Welfare in the United States and California, 1967–1969

In the 1960s and 1970s, enrollment in and expenditures on entitlement programs such as Aid to Families with Dependent Children (AFDC), the nation’s principal means-tested income-support program that provided monetary support to poor mothers with children, increased greatly at the same time that many Americans grew concerned that welfare encouraged divorce and discouraged self-sufficiency.^{Footnote 5} Between 1960 and 1969, the number of Americans receiving AFDC nearly doubled—increasing from 3.1 million to 6.1 million—thereby placing an increased financial burden on states to fund their share of the AFDC program.^{Footnote 6} Further, many believed that the AFDC program was overly complex and resulted in inequities in benefits and eligibility across states. For example, both federal and state governments were responsible for financing the program, with states given flexibility to set benefit amounts and define eligibility. This resulted in wide variation in eligibility and benefit amounts, with only half of the states opting to offer the AFDC-Unemployed Parent (AFDC-UP) program, the AFDC program that provided monetary assistance for two-parent families whose principal earner was unemployed or employed for less than 100 hours a month. Further, a recipient in Vermont potentially received four times the amount of someone living in Mississippi.^{Footnote 7}

Similar to other states, in the 1960s California struggled with the increasing costs of social welfare programs such as AFDC and the recently implemented Medicaid program. In a 1967 letter, State Finance director Gordon Smith warned a newly elected Governor Reagan that increases in social welfare expenditure imperiled the state’s fiscal solvency. AFDC eligibility expansion would increase expenditures by 268 percent between 1960 and 1968, which Smith observed was “10 times the relative increase in total population and 12 times the rate of growth in the population under 18 years of age!”^{Footnote 8}

In response to these concerns, Reagan sought to reform the state’s welfare system. In his inaugural address on January 5, 1967, Reagan noted that society accepted its obligation to help the aged, disabled, and those unable to support themselves, but stated that his administration would “seek reforms, wherever possible, that will change relief checks to paychecks.”^{Footnote 9} In an interview with U.S. News & World Report, Reagan observed that America was stuck in a New Deal mind-set that had originally sought temporary relief for a large number of unemployed skilled workers. He stated that in the period since, the ranks of the poor had become largely comprised of those who lacked basic education and job skills or lacked any desire or motivation to work at all.^{Footnote 10} As such, he believed that the increases in enrollment and costs were driven by factors beyond providing coverage to the truly needy, noting that welfare “is spread thin in attempting to provide for too many who are not needy but through loopholes are legally eligible to claim welfare benefits, and too many who are receiving aid illegally because there is just no way to prevent their cheating.”^{Footnote 11} Observing that welfare had the tendency to keep recipients “forever shackled to a public dole,” Reagan believed that welfare should be temporary for those capable of working, noting that the goal for welfare should be to eliminate the need for it.^{Footnote 12}

Responding to these concerns, in March 1968, Reagan tasked Social Welfare director John Montgomery and Human Relations secretary Spencer Williams with conducting a study of the state’s welfare system. He asked that the study focus on simplifying administrative procedures, finding cuts in costs that would not affect aid given, and finding opportunities for parents to move from welfare to work so that recipients could become self-supporting, fully participating members of society.^{Footnote 13} In pursuing Reagan’s objectives, Montgomery and Williams were presented with the difficult task of neither creating a political uproar nor violating federal regulations that required the state to follow certain federal requirements, such as providing cost-of-living adjustments to AFDC recipients to account for inflation. As a result, instead of developing a comprehensive proposal, they developed a series of programmatic changes intended to reduce the growth of the program. For example, they proposed disqualifying families with stepfathers from receiving AFDC, establishing a maximum payment level of $400 per month, and eliminating the AFDC-UP program. These changes were estimated to save $30 million annually and remove 42,000 families from the program.^{Footnote 14}

