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HOW OUR WELFARE SYSTEM CAN 

DISCOURAGE WORK 

JOINT HEARING 

BEFORE THE

COMMITTEE ON WAYS AND MEANS 

SUBCOMMITTEE ON HUMAN RESOURCES 

AND THE

COMMITTEE ON AGRICULTURE 

SUBCOMMITTEE ON OVERSIGHT 

U.S. HOUSE OF REPRESENTATIVES 

ONE HUNDRED FOURTEENTH CONGRESS 

FIRST SESSION 

JUNE 25, 2015

Committee on Ways and Means Serial No. 114–HR05 

Committee on Agriculture Serial No. 114–3, pt. 2 

Printed for the use of the Committee on Ways and Means 

( 


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COMMITTEE ON WAYS AND MEANS 

PAUL RYAN, Wisconsin, Chairman 

SAM JOHNSON, Texas 

KEVIN BRADY, Texas 

DEVIN NUNES, California 

PATRICK J. TIBERI, Ohio 

DAVID G. REICHERT, Washington 

CHARLES W. BOUSTANY, JR., Louisiana 

PETER J. ROSKAM, Illinois 

TOM PRICE, Georgia 

VERN BUCHANAN, Florida 

ADRIAN SMITH, Nebraska 

LYNN JENKINS, Kansas 

ERIK PAULSEN, Minnesota 

KENNY MARCHANT, Texas 

DIANE BLACK, Tennessee 

TOM REED, New York 

TODD YOUNG, Indiana 

MIKE KELLY, Pennsylvania 

JIM RENACCI, Ohio 

PAT MEEHAN, Pennsylvania 

KRISTI NOEM, South Dakota 

GEORGE HOLDING, North Carolina 

JASON SMITH, Missouri 

ROBERT DOLD, Illinois 

SANDER M. LEVIN, Michigan 

CHARLES B. RANGEL, New York 

JIM MCDERMOTT, Washington 

JOHN LEWIS, Georgia 

RICHARD E. NEAL, Massachusetts 

XAVIER BECERRA, California 

LLOYD DOGGETT, Texas 

MIKE THOMPSON, California 

JOHN B. LARSON, Connecticut 

EARL BLUMENAUER, Oregon 

RON KIND, Wisconsin 

BILL PASCRELL, JR., New Jersey 

JOSEPH CROWLEY, New York 

DANNY DAVIS, Illinois 

LINDA SA ́ NCHEZ, California 

JOYCE MEYER, Staff Director and General Counsel 

JANICE MAYS, Minority Chief Counsel 

SUBCOMMITTEE ON HUMAN RESOURCES

CHARLES W. BOUSTANY, JR., Louisiana, Chairman 

TODD YOUNG, Indiana 

KRISTI NOEM, South Dakota 

PAT MEEHAN, Pennsylvania 

GEORGE HOLDING, North Carolina 

JASON SMITH, Missouri 

ROBERT DOLD, Illinois 

LLOYD DOGGETT, Texas 

JOHN LEWIS, Georgia 

JOSEPH CROWLEY, New York 

DANNY DAVIS, Illinois 


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COMMITTEE ON AGRICULTURE 

K. MICHAEL CONAWAY, Texas, Chairman 

RANDY NEUGEBAUER, Texas, 

Vice Chairman 

BOB GOODLATTE, Virginia 

FRANK D. LUCAS, Oklahoma 

STEVE KING, Iowa 

MIKE ROGERS, Alabama 

GLENN THOMPSON, Pennsylvania 

BOB GIBBS, Ohio 

AUSTIN SCOTT, Georgia 

ERIC A. ‘‘RICK’’ CRAWFORD, Arkansas 

SCOTT DESJARLAIS, Tennessee 

CHRISTOPHER P. GIBSON, New York 

VICKY HARTZLER, Missouri 

DAN BENISHEK, Michigan 

JEFF DENHAM, California 

DOUG LAMALFA, California 

RODNEY DAVIS, Illinois 

TED S. YOHO, Florida 

JACKIE WALORSKI, Indiana 

RICK W. ALLEN, Georgia 

MIKE BOST, Illinois 

DAVID ROUZER, North Carolina 

RALPH LEE ABRAHAM, Louisiana 

JOHN R. MOOLENAAR, Michigan 

DAN NEWHOUSE, Washington 

TRENT KELLY, Mississippi 

COLLIN C. PETERSON, Minnesota, Ranking 

Minority Member 

DAVID SCOTT, Georgia 

JIM COSTA, California 

TIMOTHY J. WALZ, Minnesota 

MARCIA L. FUDGE, Ohio 

JAMES P. MCGOVERN, Massachusetts 

SUZAN K. DELBENE, Washington 

FILEMON VELA, Texas 

MICHELLE LUJAN GRISHAM, New Mexico 

ANN M. KUSTER, New Hampshire 

RICHARD M. NOLAN, Minnesota 

CHERI BUSTOS, Illinois 

SEAN PATRICK MALONEY, New York 

ANN KIRKPATRICK, Arizona 

PETE AGUILAR, California 

STACEY E. PLASKETT, Virgin Islands 

ALMA S. ADAMS, North Carolina 

GWEN GRAHAM, Florida 

BRAD ASHFORD, Nebraska 

SCOTT C. GRAVES, Staff Director 

ROBERT L. LAREW, Minority Staff Director 

SUBCOMMITTEE ON NUTRITION

JACKIE WALORSKI, Indiana, Chairman 

RANDY NEUGEBAUER, Texas, 

GLENN THOMPSON, Pennsylvania 

BOB GIBBS, Ohio 

ERIC A. ‘‘RICK’’ CRAWFORD, Arkansas 

VICKY HARTZLER, Missouri 

DAN BENISHEK, Michigan 

RODNEY DAVIS, Illinois 

TED S. YOHO, Florida 

DAVID ROUZER, North Carolina 

RALPH LEE ABRAHAM, Louisiana 

JOHN R. MOOLENAAR, Michigan 

JAMES P. MCGOVERN, Massachusetts, 

Ranking Minority Member 

MARCIA L. FUDGE, Ohio 

ALMA S. ADAMS, North Carolina 

MICHELLE LUJAN GRISHAM, New Mexico 

PETE AGUILAR, California 

STACEY E. PLASKETT, Virgin Islands 

BRAD ASHFORD, Nebraska 

SUZAN K. DELBENE, Washington 


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C O N T E N T S 

Page 

Advisory of June 25, 2015 announcing the hearing .............................................. 2 

WITNESSES 

Olivia Golden, Executive Director, Center for Law and Social Policy, Testimony ...................................................................................................................... 41 

Chanel McCorkle, accompanied by Marsha Netus, Director of Operations, 

America Works, Baltimore, MD, Testimonies ................................................... 79 

Casey Mulligan Ph.D., Professor, Department of Economics, University of 

