The Culture of Generational Poverty > Chapter 6 - Welfare, Working Poor and the Homeless

Chapter 6: Welfare, Working Poor & the Homeless

Welfare, Working Poor & the Homeless

“Welfare is hated by those who administer it, mistrusted by those who pay for it and held in contempt by those who receive it.”   Peter C. Goldmark Jr.

Is welfare reform working? It depends who you ask, and when you ask them. Google the question and you will find 14 pages of results to your search, each article, white paper, or analysis claiming differing levels of success or failure from the initiative that began in 1996. Perhaps it is a case of “figures don’t lie, but liars can figure.” Depending on the political perspectives of the authors, welfare reform statistics can be found to support most any viewpoint that one wants to infer from them.

Welfare reform was instituted by the Personal Responsibility and Work Opportunity Reconciliation Act of 1996. The act replaced the failed social program known as Aid to Families with Dependent Children (AFDC) with a new program called Temporary Assistance to Needy Families (TANF). The reform legislation had three goals: (1) to reduce welfare dependence and increase employment; (2) to reduce child poverty; and (3) to reduce illegitimacy and strengthen marriage.

[QN.No.#16. Which of the following statements is NOT a goal identified by the Personal Responsibility and Work Opportunity Reconciliation Act of 1996?]

Unquestionably, the first goal has been at least partially met. There are less people in the U.S. now that are receiving cash assistance than prior to the reforms being enacted. The question remains, why? Although cash assistance caseloads have decreased by roughly 50% in most States, [i] spending for childcare, transportation, medical care, job readiness classes, and household necessities has increased dramatically. Some believe that the emphasis placed on providing supports needed to overcome barriers to employment is responsible for moving people from welfare to work. More cynical analysts owe this success to the fact that a goodly number of ADC recipients simply signed off on cash benefits, not wanting to jump through the hoops necessary to earn cash grants. A significant number of cash recipients also fell off the rolls when their time on the system expired at the end of the 3-5 year (time limits vary from state to state) benefits period. The success statistics looked good in the early 21st century due to the exodus from cash assistance, but between 2000 and 2007 the rolls have begun to eek up again.

Spin the numbers in any direction you wish, the cold hard facts for those living in poverty is that they are no better off economically than they were at the onset of welfare reform.

The 1996 TANF law expired after five years. Although its expiration was standard, it took another five years of temporary extensions before the government voted for reauthorization. As part of the Deficit Reduction Act of 2005 (passed July 2006), Congress reauthorized the TANF block grant program through 2010.[ii] The reauthorization of TANF brought with it a number of new rules that states must conform to in order to receive federal funds.
  • States now face a higher hurdle in order to maintain federal TANF funding by meeting a 50% participation rate for all families receiving assistance and a 90% participation rate for two-parent families. The new regulations curb state flexibility by limiting the set of work activities that can count towards participation rates. For states this could mean:
    • Efforts to keep more working families on the rolls by extending TANF benefits for adults who have found work;
    • A reduction of caseloads, without restricting eligibility, such as by making the application process more challenging, or;
    • A removal of those who cannot meet the rate from TANF and shifting this population to a state-funded program.
  • States are now responsible for providing the federal government with a "Work Verification Plan" -- a document containing status verification and updates on recipient participation in work activities.
  • Substance abuse, mental health and other rehabilitation services are limited to a maximum of 6 NON-CONSECUTIVE weeks during a 12-month period that may be counted towards the work participation rate.
  • Higher education programs as well as related non-supervised study time will NO LONGER count towards participation rates.
  • Vocational education and ESL programs have an increased priority and more readily count as participation.

In layman’s terms, these reforms mean that fewer TANF applicants will be able to receive assistance because the application process has become more complicated and restrictive, effectively screening out those who are unable or unwilling to pursue the more rigorous application activities.

The working poor will receive extended support, but those suffering from disabilities, mental illness, or substance abuse issues will find themselves without TANF cash assistance if they require treatment that extends beyond a week, or must be treated more than six weeks in a one year period.

