfare.19

The result of these safety-net expansions over the past few years is that more Americans receive means-tested benefits than ever before (Figure 4). For example, in an average month of FY2023, 42.2 million individuals collected benefits under SNAP (commonly called food stamps), nearly 16 million more than in 2007. As a percentage of the population, SNAP participants increased from 8.6 percent in 2007 to 12.6 percent in 2023.20

Unsurprisingly, these spending increases have reduced annual poverty rates, especially when considering measures that better count the value of taxpayer-provided benefits and other resources (such as the absolute supplemental, consumption, and full-income poverty measures depicted in Figure 5).

Figure 5. Official, Supplemental, Absolute Supplemental, Consumption, and Full-Income Poverty Measures over Time

Source: Richard V. Burkhauser et al., “Evaluating the Success of the War on Poverty Since 1963 Using an Absolute Full-Income Poverty Measure,” Journal of Political Economy 132, no. 1 (2024): 1–47, https://www.journals.uchicago.edu/doi/abs/10.1086/725705.
Note: The gray bars denote recessions as defined by the National Bureau of Economic Research. Consumption poverty estimates are unavailable for 1962–71, 1974–79, and 1982–83

This reduction in poverty rates leads many to conclude that further expanding the safety net’s reach and increasing government benefits is the key to reducing poverty rates even more. However, a crucial problem with this conclusion is that the continued growth of all federal benefits, including means-tested benefits, is increasingly unsustainable given the country’s fiscal trajectory.21 Furthermore, design features of the current safety net can unintentionally reinforce key drivers of poverty, including limited employment and single parenthood. As a result, further expansion may ultimately increase rather than reduce the need for assistance, creating a self-defeating cycle.

Major Problems

The trends identified above raise questions about the sustainability of safety-net expansions and the efficacy of the country’s current approach of simply accommodating poverty rather than encouraging self-reliance and upward mobility. Major problems with the safety net include its high costs, complexity, duplication, and disincentives from behaviors that lead families to self-support, such as work and marriage. Given the United States’ status as one of the wealthiest countries in the world, it is reasonable to expect significant investments in safety-net programs. However, it is counterproductive to direct, much less increase, funding to programs that are excessively expensive and uncoordinated and encourage behaviors that hinder upward mobility.

High Costs

While the largest temporary pandemic expansions have expired, the US safety net’s enormous cost, which continues to grow, remains one of its major problems. Consider the cost of just SNAP. Before the pandemic, the Congressional Budget Office (CBO) baseline projected that SNAP would cost $342 billion over the five years from FY2025 through FY2029.22 Before the passage of the One Big Beautiful Bill Act (OBBBA) in July 2025, the most recent CBO baseline (as of January 2025) projected that program outlays for SNAP during those years would increase to $548 billion—$206 billion (60 percent) higher than pre-pandemic estimates.23 Even with major SNAP spending reductions enacted through the OBBBA, the CBO still projects the program’s costs to remain above pre-pandemic levels for the next decade.24

Rapid growth in interest payments on the current debt, alongside the impending insolvency of major entitlement programs like Social Security and Medicare, only exacerbate concerns about such rising costs.25 Immediately before the OBBBA was enacted, the CBO projected that under the then-current federal spending trajectory, by 2034, the federal deficit would reach 6.9 percent of GDP, and public debt would reach 120 percent of GDP—figures far beyond historical standards with uncertain consequences for the US economy.26 Passing the OBBBA only made the situation worse, despite some spending reductions, with the CBO projecting that the act increased debt held by the public by at least 9.5 percent through 2034 compared with the January 2025 baseline.27

Complexity and Duplication

A second set of problems involve the vast complexity inherent in a system featuring dozens of programs providing for cash, food, housing, health care, energy, transportation, and other needs. This complexity is accentuated by the division of programs and funding across the federal and state governments. That division often leaves program incentives at cross-purposes, such as when some policymakers suggest SNAP benefits should promote work and thus smaller caseloads, which many states view as a financial setback since it results in less federal funding subsidizing their economy.

Recessions only create additional layers of complexity, as major new benefit programs are created and the federal government assumes an even greater role in providing assistance to families in need.28 For example, during the pandemic, over $1 trillion in federal stimulus funding, expanded CTCs, and increased unemployment benefits was ignored in determining eligibility for major means-tested benefits.29 This contributed to record benefit receipt even as unemployment fell to historic lows—the opposite result of what automatic stabilizers are typically intended to accomplish.30

Disincentives to Work and Marriage

The high costs and complexity of the US safety net might be justified if these programs effectively reduced poverty and meaningfully increased self-reliance. However, evidence suggests that while increased spending on safety-net programs may reduce annual poverty rates, it does so by increasing government dependence and limiting upward mobility.31 This is partially due to the current safety net’s severely flawed incentive structure.

The extraordinary complexity and competing incentives in many safety-net programs’ design suggest that a major goal of federal reforms should be to align program incentives so they pull in the same positive direction, freeing families from government dependence. That is, states administering benefit programs should experience financial gains, not losses, from achieving the desired ends of increasing work, decreasing dependence on benefits, and encouraging stronger families. To accomplish this will require overcoming work and marriage disincentives inherent in the design of individual benefit programs.

Simply prioritizing increased federal spending on and participation in safety-net programs overlooks crucial contextual factors that can hinder a household’s future financial success, such as family structure and parental employment. The safety net affects these factors—sometimes negatively, which makes long-term success more challenging. Successful policies should reduce material hardship by not just providing immediate financial assistance but also ensuring that assistance does not undermine employment and the formation of strong and stable families, especially when children are involved.