Chicago, Testimony .............................................................................................. 13 

Erik Randolph, Senior Fellow, Illinois Policy Institute, Testimony .................... 31 

Eugene Steuerle Ph.D., Senior Fellow, Urban Institute, Testimony ................... 63 

SUBMISSION FOR THE RECORD 

Feeding Texas .......................................................................................................... 109 


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HOW OUR WELFARE SYSTEM CAN 

DISCOURAGE WORK 

THURSDAY, JUNE 25, 2015 

U.S. HOUSE OF REPRESENTATIVES, 

COMMITTEE ON WAYS AND MEANS, 

SUBCOMMITTEE ON HUMAN RESOURCES, 

COMMITTEE ON AGRICULTURE, 

SUBCOMMITTEE ON OVERSIGHT, 

Washington, DC. 

The subcommittee met, pursuant to call, at 9:30 a.m., in Room 

1100, Longworth House Office Building, the Honorable Charles 

Boustany [Chairman of the Subcommittee] presiding. 

[The advisory of the hearing follows:] 


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HEARING ADVISORY 


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f 

Chairman BOUSTANY. Welcome to today’s hearing. I will ask 

our witnesses to take their seats. 

As chairman of the Ways and Means Human Resources Subcommittee, I am honored to welcome Chairman Conaway of the Agriculture Committee, along with Chairwoman Walorski and our colleagues from the Agriculture Nutrition Subcommittee for today’s 

joint hearing. 

In the interest of time and so we can move quickly to our witness 

testimony, both sides have agreed to limit members’ opening statements to 3 minutes apiece. 

Since we are accompanied by Chairman Conaway, we will break 

precedent here, and I will yield time to Chairman Conaway to 

make his opening statement. 

You can go first, since you are set, and we will go to Chairman 

Ryan afterwards. 

Mr. CONAWAY. I want to thank the chairman. I want to thank 

Chairman Ryan and Chairman Boustany and the Ways and Means 

Committee for hosting the first joint hearing between our two committees as we explore how our welfare system can discourage work. 

It is surprising that our committees have not engaged formally before given the overlap in our recipient populations. 

According to the most recent SNAP characteristics report, 20 percent of SNAP recipients receive Supplemental Security Income, 24 

percent receive some form of Social Security income, 9 percent receive child support enforcement payments, 7 percent receive support from TANF, and 4 percent receive unemployment income. 

While today’s hearing is about work, the level of overlap suggests 

this is only the beginning of our efforts to better coordinate programs across the committee jurisdictions. Throughout our top-tobottom review of the past, present, and future of SNAP, we have 

had an eye towards strengthening the program so that it doesn’t 


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become a trap, but rather a tool to help individuals move up the 

economic ladder. 

We have included a number of former recipients and front-line, 

nongovernmental organizations who we now know are succeeding 

despite our welfare system. 

Our hearing series have shown us that SNAP does not operate 

in a vacuum and that it plays an important role in the lives of 

nearly 46 million Americans. This is why the hearings like today 

are important: Recipients don’t think in terms of program. But 

while we do, it is our responsibility to look beyond our programs 

to understand the experience of the recipients and the potential unintended consequences. 

During our last hearing, we heard from practitioners about how 

they engage individuals to help them succeed in the workforce. We 

quickly encountered the reality of the ‘‘cliff effect’’ when programs 

designed to support work do just the opposite. 

There is great dignity that comes from being able to provide financially for one’s own family, but that feeling can easily be overrun when our welfare system creates a situation where earnings do 

not necessarily translate into higher income. This is not a problem 

that can be addressed by SNAP alone. It is going to take a coordinated effort. 

Thank you again for hosting this important joint hearing. I look 

forward to working with Chairman Ryan, Chairman Boustany, and 

your committee to ensure that our welfare system is prepared to 

address current and future challenges. 

We know that work is the best way to help individuals climb the 

economic ladder, and we must ensure that our policies reward that 

work. I look forward to the hearing, and I yield back. 

Chairman BOUSTANY. Thank you, Chairman Conaway. 

Now I am pleased to yield time to Chairman Ryan, chairman of 

the Ways and Means Committee. 

