THE WHITE HOUSE
Office of the Press Secretary
|For Immediate Release|| ||August 4, 1998|
REMARKS BY THE PRESIDENT
ON WELFARE REFORM
The East Room
3:15 P.M. EDT
THE PRESIDENT: Thank you. Thank you very much, VestaKimble, for that fine statement and for the good work you do. And Iwelcome your colleagues and co-workers from Maryland here. I thankCongressman Levin and Congressman Roemer for coming. There was avote in the House of Representatives which was concluded literallytwo minutes before we started this ceremony and they got here asquick as they could. We welcome you and thank you for your role inwelfare reform.
I'd like to thank Secretary Herman and Secretary Shalalafor the terrific job they have done, and welcome all of you in theaudience, including my good friend, Eli Segal, who founded ourpartnership with the business community, about which I'll say morelater. The First Lady was just a few moments ago meeting withmembers and I think maybe some former members of the D.C. ControlBoard. I know that some of them are here and I welcome them as well.
Two years ago I stood with many of you in the RoseGarden and made the following statement: "From now on our nation'sanswer to the problems of poverty will no longer be a never endingcycle of welfare; it will be the dignity, the power, and the ethic ofwork. . . . We are taking an historic chance to make welfare what itwas meant to be: a second chance, not a way of life."
As those of us who have been working for years and yearsto change the system knew all too well, welfare had in too many waysfailed our society, and more important, failed the millions offamilies it was designed to help. So in the Rose Garden we cametogether two years ago to restore our basic bargain of providingopportunity to all those willing to exercise responsibility in turn.We ended welfare as we knew it and made way for a system based on thedignity of independence and the value of work.
But I would also like to reiterate something SecretaryShalala said. We did not want to put poor people moving from welfareto work in the exact same position too many people who've always beenin the work force find themselves, of having to choose between beinga good worker and a good parent. So we said, okay, we will requirepeople who have to move from welfare to work, if they're able-bodied,to go to work. But we will leave their children with food assistanceand guaranteed medical coverage, and we will invest more in childcare and other family supports.
Today we come here not only to observe this anniversarybut to lay to rest the last vestige of the old system -- ananti-work, anti-family provision that has deprived some two-parentfamilies of their Medicaid coverage when a parent secures a full-timejob.
But first, on this important anniversary, I think it'simportant to recognize that this new strategy -- this great newexperiment that we launched two years ago -- has already shownremarkable signs of success. Two years ago, we said welfare reformwould spark a race to independence, not a race to the bottom, andthis prediction is coming true.
According to the National Governors Association, stateinvestments in helping former welfare parents succeed at work havegone up by one-third, and spending on child care has increased byone-half. And let me remind you, I believe this has happened partlybecause the Congress in the Balanced Budget Amendment appropriated $3billion for child care, but partly because there was a little-noticedprovision in the welfare reform law which lets states keep the amountof money they were receiving for the welfare case load in February of'94, when it had reached an all-time high.
So as the case loads go down, they can keep the money aslong as they reinvest it in the potential of the families involved.And I think that was a very good thing to do.
We also said back then that work should pay more thanwelfare. Last week the Urban Institute reported that family incomegoes up more than 50 percent, on average, when parents move fromwelfare to part-time entry-level jobs, and significantly more whenthey move up to full-time work. And I must say, I was especiallypleased to note how helpful the Earned Income Tax Credit is forfamilies making this transition. In several states it accounts foralmost half the income gains.
For those of you who may not know it, the Earned IncomeTax Credit is a tax cut to lower-income working people that isespecially generous to working families with children. We doubled itin 1993, and because of that provision, today it's worth a tax cut ofapproximately a thousand dollars a year to a family of four with anincome of under $30,000 a year. Obviously, for people working formore modest wages than that, it means a very great deal.
Today we have more good news. In a few moments I willrelease our first annual report to Congress on welfare reform --precisely the kind of report we had hoped for two years ago. Itshows that the number of welfare recipients entering the work forcerose by nearly 30 percent in a single year. It reports that statesare spending more per person on welfare-to-work efforts than they didtwo years ago, including health care, job training, job placement,child care, and job retention.
Come in, Congressman Shaw, you're welcome. (Laughter.)Thank you for the role you've played in welfare reform legislation.We're glad to see you.
