The Militant - September 21, 2004 -- N.Y.: more jobless seeking welfare are rejected

Vol. 68/No. 34 September 21, 2004

N.Y.: more jobless seeking welfare are rejected

BY DOUG NELSON
NEW YORK—A fiscal brief released August 24 by the New York City Independent Budget Office reported that as a result of the welfare “reform” enacted in the mid-1990s, the total number of New York City residents on public assistance decreased by 61 percent in the last decade, going from 562,943 in December 1994 to 218, 591 in June 2004.

According to the report, one factor in this decrease during the first six years from 1994-2000 is the increase in employment as more jobs were created here after the recession of the early 1990s. Since the year 2000 however, welfare benefits have continued to erode while unemployment in the city has continued to rise.

From 2000 to 2003, more than 240,000 jobs were lost, in a city whose population continues to grow, resulting in a steady rise in the number of welfare applicants. During the same period however, the number of people receiving welfare benefits decreased by 38,000.

The Clinton administration ended welfare “as we know it.” The legislation, passed in 1996, set a five-year cut off for families to receive federally funded assistance. The federal government instead gave block grants to the states, which are now responsible for giving the diminished welfare payments. As the five-year period ended, the effects of this legislation are beginning to be felt, resulting in a higher number of people without any jobs or housing and no safety net to prevent them from falling into destitution. The effects will be much more extensive and devastating if a severe financial crisis hits.

Although the last two years have seen a modest increase in the number of people receiving welfare, this figure lags further and further behind increasing demand as more people are denied assistance every year.

The Independent Budget Office report—entitled “Despite Recession, Welfare Reform and Labor Market Changes Limit Public Assistance Growth”—points out that “as the recession hit the city in 2001, the number of applicants for public assistance increased, and along with it the number of applications that were rejected.”

The percentage of welfare applications that were rejected rose from 17 percent in 2000 to 27 percent in 2003, the latest available figure.

The 2003 rejection rate is the highest since 1996, the year Clinton signed the Personal Responsibility and Work Opportunity Reconciliation Act, which formally ended Aid to Families with Dependent Children (AFDC)—a program that had provided some protection against unemployment for working-class families with children since the passage of the Social Security Act in 1935.

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