Social Welfare Policymaking Chapter 17 1

Social Welfare Programs Two main types: Entitlement programs: Government benefits that certain qualified individuals are entitled to by law, regardless of need. This includes Social Security and Medicare. Means-tested programs: Government programs only available to individuals below the poverty line. This includes Temporary Assistance for Needy Families and Medicaid. 2

Social Insurance: Non Means Based Old Age, Survivors, and Disability Insurance Social Security- 6.2% Not a pension program but a tax system Considered a regressive tax People making over 128,400 do not pay the tax on the amount they make after this figure Social Security has a problem. More people are retiring while fewer are working

Government Policies Progressive tax: people with higher incomes pay a greater percentage. Proportional tax: all people pay the same percentage of their income. Regressive tax: the poor pay a higher percentage of their income than the rich 4

Social Insurance- Means Tested Program SSI- Supplementary Security Income Single- 674.00 and Couple- 1,011 Aid to Families with Dependent Children Monetary benefits given to single women EITC (Earned Income Tax Credit) To those who qualify it provides an average of 1500 dollars credit on income taxes $15,010 if you're not claiming a qualifying child ($20,600 if filing jointly); $39,617 if you're claiming 1 qualifying child ($45,207 if filing jointly); Food Stamps (SNAP) To those who qualify it is about 100 dollars a month in stamps for those whose average family income is less than about 1700

Health Care Medicare- Covers people who receive Social Security benefits Financed by about a 1.45 percent tax paid by employers and employees Medicaid- provides medical care to the poor including hospitalization, physicians services, prescription, and long term nursing care to all who are covered under SSI and AFDC Jointly financed by the states and the National Government

Income, Poverty, and Public Policy Income: amount of funds collected between any two points in time. Wealth: amount of assets already owned. 7

Income, Poverty, and Public Policy Poverty Line: what a family must spend for an “austere” standard of living. In 2018, a family of four had a poverty line of just over $33,885. Many people move in and out of poverty in a year’s time. There are high rates of poverty among unmarried women. 8

Income, Poverty, and Public Policy 9

Income, Poverty, and Public Policy 135% of Poverty Line for family of four is $33,885 Equals less than $23 per day, per family member From this amount all food, clothing, medical and entertainment costs must be paid Average rent in the U.S. is $1231, when subtracting this amount, this family must survive on $13 per day, per person. 10

The Demographics of Poverty 11

Government Policies Government Expenditures. Transfer payments: benefits given by the government directly to individuals Some transfer benefits are actual money. Other transfer benefits are “in kind” benefits where recipients get a benefit without receiving actual money. Some are entitlement programs, others are means- tested. 12

The Great Depression and the New Deal The Great Depression led many citizens to want the government to help protect against economic downturns and causes of poverty beyond their control. The Social Security Act of 1935 was the first major step by the federal government to help protect people against absolute poverty. 13

The Great Society Johnson declared a “war on poverty.” Medicare, school-aid programs and welfare were created. Other programs were designed to provide training and jobs, not just transfer payments. 14

Reagan and Changes to Welfare Reagan played a lead role in getting attention on benefit programs. Many programs had benefits reduced, and people were removed from benefit rolls. Democrats worked to prevent cuts and protect the truly poor. 15

The Welfare Reform Act Temporary Aid to Needy Families replaced Aid to Families with Dependent Children. The new program put a 5 year limit on the amount of time a person could receive benefits. It also gave the states money in a block grant to run their own welfare programs. 16