Williams and Montgomery’s proposal was met with ambivalence, and the proposal never made it beyond the planning phase. Williams admitted, “In presenting these proposals, I feel compelled to state that serious repercussions must be anticipated.”^{Footnote 15} Ken Hall, an assistant to Reagan, warned that eliminating AFDC-UP was dangerous because of the program’s popularity and observed that eliminating the program could create hardship for “potentially emotional communities.”^{Footnote 16} He added that eliminating stepparents from AFDC-UP would have a negative impact on children and begged the question “Why should children be disqualified from receiving payments just because they have a stepfather rather than a natural father?”^{Footnote 17} However, Reagan believed these changes were essential in controlling the costs of the program. He stated that the administration had to “convince the legislators that they are not committing suicide by taking a firm stand,” noting “people will cheer if we will stand firm.”^{Footnote 18}

A “basic floor of dignity”: The Family Assistance Plan

While Reagan’s staff was quietly developing and testing the political salability of state-based welfare reform in California, the Nixon administration was actively working on its own proposal. Influenced by many of the same concerns as the Reagan administration, and further prompted by the National Advisory Commission on Civil Disorders report linking the 1968 riots in Watts and Chicago with economic inequality, on August 8, 1969, Richard Nixon called for the nation to replace AFDC with the Family Assistance Plan (FAP).^{Footnote 19} He noted that “whether measured by the anguish of the poor themselves, or by the drastically mounting burden on the taxpayer, the present welfare system has to be judged a colossal failure.”^{Footnote 20} Nixon called for a system based on three principles: equality of treatment across the nation, a work requirement, and a work incentive.^{Footnote 21} The proposal would provide a family of four a guaranteed annual income of $1,600 plus $800 of Food Stamps—what the administration referred to as a “basic floor of dignity” and would increase federal reimbursement to relieve welfare’s burden on states.^{Footnote 22} To address concern that the proposal would create a disincentive for recipients to work, recipients would be required to apply for work, and work would be incentivized by allowing recipients to keep a portion of their welfare payment until their yearly earnings reached $3,920.^{Footnote 23} The administration believed that establishing greater federal control over welfare and encouraging work would both increase the efficiency and fairness of the welfare system by replacing states’ AFDC programs with one program with uniform benefits.

Marking a radical shift in welfare policy, FAP sought to force the nation to confront the variation in states’ welfare payments and discrimination against poor fathers who stayed with their families in states without an AFDC-UP program.^{Footnote 24} As Brian Steensland noted in The Failed Welfare Revolution, Nixon also sought to appease southern whites who were concerned that the proposal would largely benefit poor blacks by tilting benefits toward the working poor, rather than the unemployed, who were largely single black mothers.^{Footnote 25}

However, despite the proposal’s attempt to establish a guaranteed annual income and to promote work, FAP faced fierce resistance from liberals and conservatives alike. Liberals and organizations such as the National Welfare Rights Organization believed that the proposed minimum income was too low and called requiring poor mothers to work “an act of political oppression.”^{Footnote 26} Conservatives criticized the provision of a guaranteed income. By entitling the working poor to receive aid, the proposal had the potential to add as many as 12 million recipients to the welfare rolls and increase federal costs by $4.4 billion.^{Footnote 27}

By increasing the number of beneficiaries and costs to the states, FAP was at odds with Reagan’s desire to restrict eligibility and control costs. In letters sent to both congressmen and Nixon, Reagan argued that FAP decreased the power of the states by establishing an NIT that “establishes a radically new welfare principle that has not been demonstrated as an effective mechanism for solving the problems of the poor [emphasis original].”^{Footnote 28} Reagan observed that the bill would “weaken the moral fiber and fiscal integrity of the nation; and it would drain the productive wellspring of America.”^{Footnote 29} The Reagan administration also worried about the destabilizing effect the income guarantee might have on the labor market. A California state analysis predicted that 416,000 more Californians would receive aid at an additional cost of $52.6 million.^{Footnote 30}

Nixon needed support, or at the very least silence, from the governor of the nation’s most populous state. Nixon believed that Reagan could be swayed into supporting the measure by establishing work requirements and increasing federal funding for states.^{Footnote 31} He also knew that Reagan needed a federal waiver to implement a welfare-to-work proposal and that Reagan was facing the potential loss of federal funds on account of California’s failure to adopt required annual AFDC cost-of-living adjustments, which the state had decided to delay in order to save money.^{Footnote 32}