The challenges are steep, especially for individuals in jurisdictions that add significant local benefits to the already extensive federal safety net. Consider the disincentives to work for some low-income single parents in Washington, DC, described in a 2023 report by Federal Reserve Bank of Atlanta analysts. They found that due to benefit cliffs and the co-occurring phaseouts of multiple transfer programs, a hypothetical DC family participating in a housing subsidy program could be as financially well-off with an earned income of $11,000 as it was with an earned income of $65,000. In other words, due to the structure of the combined federal and local social safety nets, an increase in employment income by $54,000 would not bring this family any net financial gains.32

While this hypothetical family might be eligible for more and larger benefits in DC than in other jurisdictions, complicated benefit eligibility terms— including how multiple means-tested benefits phase in and out depending on recipients’ earnings from work and other financial resources—no doubt widely confound claimants seeking to navigate this system.

Figure 6 shows how the safety net left this hypothetical family caught in the same financial position whether the parent worked full-time, worked only a little, or did not work at all, after considering benefit loss and basic expenses.33 This phenomenon is often called a “poverty trap” or “welfare trap.”34

These benefit designs might offer immediate financial relief, but they send a simple yet powerfully negative message: It makes little financial sense for parents to work harder and strive to get ahead, since doing so will result in their being no better-off—and even worse off, in some cases. The same benefit structures that penalize work penalize marriage when it brings additional income into the household.

Solutions

The overarching solution to the problems outlined above involves reorienting existing safety-net programs to unleash opportunity and give families what they need to achieve self-sufficiency rather than simply redistributing income to meet short-term needs. As Rachel Sheffield and Robert Rector argued in 2016,

The goal of welfare should not be to reduce poverty through an ever-larger welfare state. Rather, the goals should be to increase self-sufficiency (having an income above poverty level without relying on government welfare aid); enhance productive participation in society; and improve personal well-being and upward mobility.35 (Emphasis in original.)

This solution requires a fundamental shift in understanding the safety net’s purpose and structure. A good start is altering its financial structure to place more responsibility on the states while encouraging states to enact policies proven effective in reducing dependency, encouraging employment, and supporting more two-parent families. We propose that the federal government provide refundable tax credits to working families while states take increased responsibility for programs that offer temporary assistance and support to families as they transition toward employment and stability. For states, that responsibility includes having a substantial financial stake in better administering safety-net programs, including those focused on food, housing, and disability assistance.

Specifically, we propose four reforms to achieve an opportunity-focused safety net:

1. Strengthen support for low-income working families by reforming federal refundable tax credits,

2. Streamline and better coordinate the safety net by consolidating programs and giving states more flexibility and financial responsibility,

3. Promote policies at the state and federal levels that support employment and marriage to foster long-term upward mobility, and

4. Assess programs’ effectiveness based on outcomes such as employment, poverty reduction, and upward mobility, rather than increased spending and caseload size.

Figure 6. Benefit Cliffs in DC for a Hypothetical Family: Single Adult with One Child (Age Three)

Source: Elias Ilin and Alvaro Sánchez, “Mitigating Benefits Cliffs for Low-Income Families: District of Columbia Career Mobility Action Plan as a Case Study” (working paper, Federal Reserve Bank of Atlanta, September 2023), https://www.atlantafed.org/research-and-data/publications/discussion-papers/2023/09/26/01-a-case-study-mitigating-benefits-cliffs-in-the-district-of-columbia; data provided by Elias Ilin and Alvaro Sánchez; and Federal Reserve Bank of Atlanta, Policy Rules Database, https://github.com/Research-Division/policy-rules-database.
Note: The red horizontal line in Panel A illustrates that the family’s net resources do not increase with an income increase from $11,000 to $65,000. The two vertical black lines running through both panels mark these two income levels. CDCTC stands for “Child and Dependent Care Tax Credit.

Figure 7. Real Federal Outlays on Major Means-Tested Safety-Net Programs, 1996–2023

Source: Office of Management and Budget, “Table 8.5—Outlays for Mandatory and Related Programs: 1962–2024,” https://www.whitehouse.gov/omb/budget/historical-tables/; Internal Revenue Service, SOI Tax Stats—Individual Statistical Tables by Size of Adjusted Gross Income (Publication 1304), Table 2.5, November 8, 2024, https://www.irs.gov/statistics/soi-tax-stats-individual-statistical-tables-by-size-of-adjusted-gross-income; Internal Revenue Service, SOI Tax Stats—Individual Statistical Tables by Size of Adjusted Gross Income (Publication 1304), Table 3.3, November 8, 2024, https://www.irs.gov/statistics/soi-tax-stats-individual-statistical-tables-by-size-of-adjusted-gross-income; and Internal Revenue Service, SOI Tax Stats—Individual Statistical Tables by Size of
Adjusted Gross Income—Individual Income Tax Returns, Table 4, Returns with Earned Income Credit, by Size of Adjusted Gross Income, https://www.irs.gov/statistics/soi-tax-stats-individual-statistical-tables-by-size-of-adjusted-gross-income.
Note: Dollar amounts are adjusted to 2024 dollars and exclude spending on health care. Years shown are fiscal years, with the tax credit amounts shown for the filing year

Reform and Expand Refundable Tax Credits for Working Families

Federal refundable tax credits became an increasingly important part of the nonmedical safety net for low-income families in the decades preceding the pandemic. As shown in Figure 7, means-tested expenditures that were nonmedical (that is, not including public health insurance) outside refundable tax credits increased 50 percent in real dollars between 1996 and 2019. However, the additional child tax credit (ACTC)—which consists of the refundable parts of the CTC—and the EITC increased 198 percent. (The ACTC was created in 1997 but limited to large families with no tax liability until 2001.) While the EITC and ACTC accounted for 22 percent of total expenditures in the programs included in Figure 7 in 1996, they made up 36 percent in 2019 and 37 percent in 2022. That share dropped substantially in 2023, to 24 percent, but only because of an unprecedented permanent increase in SNAP benefits in 2021.36 Despite this drop, in real terms, spending on refundable tax credits was still 130 percent higher in 2023 than in 1996.

