‘Welfare to Work’ - the new poverty trap? A Liberal response

It has been said that passive welfare, whereby an individual received a handout from the State but was not asked to deliver anything in return, was creating ghettos of inter-generational poverty. As Noel Pearson has noted, this seems to remain the case in many indigenous communities. And it has also been said that the problem with the model of welfare devised in the aftermath of the Great Depression and expanded upon in the 1960s and 1970s, was that it assumed that "one size fits all".

The Howard Government has been an advocate of so-called "welfare to work" policies. In short, it believes that welfare recipients should participate in some form of activity if they are to continue to receive benefits. Single mothers, the young unemployed and even the disabled seem to be encompassed by this policy. The Treasurer, Mr Costello, believes that we need to "reform our welfare system so that the interaction between welfare and work becomes unashamedly more pro work …" And the Howard Government believes in tailoring welfare programs to each individual’s needs.

But despite what is often said about the "one size fits all" and passivity of post-Depression welfare programs, there is nothing new in the approach to welfare policy that demands reciprocity and that it should be tailored to communities and situations that individuals find themselves in - the great and much underrated US President Lyndon Johnson’s War on Poverty and Great Society programs of the mid-1960’s were built on such premises.

Be this as it may, the real issue here for a liberal is this - is an individual’s autonomy best realised through the application of a universal underpinning of reciprocity in the welfare system and through the individualisation of welfare?

Or, as the leading liberal philosopher John Gray would put it, it "is that a liberal commitment to personal autonomy itself compels an evaluation of the worth of different ways of living".

The evidence regarding the welfare to work approach and how it maximises an individual’s personal autonomy is mixed. And it is from the US that such a story emerges.

Remember that former US President Bill Clinton has cited as one of his great achievements of office his suitably "Third Way" welfare to work laws, passed by the Congress in 1996. These laws, which are now up for review, essentially handed welfare back to the States in the form of block grants and made those grants dependent on the States adopting welfare to work policies.

The Chicago based not-for profit Joyce Foundation, a welfare research outfit, has just released some fascinating findings on just how the Clinton reforms have been working in practice.

The Joyce Foundation report has found that welfare recipients are now more aware of the tougher requirements for receiving benefits and are positive about the changes. For example, 83 per cent of interviewed welfare recipients in Chicago agreed that it’s a "good idea" for people on welfare to be required to find work.

But the report also highlights the danger of simply relying on welfare-to-work policies alone to improve an individual’s autonomy. It has found that most people who come off welfare move into part time or short-term jobs. For example in Ohio, only 40 per cent of those who left welfare to work were still working 12 months later.

And more alarmingly, in "Illinois, Iowa, Michigan, Ohio, and Wisconsin, the average hourly wages earned by people who left welfare put a mother with one child slightly above the poverty line, a mother with two children well below the poverty line".

The Joyce Foundation confirms that many of those who are forced from welfare to work find it difficult to hold down jobs because of mental illness, childcare needs, transportation difficulties, and low educational qualifications.