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This essay is taken from the book American Conservatism: An Encyclopedia, edited by Bruce P. Frohnen, Jeremy Beer, and Jeffery O. Nelson (Wilmington: ISI Books, 2006)

President George W. Bush’s chief political advisor Karl Rove drew the ire of liberals several years ago when he defined compassionate conservatism as “Ronald Regan Meets Bobby Kennedy.” Rove was referring to Reagan’s conservative demands for personal responsibility coupled with Kennedy’s progressive call for societal responsibility to the poor. However one judges Mr. Rove’s interpretation of political history, no policies better exhibit at the place where compassion meets conservatism than do the welfare reform packages of the 1990s. Following mounting dissatisfaction with the welfare state’s massive expenditures, which yielded increased poverty, decreased employment, and rapidly eroding family structures, a national consensus finally formed during these years that indicted Great Society welfare policies for their unintentional consequences. 

In both the 1987 and 1988 State of the Union addresses, President Ronald Reagan invited states to succeed where the federal government had failed. Pointing to a long neglected provision in the Social Security Act enabling states to seek federal waivers from the Aid to Families with Dependent Children (AFDC) program, Reagan challenged the governors to reform the welfare system from the bottom up. The states were quick to accept the invitation. More than three-dozen states administered myriad waiver demonstration projects as antecedents to the systematic changes eventually wrought by the 1996 welfare law. 

Most of the waiver programs reversed the work disincentives inherent in AFDC. Requiring stricter work activities for more of their caseload, allowing these new workers to keep more of their earnings, and widening the supportive services necessary to sustain productive employment were among the states’ most popular requests. Rigorous evaluation criteria and cost neutrality were the federal conditions that accompanied the privilege of state flexibility. 

This federal-state bargain helped produce the twin objectives that defined welfare reform in the 1990s: higher expectations for personal responsibility on the part of recipients joined to a heightened emphasis on improved public performance by welfare agencies and their service providers. 

The growing success of welfare reform efforts stimulated the debate that led to adoption of the 1996 welfare law upending sixty years of entitlement welfare. The new law replaced AFDC with the Temporary Assistance to Needy Families (TANF) program, which contains three features that have completely redefined American welfare policy: 

(1)   Work requirements. State are obligated by the federal law to engage more than half of their welfare caseload in work activities as a condition of receiving public assistance. This traded the “something for nothing” culture of AFDC to one of mutual obligation. It also prepared the poor for the only sure route out of poverty: sustainable private sector employment. 

(2)   Time limits. The new law caps the receipt of welfare to five years over a person’s lifetime. States are granted permission to impose even stricter time limits. This sent the very clear message that welfare support was to be a temporary way-station – not a way of life. The welfare bureaucracy was affected, too, for now there is a real sense of urgency to its labors. 

(3)   Block grants. States are given unprecedented spending and policymaking authority through a block grant funding structure that caps spending over a five-year period but carries far fewer spending restraints that AFDC’s rigid reimbursement formula. 

Three prominent Clinton officials resigned in protest of the 1996 law, citing an Urban Institute study predicting two million families would be added to the poverty rolls as a result. Happily, those predictions have proven to be inaccurate. In the first five years after the new law came into force, the national welfare caseload had been cut in half, down to 1972 levels. In addition, five million fewer people lived in poverty and the poverty rate for black children reached its lowest level ever. 

Even amid these unprecedented successes, welfare policy cannot be maintained at the status quo. Many families remaining on assistance or seeking new help today face severe barriers to employment. The TANF program and other workforce development services are continually being adapted to better meet these challenges. Among the leading strategies are generous wage supplements (e.g., the Earned Income Tax Credit) and necessary support services, such as childcare and medical assistance. 

The compassionate conservative welfare policies also acknowledge that government alone cannot meet all the needs of low-income families, nor are their needs merely economic. Thus, the TANF program contains a “charitable choice” provision that opens the door wider to government partnerships with the faith community. In addition, efforts are being made to strengthen families by encouraging two-parent families and preventing teen pregnancy.