The federal government is well suited to redistribute income through the tax system. A large share of working families file tax forms to receive the EITC, with take-up rates among eligible tax filers at 80 percent.37 While the administration of the EITC and CTC remain marred by significant improper payments that are largely attributable to complicated eligibility terms, the federal government’s distribution of these transfer payments to low-income working families is timely and otherwise generally effective at redistributing income.38

To make refundable tax credits even more effective, we propose combining the EITC and refundable portion of the CTC into one refundable tax credit, the working family credit.39 Our proposed credit would offer a maximum refundable benefit of $9,000 (updated for inflation) for a single parent with two children. This would streamline program rules and requirements while increasing transparency for policymakers and taxpayers.

We also propose increasing the income eligibility limit for married families to partly overcome the existing marriage penalty while decreasing the benefit’s phaseout rate to reduce the effective marginal tax rate on low-income families.40 When parents remain unmarried, parental income is considered separately for the EITC’s purposes, but when they are married, their income is considered together, which can often move them above the income eligibility level. Expanding the income eligibility limit for married parents partly addresses this concern.

In our long-term vision, the bulk of federal safety-net spending would shift to this refundable tax credit as more families work and fewer rely on other safety-net programs for ongoing support. This effect would be driven by expecting states to contribute more of their own funds toward what today are fully federally funded benefits such as SNAP and Supplemental Security Income (SSI)—especially if benefit recipients do not increase their work effort. One expected result is rising earnings due to increased employment, which the federal government would supplement with refundable tax credits. To achieve this goal, the working family credit would help working families maintain employment, including by helping them afford childcare, housing, and food. (Our previous working family credit proposal would have cost approximately $25 billion more than the cost of both programs operating separately in 2022, which could be fully offset with savings from other reforms.)41

Streamline and Better Coordinate Safety-Net Programs

As more working families receive assistance from a combined refundable tax credit, the balance of safety-net programs can focus on assistance for nonworking families or families facing short-term economic crises. Our opportunity-focused agenda includes a complete overhaul of the existing safety-net infrastructure, with the specific aim to strengthen factors essential for family self-sufficiency and upward mobility rather than simply redistributing income. The objective is not necessarily reductions to existing safety-net spending but rather a more efficient and effective safety net with better targeting of federal funds. This starts with rethinking the purpose and design of the myriad current programs that comprise a confusing web for individuals to navigate and state and federal governments to administer.

As previously mentioned and displayed in Figure 1, the safety net for low-income families includes over 80 means-tested programs, covering a variety of basic needs such as food, housing, and health care.42 Many of these programs are small in terms of expenditures and populations served, with different federal, state, or local bureaucracies administering them. These programs developed over time, often with admirable goals. However, the effectiveness of this tangle of programs is unclear, while the downsides of its complexity and redundancy are obvious.

For example, SNAP benefit levels are set to accommodate the food budget of a low-income household (using the Thrifty Food Plan), and in FY2024, the federal government spent $94 billion on SNAP benefits.43 At the same time, as Figure 1 shows, several other programs operate alongside SNAP but out of different federal agencies to provide food assistance, often to the same households. These include the school breakfast program, emergency food program, child and adult care food program, and food program for the elderly.

Another example of such duplication involves the EITC. Created in 1975 and expanded several times, it is supposed to help low-income families cover the cost of raising children. However, dozens of other programs also provide financial support to families with children. These include the refundable CTC, childcare vouchers, the school lunch program, and the Special Supplemental Nutrition Program for Women, Infants, and Children. The cost of inefficiency due to such redundancy is unknown but likely high. This structure also masks the true cost of safety-net programs to taxpayers and policymakers, who often argue for expanding one program while ignoring other programs that provide similar benefits to many of the same families.44

Turn Existing Programs into an Opportunity-Focused Framework

As part of our vision for the safety net for low-income families, in a chapter of the 2022 book American Renewal: A Conservative Plan to Save the Country’s Finances and Strengthen the Social Contract, we proposed gradually shifting 50 percent of the costs of three major federal benefit programs—namely, SNAP, SSI, and various housing assistance programs— to the states.45 We also proposed allowing states more flexibility to combine funding streams and offer assistance that better meets the needs of low-income households, with program goals and allowable uses specified in federal law through a demonstration project model.

Program goals would include providing food, housing, utility, and disability assistance to low-income individuals and families. Allowable uses would include providing cash or in-kind assistance, subject to income and other eligibility guidelines. The federal government would specify additional conditions to support essential features of an opportunity-focused agenda, including promoting marriage and employment. For example, recipients who are able-bodied adults without dependents would be expected to engage in work, education, or training while collecting benefits. To minimize long-term dependence, states could set and enforce time limits for receiving assistance, especially for those most capable of work and self-support.

