Welfare State. The American Economy: A Historical Encyclopedia

During the first half of the twentieth century, the United
States experienced a tremendous expansion in its welfare
programs at the federal level, developing into what is termed
the “welfare state.” During the 1950s and 1960s, this expansion continued even further, increasing programs such as Social Security and Aid to Families with Dependent Children. A
new understanding of social reform, poverty, and state responsibility helped to influence the creation of welfare programs beginning in the Progressive Era, but two disparate
economic trends aided in putting this new philosophy into
action. First, the effects of the Great Depression created a
greater atmosphere of need, placing unprecedented demands
on any programs already in place and resulting in the creation of new programs. Once the welfare state became fixed,
expectations of assistance for the less fortunate rose in America, and though this subject was greatly debated, post–World
War II prosperity allowed for the continued and often increased funding of programs. But although the welfare state
as we have come to know it evolved comparatively quickly in
the last century, it had established roots long before.
Much of the sentiment and practical measures present in
the modern welfare state appeared in the English Poor Laws
of the sixteenth and seventeenth centuries. As English society
shifted from feudalism to a wage-based economy, the lower
classes no longer enjoyed the guarantee of security that they
once held. Under feudalism, the serf could rely on—for better or worse—a lasting relationship with his or her master.
Although wage earners enjoyed more freedom, they lacked a
guarantee of economic security. When jobless, they often
turned to begging or stealing. In response, the landed gentry
encouraged passage of legislation compelling people to work
for a living and punishing those caught begging or giving
money or goods to beggars.
As the English economy transformed into one based on
the production of wool for a larger market, population and
social shifts demanded that society pay more attention to the
poor. First, the enclosure system, which gave large tracts of
land to sheep raisers, forced the small landowners off their
land and into urban areas. In addition, the growing economy
encouraged the migration of potential workers into regions
where they hoped to find work but could not. At the same
time, Henry VIII, in his break from the Catholic Church,
worked to abolish monasteries, institutions that for centuries
had been largely responsible for addressing the needs of the
poor. During the sixteenth century, Parliament passed a series
of laws in this arena, essentially taking a harsh position
against those in need, but by 1600 some attitudes and terminology regarding poverty began to change. Parliament had
designed earlier legislation to punish vagabonds and beggars,
but the Act of 1597 focused on the “relief of the poor.” The
Elizabethan Poor Law of 1601 served as a model and was fundamentally unchanged for centuries. Though the measure
was enacted at the national level, local officials carried it out,
emphasizing work and family responsibility. As with a number of institutions, English Poor Law was transplanted in the
American colonies.
The colonies had comparatively fewer poor than did the
home country. The availability of land and access to it—either by ownership or through common grazing rights—and
the need for labor left fewer people without a means to live.
However, America remained far from a paradise, and many
arrived in the colonies ill or otherwise unable to work. Subsequent generations eventually produced more individuals
with physical or mental problems that prevented them from
working. In addition, comparatively few individuals amassed
substantial wealth in the early years of the colonies, which
placed the responsibility of poor relief on those with moderate means. As a result, colonial assemblies enacted poor laws
similar to those in England.
The laws varied from colony to colony, as the economies,
social structure, and needs differed. For example, colonies
such as Virginia depended on large numbers of indentured
servants, who often struggled financially once their contracts
of service ended. Able-bodied adults often “bonded out,”
whereas parents placed their children in apprenticeship programs. In southern colonies, free education remained virtually nonexistent, but in colonies such as Massachusetts, which
was much more “community-minded” from its foundation,
education functioned as a means of creating productive citizens. Port cities, such as New York, developed legislation to

address issues involved with the incoming poor, and various
urban centers experienced an influx of desperate people who
had fled from the frontier after encountering serious problems there, such as the Indian wars. Although laws varied
from place to place, most all were influenced by religious beliefs, which generally viewed the poor with pity and considered them deserving of help. In many cases, assistance originated in the local church or parish.
