604 Chapter 16Chapter 16 || Social PolicySocial Policyhas resources that do not exceed specific levels may qualify for food stamps. In
2018, the maximum monthly gross income to qualify for food stamps for a family
of four was $2,665. As the effects of the economic crisis lingered through 2013, the
number of people using food stamps peaked at a record of nearly 47.8 million in
June 2013, with an average monthly benefit of $133 per person. With improvements
in the economy, by mid-2018 the numbers had dropped to 39.6 million and $123 per
person.^66
The Federal-State Unemployment Compensation Program was established in
1935 as part of the Social Security Act. The U.S. Department of Labor oversees the
program, but it is administered by the states. The program provides temporary and
partial wage replacement for people who have been laid off from their jobs and helps
stabilize the economy during recessions. States set a broad range in benefit levels,
minimum amount of income earned, and hours worked during the period leading up to
unemployment. (For example, you do not qualify for unemployment insurance if you
have worked only five hours a week in a minimum wage job.) Also, laid-off workers have
to make themselves “available for work.” About 97 percent of workers are covered by
unemployment insurance, but only about half of the eligible unemployed make use of
the benefit. The regular state programs provide up to 26 weeks of income support, and
the Federal-State Extended Benefits Program temporarily provides up to 20 additional
weeks in states with relatively high unemployment rates. In the first quarter of 2018,
3.1 million Americans filed claims (12.4 million filed in the previous 12 months) and
the average weekly benefit check was $360, which replaced 33.8 percent of the average
worker’s previous salary. Workers received benefits for an average of 15.4 weeks in
early 2018.^67
The EITC is one of the most successful programs for providing income support for
the working poor. Established in 1975, the program aims to help poor people move from
welfare to work: it provides tax credits to people who do not earn enough to pay income
taxes and are relatively poor. It is intended to offset the burden of Social Security taxes,
which all workers pay as part of payroll taxes. In 2018, you could qualify for an EITC
if you had two children and earned less than $45,802, one child and earned less than
$40,320, or no children and earned less than $15,270; the figures were about $5,600
higher if you were married and filing jointly.^68 The federal government provided
$65 billion in EITCs in 2017 to more than 27 million recipients, with an average annual
benefit of $2,445;^69 Figure 16.8 shows average yearly figures for other programs.
Clearly, nobody is getting rich from this program, but it provides added assistance for
the working poor.
Another source of income support for poor people is SSI, a program for aged, blind,
and disabled individuals with limited income. The Social Security Administration runs
the SSI program, but it is financed through general tax revenues, not Social Security
taxes, and it is a means-tested program rather than a contributory program. Many
states supplement the maximum monthly federal benefit of $750 for an individual and
$1,125 for a couple (in 2018). More than 8.3 million people received SSI benefits in 2016,
and 86 percent of those recipients were disabled or blind.^70
Welfare is straight cash assistance for people who are not working and do not qualify
for unemployment compensation. The primary welfare program for the latter half of
the twentieth century was Aid to Families with Dependent Children (AFDC). This
program became increasingly unpopular through the 1980s, and in 1992 Bill Clinton
was the first Democratic presidential nominee to campaign against welfare, promising
to “end welfare as we know it.”^71 Clinton got the ball rolling on welfare reform in June
1993 by appointing a task force that submitted its bipartisan plan in January 1994; the
president’s plan was submitted to Congress in June. When the Republicans took over
Congress in 1994, the momentum for reform grew. Clinton and Congress haggledAid to Families with Dependent
Children (AFDC)
The federal welfare program in place
from 1935 until 1996, when it was
replaced by TANF under President
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