Ultimately, our vision would allow states to maintain the existing infrastructure of these three programs but share up to 50 percent of the costs over time, subject to the financial incentives described below. Alternatively, states could propose a demonstration project that combines the funding streams in these programs to offer more flexible assistance while covering 50 percent of the costs. In the demonstration project model, states would be required to meet specified outcomes such as poverty reduction, employment increases, and wage gains.46 Those demonstration efforts would be amplified by allowing states to further consolidate the funding streams in an expanded Social Services Block Grant (SSBG), as detailed below.

To incentivize states to achieve desired results, we propose allowing them to offset their required 50 percent match by increasing and maintaining higher employment rates among low-income populations that would otherwise depend more heavily on benefits. As we proposed, potential increased state benefit costs could be offset by a growing number of working families receiving federal refundable tax credits.47 If an increasing share of low-income families find and maintain employment, they would be better-off financially due to their growing earnings and refundable federal tax credits, and states accordingly would be credited with a lower required match for safety-net programs.

As we described in American Renewal, the goal of this improved financial architecture is to replace current state financial incentives for larger caseloads with policy sticks and carrots discouraging benefit collection and promoting work. For example, if a state wishes to maintain large SNAP caseloads without promoting work, eventually, half the cost of all SNAP benefits would shift to that state. But that policy stick is not the end of the story. Our proposal includes a significant carrot: Any state could offset its nominally growing financial responsibility by helping more benefit recipients enter and increase their work. The country’s experience of similarly motivated financial incentives included in the 1990s welfare reforms suggests that when safety-net programs are successful, their cost (including the required state match) will plunge as more people find employment, replace benefit income with earnings, and take advantage of increased federal refundable tax credits.

Table 1. Federal Programs Involved in the Proposed Policy Shift

Source: Jordan W. Jones and Saied Toossi, The Food and Nutrition Assistance Landscape: Fiscal Year 2023 Annual Report, US Department of Agriculture, Economic Research Service, June 12, 2024, https://www.ers.usda.gov/webdocs/publications/109314/eib-274.pdf; Office of Management and Budget, “Table 8.6—Outlays for Mandatory and Related Programs in Constant (FY 2017) Dollars: 1962–2024,” https://www.whitehouse.gov/omb/budget/historical-tables; US Department of Housing and Urban Development, Department of Housing and Urban Development Budget Outlays by Program: Comparative Summary, Fiscal Years 2021–2023, https://archives.hud.gov/budget/fy23/2023BudgetOutlayTable.pdf; and Internal Revenue Service, “Earned Income and Earned Income Tax Credit (EITC) Tables,” January 27, 2025, https://www.irs.gov/credits-deductions/individuals/earned-income-tax-credit/earned-income-and-earned-income-tax-credit-eitc-tables. For a breakdown of outlays (indicating refundability) versus tax relief, see US Congress, Joint Committee on Taxation, Estimates of Federal Tax Expenditures for Fiscal Years 2019–2023, December 18, 2019, 31, https://www.jct.gov/CMSPages/GetFile.aspx?guid=71b5ac20-f36a-46fb-9def-f7194212e849.
Note: All amounts are in 2023 dollars. Tax credit amounts are for fiscal years and program spending.

Consolidate the Balance of the Safety Net

Beyond these major benefit programs, a handful of other programs should remain under federal control, such as the National School Lunch Program, the Child Care and Development Fund, Medicaid, and medical and other services for other specific populations, such as veterans. However, the balance of approximately 70 of the lesser programs shown in Figure 1—which, according to the nonpartisan Congressional Research Service, collectively spent more than $113.6 billion in FY2022—should be eliminated and their current federal funding reallocated to a transformed structure that gives states flexibility to address their low-income residents’ specific needs.48

We propose consolidating these federal programs into one flexible funding stream with allocations to states based on a formula, as shown in Table 1. Like TANF, the expanded SSBG would include clear goals for allowable use of funds and accountability measures, such as poverty reduction, employment and wage gains, and family strengthening.

A conceptual model already exists in the current SSBG and Community Services Block Grant. Congress’s purpose in creating these block grants in 1981 was to allocate federal funding to states in a way that gave them flexibility to serve their low-income populations effectively rather than through a top- down federal approach. While the intent was commendable, the vision ultimately failed to materialize. This may have been due to the lack of financial risk for states if programs proved ineffective and the layering of other safety-net programs that created work and marriage disincentives. Meanwhile, dozens of other safety-net programs have rendered the SSBG and Community Services Block Grant redundant and duplicative.49

One allowable use of the expanded SSBG could be to provide the resources for low-income families with children to meet their food, housing, utility, or other basic needs. Another allowable use would be to assist only work-capable adults who satisfy a work requirement. For example, if states found it useful to offer home visiting programs, this would be allowed in the block grant. States could transfer up to 50 percent of the expanded SSBG funds to the Child Care and Development Fund or TANF to promote work or additional education and training for low- income parents.

Promote Policies That Support Employment and Marriage to Foster Upward Mobility

In addition to the previously mentioned issues of duplication, redundancy, waste, and overall ineffectiveness, the current safety-net design discourages employment and marriage—key factors that promote self-sufficiency and upward mobility. Policymakers must reorient the safety net for low-income families to promote these pillars of upward mobility.

We believe that, by making refundable tax credits more generous for working and married families, the federal government can better promote these principles. Giving states more flexibility to operate assistance programs would allow them to better coordinate benefit phaseouts and mitigate marriage penalties in ways that promote upward mobility. Allowable uses of federal funds should recognize the need to encourage marriage and employment. Putting time limits on key benefits can focus the attention of both recipients and program administrators on the need to achieve independence from government benefits, whether through work, additional training, or strengthened family bonds.

