Effects of Welfare Reform - Research Paper Example

In US history, it was the 'New Deal' policies of a Democrat, Franklin Delano Roosevelt, that created the very infrastructure for welfare. The following will examine this divisive issue. The focus of this analysis, will be reforms made to the system in the State of Georgia, and it will be argued that there is a causal relationship between 'unemployment' and the number of people who apply for welfare. Therefore, the issue itself is 'economic' and not 'ideological', and this means that the divisions that exist on welfare reform are meaningless.

Further, it will be demonstrated in this analysis that in spite of a long history of welfare-reform, current levels of social assistance payment in the State of Georgia are barely sufficient for just subsistence. As mentioned, welfare in the United States (and Georgia) has its origins during the period the Depression. After the stock-market crash of 1929, what followed was the era known as the Great Depression, and one of the defining socio-economic features of this era, was high unemployment coupled with no social safety net.

As had been a long-history to that era, if an individual or family was so destitute that they cannot even afford to subsist, they had only the Church to turn to for aid. By the 1930's, economists maintained that the only way to get out of a condition of high unemployment, was to transfer money to those who are most desperate [Weir and Orloff 155-6]. Economists, like John Maynard Keynes believed that if the poor had more or just some money to spend, they would be in a better position to help themselves find gainful employment and they would also have disposable income to put back into the economy [Weir and Orloff 154].

That is, it was maintained that even buying groceries or necessities helped the economy overall by creating employment in those areas that served the very poorest. What is important to stress, is that it was an act of kindness that prompted the government to create social assistance or welfare, rather, the establishment of the the 'welfare state' was believed to be good for the economy overall. Thus, the establishment in 1935 of the Social Security Act represents the beginning of the welfare-state in the US [Weir and Orloff 235].

While it might seem unnecessary or a waste of space, to trace the origins of the Welfare State in the US, it is important to stress that most of the reform that has happened to Social Assistance in the last thirty-years, is based on a very focus challenge to some of the assumptions that drove the establishment of government programs in the 1930's. In particular, what has been the focus of the current agenda of reform, is a direct extension of the basic economic assumptions that were there in the 1930's.

The rise of neo-liberalism or new conservative politics maintains that reducing government expenditures improves the economy. If the government taxed less, and spent less, more money would be in circulation in the private sector. Further, the private sector itself is the very engine for job growth [Streissguth 33]. If corporations were paying less in taxes, they would have more money to spend on re-investment and growth. These factors have much to do with the creation of jobs. Thus, during the 1990's, welfare reform was driven by reducing taxes, reducing governme