Reagan and Nixon met on August 13, 1969, at Nixon’s Summer White House in San Clemente, California, to discuss the FAP and Reagan’s desire to implement statewide welfare-to-work. Nixon assured Reagan that FAP would be work-oriented and stressed that individuals would be disqualified if they refused to work or register for training.^{Footnote 33} Reagan, needing his waiver and facing noncompliance with federal regulations, was careful not to direct his criticism of FAP at Nixon but at Congress, who he argued was subverting the proposal’s pro-work structure with an income plan.^{Footnote 34} Nixon indicated that he would be supportive of Reagan’s plans to test work requirements, agreeing that California could be used as a pilot to work bugs out of the welfare reform program.^{Footnote 35} However, despite Nixon’s assurances, Reagan was unwilling to support FAP publicly and they parted on uncertain terms.

Despite Reagan’s criticism of the program, the Nixon administration secured passage of FAP in the House in April 1970, by a vote of 243–155.^{Footnote 36} Support in the House was reasonably strong among Democrats, which was aided by the support of Wilbur Mills, a Democrat from Arkansas and powerful chairman of the House Ways and Means Committee. In response to the House vote, Reagan issued a statement restating his opposition to the proposal.^{Footnote 37} Careful not to alienate Nixon, Reagan again stressed that he did not oppose FAP’s basic concepts, but opposed the House bill. In private, he warned Nixon that since their meeting in San Clemente, Senate Finance Committee chairman Russell Long, a Democrat from Louisiana, requested his views on the act on April 29 and he intended to answer him. “In fairness to you and your administration, I hasten to send you herewith the essence of those reservations.”^{Footnote 38} He informed Nixon: “My reservations about the Welfare Reform Act stem from a deep philosophical antipathy toward a government-guaranteed income and increasing federal intervention into state operations. . . . [I]n addition, I have a real apprehension that the costs of the Act will be excessive at a time when the taxpayer is already struggling to make ends meet. I’m sure you know how painful it is to find myself in the position of opposing this measure.”^{Footnote 39}

Ultimately, Reagan found an unexpected ally in Senator Long and others in the Senate Finance Committee. Many Democrats and Republicans within the committee were opposed to FAP. Senator Abraham Ribicoff, a Democrat from Connecticut, observed that FAP “had no legislative basis . . . [I]t goes against the philosophy and morals of most Senators and House members.”^{Footnote 40} For Long, FAP was essentially dead on arrival, noting that in states such as Mississippi, 35 percent of the population would receive aid, and the bill would reduce benefits in some, mainly northern, states.^{Footnote 41} The committee held a series of votes on the proposal in October and November 1970, easily defeating the proposal each time.^{Footnote 42}

The California Welfare Reform Act of 1971

While the Nixon administration debated about how to respond to the Senate’s rejection of FAP, the Reagan administration worked to develop its own proposal. Frustrated with the lack of progress on welfare reform in his first term and troubled by the continued increases in the state’s welfare rolls, Reagan devoted the beginning of his second term to welfare reform. In August 1970, Reagan secretly assembled a task force of state officials that were to be charged with examining the state’s welfare system and developing policy recommendations. He told them: “It’s no time to mince words. This state is on a collision course with bankruptcy. We need a complete overhaul of welfare. I am naming you my task force. Talk to experts in and out of government. Call in the finance people. Interview recipients. Do whatever is necessary—but cage this monster.”^{Footnote 43}