Assess Effectiveness Through Outcomes, Not Inputs

One risk in shifting financial responsibility for a larger share of the safety net to states is that federal funds would not achieve desired results or that results would be inconsistent across states. For this reason, the federal government should outline key outcome measures to which states would be held financially accountable to ensure they deploy funds effectively and successfully to promote opportunity. For example, states should be held accountable for ensuring programs improve employment, reduce poverty, and increase upward mobility. States can assess these outcomes through demonstration projects with rigorous evaluations and by measuring employment rates, retention rates, poverty rates, wage growth, hours worked, and improvements in educational credentials, among other criteria. Similar measures could apply to family conditions, such as the share of children in two-parent households, and child support payment rates.

Key considerations of successful reform include ensuring that states have financial incentives to boost employment and strengthen families and that any increased costs are matched by equivalent or greater savings. The OBBBA took substantive steps in this direction through federal policy changes, such as restricting SNAP and Medicaid eligibility for certain categories of noncitizens, tightening work requirements in both programs, limiting SNAP benefit increases, and incentivizing states to reduce fraud and improper payments. Additional comprehensive reforms should follow, including giving states more flexibility to operate safety-net programs while requiring them to assume more financial responsibility. Shifting the financial infrastructure of safety-net programs will increase states’ incentives to operate them efficiently and effectively.50

Conclusion

The federal government’s response to the problem of poverty, especially during the pandemic, has been to throw billions of dollars in benefits at American families, with some of the greatest increases targeted at low-income households. Over recent decades, the federal government has addressed the challenges of poverty by simply broadening the criteria for safety-net program eligibility and increasing assistance, resulting in sharply increased federal spending on means-tested and other benefits. But that approach misses the broader point: While transferring more taxpayer resources to low-income households might meet those households’ short-term material needs, it does little to help such families achieve long-term success. In fact, it may impede that goal by disincentivizing employment and penalizing marriage.

To ensure that low-income families—and especially their children—thrive, the government should provide assistance, particularly vital health and educational resources. But more importantly, families and communities must offer an environment conducive to success. We believe this is most attainable when adults are healthy, are employed, and, whenever possible and whenever children are involved, form two-parent families.

For these reasons, we recommend reforms that would better align federal benefits and, critically, state financial incentives with the goals of increasing employment rates and encouraging two-parent families. Absent such fundamental changes, federal policy has focused on short-term poverty alleviation, undermining the long-term interests of needy families and taxpayers alike. Policymakers can and must do far better, and adopting these reforms would pave the way for greater upward mobility and long-term success for all Americans.

Acknowledgments

The authors thank Cary Lou and Heather Hahn of the Urban Institute for providing valuable data related to Kids’ Share. They also thank Elias Ilin and Alvaro Sánchez for providing data used in Figure 6.

