'Super' Model Falls

 by Barbara Meyer-Spidell

The Wisconsin Legislative Audit Bureau shows that Wisconsin Works or W2 cost more than former AFDC and is laced with ‘erroneous’ pay-outs. Self sufficiency for working poor with dependent children is ‘ mythical’ as Temporary Assistance to Needy Families or TANF , the‘super’model for welfare reform originating in Wisconsin and replacing AFDC in 1996, fails as the nation watches.

Welfare Warriors actively protest the devastation being caused by "welfare reform’ and discovered the $1.9 billion discrepancy after pouring over a Federal and State TANF breakdown from state auditors and reviewing figures from the Wisconsin Department of Workforce Development Quarterly Reports sent to the federal Department of Health and Human Services.

By omitting the bulk of W2 expenditures, the conclusions of the Legislative Audit Bureau report were badly skewed and the fact remain as followed:

*TANF families fall $8,300-11,500 (25-50%) below poverty as per audit by nonpartisan WLAB.

*Dollars spent on W2, fail to include $1.9 billion out of a total $3.3 billion federal and state TANF spending showing W2 agencies took $30 million in sanctions from families already below poverty level by reducing fixed grant lows averaging $7800 to $6561 to balance.

*Moms who ‘Graduated’ earn below poverty wages and only 19% are self sustaining meanwhile Privatized W2 agencies being compensated for this failing receive $149.9 Million in profits.

Only 19% of those families escaped poverty. (Four years after leaving W2 the average income was still only $11,500 for a family of 3.)

W2 is funded primarily by the federal Temporary Assistance for Needy Families (TANF) program. Yet the 272-page audit, which includes charts detailing dollar amounts and percents spent on W2, fails to include $1.9 billion out of a total $3.3 billion federal and state TANF expenditures. The nonpartisan audit also fails to mention this absent $1.9 billion in its Highlights and in the cover letter to the Joint Legislative Audit Committee who requested the audit. Auditors repeatedly concluded that W2 expenditures totaled $1.5 billion from 1997 to 2004.

Welfare Warriors discovered the $1.9 billion discrepancy after requesting a federal and state TANF breakdown from state auditors.

In dollar amounts W2 cost taxpayers $3.3 billion: $1.95 billion federal TANF funds and $1.35 billion state dollars. The state provides 41% of all W2 expenditures and the federal government contributes 59%. Welfare Warriors received these figures from the Wisconsin Department of Workforce Development Quarterly Reports to the federal DHHS.

By omitting the bulk of W2 expenditures, the conclusions of the Legislative Audit Bureau report are badly skewed. For instance, the report states that cash benefits for participants were 38.7% of the total W2 costs. The correct figure should be 13% of the total. "Services to participants" (mandatory work activities, eligibility determination, education, skills and transportation) totaled $591 million. This was 18% of total expenditures NOT 51.4% as reported in the audit. (Table 4, page 18)

With $1.9 billion W2 expenditures overlooked, it is impossible to determine the cost of administration (which is scandalously high).

When the mysteriously missing $1.9 billion is included, the program failures are more pronounced. Using the $3.3 billion figure, the state spent an average of $35,467 per family each year. Yet only 19% of those families escaped poverty. (Four years after leaving W2 the average income was still only $11,500 for a family of 3.) W2 families received a total of $430 million in cash benefits. But W2 agencies received $150 million in profits ($77.9 in unrestricted profits and $71.9 in Community Reinvestment Profits.)

Then in 2003-4, Harvard Medical School took part in a study published by International Journal of Health Services. They found that health care bureaucracy in alone 2003 year cost the United States $399.4 billion. The study estimated that national health insurance (NHI) could save at least $286 billion annually on paperwork,. That is ENOUGH to cover all of the uninsured and to provide full prescription drug coverage for everyone in the United States.The study was the most comprehensive analysis to that date of health administration spending data. The potential administrative savings of $286 billion annually under national health insurance could allow substantial improvements in coverage and quality of care for U.S. consumers who do not already have insurance.

• 81% Of Moms "Graduating" From W2 Earn Well Below-Poverty Wages

• 42% of Employment Secured by Moms under W2 are Temporary Jobs (meaning NO unemployment compensation)

• W2 Agencies Took $30 Million in SANCTIONS from Families with Nothing

• Wisconsin Spent $3.3 Billion from 1997-2004 For Only 13,300 Families Per Year

• Privatized W2 Agencies Received $149.9 Million in PROFITS

An audit of Wisconsin’s $3.3 billion welfare experiment, W2, found that 81% of families formerly on W2 are still struggling to survive. Their earnings are 25%-50% below poverty. ($8,300-$11,500). The audit was conducted by the nonpartisan Wisconsin Legislative Audit Bureau (LAB). It reports that 90% of W2 graduates work in the low-wage service industry: 41.9% in Temp jobs, 19% in Home Health Care and Nursing Homes; 18% in retail services; 11% in food service. (Audit is at www.legis.state.wi.us/lab)

Only 19% of moms who found jobs while on W2 are able to support their families on their income alone. Yet W2’s mandate is to help family heads reach "self-sufficiency." 53% of participants in 2004 were former clients who returned after loss of jobs. Only 43% of applicants were screened for barriers to employment despite state law requiring this.