As the nation evolved in its early years of independence,
new ideas of welfare appeared as well. The French and Indian
War and the American Revolution had left large numbers of
widows and children in the various colonies and new states,
a situation that demanded new attention to funding. Religious groups, such as the Quakers, became well known for
their efforts to support those in need, as did certain nonreligious organizations, such as nationality groups (representing
immigrants from Scotland, Ireland, Germany, and France)
and fraternal societies. Public aid and individual philanthropy originated from seemingly endless sources and in
many forms. Furthermore, the revolutionary philosophy,
which declared universal human rights, drew increasing attention to the needs of all people. Although the war itself disrupted the implementation of many programs, the sentiment
supporting assistance expanded.
Immediately following the Revolutionary War, the poor
laws themselves remained essentially the same; retaining their
variations from state to state, they were transplanted into the
new territories. Frontier issues such as housing, school construction, and Indian relations helped to shape whatever legislation was deemed necessary. In 1790 townships in the
newly created Northwest Territory gained jurisdiction over
the poor and responsibility for distribution of relief, a structure that continued when the region divided into the various
states of Ohio, Michigan, Indiana, Illinois, and Wisconsin.
The Revolution brought about a more significant change in
the southern states, where the churches had primarily accepted responsibility for poor relief. The war brought greater
separation between church and state, which encouraged
states to place poor relief under civil jurisdiction in the
South.
One of the most complex notions regarding the responsibility for poor relief in the United States developed during the
early years of nationhood. In the decades before the Civil
War, the demand for states’ rights resulted in a continued
fragmentation of relief programs. The U.S. Constitution’s
general welfare clause (Article 1, Section 8) stated that “the
Congress shall have power to lay and collect taxes, duties, imposts and excises, to pay the debts and provide for the common defence and general welfare of the United States,” but
many argued over the founders’ intention. Though that single clause might have given the federal government ultimate
power in developing and sustaining a national system of poor
relief from the start, the strength of the defenders of states’
rights effectively limited the role played by the federal government in this case. At the same time, Americans developed
a sense of national identity, which included ethics of individualism and self-reliance, promoting the idea that anyone
could make a living if willing to do so. Territorial expansion
and economic growth advanced this notion as possibilities
for individual economic independence grew. Overall, Americans seemed to prefer voluntary philanthropy to public programs when the need to provide relief arose. The separation
of church and state, combined with the fervor of the Second
Great Awakening, resulted in competition between numerous religious denominations, each with its own hospitals, orphanages, and schools.
New population theories inspired by the work of Thomas
Malthus at the dawn of the nineteenth century, originating in
Europe but international in scope, often argued against poor
relief. One of the greatest fears—which has continued into
the twenty-first century—was that offering assistance would
encourage the poor to have more children. Population theorists insisted that refusing them aid would force them to limit
their family size. Though such arguments held less weight in
land-rich America, the notion that poor laws contributed to
overpopulation took root in the United States as well. In addition, classical economists believed there was a finite
amount of capital available to support the working class and
that money spent on assistance would take away from the
wage-earning pool. These beliefs, combined with nineteenthcentury ideals of individualism and industriousness, resulted
in a sharp decline in support for public assistance.
Renaissance, Reformation, and Enlightenment philosophies, which had challenged the notion of poverty as inevitable, helped to lay the groundwork for reform movements that shaped early-nineteenth-century American
society. But though reformers sought real improvement in
the conditions of the poor, they also worked within an atmosphere in which the poor were increasingly blamed for
their own poverty. Before the early nineteenth century, the
idea that “the poor will always be with us” existed alongside
the notion that society should address the needs of the poor.
During the early 1800s, reformers attempted to put into action a kind of democracy that coexisted with individual responsibility. Only in a minority of cases did Americans see
people in need as “worthy” of assistance, and a large percentage of those were put to work in workhouses.
People in need of assistance lived and worked under
watchful eyes. Society housed those deemed unable to provide for themselves, such as the permanently disabled, in institutions, often in horrid conditions. Social reformers recommended the development of workhouses and almshouses
as more humane and effective means of dealing with the
poor. New York’s secretary of state, J. V. N. Yates, provided one
of the nation’s most influential documents supporting this
move. Commissioned in 1834 by the state legislature to survey the state of poor relief, he reported tremendous problems
and proposed to correct the situation by placing the poor in
institutions. Within a short time, various states had constructed almshouses (Massachusetts alone had 219 by 1860),
but reformers subsequently reported the existence of inhumane conditions in a number of them.
