NCPA - National Center for Policy Analysis

Restoring a True Safety Net

October 12, 2012

Spending on welfare programs has increased at alarming rates under the Obama administration. Rather than targeting assistance for those truly in need, many programs and agencies have expanded eligibility to include some individuals and families well into the middle class, say David J. Armor, professor emeritus of public policy in the School of Public Policy at George Mason University, and Sonia Sousa, a post-doctoral research fellow at the School of Public Policy at George Mason University.

  • From 2008 to 2010, spending on welfare programs increased from $475 billion to $666 billion, a 40 percent increase after inflation.
  • According to the U.S. Census Bureau in 2011, the poverty threshold for an individual was $11,702 and for a family of four it was $22,811.
  • However, federal poverty guidelines allow agencies to move the threshold to include families that are 130 percent or 200 percent of the official poverty level.

To control its budget deficit, it is necessary for the United States to make reforms to its programs. Federal food aid is one area that requires significant government funding to make its programs solvent.

  • Spending on food programs has increased from $57 billion in 2007 to $95 billion in 2010.
  • Between 2000 and 2010, the number of persons receiving food stamps increased from 17 million to 40 million.
  • Surprisingly, 7.2 million recipients are between 130 percent and 200 percent of the poverty line. But almost 8 million have incomes greater than 200 percent of the poverty line.

Federal health programs, income assistance and housing also make significant portions of welfare spending in the United States. In 2010:                          

  • Spending on Medicaid reached almost $270 billion.
  • The Children's Health Insurance Program cost nearly $8 billion.
  • The Supplemental Security Income program totaled nearly $47.8 billion for 7.5 million people.
  • The Earned Income Tax Credit cost nearly $55 billion.
  • Housing assistance comprised more than $50 billion of federal spending.

It is increasingly important to make cuts or changes to these welfare programs in order to make them sustainable and alleviate pressure on the federal government. One big step in the right direction would be to return eligibility of these programs to those that are currently at or under the defined poverty level.  Critics argue that the poverty level is too low as it is. However, meaningful cuts in spending can be made by simply limiting eligibility to those at the poverty level and even 130 percent of the poverty level.

Source: David J. Armor and Sonia Sousa, "Restoring a True Safety Net," National Affairs, Fall 2012.


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