Mostly summarized from Gregory Mankiw’s Principles of Economics, 5th Ed.
PART 6 The Economics of Labor Markets
Chapter 20 of 36 Income Inequality and Poverty
Section 19 of 20
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Another way to reduce the work disincentive of antipoverty programs is
provide benefits for only a limited time period.
The 1996 welfare reform bill imposed a 5-year lifetime limit on welfare recipients.
President Clinton said when he signed the bill, "welfare should be a second chance, not a way of life."
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Its passage of the bill was followed by
· a large decrease in the welfare rolls
· a large increase in employment among those groups mostly on welfare
In a 2003 study, economist Rebecca Blank summarized:
“This nation transformed its assistance programs to poor families with children from cash-assistance oriented programs aimed at providing income support to work-assistance programs aimed at encouraging and supporting work.”
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Critics argue the changes have left society with an inadequate safety net, in which an increasing number of needy families will be unable to return for assistance due to time limits.
They argue work requirements force women into unstable, difficult work situations with low wages and inadequate support for child care, healthcare or other family needs.
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Supporters argue the system has worked.
A substantial number of women who would previously have been receiving welfare are now in employment building a record of experience resulting in increasing wages.
Another benefit is they demonstrate to their children the necessity and importance of work.
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Dire predictions about deepening poverty and greatly increased homelessness have been incorrect.
Blank said “Even if the work-support system is less than perfect, it has proved preferable to the poorly-functioning Aid to Families with Dependent Children welfare system of the past.”
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What major changes in federal government welfare programs have happened in recent years?
ChatGPT:
-Stricter work requirements and eligibility for food assistance (2024-2025):
The One Big Beautiful Bill Act of 2025 (“OBBB”) introduced tougher work/volunteer hours for Supplemental Nutrition Assistance Program (SNAP) recipients, expanding age-groups and reducing exemptions.
-Shift of costs & responsibility to states (2025 onward):
Welfare programs like SNAP and Medicaid now require greater state-contributions of administrative and benefit costs, especially when error-rates exceed thresholds.
-Changes in Medicaid eligibility and benefit design (2025):
The OBBB also imposes changes such as higher verification frequency, work requirements for Medicaid expansion adults, and narrowed benefit access for certain immigrant categories.
-Reorientation of federal welfare mission:
Some recent reforms emphasise shifting welfare towards a “hand-up” model—short-term assistance combined with work/training—rather than long-term “hand-out” welfare.
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dire predictions
hisan na yosoku
悲惨な予測
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