Republicans have played key role in poverty fight
Has the Republican Party declared “war on the poor”?
That is the recent accusation from New York Times columnist Paul Krugman, adding that Republicans “are fanatical about cutting off aid to the less fortunate” because “they hate the idea of government helping anyone.” Krugman is a brilliant international trade economist, which makes it so disappointing that his columns are known less for any economic insight than for their hyper-partisanship, personal attacks, vitriol, hyperbole, straw men and accusations of bad faith. He has even shown a repeated willingness to reverse his own policy positions and contradict his own academic work if it helps him savage the latest GOP policy.
Rather than slander an entire party and its voters, let’s actually examine the data on the GOP and welfare policy.
Since the Republicans’ historic 1995 takeover of Congress (beginning an era in which they have typically controlled the House and Senate), federal antipoverty spending has soared from $334 billion to $779 billion, adjusted for inflation. Put differently, since 1995 federal antipoverty spending has increased from 2.9 percent to 3.9 percent of GDP, which now dwarfs the spending levels under Democratic presidents Lyndon Johnson, Jimmy Carter and Bill Clinton.
This burst of antipoverty spending was no accident. Since 1995, Republicans have played a key role in creating the Children’s Health Insurance Program (1997), creating and expanding the child tax credit (1997, 2001, 2017), and substantially expanding food stamps (2000-2002). In addition to this direct antipoverty spending, Republicans also created an expensive new Medicare drug benefit in 2003, repeatedly extended unemployment benefits during and after the recessions of 2001 and 2007-2009, and saved the Social Security Disability Insurance program from bankruptcy in 2015. Under Republican control, Washington spends more on poor families than ever before.
Krugman ignores this GOP-led expansion of the welfare system and instead attacks a couple Republican governors for not expanding Medicaid to higher-income families as aggressively as he would prefer. To be sure, the Affordable Care Act allows states to expand Medicaid to higher incomes with Washington (i.e., your federal taxes) paying 90 percent of the cost. Several Republican-led states have accepted the deal. Many other state Republicans are concerned — with justification — that escalating federal debt will eventually force Washington to cut this 90 percent federal reimbursement rate back to the typical 60 percent rate that prevails for the rest of Medicaid. This would dump large new costs on these Medicaid expansion states, many of which are already drowning in unfunded pensions and surging health care costs.
Either way, it is simply dishonest to call a refusal to expand a program to higher-income populations “fanatical(ly) cutting off aid.”
And modest work requirements have already proven successful in raising incomes and reducing poverty. In 1996, the Republican Congress drafted ambitious welfare reform legislation to replace a New Deal-era welfare program called AFDC with a new program encouraging work and self-sufficiency, called TANF. When President Bill Clinton reluctantly signed the bill, several top aides at the Department of Health and Human Services resigned in protest. Democratic Sen. Daniel Patrick Moynihan of New York predicted “children sleeping on grates, picked up in the morning frozen,” while think tank allies warned that 2.6 million more people will fall into poverty.
These doomsday predictions turned out spectacularly wrong. Millions of welfare recipients moved into steady work and their earnings soared. This contributed to the caseloads of AFDC and its successor TANF falling from 13.4 million in 1995 to 3.8 million in 2017. The overall child poverty rate fell at the fastest rate in decades.
Overall, the 1996 Republican welfare reforms lifted millions out of poverty by promoting work and self-sufficiency — providing a successful model for today’s proposals.
Much more can be done to combat poverty. This will require the best ideas from both parties. Columnists like Paul Krugman poison this conversation when they choose demonization over data.