Social reformers sought both state and federal assistance
in addressing the poor housing conditions. Dorothea Dix
fought one of the more pronounced battles in her effort to
obtain federal funding to address the needs of the mentally ill

who were often held under inhumane conditions in
almshouses and jails. After years of research and lobbying,
she finally convinced both houses of Congress in 1854 to pass
legislation appropriating land for the construction of adequate mental hospitals. However, President Franklin Pierce
vetoed the legislation because he feared the idea of making
the federal government the “greatest almoner of public charity throughout the United States,” a move he saw as contrary
to the U.S. Constitution. The federal government had previously given land grants to a number of efforts considered to
be social welfare projects, but Pierce’s comments set the tone
for federal resistance on the welfare front. On the state and
municipal levels, surveys of poverty continued, but private
charities distributed most of the funds.
The Civil War placed unforeseen demands on charity organizations, which failed to meet all of the needs of people affected by the conflict. Unprecedented concerns about public
health and medical care issues demanded much attention,
spurring the creation of the U.S. Sanitary Commission. Led
and staffed primarily by women, the commission provided
supplies and services to meet the critical demands for medical treatment of injured individuals. The Sanitary Commission not only served as a foundation for subsequent developments in the field of medicine but also demonstrated that
provisions for assistance were possible and desirable on a national scale. Furthermore, the conclusion of the Civil War
brought about a philosophical and political shift that
strengthened the position of the federal government relative
to issues of states’ rights.
The establishment of the Freedmen’s Bureau (Bureau of
Refugees, Freedmen, and Abandoned Lands) in 1865 as the
nation’s first federal welfare agency demonstrated the willingness and ability of the federal government to address welfare needs when the local governments failed to do so.
Though dismantled in 1872, the bureau helped to establish
schools for more than a half million freed slaves, operating
under the philosophy that education could serve as the
means to escape poverty. It also supported medical care, the
maintenance of hospitals, and assistance in land distribution.
The act that established the bureau signaled the first solid attempt by the federal government to take responsibility for social welfare. At the same time, however, American economic
philosophy discouraged such a role.
During the nineteenth century, broad-based industrial
capitalism left workers increasingly dependent on larger
forces for employment, but laissez-faire attitudes in business
and government provided little protection for workers who
were injured or laid off, with the poor being generally neglected. Adam Smith’s free market economic philosophy
reigned, and officials viewed regulations designed to protect
workers as an imposition and generally detrimental to the
natural balance of a free and profitable economy. Much resistance existed to any government demands that business
provide for the welfare of their workers, especially at the federal level. Many Americans criticized the idea of taxing the
wealthy to provide for the indigent because it interfered with
the natural laws of economics.
Social Darwinists, who applied elements of the survival of
the fittest concept to business, also applied them to society,
justifying the existence of poor people as a factor of natural
selection. In other words, they believed that the poor became
poor because they did not have the inherent qualities necessary to become wealthy. Social Darwinists argued that “dogooders” should ignore individuals with disabilities or illnesses that many believed contributed to poverty. In their
view, charitable aid only hurt society, as it allowed the weaker
to survive. Reformers, by contrast, believed that providing assistance to all Americans in need was a fundamental role in a
democracy. Yet even reformers blamed individuals, personal
circumstances, or character flaws for poverty in the nineteenth century. With the best intentions, the Society for the
Prevention of Pauperism and similar groups attempted to
help the poor overcome any shortcomings that had led them
to a life of poverty.
The subsequent development of charity organization societies in the 1870s featured the use of scientific management
principles to address social ills and provide individuals with
“scientific charity.” Still, ideas inherent in the American work
ethic and Social Darwinism abounded. Mutual-aid societies
(including secret societies, sick and funeral benefit societies,
and life insurance societies) that had promoted fraternity and
association since the early nineteenth century continued to
thrive. They served as vehicles to collect contributions and
distribute relief to those in need of aid, and they did so with
fewer stigmas attached. By the late nineteenth century, Americans viewed both private and public charity as patronizing,
with the needy placed in a position of inferiority, but they
considered fraternal societies far more egalitarian because
those giving and those receiving coexisted on more equal
terms.
