Interstate Competition and Welfare Policy

In 1996, the federal government terminated the Aid to Familieswith Dependent Children (AFDC) program and replaced it withthe Temporary Assistance for Needy Families program (TANF).Many powers once held by the federal government are now beingused by state governments. Will welfare assistance be redesignedand expanded or will states "race to the bottom?" This issueis investigated by examining state welfare policy choices duringthe latter years of AFDC(1976–1994). Because each stateunder AFDC had the authority to set the level of its welfareguarantee for families that had no income, it is possible toestimate the effects of interstate competition on AFDC guaranteelevels. By estimating a spatial autocorrelation coefficientwhile controlling for theoretically relevant variables and statefixed effects, this study finds evidence that states are sensitiveto the welfare policies of their competitors.     

Finland's Parliamentary Election 2015: Certainty of the Result with Uncertainty of the Outcome

The winner of the Finnish parliamentary election 2015 was certain long before the elections. The Centre Party of Finland would win, but for the composition of the government and future societal changes, it was more interesting who would be the runners-up. With eight parliamentary parties and with eight different political agendas, the Finnish political system forms a hard to predict political landscape. Key issues for the Centre Party, rebounding from the catastrophic elections of 2011, were to find a coalition with trust between its members and to generate trust in getting things done. One evident societal outcome of the election is the deceleration of centralization policies furthered by the previous government. The disagreement over regional politics and devolution and related cleavages within the country brought the coalition government between the Centre Party, the National Coalition Party and the Finns Party to the verge of falling after only six months.     

‘Strangers in their own land’: Powellism’s policy impact

ABSTRACT

In this paper, Solomos provides an account of the impact of Powell’s ‘Rivers of Blood’ speech on policy agendas about race relations and immigration. He argues that Powell’s intervention helped to shape policy frames around race and immigration in its immediate aftermath and beyond. By exploring the impact of the speech on the policy climate, his paper argues that perhaps the most important aspect of the speech is the way it helped to shape the policy agendas of both the Conservative and Labour parties, even as Powell himself was marginalized from mainstream politics. He concludes by suggesting that Powell’s intervention links up with contemporary debates and preoccupations about race and immigration.     

Evolution and Devolution: Citizenship, Institutions, and Public Policy

The United Kingdom is a state of unions. It evolved througha series of diverse unions, each leaving an institutional legacy.Though the United Kingdom was highly centralized it was notuniform. Devolution is rooted in this legacy. Past institutionalarrangements, notably central government departments responsiblefor Scottish, Welsh, and Northern Ireland affairs (collectivelyknown as "administrative devolution") remain central to howUK politics and policy should be understood today. Devolutioninvolved adding elected representative institutions to eachof the components of the state of unions apart from England.The powers, responsibilities, and funding arrangements of devolutionreflect the evolution of administrative devolution. Nonetheless,devolution marks a critical juncture that will accentuate differencesin citizenship rights within the United Kingdom.     

Does state AFDC generosity affect child SSI participation?

This article examines the extent of interactions or spillovers between the Supplemental Security Income (SSI) and Aid to Families with Dependent Children (AFDC) programs for children. In the early 1990s, the Social Security Administration substantially relaxed child eligibility criteria for SSI benefits. Since the changes, the number of U.S. children receiving cash and medical benefits through SSI tripled to nearly 1 million. The article describes a family's decision to participate in SSI and/or AFDC, and uses state‐level data for three years before, and three years after, the Zebley decision to estimate the effect of state program generosity on child program participation. The expansions in child SSI eligibility increased child SSI participation and contributed to increased total program participation by children in the early 1990s. Child SSI participation increased more in states with lower AFDC payments and higher state SSI supplementation payments. These results suggest that families use SSI and AFDC as substitutes. At least 32 percent of the Zebley increase in SSI is likely attributable to the SSI–AFDC benefit gap for the median AFDC benefit state. © 2000 by the Association for Public Policy and Management.     