The task force was comprised of Reagan’s appointments secretary Ned Hutchinson, Department of Agriculture director Jerry Fielder, and Public Works and the Division of Highways deputy director Robert Carleson. According to Carleson, they were purposely chosen for their lack of familiarity with welfare in order to help promote the development of new ideas.^{Footnote 44} Reagan informed them that he had two principal goals in reforming welfare. The first was to balance the state’s budget and the second, countering the Nixon administration’s movement to federalize welfare, was to prove that welfare reform was a state responsibility.^{Footnote 45} Wishing to keep reform from hurting him politically in an election year, Reagan requested that his task force work in secret. Carleson reported that they were given instructions to develop a welfare system that directed “a finite amount of money to those who need it most and don’t worry about anything to do with money or how big or how little or anything.”^{Footnote 46} In a confidential memorandum to his cabinet and senior staff regarding the task force, Reagan stressed that the study would “place heavy emphasis on the tax-payer as opposed to the tax-taker” and on the “truly needy as opposed to the lazy unemployable.”^{Footnote 47} Reagan expressed his determination to “reduce these programs to essential services at a cost the taxpayers can afford to pay,” and concluded, “This is our NUMBER ONE priority [emphasis original].”^{Footnote 48}

Carleson, appointed State Director of Welfare in January 1971, developed a list of proposed changes that he presented to Reagan and Chief of Staff Edwin Meese that same month.^{Footnote 49} In his account of the meeting, Carleson informed Reagan and Meese that he had both good and bad news. The bad news was that the Californian welfare system was “an administrative nightmare, a multibillion-dollar operation managed by social workers with no managerial skills” and that “the welfare families are really hurting. They haven’t had a benefit increase in thirteen years and they have to have it.”^{Footnote 50} The good news, Carleson noted, however, was that he believed there was so much waste in the system that the state could make changes that would both save money and increase benefits.^{Footnote 51} Carleson, with the assistance of Meese and State Health and Welfare Agency director Earl Brian, presented Reagan with a list of eighty policy changes based on reducing fraud, improving administration, promoting work, and tightening eligibility that would become known as the California Welfare Reform Act (CWRA).

The Democrats in the state legislature were hostile to the proposal, believing that the increasing AFDC caseloads were the direct result of the worsening economy and that welfare required a federal solution similar to that proposed by the Nixon administration.^{Footnote 52} The influential Democratic Assemblyman John Burton wrote to Reagan, attacking his proposed cuts, “I consider your attack on welfare a base canard. You, sir, are either a liar or a fool.”^{Footnote 53} As such, the Democratic leadership denied Reagan the opportunity to present his proposal to the joint legislature, arguing that it was inappropriate for Reagan to speak before the legislature as he was only offering broad goals for reform instead of a specific piece of legislation. In an event billed as “the speech the Legislature didn’t want to hear,” Reagan introduced CWRA in a town hall meeting in Los Angeles on March 3, 1971.^{Footnote 54} Calling the welfare system “a $3 billion moral and administrative disaster,” Reagan informed the crowd, “Either we tighten the government’s belt or we loosen your purse strings and extract even more money than we are taking now.”^{Footnote 55} Citing the need “to restore the balance between the taxpayer and truly dependent welfare recipient,” Reagan called for a twofold program aimed at reducing growth of welfare and increasing assistance to the truly needy. He called for restricting eligibility, promoting work, and closing loopholes that encouraged abuse, as well as reductions in administrative complexity.^{Footnote 56} He warned, “If present laws and regulations are not changed, California’s welfare rolls could swell by another 600,000 by July 1972, raising the total welfare population to roughly 3,000,000 people.”^{Footnote 57}

Reagan was fortunate that Democratic Assembly Speaker Robert Moretti was willing to negotiate and compromise on welfare reform. Moretti wrote to Reagan, noting that it was time “we set aside our personal and philosophical disagreement and work to assure the people that our State will prosper.”^{Footnote 58} With the assistance of Senate Health and Welfare Committee Chairman Anthony Beilson and Republican Assemblyman William Bagley, a compromise proposal was developed through negotiations with Reagan, Meese, and Carleson. In exchange for the Democratic support of the broader proposal, Reagan agreed to provisions for job training, day-care centers, and cost-of-living adjustments for recipients.^{Footnote 59}