The dawn of the twentieth century brought a wealth of reforms, inspired by Progressives who sought to apply scientific
principles, modern understanding, and democratic ideals to
the task of improving conditions in the changing American
city. Rapid urbanization, industrialization, and immigration
resulted in demands on housing and health services, and
though many groups sought changes at the municipal level,
some changes took place through congressional legislation.
Proponents of proposals for federal mandates addressed social welfare issues by employing models from Germany and
Great Britain, where reform at the national level had made
great strides. Unions urged the federal government to force
businesses to put protective measures in place. In 1912 the
American Association for Labor Legislation proposed compulsory health insurance, which would have required disability, hospitalization, maternity care, and burial benefits to be
financed by employers, workers, and taxpayers.
But the United States resisted the adoption of programs
that had found success in other countries. By 1884 Germany
had implemented a broad social insurance system, and other
Europeans subsequently followed. However, the United
States opted for a system of “welfare capitalism,” in which
corporations periodically implemented measures that would
pacify workers by providing benefits. Refusing to take orders
from the government or from labor unions, company owners
gradually began to provide just enough in insurance policies

and pensions to prevent litigation and strikes. In reality,
workers did not always have access to promised benefits,
since the law had not mandated them. And workers often
viewed the company store system—in which companies provided stores, homes, and recreational facilities for their employees—as feudalistic, making them even more dependent
on the companies and living at the mercy of factory owners
who controlled every aspect of their lives.
Still, the turn of the twentieth century saw the beginning
of increased focus on social welfare and reform. Writers such
as Upton Sinclair, who vividly depicted the horrid lives of immigrants working in Chicago’s meatpacking industry in
The
Jungle,
shed light on social ills in a way that eventually drew a
significant government response. That work alone receives
credit for inspiring the Pure Food and Drug Act of 1906. But
such writings also influenced reforms in housing, factory
conditions, and child labor.
Children drew much attention in social reform programs,
as the state assumed an increasing responsibility for their welfare. With new attitudes toward education, certification, and
professionalization, modern “experts” addressed public
health concerns through nutrition, disease prevention, and
education programs and even juvenile courts. They argued
that a failure to address needs beginning in early childhood
could prove costly—monetarily and otherwise—to society at
large. The year 1912 marked the creation of the U.S. Children’s Bureau, a significant shift toward the nationalization of
welfare. The Children’s Bureau took up causes of maternal
and child health, maternal and child mortality rates, and
health provisions for mothers and children in poor urban
and rural areas.
The country’s entrance into World War I altered the role of
the federal government considerably. The government expanded its powers during the Great Depression and World
War II, but the foundations for such expansion developed
during World War I. A peacetime economy was transformed
into a wartime economy largely through the creation of the
War Industries Board, as well as the U.S. Food Administration, the National War Labor Board, the U.S. Railroad Administration, the U.S. Fuel Administration, and so on. These
agencies would fix prices and control production and resources at the federal level, all for the good of the nation and
the war effort.
This new position of the federal government had a significant impact on its approach to welfare programs. First, the
creation of federal agencies with substantial powers to address needs permeated the arena of social welfare. In addition, the government transmitted information and scientific
knowledge gathered in the war effort to the civilian sector.
For example, social workers noted that the prevention of
many of society’s ills required addressing the needs of America’s children—such as nutrition, health care, education, and
juvenile courts, as mentioned earlier. The Progressive Era
had brought attention to social ills that often seemed too
costly to solve, but reformers insisted that prevention programs involving children were a good investment and saved
dollars in the long run. When the government began a program to provide detailed physical examinations for draftees
into the armed forces, experts found that many disabilities
(or problems termed “defects” at the time) could have been
prevented by improved care during pregnancy and early
childhood. As a result, the Children’s Bureau expanded programs in public health. This sense of federal responsibility
would continue after the war. In 1921 women’s groups successfully lobbied for passage of the Sheppard-Towner Maternity and Infancy Act, allocating federal funds to create maternity and pediatric clinics.