The effect of disabilities on exits from AFDC.

The Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) of 1996 replaces AFDC, the largest means-tested cast assistance program for low-income families, with the Temporary Assistance for Needy Families (TANF) block grant. Unlike AFDC, assistance under TANF is limited to five years in a lifetime, and states are required to move families from the assistance rolls into jobs. But not all adult welfare recipients can easily move to work because either they themselves are disabled or they have a child with disabilities requiring special care. This article examines the extent and impact of disability among families on AFDC to gain insight into the potential impact of changes under TANF. Using data from the 1990 Survey of Income and Program Participation (SIPP), we find that in nearly 30 percent of the families on AFDC either the mother or child has a disability. Furthermore, we find that having a disability significantly lowers the probability that a woman leaves AFDC for work but not for other reasons, such as a change in living arrangements. Finally, we find little evidence that having a child with a disability affects the probability of leaving AFDC for any reason.     

The effect of incremental benefit levels on births to AFDC recipients

We examine the relationship between fertility and incremental AFDC benefits using the 1990 Panel of the Survey of Income and Program Participation (SIPP). Estimating a logit equation for the probability of a higher-order birth among a sample of AFDC recipients, we find a positive coefficient (although statistically insignificant) on the incremental AFDC benefit level. However, we find a positive correlation between incremental benefits and fertility for several nonrecipient comparison groups which is larger than the positive correlation for AFDC recipients. This finding suggests that the previously estimated relationship between incremental benefits and fertility among AFDC recipients is largely the result of a spurious correlation. We find similar results among whites, blacks, and never-married women, but less consistent results among Hispanics and divorced or separated women. We infer from these results that family cap policies, which eliminate the incremental benefits entitled to AFDC recipients who have additional children, are not likely to result in a large reduction in the number of out-of-wedlock births to AFDC recipients.     

Devolution Paradox and the US South

There is an inherent trade-off in federalism regarding representation and equity. With the devolution of responsibilities to regional governments offering increased representation, there comes the inequity of services provided by some governments and not others. However, citizens in these federations may want the best of both worlds—desiring regional control but without the regional policy variation. This tension, dubbed ‘the devolution paradox’ in a study of federal countries in Europe, was less apparent in one key group of regions—those with historic ties through language, culture, or experience. This article examines US respondents to identify whether the devolution paradox is evident in this country and looks specifically at the South, a region with long-standing distinctiveness. We find that there is evidence of the devolution paradox among the American public and that the South is indeed different.     

Reagan's Welfare Reforms: Were the Program Savings Realized?

This paper provides a discussion of the impact of the Omnibus Budget Reconciliation Act of 1981 (OBRA) on AFDC caseloads and expenditures. Intervention analysis and regression analysis are used to examine whether OBRA resulted in either temporary or permanent changes in the levels of these variables. This study indicates that while OBRA may have resulted in a decline in AFDC caseloads, it did not have a significant effect on total AFDC expenditures.     

Policy Decentralization and the Endogenous Effects of State Traditions: Devolution of Water Management in Ghana and Senegal

Abstract

The widely held belief that decentralization of public services would reduce the fiscal burden of deeply indebted states led a large number of developing countries throughout the 1980s and 1990s to embark on devolution and public sector reform. Among the responsibilities that have generally been devolved are the provision and support of drinking water facilities. There is, however, a substantial cross-national difference in implementation records of public service devolution. This paper argues that state-building legacies, which shaped the capacity of local governments and the opportunity structure of local governments to cooperate with indigenous communities, explain this variation. This argument is analyzed in the context of devolution of water supply in Ghana and Senegal. The analysis shows that the weak capacity of local governments is compensated in Ghana, but not in Senegal, through co-optation of historically strong traditional authorities into local governance structures.     

