Number of Families in Extreme Poverty Has Increased More Than 100% Since 1996


Welfare “reform” in 1996 limited benefits to the poorest American families and led to a nearly 130% increase in the number of American families with children living in extreme poverty (on $2 a day or less).

The value of monthly cash benefits provided under the Temporary Assistance for Needy Families (TANF) program has declined steadily since 1996. According to a new study by the Center on Budget and Policy Priorities, not a single state in the country provides welfare benefits that are enough to lift a poor single mother with two kids above 50% of the poverty line (about $9700 a year).

In many southern states, TANF doesn’t provide enough money to get a poor family much above 10% of the federal poverty line.

Relatively few poor families get TANF assistance: in 2012, just 25 families received TANF benefits for every 100 poor families, down from 68 for every 100 in 1996.

TANF benefits are often the only source of support for these families, and without it, they would have no cash income to meet basic needs, such as housing. But TANF benefits cover only a fraction of a family’s housing costs, and most TANF families do not receive housing subsidies because of federal housing program funding limitations. The monthly TANF benefit level for a family of three is now less than the estimated cost of a modest two-bedroom apartment in all states.

The census bureau reports a sharp increase in the number of American households with unmet essential expenses (electricity, diapers, school supplies) and experiencing food shortages between 2005 and 2011. During this period, 7 million more Americans were unable to make a mortgage or rent payment.

Households with the lowest incomes, the least amount of education, or with single parents caring for children have been the hardest hit.

Families who receive food stamps in addition to TANF benefits still fall below 75% of the poverty line in 48 states and Washington, D.C. The temporary increase in food stamps provided under the 2009 Recovery Act ends next week.