Notes

  1. Michael R. Strain, “Yes, the Biden Stimulus Made Inflation Worse,” National Review, February 10, 2022, https://www.nationalreview.com/corner/yes-the-biden-stimulus-made-inflation-worse/.
  2. See Jeff Merkley, “Re: Effects on Deficits and the Debt of Public Law 119-21 and of Making Certain Tax Policies in the Act Permanent,” August 4, 2025, Congressional Budget Office, https://www.cbo.gov/system/files/2025-08/61466-DebtService.pdf. The letter’s author estimates that the OBBBA will add $4.1 trillion to the federal debt through FY2034, after adding debt-service effects.
  3. White House, Economic Report of the President: Together with the Annual Report of the Council of Economic Advisers, March 2014, 221–68, https://obamawhitehouse.archives.gov/sites/default/files/docs/erp_2014_chapter_6.pdf.
  4. Angela Rachidi et al., “A Safety Net for the Future: Overcoming the Root Causes of Poverty,” in American Renewal: A Conservative Plan to Strengthen the Social Contract and Save the Country’s Finances, ed. Paul Ryan and Angela Rachidi (AEI Press, 2022), https://www.americanrenewalbook.com/a-safety-net-for-the-future-overcoming-the-root-causes-of-poverty/.
  5. Angela Rachidi and Matt Weidinger, “A Federal Safety Net to Build a Better Future for Low-Income Children,” in Doing Right by Kids: Leveraging Social Capital and Innovation to Increase Opportunity, ed. Scott Winship et al. (AEI Press, 2024), https://www.aei.org/wp-content/uploads/2024/09/doing-right-by-kids-2024-Chapter-5.pdf.
  6. Rachidi and Weidinger, “A Federal Safety Net to Build a Better Future for Low-Income Children.” These categories of spending include several benefits that are not confined to low-income children, such as the refundable portion (in excess of income tax liability) of economic impact payments (stimulus checks) from 2020 and 2021, Social Security survivors’ and dependents’ benefits, and benefits for the children of veterans who are deceased, retired, or disabled. The economic impact payments, in particular, are responsible for the spike in 2021.
  7. Jeff Stein, “The U.S. Spends Less on Children Than Almost Any Other Developed Nation,” The Washington Post, May 16, 2018, https://www.washingtonpost.com/news/wonk/wp/2018/05/16/the-u-s-spends-less-on-children-than-almost-any-other-developed-nation/.
  8. This figure is in 2024 dollars. Rachidi and Weidinger, “A Federal Safety Net to Build a Better Future for Low-Income Children.” These estimates come from Adam Carasso et al., Kids’ Share 2007: How Children Fare in the Federal Budget, Urban Institute, March 15, 2007, https://www.urban.org/research/publication/kids-share-2007; Adam Carasso et al., Kids’ Share 2008: How Children Fare in the Federal Budget, Urban Institute and New America Foundation, June 24, 2008, https://www.urban.org/research/publication/kids-share-2008-how-children-fare-federal-budget; Julia B. Isaacs et al., Kids’ Share: An Analysis of Federal Expenditures on Children Through 2008, Urban Institute and Brookings Institution, December 8, 2009, https://www.urban.org/research/publication/kids-share-analysis-federal-expenditures-children-through-2008; Kids’ Share 2010: Report on Federal Expenditures on Children Through 2009, Urban Institute and Brookings Institution, July 14, 2010, https://www.urban.org/research/publication/kids-share-2010-report-federal-expenditures-children-through-2009; Julia B. Isaacs et al., Kids’ Share 2011: Report on Federal Expenditures on Children Through 2010, Urban Institute and Brookings Institution, July 21, 2011, https://www.urban.org/research/publication/kids-share-2011; Julia B. Isaacs et al., Kids’ Share 2012: Report on Federal Expenditures on Children Through 2011, Urban Institute, July 19, 2012, https://www.urban.org/research/publication/kids-share-2012; Julia B. Isaacs et al., Kids’ Share 2013: Federal Expenditures on Children in 2012 and Future Projections, Urban Institute, September 24, 2013, https://www.urban.org/research/publication/kids-share-2013-federal-expenditures-children-2012-and-future-projections; Heather Hahn et al., Kids’ Share 2014: Report on Federal Expenditures on Children Through 2013, Urban Institute, September 18, 2014, https://www.urban.org/research/publication/kids-share-2014-report-federal-expenditures-children-through-2013; Julia B. Isaacs et al., Kids’ Share 2015: Report on Federal Expenditures on Children Through 2014 and Future Projections, Urban Institute, September 29, 2015, https://www.urban.org/research/publication/kids-share-2015-report-federal-expenditures-children-through-2014; Sara Edelstein et al., Kids’ Share 2016: Federal Expenditures on Children Through 2015 and Future Projections, Urban Institute, September 20, 2016, https://www.urban.org/research/publication/kids-share-2016federal-expenditures-children-through-2015-and-future-projections; Julia B. Isaacs et al., Kids’ Share 2017: Report on Federal Expenditures on Children Through 2016 and Future Projections, Urban Institute, October 31, 2017, https://www.urban.org/research/publication/kids-share-2017-report-federal-expenditures-children-through-2016-and-future-projections; Julia B. Isaacs et al., Kids’ Share 2018: Report on Federal Expenditures on Children Through 2017 and Future Projections, Urban Institute, July 18, 2018, https://www.urban.org/research/publication/kids-share-2018-report-federal-expenditures-children-through-2017-and-future-projections; Julia B. Isaacs et al., Kids’ Share 2019: Report on Federal Expenditures on Children Through 2018 and Future Projections, Urban Institute, September 17, 2019, https://www.urban.org/research/publication/kids-share-2019-report-federal-expenditures-children-through-2018-and-future-projections; Heather Hahn et al., Kids’ Share 2020: Report on Federal Expenditures on Children Through 2019 and Future Projections, Urban Institute, July 28, 2020, https://www.urban.org/research/publication/kids-share-2020-report-federal-expenditures-children-through-2019-and-future-projections; Heather Hahn et al., Kids’ Share 2021: Report on Federal Expenditures on Children Through 2020 and Future Projections, Urban Institute, November 17, 2021, https://www.urban.org/research/publication/kids-share-2021-report-federal-expenditures-children-through-2020-and-future-projections; Cary Lou et al., Kids’ Share 2022: Report on Federal Expenditures on Children Through 2021 and Future Projections, Urban Institute, September 29, 2022, https://www.urban.org/research/publication/kids-share-2022-report-federal-expenditures; Cary Lou et al., Kids’ Share 2023: Report on Federal Expenditures on Children Through 2022 and Future Projections, Urban Institute, November 9, 2023, https://www.urban.org/research/publication/kids-share-2023; and Heather Hahn et al., Kids’ Share 2024: Report on Federal Expenditures on Children Through 2023 and Future Projections, Urban Institute, September 30, 2024, https://www.urban.org/research/publication/kids-share-2024. Cary Lou and Heather Hahn provided the historical Kids’ Share data in nominal dollars. We converted them to constant dollars using the Bureau of Economic Analysis’s Personal Consumption Expenditures implicit price deflator.
