Conservatives had been attacking the old welfare system for decades, claiming that it fostered dependency. Many liberals found it unsatisfactory as well. Welfare checks weren't big enough to lift families out of poverty, and the system did little to help recipients get or keep jobs. When Republicans gained control of Congress and welfare rolls swelled in the early 1990s, these attacks gained momentum, and in 1996, Clinton ended the legal right to cash assistance and imposed a five-year limit on federally financed help to any given family.
Welfare reform also provided the states with nearly complete discretion over how to administer benefits. Most states responded with gusto, reducing welfare rolls nationally by two-thirds in just a few years.
So when the Great Recession came along, the government safety net for families with children was in tatters. The United States was no more prepared for massive unemployment than New Orleans had been prepared for its levees to fail. Some important government programs, including unemployment insurance and food stamps, have started to rise to the challenge and have even begun to lose their stigma among former members of the middle class. Unemployment insurance now covers 57 percent of those who have lost their jobs, as opposed to less than 40 percent before the recession -- although their benefits amount to less half their former wages. Reliance on food stamps has expanded even more dramatically. While the average benefit still isn't enough to meet people's basic nutritional needs, the program now serves 36 million people, double the number when Clinton left office and up by a quarter in the past year.
By contrast, the caseload for TANF (Temporary Assistance for Needy Families, the name we now give welfare) is about 5 million people. This number is up by about 1 million since the beginning of the recession, but it's still just a little over a third of what it was 15 years ago, before welfare reform.
Why the huge difference between unemployment insurance and food stamp usage and welfare caseloads? People have a legal right to food stamps if they meet the statutory requirements, but since 1996 there has been no legal right to cash assistance. And so welfare, generally speaking, has not cushioned the impact of the recession.