Chairman RYAN. Well, first of all, thank you. Welcome everybody. It has been a long time since I have sat down here in these 

seats. The view is a little different, I got to admit. 

I want to welcome our colleagues from the Agriculture Committee, including my friend Chairman Conaway and Chairwoman 

Walorski and Ranking Member McGovern. We are happy to have 

you, we are happy to host this, but we want to thank you for letting us use your committee room twice when we were renovating 

this room earlier in the year. 

This is an important hearing because for the past 50 years we 

have been waging this war on poverty, and I don’t think you can 

really call it anything but a stalemate. I am not saying we haven’t 

made any progress. We clearly have. But the Federal Government 

has spent trillions of dollars on dozens of programs, and yet upward mobility is no better than where it was when we started. 

Today, if you were raised poor, you are just as likely to stay poor 

as you were 50 years ago. 

Here is the problem. We have created 80 different programs to 

try and fill 80 different holes in people’s budgets, health care, child 

care, energy, education, and more. You qualify for these programs 

on income, naturally. If you don’t make much, you get a lot of benefits, but as you make more, you start to lose your benefits very 


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quickly in some cases. Because we have piled these programs right 

on top of each other, the falloff can be really steep, and the more 

you make, you can end up losing a ton. 

Take a single mom with one child earning the minimum wage, 

and she gets offered a job paying her $3 more an hour. When you 

factor in the taxes and the benefit cuts that she will experience, 

she will only get to take home 10 cents of every extra dollar she 

makes. What is the point in taking that job? 

So you find that we have been filling holes, but we have actually 

been building a trap, and we are isolating people from the rest of 

the communities, we are isolating people from getting out of poverty. Right now we have a safety net that is designed to catch people falling into poverty. What we need is a safety net to help lift 

people out of poverty. 

And so the way I see it, we have got three choices. Number one, 

we either accept the status quo and just do nothing. Number two, 

we reinforce the status quo and simply just do more of the same. 

That will only make it harder for people to get from welfare to 

work. Or number three, we reform the status quo, we try something different, get people in jobs or in training, customize benefits 

to fit people’s needs, make sure that it always pays to work. These 

are the principles that we want to put into practice. We need another round of welfare reform so that we can actually have a safety 

net pulling people from poverty, from welfare, into work, into a better life. 

You know, Pope Francis recently said: ‘‘Where there is no work, 

there is no dignity.’’ That is the challenge we face, to protect and 

to promote the dignity of work. I look forward to working with our 

colleagues in the future to do just that, and I think this hearing 

is a great start. 

Thank you. 

Chairman BOUSTANY. Thank you, Chairman Ryan. I would like 

to amplify that this hearing is a very historic event. Since 1995, 

the Human Resources Subcommittee has held joint hearings with 

other committees only twice and never with our colleagues on the 

Agriculture Committee. It is way overdue that we approach this 

subject matter in this way. That is despite the wide overlap between the programs we oversee that assist millions of Americans 

with food stamps and other welfare benefits. 

So today’s hearing is long overdue and reflects the start of what 

I hope will be much closer cooperation ahead between our committees. What we will explore today is one of the worst side effects of 

current welfare program rules, the fact that getting a job or working more does not always make families better off. This poverty 

trap may be unintended, but for those in its grips, it is all too real. 

We need to review how we got here, how real people are affected, 

and how we can reform the system to help people go to work and 

earn more instead of making them worse off when they do just 

that. 

Consider how destructive today’s anti-work signals are. We have 

a chart. I will put it up on the screen. This chart shows one thing 

we know for sure is that work, and especially full-time work, is 

really the only cure for poverty. Less than 3 percent of people who 


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work full-time are poor. In contrast, people who don’t work are 8 

to 10 times more likely to be poor. 

So promoting work is the real key to helping people avoid poverty. Benefits can and should serve as a temporary bridge between 

jobs or to supplement earnings when someone can find only parttime work. But unless we are willing to tolerate more poverty—and 

I am not—those benefits need to reinforce, not undermine the importance of work. Redesigning welfare benefits to do just that is the 

challenge before us. 

I look forward to all the testimony and to working with Members 

on both sides of the aisle to find solutions to this problem. 

And with that, I am happy to yield to my colleague, Mr. Doggett, 

the ranking member of the subcommittee, for an opening statement. 

Mr. DOGGETT. Thank you for the opportunity to consider these 

matters. 

You know, when Lyndon Johnson declared war on poverty, he 

got underway programs that have changed the lives of millions of 

Americans for the better. In 1996, when we approved welfare reform, which I supported, we recognized there was a need to consider some of those programs and make alterations. 

When I hear talk this morning of another round of welfare reform, I want to be sure that the reform that is coming achieves 

more than the 1996 reform, does not simply use Federal resources 

to permit the States to displace their own commitment and denies 

so much assistance to individuals compared to where we were in 

1996. It needs to be about lifting people up, not just reform that 

is about cutting and numbers. 

There are things that this hearing can focus on that I think can 

be helpful. If you means test programs, benefits eventually stop 

after an individual earns a certain amount of money, we can and 

should mitigate the impact by preventing eligibility cliffs. And we 

have one model for that, though it is under constant attack in this 

room, and that is the Affordable Care Act. It did just that for lowincome workers by allowing them to earn more and still receive 

Medicaid in those States that had the good judgment to accept 100 

cents of the dollar to finance their Medicaid or to receive private 

tax credits for private insurance. 

