Essay: Temporary Assistance for Needy Families

Sample Essay

Another political argument draws attention to the political incentives for focusing benefits on families just below the poverty threshold, which would maximize the number of persons pulled out of poverty at relatively low cost. As noted earlier, such an approach would raise severe concerns in terms of both equity and efficiency. According to Economists, this incentive can be muted if policy makers are held accountable for the rate of deep poverty and the total poverty gap as well as the more widely publicized rate of poverty.

The political logic for structuring spending in this way is clear. Yet to date America’s core income tested programs for working age families generally do not have this structure. Temporary Assistance for Needy Families (TANF), food stamps, public housing, and Supplemental Security Income (SSI) all are classic income-tested programs. Their benefits decline as recipients’ incomes rise, so the largest benefits go to the poorest recipients. In all but six states, TANF benefits fully phase out before family income reaches the official poverty line (Rowe & Murphy, 2006). In Medicaid, the largest income tested program, benefits are independent of eligible families’ incomes, not highest for those near the poverty line. Medicaid benefits abruptly vanish as soon as a family’s income exceeds the eligibility limit.

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