Going to college will no longer count as a legitimate pursuit if you wish to receive TANF. On the other hand, if you wish to enroll in vocational education, or learn to speak English, the system will be more generous with you. Certainly these reforms will make the national numbers look better, but what impact will they have on the lives of the poor?

Earning and Learning

As a result of the latest welfare reforms most States are placing an emphasis on transitional jobs programs instead of encouraging self-directed job search to move recipients from welfare to work. Transitional Jobs (TJ) is a successful strategy to employ the hard-to-employ by building skills, addressing barriers, and providing real work experience. TJ programs combine meaningful work experience with valuable life and job-skills training, intensive case management, and job retention services in order to help participants successfully enter and compete in the workforce.

Participants in these programs receive intensive job and life-skills training and case management while they work in temporary jobs in community-based organizations, government agencies, or private businesses. During the transitional job, which typically lasts two-to-six months, but can extended up to two years, participants earn a salary at the federal or state minimum wage, which enables them to pay into Social Security, qualify for the Earned Income Tax Credit, and start earning a paycheck.

TJ programs target current and former TANF recipients, ex-offenders, and other individuals with significant barriers to employment. These individuals often experience difficulty finding and holding jobs due to multiple barriers, including a lack of an employment record, low education levels, lack of job skills, substance abuse, past criminal offenses, or domestic violence. TJ programs help participants manage these obstacles to promote success in the workplace.

Through the program, participants transition out of the temporary jobs and move into permanent, unsubsidized jobs. TJ programs have an extremely high success rate of placing participants into permanent jobs. According to national data, 81% to 94% of transitional jobs participants go on to secure unsubsidized employment. [iii]

This is not a new concept. Those who have spent their careers in social services will recognized this program as a recycled version of the Job Training Partnership Act of 1982 (JTPA) that sponsored the “Work Experience Program” in the 1980’s. JTPA was replaced by the Workforce Investment Act of 1998 (WIA). WIA funds workforce development activities provided in local communities that can benefit job seekers, laid off workers, youth, incumbent workers, new entrants to the workforce, veterans, persons with disabilities, and employers. [iv]

Since its’ inception WIA has given the lion’s share of its’ funds to people who are seeking short term occupational skills training, and has provided training opportunities for high demand jobs such as truck driving, licensed practical nursing, certified nurse aide, clerical and office skills, peace officer training, and cosmetology. While preparation for these occupations looks to be helpful to the poor at first glance, a significant number of impoverished individuals cannot qualify for such occupations. Former felons, the mentally ill, those with spotty driving records, and substance abusers will have trouble finding work in the fields of trucking, nursing, and law enforcement.

Also of concern is the fact that many of the jobs available in these fields are part of today’s “casual labor market.” These jobs are commonly staffed through temporary agencies which provide a steady flow of workers to employers without the employer having to hire them. This is a pretty good deal for employers who don’t have to invest in benefit packages for these employees, but is less sweet for the workers who work sporadically and may average only 8-32 hours a week, and have no way to foresee how many paid hours they will be offered from one week to the next.

[QN.No.#17. Which statement is false?? Transitional Jobs is a program designed to ...]

Who will Pay the Light Bill?

There are a number of programs that help both the unemployed and the under-employed pay their utility bills. This assistance is purported to sustain self-sufficiency and prevent homelessness. Although this is a tactic that is effective in preventing homelessness, preservation of self-sufficiency requires greater definition to assess its effectiveness. The practice of depending on the government to pay for life’s essentials such as heat, light, and water tends to foster the idea that it doesn’t matter who pays your bills as long as someone does. This notion fosters an entitlement mentality, and does little to cultivate true self-sufficiency thinking and behavior.