It shows that more single parents are moving into thework force, a very significant statistic. And it confirms that thepercentage of Americans now on welfare is at its lowest level since1969 -- 29 years. There are other, more powerful signs of successthat of course a report can't show. Too often we take for grantedwhat it really means for a family to reconnect to the world of work.Work is more than a punch card, more than a paycheck. It providesstructure to a day, link to a society, dignity for a family. It canbuild self-confidence and self-esteem. There is nothing like thepride in a child's eyes when he or she goes to school and can answer,often for the first time, what their parents do for a living.
One of the most important ways we can now build on theseeveryday triumphs is to make absolutely sure that parents who doenter the work force can go to bed at night without worrying thatthey will lose health coverage for their families. That is why I'mproud to announce that the Department of Health and Human Serviceswill revise its regulations to allow all states to continue toprovide Medicaid coverage to two-parent families after a parent takesa full-time job. Believe it or not, under the old rules adults intwo-parent families who worked more than 100 hours per month couldactually be cut off Medicaid in many states.
Perhaps no aspect of the old welfare system did more todefy common sense and insult our common values than this so-called100-hour rule. Just think of the message it sent. It took awayhealth care from people who secured a full-time job just as we wereimploring everybody to move from welfare to work. Instead ofrewarding stable families, it actually punished couples that work andwork hard to stay together. Instead of demanding responsibility, itbasically said a father could do more for his children's health bysitting at home or walking away than earning a living.
The 100-hour rule was wrong. Now, it and every otherstrand of the old welfare system are history. The remainingchallenges are ones we all have to accept. All of us -- the public,private, religious, nonprofit sectors -- have an obligation tocontinue helping all former welfare recipients not only find, butstay in those jobs.
First, we must continue to offer states and communitiesthe tools they need to promote work. Today, we will release $60million more in Welfare-to-Work grants to states to help mothers andfathers facing the most significant employment hurdles. And I alsowant to call on Congress to fully fund my plan to provide housingvouchers for welfare recipients who need to move closer to theirplace of work.
Some recent studies, including some coming out of NewYork, show that the effects of welfare reform in terms of peoplebeing able to move into the workplace have been quite uneven,depending upon the level of preparation of the people on welfare forthe work force and their level of isolation from available jobs. Sothese are important next steps.
Second, the private sector -- the true engine of jobcreation in our country -- must continue to do its part. Listen tothis: last year our Welfare-to-Work partners, who were mobilized byEli Segal, as I said earlier, hired more than 135,000 former welfarerecipients. I have asked them to hire another 270,000 by the end ofthis year. Thank you, Eli, but you have to do more. (Laughter.)
Third, we must continue to welcome former welfarerecipients into the federal family workforce. Today we released newdata showing that the federal government has hired more than 5,700former welfare recipients in just the past year. That means we'rewell over half the way toward our goal of hiring 10,000 by the year2000.
Fourth, let me say again, I think it's important that wedo more to bring the benefits of this economic revival our country isenjoying into isolated urban and rural areas where free enterprisehas not let yet reached. A lot of the people who are still stuck onwelfare are physically separate from the job availability. And Ihave asked the Congress to approve a second round of empowermentzones, to approve a whole range of initiatives, and Secretary Hermanand Secretary Cuomo's budget designed to create jobs principally inthe private sector in isolated inner-city and rural neighborhoods.So I hope that will be a part of the work we conclude in the daysremaining in this congressional session.
Welfare reform itself was a bipartisan effort. Itbecame an American issue. Now, providing jobs and opportunity andnew businesses and new free enterprise in these neighborhoods thatstill have not felt the economy should also be an American issue.
We have now the lowest unemployment in 28 years, thelowest inflation in 32 years, the highest homeownership in history,wages are on the rise for our families after 20 years of stagnation.This is our window of maximum opportunity to make sure every poorperson in America stuck on welfare has a chance to be a part ofAmerica's future and to share in the American Dream. If we can't doit now, when our economy and our prospects and our confidence are sostrong, then when?
Now we have jobs waiting to be filled in almost everycommunity. I've been working with people here in Washington, D.C. --there are hundreds of thousands of jobs in informationtechnology-related fields open today, everywhere from Silicon Valleyto the suburban areas of the nation's capital. If we make the bestuse of this time, we can change the whole culture of poverty and longneglected neighborhoods. We can help millions more people ensurethat their children will be raised in homes full of hope and pridebased on dignity and work.
To all of you who have made this day come to pass, whohave played a role in the progress of the last two years, and to allof you who are committed to keeping on until the job is done, Iextend the thanks of our nation. Great job. Let's do better.
Thank you very much and God bless you. (Applause.)