New evidence suggests that a groundbreaking Minnesota welfare reform program has not only lifted families out of poverty but promoted marriage and reduced divorce–two ardently hoped-for but previously unrealized goals of the nation’s overhaul of the welfare system.
The innovative program achieved those results while pushing welfare recipients to find work and preserving many of their benefits, according to a study released Wednesday by a non-profit and non-partisan national research group.
Particularly striking were findings that, over a 2-year period, two-parent families participating in the Minnesota Family Investment Program were more likely to maintain their marriages compared with people in traditional welfare programs.
By the end of the study period in 1996, 67 percent of two-parent families were married, compared with 48.5 percent on traditional welfare.
“We were astounded by these findings,” said Gordon Berlin, senior vice president of Manpower Demonstration Research Corp., the highly respected New York firm that evaluated Minnesota’s program.
Minnesota Gov. Jesse Ventura heralded the program’s results at a press conference Wednesday in St. Paul and announced, with evident pride and a bit of hyperbole, that “Minnesota is leading the nation in welfare reform.” But he added: “Just getting off welfare and staying in poverty is not exactly a victory.”
The family investment program, which started out as a pilot program in seven Minnesota counties from 1994 to 1998, was expanded across the state early in1998. More than 40 states now have incorporated variations of Minnesota’s “make work pay” approach into their welfare programs.
Against the backdrop of a continuing economic boom, the nature and extent of Minnesota’s positive results surprised even state officials. The apparent success in Minnesota seems likely to catch the attention of policymakers nationwide, who have begun to rethink the goals of welfare-reform efforts as caseloads decline precipitously.
“These are some of the most significant results ever achieved for low-income families,” said Wendell Primus, a former Clinton administration official and director of the Washington-based Center on Budget and Policy Priorities.
“They explode the conventional wisdom that welfare recipients respond only to sanctions and that nothing works to strengthen families.”
Under the Minnesota program, which began with 14,000 families, economic incentives designed to improve families’ financial status were coupled with work requirements that reduced, but did not end, dependency on government programs.
Families were allowed to keep more of their earnings from work than under traditional welfare. Cash benefits were combined with food-stamp benefits, and increased 20 percent when a recipient went to work. For each dollar earned, the state reduced a family’s benefits by 62 cents, allowing recipients to retain 38 cents and still receive some welfare payments from the government.
Child-care payments were made directly to providers, eliminating parents’ “when will I get the money?” concerns. Job training focused on getting people into the workforce quickly, and barriers to welfare for two-parent families were removed.
Overall, as hoped, the program raised welfare recipients’ participation in work and increased their incomes, giving many families hope for the first time of leaving a life of poverty.
What’s behind the improvements in family stability isn’t entirely clear. It could be that families became less stressed and more financially secure as their incomes increased under the program, Berlin speculated. Or it could be that pressure for both adults to work was relieved somewhat, allowing at least one parent to spend more time with children and keep the family running more smoothly, he suggested.
“What this seems to have done is taken some relatively fragile families and help them stay together,” said David Ellwood, a professor at Harvard University’s John F. Kennedy Graduate School of Government. “And that’s really, really important, because it means ultimately that both parents are there and available to support their kids. We’ve never seen this kind of positive impact on family structure in a study before.”
Results for single-parent families in the project were similarly promising, although somewhat different.
A smaller boost in marriage rates wasn’t the attention-grabber here. Instead, it was the largely unexpected drop in abuse of single mothers by boyfriends or other family members, from nearly 60 percent in traditional welfare programs to 49 percent under the Minnesota program.
More economic stability may have played a part by reducing stress, or women may have felt a greater sense of control, allowing them to negotiate difficult situations more effectively, theresearch report noted.
Equally impressive, children in welfare families appear to have realized significant improvements under the Minnesota experiment. It’s believed to be the first program to demonstrate that children act up less (an 11.7 percent drop) and do better in school (41.5 percent fewer posted below-average performance) when single parents start working and earning more money.
Interestingly, among the groups most helped were African-American children. Previous studies have indicated that white families fare better than minorities under welfare reform.
The gains in Minnesota’s welfare experiment came at a price: an extra $2,000 per year per family, largely associated with maintaining welfare payments for working families.
“We think in the long run, this is the kind of investment we need to be making,” said Chuck Johnson, a top official with the Minnesota Department of Human Services. The question for the Minnesota legislature in the future, he noted, is if it will extend benefits beyond the mandated 60-month lifetime limit on welfare if families continue to need them.
As far as Lisa Halverson of St. Paul is concerned, the answer should be yes. After the birth of her daughter five years ago, Halverson couldn’t afford child care, so she quit her job and signed up for welfare.
“I was devastated over what this would teach my children: that I couldn’t make it, that I was depending on someone else for my livelihood,” Halverson said. But when she learned about the pilot program, she got her job back and eventually moved into management ranks at another company.
“As my wages increased, they weaned me off. It helped me keep my dignity and gave me the edge to be successful,” the 29-year-old said.
States considering how to balance this kind of support with time limits should look to Illinois as a model, suggested Berlin of Manpower Demonstration Research Corp.
By stopping the clock when welfare recipients work 30 hours a week or more and still continuing to provide generous economic subsidies (Illinois allows people to keep $2 out of every $3 earned before reducing benefits), Illinois has created a blueprint for easing the transition of welfare families into work and creating a new culture of assistance, not dependency, he said.
“We understand supports are absolutely crucial, and we are committed to the goal of self-sufficiency,” said Linda Renee Baker, secretary of the Illinois Department of Human Services.