But our Republican colleagues have continued to insist that these 

important steps must be repealed, and many governors, like my 

own, have refused to fully implement the promise of the Affordable 

Care Act. We can increase the phaseout range for programs so that 

benefits decline more gradually when a person goes to work. We 

can support programs that now actively promote and reward work, 

like the Earned Income Tax Credit, the Child Tax Credit. 

But for some people the solution to every problem—I view it as 

rather blockheaded—it is to block grant everything. Rather than 

pursuing these commonsense approaches of supporting work, I 

hope that this one-size-fits-all answer of block grants is not the 

only one advanced along with cutting Federal funding. 

Mr. Chairman, Americans deserve better than a cut-and-run 

strategy. We need concrete proposals for helping Americans find, 

keep, and advance in employment, not a reduction in the Federal 

commitment to reaching this critical goal. I hope our witnesses will 


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provide additional insight and recommendations for how we 

achieve that objective. 

And I yield back, and thank you. 

Chairman BOUSTANY. I thank the gentleman for his statement. 

I now yield time to the chairwoman of the Agriculture subcommittee, Mrs. Walorski, for the purposes of an opening statement. 

Mrs. WALORSKI. Thank you, Chairman Boustany, thank you to 

Chairman Ryan as well, for hosting this historic joint hearing between our two committees as we better explore how our welfare 

system can discourage work. 

As the chair of the Nutrition Subcommittee, we have spent the 

past 5 months exploring the Supplemental Nutrition Assistance 

Program, also known as food stamps. Our review of the past, 

present, and future of SNAP is why we are here today. We will explore real issues with another committee that is having many of 

the same discussions as we are. 

Throughout our review, I have stressed that we cannot just examine SNAP in a vacuum. We have to recognize there are other 

programs that exist and explore how they work or don’t work together. In my home State of Indiana, my fellow Hoosiers aren’t 

concerned about whose jurisdiction of committees this is. They care 

more about how we as legislators work together. Today is the next 

step in that process. 

During our last hearing, witnesses discussed the importance of 

case management and how they engage with recipients. We heard 

stories detailing the barriers they face. For example, workers near 

the poverty line who are eligible for multiple assistance programs 

stand to lose financially by increasing their income as their benefits are phased out. This is described by analysts as the welfare 

cliff. 

In the face of such a scenario, many people forego raises or put 

in fewer hours. Individual programs may attempt to address this, 

but it still requires a broader view of how programs interact to ensure that we as policymakers are not inadvertently discouraging 

work. 

Welfare programs should support those in need, not deter them 

from reaching their full potential in the workplace. I do worry that 

this cliff is a serious obstacle when recipients try to enter, reenter, 

and remain in the workforce in order to climb the economic ladder. 

Helping recipients move into better paying jobs not only benefits 

their families, but also benefits taxpayers. 

I am looking forward to hearing about ways to explore how we 

can improve the operation of these programs in order to help millions of Americans seeking a better future. 

Again, I thank Chairman Ryan and Chairman Boustany for 

hosting, and I look forward to working with them in the future. I 

also want to thank all of our witnesses for being here today with 

us and look forward to their testimony. 

Chairman BOUSTANY. I thank the gentlelady. 

I now yield time to the ranking member of the Agriculture subcommittee, Mr. McGovern. 

Mr. MCGOVERN. Thank you. 


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You know, the hard reality is that we can and we must do a better job in fighting hunger and poverty in America. For 7 years now 

I have called for a White House conference on food, nutrition, and 

hunger. Holding a White House conference like this would be a 

major step forward in our effort to reduce hunger and poverty by 

better connecting the dots amongst Federal and State agencies, 

nonprofits, faith-based communities, schools, hospitals, and the 

business community. Such a conference would help us better understand and meet the needs of the millions of Americans struggling to put food on the table and to help them transition to a better place. 

Being poor in America is hard work, and quite frankly, our safety 

net has some holes in it, and it must be strengthened to meet some 

of our families’ most basic needs. Talk to those who run our food 

banks. They will tell you that at the end of every month SNAP 

families are at their doors because they can’t afford to purchase 

any more food. 

And while we all want to encourage work, let’s state for the 

record that a majority of those on SNAP are kids, elderly, and the 

disabled. They are not expected to work. Of those who are expected 

to work, more than half do. Among those who work, 58 percent 

work full-time for 6 months or more after receiving SNAP. Remember that the next time you hear someone claim that SNAP recipients don’t work. About 60 percent of SNAP recipients who are expected to work do work for 6 months or more after receiving SNAP 

benefits. 

The real problem is that those who work earn so little that they 

still are eligible for the program. I believe that if you work in this 

country, you ought not to live in poverty. Where is the outrage over 

lousy wages? And yes, Pope Francis, and I agree with him, said: 

‘‘Where there is no work, there is no dignity.’’ But what about the 

indignity of low wages, of working hard two, three jobs, and still 

living in poverty? 

No doubt this is a complex problem, and I think American families deserve more, but that means talking about raising the minimum wage to a livable wage so that workers can earn enough to 

support their families, and it means creating a sustainable path to 

phase out safety net benefits only after they are on solid footing. 

Some of my friends have suggested we lower the marginal tax 

rates. An easy way to accomplish that is to extend phaseout ranges 

for programs in addition to SNAP, which I am sure some of my 

friends might not be crazy about because it will cost more. But 

without that critical investment, any changes in SNAP could hurt 

the program and actually make poverty worse. 

I am all for flexibility too, but if flexibility is code for block 

grants, I have got a big problem with that. Too often this results 

in anti-hunger programs like SNAP being underfunded and our 

most vulnerable families being left behind. 