Though during the first few decades of the twentieth century the nation experienced a growing sense of duty in terms
of addressing the needs of the poor, society was unprepared
to handle the demands of the Great Depression. In October
1929 the stock market crashed, setting off a downward spiral
of the economy that would raise unemployment rates to unprecedented levels. State, municipal, and private philanthropic agencies inadequately addressed the burden of relief,
as the needs exceeded their resources. As the depression set
in, tax revenues and donations diminished, forcing the federal government to assume responsibility and initiate new
programs. President Herbert Hoover instituted plans for
public works programs that would rely on cooperation from
the various states, but such programs could not provide immediate solutions to the growing number of unemployed.
The Hoover administration also established the President’s
Committee for Employment, but it would limit itself to
overseeing state, local, and private relief programs. Those
programs lacked the resources necessary, given the severity
of the situation, and directors of the programs lobbied
Washington for a federal relief program. Despite much resistance, Congress and the president granted authority to the
Reconstruction Finance Corporation (RFC) to make $300
million in loans available to the states for unemployment relief. However, the program proved ineffective, largely because of a lack of federal regulations on administering the
money. Hoover received heavy criticism for his unwillingness to take strong action as president when the economy
collapsed.
In 1932 the American electorate blamed Hoover for failing
to confront the depression effectively and voted in Franklin
Delano Roosevelt. In his first 100 days, Roosevelt convinced
Congress to implement a vast array of programs to address
difficulties across the American economy, including banking,
agriculture, and industry. In an unprecedented move, the
government created the Federal Emergency Relief Administration (FERA) to provide assistance to the unemployed. It
abolished the existing loans established through the RFC
under Hoover, replacing them with grants, and strengthened
administrative powers to oversee the program.
Myriad other programs followed. In November 1933,
Congress created the Civil Works Administration (CWA), a
work relief program designed to put at least half of the nation’s unemployed to work. In 1934 the government replaced
the CWA with the Emergency Work Relief Program, which,
in turn, the Works Progress Administration (WPA) replaced.
During that time, the WPA employed an average of 2 million
Americans per month. To address the special needs of young
men and boys—who, experts warned, could cause significant

problems in society if left idle for too long—the federal government designed the Civilian Conservation Corps (CCC).
The War Department supervised the CCC work camps, and
the Departments of Agriculture and the Interior planned
projects that primarily put them to work in reforestation and
flood control.
Even as various programs successfully assisted those in
need, members of Congress recommended implementing
something more long term. Members proposed the Lundeen
Bill, or the Workers’ Unemployment, Old Age and Social Insurance Bill to provide unemployment benefits at prevailing
wages for all those who were unemployed through no fault of
their own. But many Americans viewed the legislation as too
far-reaching. The economic tradition of the United States
had seen periods of significant layoffs, and would see layoffs
in the future. To suggest that the federal government should
assume responsibility for all people involuntarily unemployed seemed unimaginable. Instead, Congress passed the
Social Security Act of 1935. Though more specific and more
limited, that measure signaled a historic turning point in the
shift toward general, long-term federal responsibility in providing for Americans who found themselves in need. In addition to providing a kind of social insurance for retirement
in old age, the act established a program of federal grants-inaid to states providing assistance to the elderly, the blind, and
dependent children.
Though it has remained the cornerstone of social welfare
in the United States, the Social Security Act met with significant resistance from a variety of critics. Ideological and political differences among supporters of Social Security acted as
obstacles to developing a unified lobbying force. In addition,
conservatives argued that such a program too closely mirrored the welfare programs of a more nationalist and socialist nature that were then expanding in other countries—
something feared during the rise of Hitler and Stalinist
Russia. And American businesspeople opposed an increase in
taxes to support such a program while the economy continued to struggle.
One of the most significant influences in developing the
Social Security Act of 1935 came from the Townsend movement, a grassroots force spearheaded by Francis Townsend, a
physician. Townsend served as a powerful advocate for the
elderly, whom he believed needed protection from destitution. Although many social welfare programs had historically
centered on the needs of children, Townsend and his supporters effectively brought the needs of the elderly to the nation’s attention. Calls for “old-age insurance” had gained
some attention during the 1920s, but they gained momentum during the depression as pensions voluntarily established by companies suddenly went bankrupt. In addition,
the elderly had formed a powerful lobbying group that cut
across class lines. They did not represent a small group of
poor or underprivileged. Rather, they represented all but the
very wealthy, who could afford not to work even in old age.