An average of 13,300 families were "served" each year from 1997 to 2004 to the tune of $3.3 billion dollars. But only 9,362 families received any cash benefits. Each family received an average of $6,561 a year. This was lower than the $7800 fixed grant level because W2 families lost $30 million as a result of sanctions. (W2 agencies sanctioned 20% of their cases by 30% of their grants.)

W2 agencies imposed $30.2 million in sanctions against families with nothing. Women of color were sanctioned at a higher rate than white women.

The audit claimed that W2 agencies "erroneously" paid $1.3 million to 2,500 parents of newborn infants after 90 days ($520 per family). Auditors refer to this as "excess payments." However, families are eligible to receive W2 payments after their infant is 90 days old. The W2 agency is required to assign 30 hours of work activities to the mother when the baby is 3 months. Agency failure to assign work is NOT an excess payment. It is an agency error (perhaps based on simple human compassion.)

W2 is funded primarily by the federal Temporary Assistance for Needy Families (TANF) program. Yet the 272-page audit, which includes charts detailing dollar amounts and percents spent on W2, fails to include $1.9 billion out of a total $3.3 billion federal and state TANF expenditures. The nonpartisan audit also fails to mention this absent $1.9 billion in its Highlights and in the cover letter to the Joint Legislative Audit Committee who requested the audit. Auditors repeatedly concluded that W2 expenditures totaled $1.5 billion from 1997 to 2004.

Welfare Warriors discovered the $1.9 billion discrepancy after requesting a federal and state TANF breakdown from state auditors.

In dollar amounts W2 cost taxpayers $3.3 billion: $1.95 billion federal TANF funds and $1.35 billion state dollars. The state provides 41% of all W2 expenditures and the federal government contributes 59%. Welfare Warriors received these figures from the Wisconsin Department of Workforce Development Quarterly Reports to the federal DHHS.

By omitting the bulk of W2 expenditures, the conclusions of the Legislative Audit Bureau report are badly skewed. For instance, the report states that cash benefits for participants were 38.7% of the total W2 costs. The correct figure should be 13% of the total. "Services to participants" (mandatory work activities, eligibility determination, education, skills and transportation) totaled $591 million. This was 18% of total expenditures NOT 51.4% as reported in the audit. (Table 4, page 18)

With $1.9 billion W2 expenditures overlooked, it is impossible to determine the cost of administration (which is scandalously high).

When the mysteriously missing $1.9 billion is included, the program failures are more pronounced. Using the $3.3 billion figure, the state spent an average of $35,467 per family each year. Yet only 19% of those families escaped poverty. (Four years after leaving W2 the average income was still only $11,500 for a family of 3.) W2 families received a total of $430 million in cash benefits. But W2 agencies received $150 million in profits ($77.9 in unrestricted profits and $71.9 in Community Reinvestment Profits.)

In doing research for this article about the reformation of welfare in Wisconsin I was delighted to come across a website for Working Mothers who desist current government standards for the working poor, and who more than point their finger at the overall demoralization of working standards for those struggling to feed and house the poor within their own families; their young children were most struggling. It is the unity of women’s voices who actively protest the devastation being caused by ‘welfare reform’. Their website is http"//www. welfarewarriors.org .

Many suggest that the public actively protest the devastation being caused by "welfare reform."

One woman reading an interview with Senator John Edwards describes this prevalent attitude, as she writes: I was going along, pretty much nodding my head as Edwards talked about how poverty in the South is such an ongoing problem and the toll it takes on people, until I got to this throw-away line:

It's time to finish the job of welfare reform by giving low-income men the opportunity to work and challenging them to take responsibility for doing so. Welfare reform asked young mothers to join the workforce and gave them help to get there. Millions of poor women benefit, but poor men lost ground during the best economy we've ever had. In America today, there are communities where half the young men are out of work.

One cannot help wonder this: Why had they not forced the males or family partners who were most prone to stay at home and one parental care giver, that again was most prone to stay at home, education and study programs, and send what will be the typically male population, as studies suggest, to work and pay for the cost of her schooling and that of support of financial nature to feed and house their own children, and stop perpetuating a negative role model of being inferior and compliment the workforce, straitaway. Then put the onus on training, as already incentivized. Give them a way onto a level playing ground and end their ideas from their Mothers that it is okay for them not to work, that they never leave the nest nor do. Or can they support and nuture their young b/c of their undeveloped skills for the workforce? Demand all male role models, and males with or without children, serve in the positive of their country, and family.

When politicians start looking at social reform as human being and not a way to distort facts and hide dollars. It is the poor who is financing this war.