Passed on August 11, CWRA required individuals to work through the Community Work Experience Program (CWEP) and increased benefits for families receiving AFDC, with a family of three in San Francisco seeing its monthly payment increase from $172 to $235. The legislation also created an income limit of 150 percent of the poverty line, increased the financial incentives for counties to locate absent fathers of welfare children, and lowered the amount of annual income a recipient could earn from working from $750 to $550 prior to having their AFDC payments reduced.^{Footnote 60}

The Family Assistance Plan, Part II

In 1971, the Nixon administration, with the support of Wilbur Mills in the House, resubmitted FAP as H.R. 1. Again calling welfare “a monumental failure” and “a disgrace to the American spirit,” Nixon declared welfare reform “our most urgent legislative proposal” and noted that “it is going to be the White House priority number one until it is enacted.”^{Footnote 61} Fundamentally the same as the first proposal, H.R. 1 contained a slightly higher income floor of $2,400 for a family of four with no other income. In addition, the proposal included improved support for the aged, blind, and disabled and increased Social Security payments.^{Footnote 62}

Emboldened by the passage of CWRA, Reagan again took an active role in campaigning against FAP. Reagan argued that despite Nixon’s claims that FAP would reduce welfare’s financial burden on states, the new proposal would increase California’s costs by $32 million. A state memorandum hypothesized the program’s effect on a California recipient in 1974: before H.R. 1, a recipient who lived alone earning $95 a month would receive $139, $70 of which California would be responsible for paying. Under H.R. 1, the recipient would receive $221 per month, $91 of which California would be required to pay.^{Footnote 63}

On March 26, 1971, the House again passed FAP, where the bill’s passage was never in doubt as enough support for the bill remained. Following the vote, Reagan wrote to all members of the House, citing his opposition to income floors, the proposal’s purported antifamily components, and increased federal intrusion into state matters. Aware that the bill would likely come under review again after Senate markup in a conference committee, he closed, “It may be that something can still be done to remove the evils and correct the weakness of the House-passed bill. If you would like more information, or have any comments, I would appreciate hearing from you.”^{Footnote 64}

Reagan met with Department of Health, Education, and Welfare (HEW) Secretary Elliott Richardson on July 15, 1971, to discuss FAP, California’s lack of compliance in meeting federal requirements that it provide cost-of-living adjustments to AFDC recipients, and Richardson’s refusal to approve California’s waiver request for its CWEP program. Unable to come to an agreement, they agreed that Reagan should again meet with Nixon.^{Footnote 65} On August 20, 1971, Reagan and Nixon once again met privately for an hour and a half at the Western White House in San Clemente. The Reagan administration took the meeting very seriously, spending several weeks preparing Reagan for the meeting. Reagan believed Nixon was in a position to compromise as earlier in the week, Nixon, in light of the sluggish economy, had called for Congress to postpone the start date of FAP for one year. In order to help avoid a conflict with Nixon, Reagan again complimented Nixon on his goal of promoting self-sufficiency, while attempting to convince him that H.R. 1 needed tougher work requirements and elimination of payments to the working poor. He believed that Nixon could use his CWRA as an example of reform that increased funds to the truly needy and produced tremendous financial savings for the taxpayer.^{Footnote 66}

However, their second meeting made it clear that there was still little room for compromise. Ultimately, Reagan refused to support FAP and Nixon was unwilling to give up the income guarantee. However, the meeting was not a total loss for both parties. In exchange for California’s compliance with the required AFDC cost-of-living adjustments, Nixon agreed to provide California with the necessary federal authority to require AFDC recipients to work through its CWEP.^{Footnote 67}

Following the meeting, Reagan continued to lobby against FAP by focusing on the Senate, where the bill faced its greatest challenge. Reagan sent letters to members of Congress and Vice President Spiro Agnew. Reagan tasked his Washington office staff to lobby against FAP, with administration officials holding closed-door meetings with the House Ways and Means and Senate Finance Committees.^{Footnote 68}