Passing the buck to States, finding more ways to avoid adequate 

Federal investments in battling poverty solves nothing. Cutting 

SNAP as we did last year in the farm bill, cutting funding for job 

training, not permanently extending key features of the EITC or 

Child Tax Credit, these are dangerous policies that have often been 

presented by some of my colleagues as solutions. 


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These ideas make me nervous about what the majority is up to, 

and everyone at today’s hearing should think carefully about the 

consequences of such reckless approaches to the very programs 

that are essential to helping America’s most vulnerable families get 

on the path to the middle class. 

And I thank the chairman. 

Chairman BOUSTANY. I thank the gentleman for his opening 

statement. Without objection, each member will have the opportunity to submit a written statement and have it included in the 

record at this point. 

Now we will turn to our panel of witnesses. I want to remind our 

witnesses to limit their oral statements to 5 minutes. However, 

without objection, all of the written testimony will be made part of 

the permanent record. 

This morning we will hear from Dr. Casey Mulligan, professor, 

Department of Economics, University of Chicago. 

Next—and we are going to accommodate our next witness’ schedule when she arrives, she has had a little transportation issue—we 

will have Chanel McCorkle of Baltimore, Maryland, accompanied 

by Marsha Netus, director of operations at America Works of Baltimore. 

Thirdly, Erik Randolph, senior fellow, Illinois Policy Institute. 

Fourth, Olivia Golden, executive director, Center for Law and Social Policy. And fifth, Dr. Eugene Steuerle, senior fellow, Urban Institute. 

We welcome all of you. Your testimony is going to be very helpful 

as we carve a path forward on this. 

And so with that, Mr. Mulligan, please proceed with your testimony. 

STATEMENT OF CASEY MULLIGAN, PH.D., PROFESSOR, DEPARTMENT OF ECONOMICS, UNIVERSITY OF CHICAGO, CHICAGO, IL 

Mr. MULLIGAN. Chairman Boustany, Chairman Walorski, 

Ranking Member Doggett, and Ranking Member McGovern, and 

all the Members of the Subcommittee, thank you for really the opportunity and the honor today to discuss with you about how public 

policy has affected the reward to working. 

A basic economic principle is that the monetary reward to working has important effects on how many people are employed and 

how much they work. People without jobs or otherwise with low incomes sometimes receive benefits from social safety net programs. 

The benefits themselves are rarely called taxes by laymen, but 

economists understand the benefits to have many of the characteristics of tax rates because a program beneficiary loses some or all 

of her benefits as a consequence of accepting a job. 

I have illustrated the reward idea in figure 1 of my testimony. 

The left bar in that figure measures the resources available when 

working, and the right bar measures the resources the same person 

would have if not working, including subsidies net of taxes paid. 

The difference between the two bars is the monetary reward to 

working. 

Now, consider adding a new safety net program, which I put in 

green, or expanding an old one. Exactly because it gives more help 


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when not working, the new program reduces the reward to working. The combined effect of taxes and subsidies on the reward to 

accepting a job can be summarized as a penalty, the effective 

amount that is lost from paying taxes and replacing benefits associated with not working. I like to express that penalty as a marginal 

tax rate, namely as a percentage of employee compensation. 

If there were no penalty, then the marginal tax rate would be 

zero. Thanks to a labyrinth of tax and subsidy programs, the marginal tax rate can equal or exceed 100 percent, which means that 

at least as many resources are available when not working as when 

working. 

Government tax and spending rules reduce the reward to working for two separate reasons. First, the rules include income contingencies. The more income from work means more taxes and fewer 

benefits. But second and separate and not unimportant is the rules 

include employment contingencies. More employment for a family 

affects its taxes and benefit amounts even if their income is the 

same. 

For unmarried middle-class Americans, SNAP is not a marginal 

tax on their income, despite the 30 percent benefit-reduction rate, 

because they are ineligible for the program whenever they are 

working. But SNAP is a marginal tax on their employment because 

every month out of work is another month of SNAP eligibility. This 

is one of the many examples where a program’s employment contingencies have different economics from its income contingencies. 

Legislation that cuts or credits taxes, so to speak, can nonetheless reduce the reward to working and increase the marginal tax 

rate if it cuts taxes more for those who work than it cuts taxes for 

those who work less. 

At the same time the safety net programs implicitly tax job acceptance, they also implicitly subsidize layoffs because the programs absorb some of the income and production that employer 

and employee together lose when an employee stops working. Layoff subsidies give employers and employees less incentive to take 

the steps that might avoid or delay layoffs. 

Let me be clear, America absolutely must have taxes and safety 

net programs even though they reduce the reward to working and 

even though they subsidize layoffs. But if you want to understand 

what is happening in the labor market or to the budgets of social 

programs, it is counterproductive to approximate marginal tax 

rates as zero or to assume that they are eternally constant regardless of what comes in new legislation. 

The resources provided for people not employed or underemployed have increased in the past decade. SNAP program rules 

have changed in a variety of ways. Unemployment benefits are now 

paid in a variety of new circumstances. The Recovery Act and now 

the Affordable Care Act help unemployed people pay for their 

health insurance. 

Figure 2 shows my estimates of 9 years marginal tax rates coming from tax and subsidy programs, taking into account that some 

of the poor and unemployed do not participate in all or sometimes 

none of the safety net programs. The combined effect of these and 

other changes through this year was to reduce the reward to work, 


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that is, increase marginal tax rates for most of the nonelderly population. 