Determinants of initial entry onto welfare by young women

Using data from the youngest cohorts of women in the National Longitudinal Survey of Youth, this study constructs Aid to Families with Dependent Children (AFDC) histories starting at age 15. Most young women go on AFDC for the first time between ages 18 and 25 and do so in the first few years after the birth of their first baby. These histories are used to estimate models of the determinants of initial use of AFDC. The models provide mixed evidence that the financial or other incentives of welfare policy affect the likelihood and timing of AFDC use. Benefit levels do not seem to affect participation, but the presence of a program for medically needy families who are not on welfare appears to decrease entrance to welfare for some groups. Parental poverty, family structure, academic achievement, attitudes toward school, and race are significantly related to the likelihood of participating in AFDC, and the rate of entry. © 2000 by the Association for Public Policy Analysis and Management.     

Sovereign Currency and Non-Sovereign Budgets: The Modern Money Theory Approach

This paper will present the Modern Money Theory approach to government finance. In short, a national government that chooses its own money of account, imposes a tax in that money of account, and issues currency in that money of account cannot face a financial constraint. It can make all payments as they come due. It cannot be forced into insolvency. While this was well-understood in the early post-war period, it was gradually “forgotten” as the neoclassical theory of the household budget constraint was applied to government finance. Matters were made worse by the development of “generational accounting” that calculated hundreds of trillions of dollars of government red ink through eternity due to what neoconservatives label “entitlements” (largely, Medicare and Social Security). As austerity measures were increasingly adopted at the national level, fiscal responsibility was shifted to state and local governments through “devolution.” A “stakeholder” approach to government finance helped fuel white flight to suburbs and produced “doughnut holes” in the cities. To reverse these trends, we need to redevelop our understanding of the fiscal space open to the currency issuer—expanding its responsibility not only for national social spending but also for helping to fund state and local government spending. This is no longer just an academic debate, given the challenges posed by climate change, growing inequality, secular stagnation, and the rise of Trumpism.     

Transitions from AFDC to SSI before welfare reform

The Supplemental Security Income (SSI) and Aid to Families with Dependent Children (AFDC) programs serve populations with similar characteristics. SSI serves adults and children with disabilities who are in low-income families, and AFDC serves low-income families with children. Because of that overlap, policy changes in one program can affect the other. In 1996, Congress enacted the Personal Responsibility and Work Opportunity Reconciliation Act, which transformed AFDC into the Temporary Assistance for Needy Families (TANF) program. Many people have expected that implementing that welfare reform legislation would eventually increase SSI participation, for two reasons. First, TANF includes new work requirements and time limits that induce more AFDC/TANF recipients with disabilities to obtain SSI benefits. Second, the change in the funding mechanism--from open-ended funding on a matching basis for AFDC to cash assistance block grants for TANF--gives states a stronger incentive to shift welfare recipients to SSI. This article examines the interaction between the SSI and AFDC programs in the prereform period (1990 to 1996) and discusses the potential implications of welfare reform on that interaction. Using matched data from the Survey of Income and Program Participation and Social Security Administration (SSA) records, our analysis focuses on how the interaction of those programs affects young women (aged 18 to 40) and children (aged 0 to 17). We find a very strong link between AFDC and SSI for young women and children. Significant portions of young female and child SSI beneficiaries in the 1990-1993 period were in AFDC families or had received AFDC in the past. In addition, a substantial share of young women and children who received AFDC during that period eventually entered SSI. Because the SSI program is now serving a much larger population of families with young women and children than in the past, SSA might need to develop policies to better serve that group. The findings also suggest that the prereform period is a poor baseline against which to measure the impact of TANF, primarily because of the instability in programs and policies.     