  9. These figures are in 2024 dollars. For GDP in 2023, see US Department of Commerce, Bureau of Economic Analysis, National Income and Product Accounts, Table 1.1.6. Real Gross Domestic Product, Chained Dollars, March 13, 2026, https://apps.bea.gov/iTable/?reqid=19&step=2&isuri=1&categories=survey. For the population in poverty, see Emily A. Shrider, Poverty in the United States: 2023, US Census Bureau, September 10, 2024, https://www.census.gov/library/publications/2024/demo/p60-283.html. Not all means-tested benefits flow to households in poverty, including because the benefits cause household incomes to exceed the poverty line in some cases.
  10. Figure 2 and the estimates from the previous paragraph include Social Security survivors’ and dependents’ benefits received by children.
  11. For a review of growth in Social Security and Medicare spending, see Social Security and Medicare Boards of Trustees, “A Summary of the 2024 Annual Social Security and Medicare Trust Fund Reports,” US Social Security Administration, https://www.ssa.gov/oact/TRSUM/2024/index.html. For example, Chart B displays how, since 1970, Social Security spending has grown from roughly 3 percent to 5 percent of GDP, while Medicare spending has grown from under 1 percent to nearly 4 percent of GDP. For a review of rising unemployment benefit spending, including on extraordinary federal benefits paid during and after recessions, see Matt Weidinger and Amy Simon, Pandemic Unemployment Fraud in Context: Causes, Costs, and Solutions, American Enterprise Institute, February 13, 2024, https://www.aei.org/research-products/report/pandemic-unemployment-fraud-in-context-causes-costs-and-solutions/.
  12. An estimated 85 percent of US households received stimulus checks. See Peter G. Peterson Foundation, “How Did Americans Spend Their Stimulus Checks and How Did It Affect the Economy?,” May 14, 2021, https://www.pgpf.org/article/how-did-americans-spend-their-stimulus-checks-and-how-did-it-affect-the-economy/. The Committee for a Responsible Federal Budget’s COVID Money Tracker estimates that $859 billion was provided in stimulus checks, formally known as economic impact payments. Committee for a Responsible Federal Budget, COVID Money Tracker, https://www.covidmoneytracker.org/. For a discussion of pandemic assistance per person and household, including the maximum of $11,400 in such payments for a typical family of four, see Matt Weidinger, “As Democrats Offer Massive New Benefits, a Refresher on Pandemic Check Writing,” AEIdeas, August 30, 2022, https://www.aei.org/opportunity-social-mobility/as-democrats-offer-massive-new-benefits-a-refresher-on-pandemic-check-writing/.
  13. See Weidinger, “As Democrats Offer Massive New Benefits, a Refresher on Pandemic Check Writing.”
  14. See US Department of the Treasury, “Assistance for American Families and Workers,” https://home.treasury.gov/policy-issues/coronavirus/assistance-for-American-families-and-workers; and Randy Alison Aussenberg, USDA Nutrition Assistance Programs: Response to the COVID-19 Pandemic, Congressional Research Service, January 24, 2023, https://www.congress.gov/crs-product/R46681.
  15. See Rachidi and Weidinger, “A Federal Safety Net to Build a Better Future for Low-Income Children.” For a review of key issues in the controversial temporary expansion of the CTC, see Matt Weidinger and Angela Rachidi, “CTC Expansion Rooted in Desire to Roll Back Work-Based Welfare,” American Enterprise Institute, February 8, 2024, https://www.aei.org/articles/ctc-expansion-rooted-in-desire-to-roll-back-work-based-welfare/.
  16. US Congress, Joint Committee on Taxation, Estimates of Federal Tax Expenditures for Fiscal Years 2024–2028, December 11, 2024, https://www.jct.gov/publications/2024/jcx-48-24/.
  17. See Rachidi and Weidinger, “A Federal Safety Net to Build a Better Future for Low-Income Children.”
  18. Angela Rachidi and Mariana Icaza Díaz, The Reach of the Safety Net for Poor Families with Children in America Through 2023: An Update (American Enterprise Institute, forthcoming); and Angela Rachidi and Shijie Jin, The Reach of the Cash-Based Safety Net for Poor Families with Children in America, American Enterprise Institute, February 28, 2017, https://www.aei.org/research-products/report/the-reach-of-the-cash-based-safety-net-for-poor-families-with-children-in-america/.
  19. Rachidi and Icaza Díaz, The Reach of the Safety Net for Poor Families with Children in America Through 2023.
  20. See Gilbert Crouse et al., Welfare Indicators and Risk Factors: 23rd Report to Congress, US Department of Health and Human Services, Office of the Assistant Secretary for Planning and Evaluation, June 3, 2024, https://aspe.hhs.gov/reports/23rd-welfare-indicators-rtc. For FY2023, see US Department of Agriculture, Economic Research Service, “Supplemental Nutrition Assistance Program (SNAP)—Key Statistics and Research,” January 6, 2025, https://www.ers.usda.gov/topics/food-nutrition-assistance/supplemental-nutrition-assistance-program-snap/key-statistics-and-research/.
  21. For a discussion of unsustainable trends involving deficits and debt, see Committee for a Responsible Federal Budget, “CBO Releases January 2025 Budget and Economic Outlook,” January 17, 2025, https://www.crfb.org/blogs/cbo-releases-january-2025-budget-and-economic-outlook.
  22. Congressional Budget Office, Baseline Projections: Supplemental Nutrition Assistance Program, June 2024, https://www.cbo.gov/system/files/2024-06/51312-2024-06-snap.pdf.
  23. Congressional Budget Office, Baseline Projections: Supplemental Nutrition Assistance Program.