The cumulative effect of all this legislation is to increase average 

marginal labor income tax rates by 7 percentage points over what 

they were in 2007. A presumably unintended consequence of the recent safety net expansions has been to reduce the reward to working and thereby keeping unemployment and poverty rates high, 

keeping national spending low, longer than they would have been 

if safety net program rules had remained unchanged. 

Thank you. 

Chairman BOUSTANY. I thank the gentleman. 

[The prepared statement of Mr. Mulligan follows:] 


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f 

We will defer on Ms. McCorkle and Ms. Netus’ testimony until 

she arrives. So next we go to Mr. Randolph. 

Mr. Randolph, you are recognized for 5 minutes. 


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STATEMENT OF ERIK RANDOLPH, SENIOR FELLOW, ILLINOIS 

POLICY INSTITUTE, CHICAGO, IL 

Mr. RANDOLPH. I want to sincerely thank the chairwoman, the 

chairman, and all the Members of the Subcommittees for inviting 

me to be here today and allowing me to speak. 

You have before you a very challenging issue. This is difficult 

and complex, and I am pleased that you have the courage to undertake it. It is solvable. Let me say it is solvable, and you can succeed, and I think you will succeed, and this Nation will be better 

because of your efforts. 

My name is Eric Randolph, and I am a senior fellow with the Illinois Policy Institute, and I also provide analytical services as an 

independent consultant. Last year, the institute sponsored me to 

develop a computational model examining welfare benefits, Federal, State, local, and to determine the impact of economic incentives relative to employment. The results of the study are nothing 

short of astounding. In some cases, it literally does not pay to climb 

up that career or opportunity ladder. 

Now, just imagine that you are a single parent with two children 

living in Lake County. It is a suburb of Chicago. You have a job 

earning $12 an hour. Someone offers you a job for $18 an hour. 

Should you take the job? Well, under the scenario that we studied, 

the answer is no, keep your $12 per hour job. 

At first glance, this makes no sense. Of course someone would prefer to make $18 as opposed to $12. But as a single parent managing a household with children you want to maximize all your resources. You have children to take care of, yourself to take care of, 

and it doesn’t matter if those resources are earned through work 

or if it is given to you through benefits. A single parent in Lake County earning $12 an hour brings home 

just over $22,000 a year. However, that same single parent is eligible for an array of welfare benefits that we can categorize, the refundable tax credits, the food assistance, housing assistance, subsidized childcare services, and medical assistance. When you add 

up the value of all the benefits that they can receive from these 

programs, it comes to an astounding $40,000. Now, that makes the 

total receivables, when we include the earned income, almost 

$62,000. 

Now, in comparison, suppose this mother would take the job earning $18 an hour, okay? She would lose almost $34,000 in the 

benefits to gain only $11,000. Now, why would anyone take a job 

to gain $11,000 but lose $34,000 in benefits? 

This is the welfare cliff that we are talking about, and this is 

what traps people. This is just but one scenario we studied using 

the computational model. We studied two other counties in Illinois, 

and we studied two-parent households, and guess what, it is essentially the same. 

So the system that we—well, let me just say, we drew a number 

of conclusions looking at this. The very first one is the magnitude 

of the potential benefits of the family that they receive is large. It 

is a general conclusion. $40,000 is not a small sum of money. The 

second is that the welfare cliff can be significant, and it is cruel. 

The third is economic disincentives are real, major, and they can 

indeed trap families. The fourth is the system is inequitable, and 


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that is, to compare someone who is not receiving these benefits, 

could be worse off financially than someone receiving these benefits. That is not equitable. Fifth, programs with the steepest cutoffs 

are the greatest culprits. 

Finally, everyone should agree that there ought to be an income 

ladder such that when someone earns more money, he or she is in 

fact better off. However, this is not the system we have as a Nation 

today. It will take the cooperation of many individuals and political 

courage. 

In my opinion, we will not be successful by giving more control 

to the Federal Government. We can only succeed if we take advantage of the laboratories of democracy, allowing States to innovate 

and finding the best solutions. 

Chairman BOUSTANY. I thank the gentleman. 

[The prepared statement of Mr. Randolph follows:] 


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f 

Ms. Golden, you are recognized for your oral testimony. 

STATEMENT OF OLIVIA GOLDEN, EXECUTIVE DIRECTOR, 

CENTER FOR LAW AND SOCIAL POLICY, WASHINGTON, DC 

Ms. GOLDEN. Good morning, Chairman Boustany, Chairman 

Walorski, Ranking Member Doggett, Ranking Member McGovern, 

and Members of the Committees. Thank you so much for the opporVerDate Mar 15 2010 06:51 Jan 22, 2016 Jkt 097912 PO 00000 Frm 00042 Fmt 6633 Sfmt 6602 I:\WAYS\OUT\97912.XXX 97912

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tunity to testify. I am Olivia Golden, the executive director of the 

Center for Law and Social Policy, an anti-poverty organization that 

promotes effective Federal and State policies. 

In addition, I bring to this testimony experience in directly administering safety net programs at the Federal, State, and local 

levels, as well as studying them as a researcher at the Urban Institute. I will briefly summarize three main points from my written 

testimony. 

First, researchers have demonstrated that the Nation’s core safety net programs, programs like the Earned Income Tax Credit, 

SNAP, childcare assistance, health insurance, sharply reduce poverty. They cut it almost in half. They improve nutrition and health 

care for millions of children and families. And—and this is really 

important emerging research—they have positive effects on children’s health, work trajectory, and income many years later into 

adulthood. Just to take one example, SNAP benefits alone kept 

more than 10 million people, including almost 5 million children, 

out of poverty in 2012. 