But Congress did not limit the Social Security Act to helping
the elderly. Very important, it established the first federal program to aid dependent children—a program that would see
significant expansion in the 1960s—and it recognized severe
physical disabilities such as blindness as obstacles to gainful
employment.
The 1930s’ trend toward federal responsibility for the welfare of the American people did not cease when the depression ended. Instead, the long-term policies expanded during
the subsequent period of prosperity. America’s entrance into
World War II helped to boost the economy by shifting it to
one based on war production. Though ultimately advantageous for economic rebirth and individual income, industrial
and agricultural restructuring resulted in a tremendous dislocation and relocation of workers, raising new concerns
about housing and settlement. These changes appeared especially pronounced among minorities. White workers received
a warm welcome into areas that needed workers, but the loss
of potential workers into the military forced companies to
draw from pools of women, blacks, and Latinos in order to
fill positions. When minorities moved into industrial areas in
hopes of finding employment, they encountered racism and
discriminatory housing policies, making resettlement difficult. Because bosses generally preferred to hire Caucasian
women, minorities often remained unemployed, forcing the
federal government to reexamine its new welfare policies.
Furthermore, the employment of women inspired a remarkable—though short-lived—federal child care program.
The GI Bill remains the most significant piece of wartime
“welfare” legislation. Federally sponsored benefits for the
families of soldiers who were killed or disabled already existed, but this bill went further. It was passed principally in
order to honor those who served in the war, but it also helped
to ensure national stability. Advocates warned of massive social and economic instability when millions of veterans
began to seek jobs during a critical period of economic restructuring, as the country shifted from wartime to peacetime production. The GI Bill offered educational assistance to
returning veterans and loans for the purchase of a home,
business, or farm. The program eased resettlement in a way
that would not harm an already fragile economy, and it reflected the more general trend toward a growing role for the
federal government in welfare.
During the 1950s, economic prosperity drew new criticism of the Social Security system, with some people contending that Americans no longer needed it. However, the
system kept expanding. President Harry S Truman worked to
continue this and other New Deal programs initiated by Roosevelt and see them grow under what he called his Fair Deal.
He supported an increase in the minimum wage, an expansion of Social Security, and new public works projects. In addition, he proposed federally funded slum clearance and the
construction of low-income housing. He even went as far as
proposing federal aid for education and a system of national
health care, neither of which passed. But even under the more
conservative Republican administration of President Dwight
D. Eisenhower, the nation witnessed a massive expansion of
Social Security. Disabled workers became eligible for social
insurance benefits, and states obtained federal public assistance. And in what would become a historic move, Eisenhower authorized the creation of the Department of Health,
Education, and Welfare.

The postwar period brought tremendous economic prosperity to the nation, which lasted into the 1950s. Poverty had
seemingly become invisible. American optimism tended to
gloss over any economic shortcomings that might have existed, and there was little debate about poverty. Although
poverty still existed, confident depictions of prosperity served
to place American economics on the side of good in the
struggle against communism. Late in the decade, however, all
that began to change. In his
Affluent Society (1958), economist John Kenneth Galbraith extolled the virtues of economic progress but painted a less than perfect picture of
American society. In
The Other America (1962), Michael Harrington went further in exposing the seriousness of economic
injustice within various segments of American society. Both
of these works influenced new attacks on poverty.
Under John F. Kennedy’s administration, poverty resurfaced as an evil to be confronted. His successor, Lyndon B.
Johnson, made such an effort a primary goal, and within six
months of taking office, he outlined his War on Poverty. By
August 1964, Johnson convinced Congress to pass the Economic Opportunity Act, which created antipoverty programs
under the direction of a new federal agency, the Office of Economic Opportunity (OEO). Johnson’s War on Poverty
sparked a heated debate, and many questioned its effectiveness. Conservative critics argued that the programs were unnecessary and costly and would create a dependency for people who should be working harder to find their own success.
Others argued that Johnson had taken on too much by even
suggesting that the nation might see a victory over poverty
through the creation of federally funded programs. Defenders of Johnson’s policies maintained that they did see some
success and that the country would have experienced greater
results if the government had not spent so much money on
the Vietnam War. In fact, some programs did achieve success,
remaining in place for decades. The Job Corps, a workt.raining program for young people, and Head Start, an early
childhood education program, proved quite effective.
