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Here are three main often-asked questions about the US safety net:

1) If your goal is to expand the social safety net, are you more likely to be successful with a focus on universal programs (like Social Security) or means-tested programs (like food stamps or welfare)?

2) Back in 1996, President Bill Clinton signed what is often called the “welfare reform act,” following up on his campaign promise to “end welfare as we know it.” For better or worse, did that legislation keep Clinton’s promise?

3) Those who need social safety net programs are often at a point where their live are unstable: perhaps an unstable job, unstable housing, unstable family arrangements, unstable income, even unstable health. For people in this situation, finding out about available programs, signing up for them, and keeping track of changes in requirements to that they can remain eligible, may be difficult. Are the administrative burdens that safety net programs place on recipients a necessary evil, or something else?

For answers to these and many related questions, I recommend the three-paper symposium on the US safety net in the Winter 2025 issue of the Journal of Economic Perspectives (where I work as Managing Editor).

• “Two Histories of the Public Safety Net,” by Christopher Howard
• “Did Welfare Reform End the Safety Net as We Knew It? The Record since 1996,” by Lucie Schmidt, Lara Shore-Sheppard, and Tara Watson
• “Administrative Burdens in the Social Safety Net,” by Pamela Herd and Donald Moynihan

Howard discusses the poverty-reduction history of means-tested and broader social insurance programs over the last century or so. He reminds readers of the old saying “programs for the poor are poor programs.”

Given the stark contrasts between means-tested “welfare” and inclusive Social
Security, it is not surprising when advocates for paid family and medical leave (Romig
and Bryant 2021) or long-term care (Powell 2019) endorse a social insurance
model. Nor is it surprising when they endorse Medicare for All (Scott 2019). Part of
me is attracted to these proposals, for reasons that range from lower administrative
costs to social solidarity. I am also attracted by the possibilities of giving extra help
to lower-income households within broadly inclusive programs. However, recent
history does not point decisively in favor of inclusive over means-tested programs.
In retrospect, the biggest achievements of social insurance, politically and
programmatically, occurred between the 1930s and 1970s. Since then, Social
Security and Medicare have had more success preventing retrenchment than accomplishing expansion.

Conversely, the last 30 years or so have seen dramatic increases in spending on a number of means-tested programs: the Earned Income Tax Credit, Medicaid, the Children’s Health Insurance Program (CHIP), the Child Tax Credit, and food stamps (now called the Supplemental Nutrition Assistance Program). Meanwhile, the trust funds that support Social Security and the hospital portion of Medicare are dwindling fast, and those programs face sharp pressures in how to constrain the projected future rise in spending. The evidence of the last three decades or so is that the US political system may be better at expanding means-tested programs, and less willing to expand universal programs, than previously thought.

Schmidt, Shore-Sheppard, and Watson dig into the evolution of specific safety net programs since 1996 in more detail. They point out that when President Clinton signed the welfare reform act into law in 1996, he was fulfilling a campaign promise to “end welfare as we know it.” The legislation in fact did so along several dimensions:

First, spending on conventional “welfare”–that is, the Aid to Families with Dependent Children (AFDC), which was converted into Temporary Assistance to Needy Families (TANF) in the 1996 welfare reform act–has dwindled in real dollars and has pivoted away from cash support to families and toward programs related to reducing poverty (for example, programs to improve high school graduate rates and reduce teen pregnancies). However, as noted a moment ago, total spending on means-tested programs has increased, not decreased.

Second, the earlier “welfare” program was a mixed federal-state program. Indeed, many safety-net programs were designed on a shared federal-state basis, including AFDC, Medicaid, and unemployment insurance. But the new surge of means-tested spending has in substantial part been federal spending–which also has the effect of equalizing support for the poor across states.

Third, many of the expanded means-tested programs have linkages to working parent, or to benefits aimed at children. As a result of this targeting, low-income working families have become better-off. However, low-income single people, or children in families where the adults do not have a job (and thus can be the poorest of the poor), may well be worse off.

Finally, Herd and Moynihan discuss administrative burdens of the safety net. Here’s an illustrative anecdote from the start of their paper:

By the age of five, Abel Sewell had survived cancer and was receiving monthly blood tests to ensure his leukemia had not returned. The tests were covered by TennCare, Tennessee’s Medicaid program, until, at a regular doctor’s visit, his mother discovered that the coverage had lapsed. Abel’s mother spent months fighting to get their coverage restored, ultimately taking out a second mortgage on their home to manage the mounting health care debt that came from being uninsured. The family very much wanted health services, and were willing to endure significant hardships to get it.

The Sewells were not an anomaly. Between 2016 and 2019, almost 250,000 children in Tennessee lost coverage. What happened? The Sewells, like many others, said they never received the TennCare renewal forms. Even those who did receive the renewal packets often struggled to complete the 47 pages (Kelman and Reicher 2019). Failure to return forms accounted for 67 percent of those who lost coverage, and it seems likely that many of them did not receive the forms due to outdated mailing addresses. Late or incomplete forms also resulted in a loss of coverage (Arbogast, Chorniy, and Currie 2022).

Full disclosure: The issue of administrative burdens is personal for me. My wife and I are the legal guardians for one of my adult children, who is disabled, and thus receives federal Disability Insurance (which means he is also on Medicare for health insurance) and state-level support through a Minnesota program. We are deeply grateful that such support is available, and the benefits make it possible for our son to live independently (although we live close by). But the paperwork burden is heavy, even for a family with two college-educated parents. We strongly suspect that a number of people who are eligible for the same benefits as my son are not actually receiving these benefits, because the legal guardians of those people can’t handle the paperwork burden.

As Herd and Moynihan point out, part of the problem here is “sludge,” the gradual accumulation of rules and forms that accumulate in a bureaucracy. As a simple example, imagine that there are two safety-net programs, and a large majority of those who qualify for one will also qualify for the other. One program has a work requirement; one does not. Should we add a work requirement to the second program? As a practical matter, adding the additional work requirement to the seconed is redundant: again, those in the second program already face a work requirement for the first program. But in a bureacracy, there is a natural tendency to reason along the lines, “they already meet the work requirement for one program, so why not add it for the other program, too?” Multiply this tendency, and you end up mailing out 47-page forms for annual renewals. For our family, a single 47-page form per year would be an enormous improvement over the administrative burden we actually face.

On average, those families with the lowest level of resources will have the hardest time meeting them. In that sense, adding to the paperwork burden for safety-net programs is a regressive method of rationing their

For the US population as a whole, 11.1% of the population is below the poverty line, and an additional 15.8% are above the poverty line, but have income of less than twice the poverty line. For those under 18 years of age–for whom the advice to “get a job” has zero practical relevance–15.2% of the population lives in a household below the poverty line, and an additional 19.8% are in a household above the povery line but with an income less than twice the poverty line. At its best, the safety net is about helping this substantial part of the US population to have sufficient resources to persevere through the hard time, and to have the space to envision and work toward better prospects in the future.

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