Paul Ryan to propose welfare overhaul. A gift to Democrats?

On the eve of President Obama’s budget proposal for fiscal year 2015, the top House Republican on budget matters has released a harsh assessment of federal poverty programs – and a promise of a major overhaul plan.  

In the House Budget Committee report, chairman Paul Ryan (R) of Wisconsin agrees that some programs provide crucial aid to low-income families. He also grants that the decline in the labor-force participation rate, now at a 36-year low, is not solely a result of welfare programs steering people away from work. Changing demographics and slow economic growth are also factors.

“But federal policies are also discouraging work,” says the report, called “The War on Poverty: 50 Years Later.” A large problem, it says, is the so-called poverty trap: “There are so many anti-poverty programs – and there is so little coordination between them – that they often work at cross purposes and penalize families for getting ahead.”

Because the programs are means-tested – that is, the benefits phase out as recipients make more money – poor families may find they are better off staying on public assistance. “The federal government effectively discourages them from making more money,” the report says.

The report itemizes 92 programs: dozens in education and job training, 17 food-aid programs, and more than 20 housing programs. In FY 2012, these programs cost the federal government $799 billion.

At another time, such a report might have been a starting point for discussion with Democrats, including the Obama White House – which calls public assistance a “hand up” and not a “hand out” and has been willing to talk about changes to entitlement programs, such as Social Security. For its part, the Ryan report does not call for eliminating public assistance, but rather suggests a need to reconfigure a system of programs that are “duplicative and complex.” Ryan tells The Washington Post that the House Republican budget, which will come out later this month, will include an overhaul of social programs, including Head Start and Medicaid.

But with midterm season in full swing – the first primary is on Tuesday, in Texas – Democrats are in no mood to collaborate with Republicans on changes to the social safety net. The Obama administration has already telegraphed that its 2015 budget will back away from past measures aimed at addressing America’s unsustainable fiscal path. In last year’s budget, Mr. Obama conceded a lower cost-of-living adjustment to Social Security. This year, that proposal will not be there.

The Democratic National Committee (DNC) called the Ryan report a “rehash of a failed economic agenda” that Americans have rejected.

“Whether it’s saying that 47 percent of Americans are takers, or claiming that the social safety net is discouraging people from making more money, Republicans just don’t get it,” says DNC spokesman Michael Czin in a statement. “Their plan is to block a minimum wage increase, cut access to higher education, slash early childhood programs, voucherize Medicare, and shred the social safety net – a safety net that lifted 45 million Americans out of poverty in 2012 alone.”  

Independent pollster John Zogby sees the Ryan proposal as potential fodder for both parties’ efforts to drive turnout of their base supporters in November.

Ryan, the Republican nominee for vice president in 2012, “is a guy who believes in the ideology, believes in the party,  and believes that they have to have a message, and this in many ways could be a unifying message,” Mr. Zogby says. “It just also happens to be very, very risky.”

The Ryan plan could backfire, he says, because it could get key elements of the Democratic base to turn out – minorities, single women, young voters, others who may feel Republicans want to balance the federal budget on the backs of those who can least afford it. An energized left, with Sen. Elizabeth Warren (D) of Massachusetts and New York Mayor Bill de Blasio (D) leading the charge, has also put pressure on Obama to back off anything that looks like a cut to the safety net.

Come November, Democrats are most concerned about maintaining control of the Senate. With just a net gain of six Republican seats needed to shift control, handicappers say it could go either way. The House is seen as firmly in Republican control, and Democrats are hoping to hold their ground, and even potentially pick up a few seats. Gubernatorial races are also crucial, in part because state political networks will be helpful to presidential candidates in the 2016 race.

Democrats know they can’t get the kind of turnout they achieved in the presidential races of 2008 and 2012, but they also want to avoid a repeat of 2010, when the Democrats got “shellacked,” as Obama put it.