Thirty years ago, Republicans and Democrats both agreed that for able-bodied adults, welfare should be temporary and tied to work. 1996’s welfare reform was historic, and it changed millions of lives. Unfortunately, instead of building on this success, Washington and the states spent three decades taking it apart. The One, Big, Beautiful Bill picks up where 1996 left off.
What the 1996 reform produced—and what the 2025 reform is projected to.
by FY2002
to work, 1996–2000
in that period
One, Big, Beautiful Bill’s welfare reforms
A bipartisan bet no one expected to pay off.
Welfare reform replaced AFDC with TANF; set a five-year lifetime limit; required able-bodied adults to work, train, or volunteer; and limited food stamps for able-bodied adults without dependents who refused to do any of the three. It passed with lopsided majorities in both chambers—and every prediction of catastrophe was wrong.
A work requirement is only as strong as its enforcement.
In three decades, work went from a party platform to an afterthought. Waivers, exemptions, and one loophole in particular—the Caseload Reduction Credit—hollowed the law out until 39 states effectively had no work requirement for TANF at all.
Washington encouraged it
President Clinton hadn’t even left office before his administration began chipping away at the law he signed. In its final days, it issued a waiver letting states exempt able-bodied adults from food stamp work requirements in areas with plenty of jobs. The Obama administration considered waiving the TANF work requirement entirely.
The Biden administration suspended food stamp work requirements outright and froze Medicaid eligibility checks during the pandemic. The result was a record 100 million enrollees on Medicaid.
States spent money that wasn’t theirs
States run their welfare programs while Washington pays the bill. With little oversight or push for program integrity, states enrolled millions, let error rates climb, skipped eligibility checks, and used loopholes like the Caseload Reduction Credit to zero out their work targets—and bore almost none of the cost. There was little incentive to change.
The result was the Quality “Learing” Center in Minnesota, shady hospices in California, and adult daycares in New York with no participants—all stealing billions of dollars from taxpayers.
“No one who is able to work can stay on welfare forever, and no one who works should live in poverty.”
1992 DEMOCRATIC PARTY PLATFORM—“A NEW COVENANT”
“Welfare should be a second chance, not a way of life” used to be in the Democratic Party platform. Now it is welfare for all.
A radical shift in just three decades. In 1992 their platform said no one who is able to work can stay on welfare forever. In 2025, not one Democrat in Congress voted for the welfare reforms in the One, Big, Beautiful Bill.
Now states have skin in the game.
Congress and President Trump passed the largest welfare reform in American history, built on the two pillars the last 30 years exposed: able-bodied adults who can work should work, and states are accountable for the money they spend.
The bill goes straight at the workarounds. It scales back the waivers and exemptions states leaned on, extends work requirements to Medicaid federally for the first time, locks in food stamp spending levels, phases out the provider-tax scheme states used to pull down extra Medicaid dollars, and penalizes states with high error rates.
Nearly all of the waste could have been stopped with basic program integrity measures—more frequent eligibility checks, cross-checking data, closing loopholes like broad-based categorical eligibility (BBCE), removing illegal aliens and deceased people from the rolls, and stopping people from enrolling in multiple states. Having states that refuse to take any steps to protect program integrity take on more of the cost of their programs is a more than fair response.
That is the lesson of 1996, finally applied. Lasting reform can’t be one celebratory moment—it has to be an ongoing process.
1996 proved welfare reform works. Thirty years proved it has to be enforced.
“The One, Big, Beautiful Bill brings back what 1996 got right, work requirements with teeth, and adds what it always lacked: a real cost for states that ignore them. History says states will test that, but for millions of Americans to experience the benefits of welfare reform, no wiggle room, loopholes, or gimmicks should be tolerated.”
The research behind the proof, the erosion, and the fix.
What Washington Learned In The 30 Years Since Welfare Reform
Jonathan Bain in the Daily Wire: a work requirement is only as strong as its enforcement, and lasting reform has to be an ongoing process.
Read →States Should Fully Embrace the One, Big, Beautiful Bill’s Welfare Reforms
Costs up nearly fivefold since 2000. The reforms save over $1 trillion—if states don’t opt out in practice.
Read →To Maximize the Reforms in the OBBB, Blue States Must Be Held Accountable
Eighty-seven percent of cash welfare enrollees are in blue states. That is where implementation gets won or lost.
Read →The Power of Work: How Kansas’ Welfare Reform Is Lifting Americans Out of Poverty
The state-level proof case—work requirements move people into jobs and raise incomes well past lost benefits.
Read →Work Requirements Are Not Controversial
77% of likely voters support tying benefits to work; 69% back Medicaid work requirements nationally.
Crosstabs →WORK OVER WELFARE · LESSONS FROM 1996. RESULTS FOR TODAY. HOPE FOR TOMORROW.
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