There is no doubt that the poor do need help from time to time in paying their bills, but the requirements of programs such as the Home Energy Assistance Program (HEAP) insist that impoverished applicants wait to get a shut-off notice before receiving aid. When aid comes it is in the form of a full payment of bill that is due. This annual rescue reinforces the belief that one doesn’t need to take responsibility for paying for the utilities that they use.

Programs such as the Percentage of Income Payment Plan (PIPP), is an extended payment arrangement that requires regulated utility companies such as gas and electric providers to accept a set percentage of a family’s income (15%) per month to keep the utilities on. Families at or below 150% of federal poverty guidelines are eligible to apply, but once a family leaves the program the full amount still owed on the utility bills comes due. This means that when a family’s income finally rises above the program’s eligibility level they may possibly be slammed with a huge debt almost immediately. Such a punch in the wallet might make a person think about quitting their job, or reducing their work hours to get the benefit back. It is not uncommon for employees to refuse pay raises or promotions at work out of fear of losing their utilities assistance.

A number of urban renewal programs now exist that help low-income homeowners insulate their homes, replace leaky windows, and install energy efficient heating and air conditioning units. These efforts not only control utility costs, but also boost property value. Again, these programs appear to be “give-aways” instead of “earn-your-ways,” but they do provide a long-term investment that will aid the family long into the future.

A Plethora of Programs

At first glance it looks as though the poor pretty much have it made, considering the numbers of non-profit and governmental agencies that exist to provide assistance to them. Even when these programs attempt to evaluate their success, they often fail to ask, “If we are meeting our goals, why are there so few people moving out of poverty?” Perhaps the programs themselves function in a way that sabotages their own efforts by snatching away the safety net while the impoverished family is still flying through the air, and does not yet have the trapeze that is the middle class in their grasp.

Homeless shelters now offer a wide range of services to aid residents in becoming self-sufficient including shelter, food, counseling, and job skills programs. They also require the homeless to be drug-free gain entrance into their facilities. Unfortunately, families are separated, the men go to one shelter, and the woman and children to another, and often, the doors of the shelter are locked in the early evening, preventing second and third shift workers from gaining access to a bed when they really need one. Given the fact that the poor often have to work jobs on the later shifts, or on split shifts, this practice tends to discourage the notion that “any job is always better than no job,” a philosophy that is common in the middle class.

Another problem exists in that many homeless shelters do not offer daycare services. Non-profit agencies seem to do a bit more about daycare provision for the homeless than do government agencies. Daycare is essential for the homeless to keep appointments, search for jobs, and locate housing. It makes a poor impression with a middle class employer if a job applicant brings their children to a job interview.

In many cities homeless shelters have a lengthy waiting list to gain entry. As the homeless wait for their name to come up on the list, their situation is sure to deteriorate further. Some resort to committing crimes to feed their family, others fall ill, or become victims of crime. Their connection with mainstream society slips away while their encounters with the underground society strengthen.

As the homeless population continues to grow, shelters are overwhelmed with demand for their services, and are often forced to set short time limits for a resident’s stay. This means that the homeless move from one shelter to another, barely getting to know one area of the city before they are forced to move across town and reinitiate another job search, locate social service resources, and begin their move towards self-sufficiency anew.

The need for transitional housing that takes the homeless from the shelter into short-term apartment living is great, but the programs that provide transitional housing services are few. Recently Section 8 HUD funded rental assistance that pays about 30% of one’s monthly rent has undergone significant reduction at the federal level. This means that many families who need rental assistance to get on their feet will not be able to receive the assistance. In Cincinnati, Ohio for example, the city cut assistance to 300 families and reduced the number of vouchers being issued from 7600 to 7300 in 2006.[v]

Over 100 U.S. cities that have recently formed community partnerships between non-profits, associations that aid the homeless, and local, state, and federal agencies to end homelessness in their cities within the next decade.[vi] Their 10 year plan to end homelessness is based on the following strategy:

A 10-Year Strategy to End Homelessness is:

• Designed to address the critical problem of homelessness and all related issues through a coordinated community-based process of identifying needs and building a system of care to address those needs.

