Welfare begins

Public provision of cash, goods, or services to those in need

The 1970’s witnessed disenchantment with governmental operation of social welfare programs, as well as the creation of new programs to assist persons facing economic and other hardships.

Introduced by the Nixon administration in 1969, the Family Assistance Plan (FAP) would have federalized the Aid to Families with Dependent Children (AFDC) program, the federal-state program created in 1935 to provide cash assistance primarily to poor widowed mothers. FAP was reintroduced to Congress in 1971 and withdrawn in 1972. It was proposed as a substitute for AFDC, replacing welfare with “workfare” and incorporating a negative income tax mechanism that set a minimum guaranteed income while encouraging people to work. Instead of FAP, Congress created the Supplemental Security Income (SSI) program, which transferred responsibility of poor, aged, blind, and disabled persons from their respective federal-state programs to the Social Security Administration as part of the Social Security Amendments of 1972.

The average monthly benefit for AFDC in 1996 dollars was $734 in 1970, and it declined to $523 by 1980. The number of families served, however, increased from 1,909, or 6.6 percent of U.S. families with children, in 1970 to 3,574, or 11.5 percent of U.S. families with children, by 1980. SSI payments varied by whether recipients owned their own home or resided in another’s household or in an institution covered by Medicaid. In 1974, the benefit was set in 1996 dollars at $414 for a single individual living in his or her own home and at $621 for a couple, increasing respectively to $453 and $680 by 1980. In 1977, the Carter administration proposed a revised version of FAP, the Program for Better Jobs and Income, which also failed to find congressional support.

Increased Federal Spending

Public welfare legislation enacted during the 1960’s had enabled states to use federal funds to pay voluntary agencies 75 percent of services provided to public welfare recipients. During the 1970’s, states took advantage of such provisions, thereby increasing federal outlays. In 1975, Congress placed a cap on such services with enactment of Title XX of the Social Security Amendments of 1974, which also initiated comprehensive social services programs directed toward achieving economic self-support and preventing dependence on government for assistance.

Federal expenditures for all income-tested programs increased throughout the 1970’s. Medical benefits, primarily reflecting the Medicaid program created in 1965, nearly doubled in 1998 inflation-adjusted dollars from $12.9 billion in 1968 to $24.5 billion in 1973, increasing annually to reach $36.9 billion in 1979. Cash assistance, primarily for AFDC, increased from $23.6 billion in 1968 to $31.5 billion in 1973, peaking at $42.3 billion in 1997 and ending the decade at $38.1 billion. Food benefits, primarily food stamps, increased from $4.2 billion in 1968 to $14.2 billion in 1973 and steadily increasing to $23.3 billion in 1979.

Federal expenditures for services increased from $1.2 billion in 1968 to $6.2 billion in 1973, peaking at $8.7 billion in 1977 and ending the decade at $8.2 billion in 1979. As a share of the federal budget, medical assistance increased from 1.54 percent in 1968 to 3.18 percent in 1978; cash assistance went from 2.83 percent to 3.50 percent; food assistance from 0.50 percent to 1.86 percent; and services from 0.22 percent to 0.75 percent.

Welfare Legislation

Congress also addressed the needs of low-skilled persons seeking employment. In 1974, it passed the Comprehensive Employment and Training Act (CETA), which initiated extensive job education and experience opportunities for unemployed people. As a result, federal outlays for job training increased in 1998 inflation-adjusted dollars from $3.5 billion in 1968 to $6.6 billion in 1975 to $24.4 billion, which included related public employment expenditures, in 1979.

Congress had also addressed child welfare in the 1970’s. In 1971, it passed the Comprehensive Child Development Act to provide comprehensive, high quality day care and support services to all children. President Richard M. Nixon, however, vetoed the act. In 1974 Congress passed the Child Abuse Prevention and Treatment Act, which initiated financial assistance for demonstration programs for prevention, identification, and treatment of child abuse and neglect and established the National Center on Child Abuse and Neglect. In 1978, Congress passed the Child Abuse Prevention and Treatment and Adoption Reform Act, which extended the 1974 act and initiated new programs to encourage and improve adoptions.

Other legislation in the 1970’s that benefited those in need and addressed the general welfare of the U.S. population included the Equal Employment Opportunity Act of 1972, the Health Maintenance Organization Act of 1973, the Education for All Handicapped Children Act of 1974, the Earned Income Tax Credit (EITC), and the Full Employment and Balanced Growth Act of 1978, which reaffirmed the right of all Americans to employment and asserted the federal government’s responsibility to promote full employment, production and real income, balanced growth, and better economic policy planning and coordination.

Impact

The 1970’s served as a transition decade between the 1960’s expansion of public responsibility and activist government and the 1980’s erosion of confidence in government, especially in the federal government, to address many social problems. Despite its reaffirmation of the work ethic, Congress eventually ended the federal entitlement aspect of the AFDC program, and it increasingly sought ways to curtail escalating costs of programs targeting people in need, particularly costs associated with Medicaid, the federal-state administered program making health care available to low-income individuals and families. Despite Congress’s commitment to a full-employment economy, the CETA program also was terminated, jettisoning public service jobs as an option for assisting low-income individuals seeking employment and brought subsequent spending for job training programs to pre-CETA levels. Congress brought under its auspices in the SSI program populations of poor persons deemed unable to compete in the labor market and provided them with higher levels of monthly income than those of AFDC recipients.

Bibliography

Axinn, June, and Mark Stern. Social Welfare: A History of the American Response to Need. 6th ed. Boston: Allyn & Bacon, 2004. This book provides original source material as well as summary, analysis, and commentary by Axinn and Stern.

Caputo, Richard K. Welfare and Freedom American Style II: The Role of the Federal Government, 1941-1980. Lanham, Md.: University Press of America, 1994. This book traces the contemporary development of social welfare and poverty programs in the United States. Contains an index and bibliography of original and secondary sources.

Patterson, James T. America’s Struggle Against Poverty in the Twentieth Century. Cambridge, Mass.: Harvard University Press, 2000. Chronicles the development of poverty-related programs in the U.S. throughout the twentieth century. Contains an index and a resource section of archival sources and documents.