  24. Congressional Budget Office, “Estimated Budgetary Effects of Public Law 119-21, to Provide for Reconciliation Pursuant to Title II of H. Con. Res. 14, Relative to CBO’s January 2025 Baseline,” July 21, 2025, https://www.cbo.gov/publication/61570.
  25. See Congressional Budget Office, An Update to the Budget and Economic Outlook: 2024 to 2034, June 18, 2024, https://www.cbo.gov/publication/60039.
  26. Congressional Budget Office, An Update to the Budget and Economic Outlook.
  27. Congressional Budget Office, “Estimated Budgetary Effects of Public Law 119-21, to Provide for Reconciliation Pursuant to Title II of H. Con. Res. 14, Relative to CBO’s January 2025 Baseline.”
  28. One example in recent recessions is the federal government’s displacing state funding under the previously federal and state unemployment Extended Benefits program. For a discussion, see Matt Weidinger, “Why Even Permanent Benefit Expansions Are Never Enough,” AEIdeas, September 27, 2022, https://www.aei.org/opportunity-social-mobility/why-even-permanent-benefit-expansions-are-never-enough/.
  29. Matt Weidinger, “Unemployment Is Low, Welfare High. What Gives?,” The Wall Street Journal, March 20, 2023, https://www.aei.org/op-eds/unemployment-is-low-welfare-high-what-gives/.
  30. Weidinger, “Unemployment Is Low, Welfare High. What Gives?”
  31. See Scott Winship, The Conservative Case Against Child Allowances, American Enterprise Institute, March 5, 2021, https://www.aei.org/research-products/report/the-conservative-case-against-child-allowances/.
  32. See Matt Weidinger, “Washington, District of Benefit Cliffs,” AEIdeas, April 26, 2024, https://www.aei.org/center-on-opportunity-and-social-mobility/washington-district-of-benefit-cliffs/; and Elias Ilin and Alvaro Sánchez, “Mitigating Benefits Cliffs for Low-Income Families: District of Columbia Career Mobility Action Plan as a Case Study” (working paper, Federal Reserve Bank of Atlanta, September 26, 2023), https://www.atlantafed.org/research-and-data/publications/discussion-papers/2023/09/26/01-a-case-study-mitigating-benefits-cliffs-in-the-district-of-columbia.
  33. Net resources are defined as “a family’s after-tax income, plus public assistance and tax credits, minus a set of basic expenses that includes housing, childcare, health insurance, food, transportation, and other miscellaneous expenses.” See Ilin and Sánchez, “Mitigating Benefits Cliffs for Low-Income Families,” 12.
  34. Sharon Parrott and Robert Greenstein, Policymakers Often Overstate Marginal Tax Rates for Lower-Income Workers and Gloss over Tough Trade-Offs in Reducing Them, Center on Budget and Policy Priorities, December 3, 2014, https://www.cbpp.org/research/policymakers-often-overstate-marginal-tax-rates-for-lower-income-workers-and-gloss-over; and Nic Horton, “How Work Overcomes the Welfare Trap,” Heritage Foundation, July 20, 2017, https://www.heritage.org/2017-index-culture-and-opportunity/how-work-overcomes-the-welfare-trap.
  35. Rachel Sheffield and Robert Rector, Setting Priorities for Welfare Reform, Heritage Foundation, February 24, 2016, https://www.heritage.org/welfare/report/setting-priorities-welfare-reform.
  36. Under President Joe Biden, the US Department of Agriculture took the unprecedented step of using a routine reevaluation of the Thrifty Food Plan to administratively increase SNAP benefit levels by 25 percent, on average, without Congress’s consent.
  37. Internal Revenue Service, “EITC Participation Rate by States: Tax Years 2014 Through 2022,” April 9, 2025, https://www.eitc.irs.gov/eitc-central/participation-rate-by-state/eitc-participation-rate-by-states.
  38. See US Department of the Treasury, Inspector General for Tax Administration, Improper Payment Rates for Refundable Tax Credits Remain High, May 10, 2021, https://www.tigta.gov/sites/default/files/reports/2022-02/202140036fr.pdf; US General Accounting Office, Earned Income Tax Credit: Design and Administration Could Be Improved, September 24, 1993, https://www.gao.gov/products/ggd-93-145; and Steve Holt, The Role of the IRS as a Social Benefit Administrator, American Enterprise Institute, July 25, 2016, https://www.aei.org/research-products/report/the-role-of-the-irs-as-a-social-benefit-administrator/.
  39. Rachidi et al., “A Safety Net for the Future”; and Rachidi and Weidinger, “A Federal Safety Net to Build a Better Future for Low-Income Children.”
  40. Rachidi et al., “A Safety Net for the Future.”
  41. Rachidi et al., “A Safety Net for the Future.”
  42. Rachidi and Weidinger, “A Federal Safety Net to Build a Better Future for Low-Income Children.”
  43. US Department of Agriculture, Economic Research Service, “Supplemental Nutrition Assistance Program (SNAP)—Key Statistics and Research,” January 6, 2025, https://www.ers.usda.gov/topics/food-nutrition-assistance/supplemental-nutrition-assistance-program-snap/key-statistics-and-research/.
  44. For a similar discussion about transparency, see Sheffield and Rector, Setting Priorities for Welfare Reform. For an example of policymakers ignoring other available resources in arguing for benefit expansions, see Angela Rachidi and Matt Weidinger, “How Many Forms of ‘Wage Insurance’ Do We Need, Exactly?,” American Enterprise Institute, March 11, 2024, https://www.aei.org/center-on-opportunity-and-social-mobility/how-many-forms-of-wage-insurance-do-we-need-exactly/.
  45. For our full proposal, see Rachidi et al., “A Safety Net for the Future.”
  46. Rachidi et al., “A Safety Net for the Future.”
  47. Rachidi et al., “A Safety Net for the Future.”
  48. Office of Management and Budget, Budget of the U.S. Government, Fiscal Year 2022, May 28, 2021, https://www.govinfo.gov/content/pkg/BUDGET-2022-BUD/pdf/BUDGET-2022-BUD.pdf.
  49. Heritage Foundation, “Eliminate Funding for the Social Services Block Grant,” https://www.heritage.org/budget/pages/recommendations/2.600.181.html.
  50. See Angela Rachidi and Leslie Ford, A Reform Framework for the Supplemental Nutrition Assistance Program, American Enterprise Institute, October 30, 2024, https://www.aei.org/research-products/report/a-reform-framework-for-the-supplemental-nutrition-assistance-program/; and Leslie Ford, “Don’t Give Away the Farm Bill,” The Wall Street Journal, June 7, 2023, https://www.wsj.com/articles/dont-give-away-the-farm-bill-food-stamps-thrifty-plan-welfare-adc8fa55.