Aid to the Poor

Max Sawicky sawicky at epinet.org
Mon Sep 28 08:29:23 PDT 1998



>Yes. But if I understand correctly, higher Medicaid outlays account for the
increase, and them some. Without it, spending on the poor would have decreased. It would be very hard to argue that higher Medicaid spending resulted on more or better health care for the poor. It simply reflects the increasing inefficiency and waste in the US health care system. I think that, in a sense, Dennis is correct in saying that public support for the poor decreased.>

Gauging aid to the poor requires the following considerations, among others:

1. What is happening with all programs, Federal, state, and local aimed at the population in question? AFDC/TANF is but one of a number, and not nearly the largest among them.

2. One needs to distinguish between effort, in terms of dollars allocated, and effectiveness. Medicaid spending has gone up a lot, though as Enrique notes its value is another matter.

3. One also needs to consider the size of the target population -- how far dollars expended can go from the beneficiary's standpoint. In recent years the lower number of beneficiaries has made it possible for the money to go further. Whether it has done so is another matter.

4. The two most salient facts in all this are: a) the real value of the basic anti- poverty benefit, which derives from the three most commonly used programs (Food Stamps, AFDC, and Medicaid) declined from the early 1970's through the 1980's, mostly because of the erosion of AFDC benefits. The program had been dying for twenty years. b) total spending for means-tested programs, by large has been stable since the mid- 1970's. AFDC declines were more than made up for by increases elsewhere.

5. Fears that the TANF reform is bad medicine are well-justified. A secondary point is that the 'race to the bottom' is not as worrisome as the simple elimination of matching provisions for states in general. No race to the bottom is necessary to explain how spending and benefits in TANF could drop. This drop has not yet been consummated. The new structure of the program leaves us wide open to such drops, but the unfolding depends on politics. It is not preordained.

If is possible to overdraw the negative features of this, and some people have. The danger in such a position is to sell short the possibilities of reform and neglect political opportunities for such reforms for the sake of fanciful political agendas which do the poor no good.

MBS



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