Reagan also accepted Long’s invitation to testify before the Finance Committee against H.R. 1 in February 1972. Accompanied by Carleson, Reagan offered a familiar argument against FAP, stating that it “lacked stimulus for family responsibility, was devoid of meaningful work requirements, and ignored the basic principle that Americans should be guaranteed an opportunity, not an income.”^{Footnote 69} He stated that welfare reform should be based on five principles: that states are better equipped than the federal government to effectively administer welfare, limits should be set on family incomes, able-bodied recipients should be required to work, welfare should be pro-family, and welfare should provide for the needy aged, blind, and disabled.^{Footnote 70}

The Finance Committee’s response to Reagan’s testimony was largely positive and revealed the depth of its dissatisfaction with FAP. “I really congratulate you on what you have been doing out there,” Senator Long noted. “Trying to put people to work rather than just loading these rolls down with people who prefer to leave their children and put the burden of supporting those children on the backs of other workers.”^{Footnote 71} Senator Carl Curtis, a Republican from Nebraska, told Reagan, “It is refreshing to see a Governor of the largest State here making these recommendations and not just coming in and asking Uncle Sam to relieve us of this whole burden entirely.”^{Footnote 72} Senator Herman Talmadge, a Democrat from Georgia, remarked, “I want to compliment you on your statement. I certainly concur with your view that the welfare system would be much better administered on the State and local levels than on the Federal level.”^{Footnote 73}

That summer, the Finance Committee effectively ended Nixon’s pursuit of welfare reform when the committee passed a version of H.R. 1 that excluded FAP. In its place, the committee called for removing 1.2 million welfare recipients and instead offering them government or private-sector jobs.^{Footnote 74} While these changes were voted down, Congress ultimately agreed to consolidate and integrate state programs for the aged, blind, and disabled into the Supplemental Security Income (SSI) program.^{Footnote 75} Providing income support to low-income individuals who were aged, blind, or disabled did not generate the same degree of opposition as providing income guarantees to two-parent families with children.^{Footnote 76}

“Reaganism on the Potomac”: The Ford and Carter Welfare Proposals and the “Reagan Revolution”

The conservative journal Human Events argued that with CWRA, Reagan delivered the “final knock-out punch to the [Nixon] Administration plan,” and Lou Cannon observed in a 1976 piece titled “Reaganism on the Potomac” that Reagan’s ideas were “going strong in Watergate-embattled Washington” and that it “seems that Reagan’s ideas will outlive Nixon.”^{Footnote 77} The Nixon administration, while pushing for income guarantees, was amenable to states’ desires to test different programs intended to promote work. Caspar Weinberger, who served as California Finance Director, replaced Richardson as Secretary of HEW in 1973.^{Footnote 78} Less of a proponent of the NIT than Richardson, Weinberger referred to CWRA as “immense,” observing that it proved for the first time that a state could manage its caseload and bring about savings.^{Footnote 79} Weinberger also brought Robert Carleson from his post in the Reagan administration to serve as his special assistant for welfare matters. Carleson worked closely with various state governments on polices similar to CWRA, an effort that showed some success as twelve states implemented administrative changes similar to those implemented in California.^{Footnote 80}

Despite bringing Weinberger and Carleson to Washington, economists within HEW were still convinced the NIT was the most efficient method for reforming welfare. In the fall of 1974, HEW submitted the Income Support Plan (ISP) to a recently sworn-in Gerald Ford. Similar to FAP, the proposal was an NIT that would cover childless couples and provide an income guarantee of $3,600 for a family of four.^{Footnote 81} Again, Reagan campaigned against the proposal into his last moments in office as governor. Shortly before leaving office, Reagan informed the nation’s governors of the success of his CWRA and warned them of the dangers of the ISP, calling it “an untried panacea.”^{Footnote 82} By 1976, with the approaching election and growing pressure from Reagan, in terms of his opposition to the ISP and a potential presidential run, Ford postponed the ISP pending the outcome of the election.

