On July 12, the Department of Health and Human Services (HHS) issued a memorandum indicating that they would consider requests to waive the requirements under section 402 – but not 401, 407 or 408 – of the Temporary Assistance for Needy Families (TANF) program. According to section 1115, HHS has discretion only in section 402.
Secretary Sebelius says the Department will grant waivers only for legitimate projects which support the objective of the program, which is to reduce dependence on public assistance. The memorandum mentions testing the waiver projects for compliance with the objective.
So, does this “gut welfare reform,” as alleged by Governor Romney? It really depends on what kinds of waivers have been requested, which ones HHS grants, and – crucially – whether you trust HHS to uphold the spirit of the legislation. Republicans simply do not trust the Department. They see this as a legal loophole that will allow states to skirt the work requirements.
Instead of a federal entitlement, the money is distributed by states, whose feet are held to the fire by Washington in order to receive the financing.
The real problem is that this is a federal program, wherein the states spend “federal money” under federal direction. Remember that all government funding originates with tax-paying citizens of the fifty states. So, if you live in Minnesota, your federal income tax goes to pay for this program – and then HHS tells Governor Dayton how to spend the money, and how much of it Minnesota will receive. The other states requesting waivers are California, Connecticut, Utah and Nevada.
There is no reason for the federal government to be involved in welfare, workfare, or waivers. The states are perfectly capable of administering their own welfare programs according to their specific needs. As John Madden would say, BAM! No more controversy. Reduce the federal tax burden, and keep that money in the states.
So, Texas would be mean and force the welfare people to dig ditches. California would be generous and then go broke. Eventually, they would settle into norms as variable among the states as, say, sales tax or liquor laws. Keeping the money away from Washington would save 20-50% of it, depending on which economist you believe. That buys a lot of new Cadillacs, right there.