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During other time periods, the labor supply response to loss of benefits could be even smaller. To understand whether such a response is typical for disadvantaged youth, I compare the earnings of removed SSI youth to the earnings of disadvantaged but non-disabled youth. This comparison suggests that SSI youth are particularly disadvantaged. The paper also finds that SSI removal substantially increases the volatility of income.

This is because the primary source of income switches from stable SSI payments to volatile earnings.

About the Author

Earnings among low-wage workers are highly volatile because of high turnover and unpredictable schedules. Welfare programs provide a more stable source of income, and recipients may value this stability in addition to the increase in income from cash welfare. Did the parents of these youth who lost benefits work harder to at least partially offset these lost benefits?

I find that parents increase neither earned nor unearned income. In addition, I find that removing year-olds from SSI causes their younger siblings to have substantially lower earnings in adulthood. Removing young adults from SSI may also affect the outcomes of their own children. I examine whether the year-olds go on to have children who are also on SSI. I find a high intergenerational correlation in SSI receipt: 18 percent of women and 4 percent of men a larger fraction of men are likely noncustodial parents in the original year-old sample have a child on SSI, not conditional on having a child.

This finding contrasts with Dahl et al. The most likely explanation for the difference is that the year-olds in my sample were all on SSI as children and are well-informed about the program through this experience, regardless of whether they are removed in adulthood. To provide a more comprehensive picture of the well-being of SSI youth, I consider the effect of SSI removal on the consumption of the youth.

Other effects

Consumption could be different from observed earnings for several reasons, such as monetary and in-kind transfers from family members, non-disability public assistance, and unreported earnings. Using administrative and survey data on these income sources, I conclude that these unobserved income sources are unlikely to be a large or steady source of income for removed SSI youth. The drop in observed income may therefore translate into a substantial, if smaller, drop in consumption.


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Overall, the results of the paper show that only a small fraction of those who lose SSI benefits are able to earn enough to offset the loss in benefits. On average, earnings replace on average only a third of lost benefits, leaving income not only much lower but more volatile. The results of the paper show that only a small fraction of those who lose SSI benefits are able to earn enough to offset the loss in benefits. An alternative explanation is that societal expectations and incentives for children with disabilities inhibit their education and health by the time they reach adulthood, and they do poorly in the labor market for this reason.

It will be important for future research to disentangle these hypotheses. Bound, John.


  • Welfare Reform.
  • EFFECTS ON FAMILIES AND CHILDREN.
  • Introduction;
  • EFFECTS ON FAMILIES AND CHILDREN, MOVING MOTHERS FROM WELFARE TO WORK.
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  • And we should seek to reduce the biases within our criminal justice system that disproportionately harm the poor and minorities. Welfare reform was neither the disaster that its critics feared nor the success its supporters claim. It was a step in the right direction—a small one, and one from which we can learn. The real work of fighting poverty remains ahead of us.

    20 Years Since Welfare 'Reform': How Has America Fared? - The Atlantic

    TANF dollars may only be used to deliver special services over and above the programs generally available to other state residents without cost and regardless of income. Edin and H. Bruce D. Meyer and James X. House of Representatives, July 19, About the Author. Indeed, as I have argued…. Read More. He admirably clears away the rhetorical fog that still envelopes our debates regarding welfare, and does not let either side get away with much. The welfare reform law seemed, at the time, like a very big deal.

    Welfare Reform and Its Long-Term Consequences for America's Poor, by James P. Ziliak

    Critics denounced it as a savage assault on those Americans whose lives were already precarious. Supporters hailed it as the first reversal since of a relentless trend: individual government welfare programs grew more numerous, while each one spent more money…. Scott Winship, Yuval Levin, and William Voegeli offer insightful critiques of my Liberty Forum essay on the 20th anniversary of welfare reform.

    Still, there are quibbles, if not major differences. Scott Winship clearly feels the reform….

    Once the Socialist genie was let out of the bottle that was the end of liberty in America. Welfare states funded with extorted taxes or borrowed fiat currency is nothing but a Ponzi scheme waiting to disintegrate into bankruptcy. Just like Rome and all the other welfare states throughout history. Nothing changes. Only the names of the politicians. I call attention to the final paragraph which refers to a collapse due to irresponsible fathers and illegitimate children.

    Has everyone been so brainwashed that they cannot see the slightest light of reality. Women would only have illegitimate children if the state allowed divorce, single mothers and financed them. Nothing is ever said that most women initiate divorce. Most women refuse to get married preferring to live off the state than sacrifice their independence in some sort of marital partnership. There is no epidemic of rape so these women are choosing to have children without a father, or a church, or a family or a marriage.

    Lastly if there are irresponsible fathers and fathers are removed by the state and the mother then who is raising these irresponsible fathers…. I am not sure if it has been mentioned but this needs to be told. The one thing about welfare reform that is overlooked is; instead of one parent households we created 0 parent households. If you look into the inner cities over the last few years you will find that shootings in the black areas have increased markedly.

    This is a direct result result of welfare reform where these fatherless and motherless children have now become adults and have absolutely no feelings for anybody. If there is one thing worse than a fatherless child it is a parentless child and welfare reform helped to achieve that in many instances in the Inner City. Your email address will not be published. Notify me of follow-up comments by email. Notify me of new posts by email.


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    • This site brings together serious debate, commentary, essays, book reviews, interviews, and educational material in a commitment to the first principles of law in a free society. About Contact Staff. Indeed, as I have argued… Read More. Supporters hailed it as the first reversal since of a relentless trend: individual government welfare programs grew more numerous, while each one spent more money… Read More.

      Scott Winship clearly feels the reform… Read More. Recent Popular Posts Popular. Who would seriously propose doing something like that? Leave a Reply Cancel reply Your email address will not be published. Home About Staff Contact Archive. This site uses local and third-party cookies to analyze traffic.

      If you want to know more, click here. By closing this banner or clicking any link in this page, you agree with this practice. Among Democratic candidates, it is entrepreneur Andrew Yang who has proposed the largest cash transfer program that would benefit the poor: the universal basic income UBI.

      While the idea may seem utopian on first glance, cash transfer programs have been implemented all over the world, with some success.

      Critics would point to the recent findings by Reichman and her colleagues that the law has appeared to harm the children of recipients. Wherever you come down on the debate, it is long past time to have it. Poverty Inequality comment.