Building upon the continued support for the NIT within HEW and reflective of his desire to comprehensively reform inefficient government programs, Jimmy Carter also made welfare reform a cornerstone of his domestic agenda. In August 1977, Carter called on Congress to enact the Program for Better Jobs and Income (PBJI), a proposal that combined an NIT with the creation of 1.4 million public service jobs. Carter promised that PBJI would emphasize work over welfare and provide for those unable to support themselves, at an annual cost of $2.8 billion. In fact, Carter’s proposal was revolutionary, with the potential to expand coverage to between 20 percent and 40 percent of the nation, at an annual cost of $20 billion.^{Footnote 83} Reagan, now hosting a national weekly radio broadcast that addressed current affairs, dedicated significant airtime to the proposal. While praising Carter for seeking reforms that encouraged self-sufficiency, he noted that PBJI “encourages dependence, expands government control over people’s lives and dumps uncontrollable cost increases on the taxpaying public.”^{Footnote 84} The cost and complexity of PBJI, along with the worsening economy and the country’s changing attitudes toward welfare, forced Carter to abandon the proposal, thereby ending the nearly decade-long pursuit of the NIT.^{Footnote 85}

Despite the Nixon and Carter administrations’ desire to efficiently alleviate poverty and promote work through the NIT, their proposals were encumbered by concern about their costs and the principle of providing income guarantees to two-parent families with children. While Senator Long’s persistent opposition to Nixon’s proposals effectively stopped FAP in Congress, the changes embodied in the CWRA and Reagan’s articulation of a conservative counterargument to the NIT arguably had a long-lasting effect on the future of welfare reform.^{Footnote 86} Reagan’s experience with welfare reform in California provided him with the opportunity to develop a set of incremental welfare proposals that stood in sharp contrast to the NIT.^{Footnote 87} Further, the failure of the NIT proposals, coupled with the public’s growing ambivalence toward public spending in light of the recession, provided Reagan with the ability to implement his welfare proposals as president. As president, Reagan touched on themes similar to those articulated in the 1960s and 1970s, calling for legislation to promote personal responsibility and control the cost of welfare. His welfare proposals were once again in part developed by Robert Carleson, whom Reagan appointed Special Assistant to the President for Policy Development. Carleson drew up a list of familiar proposals intended to limit AFDC eligibility and promote work. The administration called for the state assumption of AFDC and Food Stamps through block grants.

Not surprisingly, Congress eschewed the administration’s call to transform AFDC and Food Stamps into block-grant programs operated by the states. However, the administration was successful in achieving many of the incremental changes to AFDC through the Omnibus Budget Reconciliation Act of 1981 (OBRA).^{Footnote 88} For example, OBRA limited benefits to mothers who had children aged eighteen and under and earned less than 150 percent of a state’s standard of need and limited the amount of earned income recipients could disregard before having their benefits reduced.^{Footnote 89} A cornerstone of the administration’s proposal was its call for AFDC waivers to allow states to experiment with work requirements. Building upon California’s CWEP, Congress provided states with broad discretion to experiment with ways of moving AFDC recipients into work.^{Footnote 90}

Legacy: An Incremental Revolution

While larger questions of fairness arise when his presidential welfare policies are contrasted with his broader policies that provided tax cuts and increases in defense spending during the recessionary period of the 1980s, the policy changes in CWRA and OBRA were largely incremental changes aimed at controlling the cost of welfare and promoting self-sufficiency through work requirements.^{Footnote 91} Despite these modest changes, Reagan’s policies and philosophy have had a lasting effect on welfare policy. While claiming that welfare should be preserved to protect the often-undefined “truly needy,” Reagan’s policies and philosophy arguably represented a fundamental questioning of an individual’s right to receive welfare. He repeatedly declared that welfare should be temporary for those able to support themselves and recipients should be required to work in order to receive their benefits. To Reagan, while the state had an obligation to provide for the poor, the poor had an obligation to become self-sufficient and to provide for themselves. Further, Reagan believed that local and state governments should be given greater freedom in administering welfare programs and be permitted to implement work programs such as his CWEP. Ultimately, these policy goals—temporary income assistance coupled with work requirements and the state provision of welfare—would form the basis for current welfare policy as reflected in the Clinton administration’s passage of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996.^{Footnote 92}