Richard Nixon responded to critics of the “welfare mess”
by dismantling many of the programs begun under the War
on Poverty. But under the Nixon administration, a quiet revolution took place and demonstrated the strength of the federal government’s role in social welfare. In 1965 Congress allocated some 42 percent of the federal budget for defense and
only 25 percent for social welfare—the basis for protests surrounding America’s priorities. However, by 1975 defense expenditures accounted for only 25 percent of the federal
budget, whereas welfare expenditures had reached 43 percent. Even with the fiscal demands of the Vietnam War and
with the new conservative Republican administration, welfare expenditures rose.
The election of Ronald Reagan in 1980 introduced a new
kind of conservatism with the dawn of a new decade—a conservatism, not only in foreign policy but also in domestic policy, that would attack social welfare. A disillusioned American
public saw that the federal government had not eradicated
poverty and described liberal economic and social policies
begun in the 1960s as failures. Reagan campaigned and won
on the basis of this disillusionment, and he offered a new plan
for a better economic future for all Americans. His economic
policy—referred to as Reaganomics—called for severe tax
cuts, which he maintained would provide greater incentives
for hard work, stimulate individual productivity, and thereby
improve the American economy. He promised he would not
cut welfare programs designed to protect the truly needy, insisting that a “safety net” would remain in place. However, he
excluded Aid to Families with Dependent Children and Food
Stamps from this plan. He did defend Social Security and
Medicare, which benefited all Americans regardless of income. He converted other programs into a system of “block
grants,” by which the federal government granted money to
various states for welfare needs. His administration also eliminated federal revenue sharing, which had been established in
the 1960s to address housing, health, and nutrition needs in
poor communities. He met his goals of bringing to an end the
welfare bureaucracy in Washington and decreasing welfare
expenditures.
The George H. W. Bush administration promised a kinder,
gentler America, but the new president continued many of
Reagan’s policies. He opposed tax hikes and encouraged
states to maintain welfare responsibilities. In addition, he
called upon states to act as “laboratories” experimenting with
new and often controversial programs that would discourage
dependency on welfare and provide alternative incentives for
self-improvement. He also carried on Reagan’s theme of privatization, encouraging private charities and other organizations to provide social services instead of local, state, or federal governments. He often made references to America’s
“1,000 points of light”—or volunteers who would provide assistance to those who were less fortunate.
The election of Bill Clinton introduced the possibility of
new approaches to federal responsibility for social welfare.
First Lady Hillary Clinton espoused the idea that “it takes a
village to raise a child,” suggesting that society should take a
more active role in seeing to the welfare of individuals. But
such a philosophy came under attack. In the first few months
of the Clinton administration, proposals for health care reform, whereby the federal government would more directly
provide adequate health care for Americans, met defeat. The
conflict over social welfare concerns intensified with the election of a Republican majority in Congress in 1994 and the
positioning of outspoken conservative Newt Gingrich as
Speaker of the House. Gingrich and House Republicans
strongly supported what they termed a “Contract with America,” which would bring an end to entitlement welfare and
place the blame on unmarried mothers, who were said to
demonstrate a lack of personal responsibility in creating lives
of welfare dependency for themselves. In essence, the same
arguments used some 200 years before—that relief tended to
make people lazy and encouraged the poor to have even more
children—persisted.
Although social programs in education, health care, and
family leave have expanded and have become expected in
other industrialized nations of the world, the United States
has continued to take a comparatively conservative stance, relying on individual responsibility and privately funded charities. The fear that able people will refuse to work, depending

on the government for something to which they consider
themselves entitled, had persisted. Above all, welfare policy
makers have worked diligently to convince American taxpayers that only the “deserving” will receive benefits.
—Kathleen A. Tobin
References
Axinn, June, and Mark J. Stern. Social Welfare: A History of
the American Response to Need.
Boston: Allyn and Bacon,
2001.
Beito, David T.
From Mutual Aid to the Welfare State:
Fraternal Societies and Social Services, 1890–1967.
Chapel
Hill: University of North Carolina Press, 2000.
Berkowitz, Edward, and Kim McQuaid.
Creating the Welfare
State: The Political Economy of Twentieth-Century Reform.
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