Second key point. The research evidence indicates overwhelmingly that the safety net as a whole supports work, particularly for 

low-income parents. It is not too much support from the safety net 

but too little, such as the absence of enough help with child care, 

that typically holds people back from working. 

While some individuals encounter barriers to work related to 

safety net programs, researchers find that these effects are much 

smaller than the programs’ work-promoting effects, and many past 

barriers have been fixed in recent years. I think Mr. Doggett alluded to the Medicaid improvements. In fact, the majority of people 

who get help from core safety net programs today are working but 

earning too little to make ends meet without help. 

To take a moment to summarize the research, theories about 

work disincentives are just not supported by what researchers find 

about low-income families’ actual experiences. Rigorous studies find 

that when low-income working parents can get and keep the full 

package of work support programs, they are better able to stabilize 

their lives, keep a job, move up, and help their children thrive. 

For example, studies of parents leaving welfare for work have 

concluded that families accessing these supports were more likely 

to be stably employed. Studies of the Earned Income Tax Credit 

show large effects in increasing labor force participation. And empirical studies of the effects of the safety net taken as a whole confirm that, in practice, these programs’ work disincentives are so 

small as to have, quote, ‘‘almost no effect on their anti-poverty effectiveness.’’ 

In fact, one of the major success stories of the past two decades 

is that the safety net has made work pay as a result of specific decisions by Congress and the States to improve work incentives. One 

striking piece of evidence: Poor and near poor mothers who are eligible for the widest range of safety net benefits have become far 

more likely to work than they used to be. By contrast, employment 

has declined among childless adults, the group with least access to 

the safety net. 


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Finally, my testimony highlights practical next steps. I urge the 

Members of the Committees to consider six next steps that build 

on past success. 

First, extend the improvements to the Earned Income Tax Credit 

and Child Tax Credit that now expire at the end of the 2017. 

Second, expand the EITC to childless workers, including young 

adults, who now don’t benefit from this work incentive. 

Third, expand funding for childcare assistance whose importance 

was recognized by a recent bipartisan reauthorization in the Congress. 

Fourth, fully fund implementation of another program reauthorized in a bipartisan manner, the Nation’s workforce program, so 

low-income workers can move into family-supporting employment. 

Fifth, explore two-generational strategies that help parents move 

up at work and enhance children’s life chances at the same time. 

And sixth, avoid counterproductive ideas such as block grants 

that would turn back the demonstrated successes of the safety net. 

In conclusion, as a result of policy improvements over the last 

two decades, the major national safety net programs combine a 

strong impact on poverty with positive work incentives for low-income families. I urge you to consider building on this momentum 

with additional practical steps such as those I have highlighted 

here. 

Thank you very much, and I look forward to your questions. 

Chairman BOUSTANY. Thank you, Ms. Golden. 

[The prepared statement of Ms. Golden follows:] 


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f 

Next we will go to Dr. Steuerle. 

You are recognized, Dr. Steuerle. 

STATEMENT OF EUGENE STEUERLE, PH.D., SENIOR FELLOW, 

URBAN INSTITUTE, WASHINGTON, DC 

Dr. STEUERLE. Thank you, Chairpersons Boustany and 

Walorski, Ranking Member Doggett and McGovern, Chairman 


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Conaway, and Chairman Ryan, if he returns. I thank you for this 

opportunity to testify before you again. My name is Gene Steuerle, 

and I have worked with you on many tax, budget, and welfare 

issues over time, and again, it is an honor to be here again. My 

remarks reflect my own views and not those of the institutions 

with which I am associated. 

Despite the rhetoric about living in an age of austerity, we live 

in a time of extraordinary opportunity. On a per-household basis, 

our income is higher ever than even before the Great Recession, 

and 60 percent higher, by the way, than when Ronald Reagan was 

elected President. 

The best options, in my view, for the future of a social welfare 

budget cannot possibly be determined well by the needs and parameters established decades ago in a very different economy and 

driving the programs we are talking about today. Two examples enlighten us as to how bipartisan efforts actually led to important forward-looking shifts from past policies. 

Republicans and Democrats did not always agree on the merits 

of either AFDC or the Earned Income Tax Credit, yet they did 

favor a shift from welfare toward wage subsidies. Ditto for moving 

from public housing to housing vouchers. To me, these give evidence that there are bipartisan ways of getting around the type of 

problem we are talking about today. 

I also sense that both the American public and you, their elected 

representatives, are united in wanting to create a 21st century social welfare budget. That budget, I believe, should and will place 

greater focus on opportunity, mobility, work, and investment in 

human, real, and financial capital. However, for the most part, we 

have never really had a social welfare budget that is focused on 

mobility and work. 

As I show in ‘‘Dead Men Ruling,’’ you hold office at a time unique 

in our Nation’s history, a time when the politically unattractive option of reneging on promises the public feels it has been made has 

been turned into a requirement. Economic growth, even if modest, 

always provided new opportunities. It is just that you now operate 

within a budget where too many choices have already been preempted by dead and retired elected officials who continue to rule. 

For instance, projections by the Congressional Budget Office and 

others imply that government is scheduled to spend in excess of $1 

trillion more annually in about 10 years. And by the way, those 

numbers come about whether you are dealing often with a Republican or a Democratic budget because they are derived from economic growth. Yet all of that money, plus some, has already been 

absorbed by other commitments that have been made, and the traditional source of flexibility in the budget has been removed. 