Earthquakes and Aftershocks: Race, Direct Democracy, and Partisan Change

Although dramatic partisan change among the electorate is infrequent, the issue agendas of parties may produce large shifts. A major cause of such change is the politics of race. In a political environment charged with racially oriented issues, racial groups often align themselves with different parties (as witnessed most recently in the American South). Yet, if racial appeals violate norms of equality, these appeals may rebound on the party using them. Consequently, members of the (white) racial majority and racially targeted minority may both move away from the offending party. Using data from the California Field Poll, we find that racially charged ballot propositions sponsored by the Republican party during the 1990s in California reversed the trend among Latinos and Anglos toward identifying as Republican, ceteris paribus, by shifting party attachments toward the Democratic party. Our results raise serious questions about the long-term efficacy of racially divisive strategies for electoral gain.     

Does AFDC-up encourage two-parent families?

Effective October 1990, the Family Support Act (FSA) of 1988 extended the previously state-optional AFDC-Unemployed Parent (UP) program to all states. This policy was undertaken in an effort to reduce the two-parent penalty of the AFDC program, but little is actually known about UP and its influence on family structure. This study clarifies what is meant by “two-parent family” in the federal legislation and provides new evidence on AFDC's incentive effects. The empirical analysis makes use of the cross-state variation in the generosity of AFDC benefits and the presence (or absence) of AFDC-UP before the FSA of 1988. Specifically, these state-level data are appended to data from the 1987 National Survey of Families and Households (NSFH). A real advantage of the NSFH is that it allows for the identification of those truly eligible for the UP program-married and unmarried couples who have an “in-common” dependent child. The major empirical finding is that contrary to the hopes of Congress, a state's provision of a UP program is not found to encourage two-parent families.     

Hunting where the ducks are: activating support for Donald Trump in the 2016 Republican primary

ABSTRACT

Donald Trump’s victory in the 2016 Republican primary defied the predictions of many politicians, pundits, and political scientists. Yet, while Trump’s nomination was hard to predict, it is not difficult to explain. We show that Trump’s campaign message succeeded by activating longstanding, but often unappreciated, sentiments among Republican voters about immigration and economic entitlements. In particular, his support was concentrated among Republican voters with hawkish views on immigration and relatively liberal views on economic policy. Moreover, these views preceded support for Trump, rather than the other way around. Drawing on an original panel survey, we show that attitudes about immigration and economic entitlements measured in 2011 strongly predicted support for Trump in 2016. Although Trump’s coalition struck many observers as odd, it was predicated on a set of attitudes that is not unusual among Republican voters. He simply hunted where the ducks are.     

An empirical investigation of interstate AFDC benefit competition

Claims that states which offer generous welfare benefits attract the poor and that some states pay low benefits intending to drive the poor away are neither uncommon nor entirely unfounded. This paper employs a two player (state) generalized game to model states' choice of a benefit level in the Aid to Families with Dependent Children (AFDC) program. Migration by the poor in response to interstate differentials in earnings and welfare opportunities, and the subsequent changes in AFDC caseloads, drive this game. Estimation of the model (using 1979 data) suggests that states within approximately 750 miles of each other do engage in a benefit-setting game. The rival's initial number of poor and preference for non-AFDC consumption appear to be the more influential rival characteristics. These findings, while derived from a different methodological approach, are consistent with previous studies which indicate that welfare recipients tend to move toward higher benefit states. Such migration may impede the efficient spatial allocation of labor. The results also indicate that states will tend to offer lower benefits given recipient migration than would be the case otherwise. State jurisdiction over benefits consequently leads to underprovision of AFDC. Federalization of the AFDC program would improve efficiency in terms of the spatial allocation of labor and the provision of AFDC.     

The English Question

Devolution to Scotland and Wales throws up related questionsabout the government of England. Does England need to find itsown separate political voice? Does England too need devolution?There is little demand for an English parliament. "English voteson English laws" commands more support but would be impossibleto implement in practice. Despite the setback of the Northeastreferendum defeat, the future will see further development ofregionalism in England. Regional government is the only institutionalsolution that could help to give England a louder voice andalso help to decentralize the government of England. But itis not inevitable. There is no logic in the process of devolutionthat requires the English to have devolution too.