• Predicated on the understanding that homelessness is not caused merely by a lack of shelter, but involves a variety of underlying, unmet needs—physical, economic, and social.

• Supported by a community-wide public and private strategy with a goal of ending homelessness that is based upon the successful implementation of three major community-coordinated actions—(1) building infrastructure; (2) strengthening an existing continuum of care system; and (3) planning for sustainable outcomes.

This comprehensive approach to homelessness is significantly more effective than a fragmented system where the churches, charitable organizations, government, and non-profits struggle to interface and lack an organized approach to meeting the needs of the community’s homeless children and adults. Most notably, the entire community benefits from the efforts put forth to save families from the mean streets of metropolitan areas.

Metropolitan housing, the low-cost or no-cost strategy using large housing projects to provide homes for those who would be potentially homeless without such assistance is seen by many as a failed strategy. Although such “projects” still exist, there is a three to seven year wait to enter these housing units. The “projects” have been shown to provide breeding grounds for criminal activity by grouping together the “have-nots” together, often in substandard structures. In large cities the “projects” have become war zones where paramedics and fire fighters will not respond to emergencies without police protection.[vii] Children raised in these environments have a slim chance of ever moving to the middle class. Some of them will never have a chance to see adulthood.

Habitat for Humanity homes are a wonderful alternative to life in the projects. These homes are being built in both impoverished and lower middle class neighborhoods throughout the country. Habitat for Humanity International is a nonprofit, ecumenical Christian housing ministry. HFHI seeks to eliminate poverty housing and homelessness from the world, and to make decent shelter a matter of conscience and action. Habitat invites people of all backgrounds, races, and religions to build houses together in partnership with families in need.

Habitat has built more than 225,000 houses around the world, providing more than 1 million people in more than 3,000 communities with safe, decent, affordable shelter. Through volunteer labor and donations of money and materials, Habitat builds and rehabilitates simple, decent houses with the help of the homeowner (partner) families. Habitat houses are sold to partner families at no profit and financed with affordable loans. The homeowners’ monthly mortgage payments are used to build still more Habitat houses.

Habitat is not a giveaway program. In addition to a down payment and the monthly mortgage payments, homeowners invest hundreds of hours of their own labor — sweat equity — into building their Habitat house and the houses of others. Now that is a definite move towards helping to make families self-sufficient, but again, the waiting list is long for a Habitat Home, and not everyone on the list will be served.[viii]

[QN.No.#18. Which statement is true?? Self-sufficiency is encouraged among the poor by...]

Soup kitchens and food pantries, often sponsored by churches and civic groups also help the homeless, and those at risk of homelessness, to meet their daily needs, but many of these agencies are now facing a funding crisis that have caused them to limit aid as well.

Linking, Referral and Follow-up

It only seems to make good sense that the poor would follow-up on referrals to get on housing lists and reduced cost utility plans, and get in on food give-aways, job training, and government paid medical assistance. It seems that they would be visiting their local welfare department with regularity to check to see what sort of aid is currently available, but this is not always the case.

Some are too proud to take assistance, others may not even know that it exists, or may not have the needed skills to navigate through the many application processes, income verifications, and waiting protocols that provide gateways to resources. Frequently there is no follow-up to the referrals given by one agency to another, and the needy simply get lost in the cracks without notice. Sometimes the “directory of services” is so massive, or antiquated, that it is of little use at all to those who don’t even know how to use a telephone book.

[QN.No.#19. Educating the poor with the survival skills needed to succeed in the middle class...]

The Real Deal
Randy dropped out of community college to care for his aging mother who had Alzheimer’s Disease shortly after his father passed away. The family had always been poor, and secretly, Randy had always wished for a more financially secure life than his parents had known.

