Intended consequences: peeling the welfare onion

April 16, 1997|By J. Peter Sabonis

WELFARE IS LIKE an onion. That's not because liberals cry when it gets cut, but because it has many layers. Each layer corresponds to a different function.

There's the ameliorative function that most recognize: a safety net for poor children. Then there's the economic-stimulus function: a cash transfer to the poor which is then quickly transferred to landlords and local merchants. Then there's the labor-market function: a means of deliberately keeping the unemployed on the sidelines of the marketplace to limit the oversupply of workers in an economy that cannot guarantee jobs for everyone. Finally, there's the related social-control function: a means of muting militancy and civil unrest by providing some cushion to the sharp edges of capitalism.

To most today, however, welfare is not a complex onion but a simple apple, and a rotten one at that. Its seeds beget cultural mutation: a distortion of values that spreads cancer-like through neighborhoods making work and family appear deviant, jail and illegitimacy the norm.

Politicians, with our support, have now made this fruit forbidden. Welfare is now time-limited, family-capped, payable only to those who work or are seeking it. No longer will the poor among us be tempted by this apple.

But try as we might, we cannot make an onion an apple simply by changing our perspective. We may think the simple rotten apple has been tossed away, but it is the complex onion -- and its myriad layers -- that has been discarded.

This has been recognized by Baltimoreans United in Leadership Development (BUILD), which remained relatively silent during the welfare-reform debate as it concentrated on organizing low-wage workers around a living-wage campaign.

Now, however, these workers find themselves threatened without the layer of labor-market protection the welfare onion once offered. The workers find that they can be replaced by those fresh off the welfare rolls. Instead of paying these newcomers not to work, the state is now paying employers -- through wage subsidies and tax credits -- to hire them. BUILD has taken up the cause of the existing workers, seeking assurance through state legislation or employer agreement that

existing employees will be protected.

The Sun recognized this potential for job displacement in an editorial (March 22), but called it an ''unintended consequence'' of welfare reform, not deserving legislative attention. If nothing else, the editorial revealed that even those whose opinions deserve to be published can at times mistake an onion for an apple.

Simple economic theory tells us that welfare reform will create labor-market disruption. Even if employers were not being paid to prefer the welfare poor over the working poor, BUILD's workers would still have cause for complaint. Welfare reform has created a hungry low-skilled work force that must accept employment on any terms to survive.

And the terms are cause for concern. The swelled reserve army of low-skilled (unemployed) workers not only makes it easier for an employer to displace current workers, but to cut their wages or refuse them raises as well. In November 1995, the Economic Policy Institute predicted that this dynamic will force wages in low-skilled occupations to drop by 65 cents an hour nationwide. In Maryland, a per-hour drop of 56 cents is anticipated.

These are not the ''unintended consequences'' of welfare reform for those who understand welfare's historic function in the labor market. Frances Fox Piven and Richard Cloward, two sociologists who documented this function in their book, ''Regulating the Poor,'' opined that public assistance ''goes far toward defining and enforcing the terms on which different classes of people are made to do different kinds of work. . . . [T]he issue is not the relative merit of work itself; it is rather how some persons are made to do the harshest work for the least reward.''

In examining relief arrangements from the 1940s to the 1960s, the authors noted that regional welfare practices meshed with the manpower requirements of local employers. When growers needed a large pool of cheap labor for seasonal agricultural work, local welfare rules in the South were tightened and assistance terminated. With no other options, the ex-welfare recipient had no choice but to accept whatever terms of employment were offered in the fields.

Now this isn't the Deep South in the '40s, but there are some similarities. Maryland's Department of Labor projects that some of the greatest job growth -- and thus employer demand -- over the next eight years will occur in traditionally low-paying, low-skilled service jobs. Of the 21 occupations selected by the department to experience the greatest job growth by 2005, only seven pay average wages above $8.87 per hour. The need for food preparation, janitorial, child-care, home-health-care and retail workers, which dominate the Department's list of 21, will be more than met with the assistance of welfare reform.

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