While working as a warehouse manager in a local department store, Randy met and married a woman with a young son who was also employed at the store. When word of their nuptials became public, both Randy and his wife Karen were terminated

After a protracted job search Randy found another job at a big box store, but the entry level position he took paid only minimum wage. Karen became a maid at a an area motel. Because of Karen’s epilepsy, the medical bills began to mount the minute they left the welfare system to again become wage earners. Without medical insurance, Karen’s medication ran the couple $350 monthly, the same cost as their rent. Unable to pay for her preblockedion, Karen quit taking her medication and had a seizure while on her job. The next day she was fired for being three minutes late for work.

Karen’s young son Tom, who is enrolled in the free lunch program at school is the object of taunts daily from the more well off children that he attempts to socialize with. His experience with the middle class kids seems to have triggered a rebellious streak in him and he has begun committing petty crimes such as stealing books from the Book Fair at school.

Randy had begun working two jobs to make ends meet,, but recently lost his drivers license for allowing Karen, an unlicensed driver due to her disability, to drive the family car on a snowy winter morning to deliver her paper route. Since the buses only run during the day in the town where they reside, Randy had to quit his second job because he couldn’t get to the factory located just outside of town.

One night, in a fit of rage, Tom was heard to tell his mother and stepfather, “You guys are pathetic losers. You can’t even pay for me to eat lunch at school. I wish I never met either of you.” So much for Randy’s dream of a better life for his family.
[i] Rector, Robert, Fagan, Patrick F. (2003, February) The Continuing Good News About Welfare Reform. Retrieved July 18, 2007 from The Heritage Foundation website (2007) at

[ii] Work, Welfare & Families (2006) Welfare (TANF) Reauthorization. Retrieved July 18, 2007 from the Work, Welfare & Families website at

[iii] Work, Welfare & Families (2006) Transitional Jobs. Retrieved July 18, 2007 from the Work, Welfare & Families website at

[iv] State of California (2007) Workforce Services. Retrieved July 18, 2007 from the State of California Employment Development Dept. at

[v] Monk, Dan (2005, March) Section 8 Rent Drop Worries Some. Retrieved August 4, 2007 from the Business Courier Website at

[vi] City of Long Beach 10 Year Plan to End Homelessness (2000-2007) Within Our Reach: A Community Partnership Towards Ending Homelessness in Long Beach. Retrieved August 4, 2007 from the City of Long Beach Health and Human Services Website at

[vii] Mrs. Smith’s Leg (2005) The Projects. Retrieved August 4, 2007 from the Barely Bad Website at

[viii] Habitat for Humanity Intl. (2007) Habitat for Humanity Fact Sheet. Retrieved August 4, 2007 from the Habitat for Humanity Intl. website at


Question No.16. Which of the following statements is NOT a goal identified by the Personal Responsibility and Work Opportunity Reconciliation Act of 1996?

a. To reduce welfare dependence and increase employment.
b. To provide health insurance to all families living in poverty.
c. To reduce child poverty.
d. To reduce illegitimacy and strengthen marriage. ans:2 To provide health insurance to all families living in poverty.

Question No.17. Which statement is false?? Transitional Jobs is a program designed to ...

a. Combine meaningful work experience with valuable life and job-skills training.
b. Provide intensive case management, and job retention services in order to help participants successfully enter and compete in the workforce.
c. Encourage participants to get a bachelors degree at a top college.
d. Target current and former TANF recipients, ex-offenders, and other individuals with significant barriers to employment.

Question No.18. Which statement is true?? Self-sufficiency is encouraged among the poor by...

a.Paying their utility bills.
b. Giving them free or low-cost housing.
c. Requiring them to invest "sweat equity" in building their own home and homes for other impoverished families.
d. None of the above.

Question No.19. Educating the poor with the survival skills needed to succeed in the middle class...

a.Could help prevent them from losing jobs.
b. Is sometimes embarrassing or awkward for professional helpers.
c. May be met with resistance from the impoverished.
d. All of the above.
The Culture of Generational Poverty > Chapter 6 - Welfare, Working Poor and the Homeless
Page Last Modified On: June 1, 2017, 10:51 AM