Now, one important component of the reform that is necessary, 

if we could reallocate those future resources, increased resources, 

would be the combined marginal tax rates imposed mainly on 

lower-income households and their potential negative effects on 

work, wealth accumulation, and marriage. 

To see how many programs combine to reduce the reward to 

work and marriage, I invite you to look at the first figures in my 

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able programs, like the Earned Income Credit, SNAP, and health 

insurance, average about 66 percent when moving from about 

$15,000 of income to about $55,000 of income, typically when moving toward full-time work, taking a second job in the household, 

and particularly facing the very large penalties if you happen to 

marry another worker. 

Those beneficiaries of additional housing and welfare were not 

even included in this first figure. You add those in, and the rates 

get up above 75 percent on average. 

Now add in items like transportation, consumption, and childcare 

costs—childcare costs are dealt with quite clearly by the testimony 

by Ms. McCorkle—and the gains from work fall even more. Sometimes there are no gains at all. 

So while there is widespread disagreement on the size of these 

disincentive effects on work and marriage, there is little doubt that 

they do exist. One way out of this bind, as I keep trying to emphasize, would be to focus future increased resources more towards an 

opportunity budget that emphasizes early childhood, quality teachers, work subsidies in lieu of more subsidies just for consumption, 

decent neighborhood environments, and similar items. 

Combined tax rates could also be made more explicit, and work 

could be made a stronger requirement when they receive some benefits. And by the way, cutting healthcare cost plays a big role here 

too. 

I will be glad to discuss these options further with you as the 

hearing proceeds. Thank you. 

Chairman BOUSTANY. Thank you, Dr. Steuerle. 

[The prepared statement of Dr. Steuerle follows:] 


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f 

And we now welcome Ms. McCorkle. We are glad you were able 

to make it. I know transportation can often be treacherous around 

here. But anyway, we certainly welcome you, and you may proceed 

with your testimony. 


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STATEMENT OF CHANEL MCCORKLE, BALTIMORE, MD, ACCOMPANIED BY MARSHA NETUS, DIRECTOR OF OPERATIONS, AMERICAN WORKS, BALTIMORE, MD 

Ms. MCCORKLE. Hello. How is everyone today? Thank you for 

allowing me the opportunity to testify before you today. My name 

is Chanel McCorkle, and I am grateful to share my story. 

I moved to Baltimore in April 2011 with my daughter and her 

father. We were new to Baltimore and had no place to go. I moved 

in with my two sisters and was told about the City Homes program. I was told it was an organization that would help me find 

affordable housing for my family and me. 

The same day I applied, I was rejected. According to City Homes, 

I had not worked in the State for at least 18 months and therefore 

was ineligible for assistance. Forced to remain with my sisters, my 

next step was to go to the Department of Social Services for additional support. Fortunately, I was granted food stamps and medical 

assistance. 

I found a job at Rite Aid Pharmacy as a cashier making $9 an 

hour. When I let the Department of Social Service know of this job 

and my earnings, they dramatically lowered my food stamps. The 

$200 reduction made it difficult to make ends meet. 

One year later, I found a better opportunity as a grill chef at St. 

Joseph’s Hospital. The full-time position required me to find and 

maintain stable and reliable daycare for my 3-year-old daughter. I 

again went to the Department of Social Service for help. I applied 

for daycare vouchers and was turned down. I was informed that 

$11 per hour was too high of an income to receive vouchers. I was 

forced to rely on friends, family, and neighbors to babysit while I 

worked. 

I found myself bouncing my daughter around from place to place, 

from person to person, in order to keep my job. After a while, the 

holes in my daycare situation became more and more apparent as 

friends and family were not able to commit full-time due to their 

own work obligations. I struggled with my attendance every day, 

and over the course of 2 years, I was calling out weekly due because I had no sitter for my child and I could not afford to pay a 

childcare center. 

In 2012, I became pregnant with my son, and after he was born, 

I needed additional help with childcare. I added him to my social 

service case and still was not eligible for daycare vouchers. I was 

eventually let go from St. Joseph’s Hospital for missing too many 

days of work. 

After I lost my job, I applied for temporary cash assistance 

through the Department of Social Services. Thirty days after I applied, I was granted cash assistance and immediately received 

daycare vouchers and an increase in food stamp assistance. The 

daycare vouchers I so desperately needed while I was working were 

finally granted to me after it cost me my job. 

I was also placed with America Works of Maryland, Inc. America 

Works taught me how to dress professionally, answer interview 

questions, format a resume, and seek current and worthwhile job 

opportunities. I feel like I had to lose my job in order for social 

service to really help me. 


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I have recently accepted a job working 40 hours per week with 

excellent benefits. I am really excited to return to work. I know 

that after the Department of Social Service gets notified, I will lose 

some, if not all of my benefits, and that is scary. I am sure they 

will take my daycare vouchers from me or make the copayment too 

high, my food stamps will be decreased or nonexistent, and my 

medical benefits may end. 

I have tried to make provisions if those things should happen. I 

have just started to get back on track, and I know I am well on 

my way, no matter how much of an uphill battle it may be. I am 

fighting to get back to work to support my family and become independent once again. 

Thank you for allowing me this opportunity. I look forward to 

any questions. 

Chairman BOUSTANY. Thank you, Ms. McCorkle, for sharing 

your story with us. 

For the members, we have three votes. There are about 91⁄2 minutes left. We are going to continue for a while longer, and then we 

will recess for votes when we get down a little further on the clock. 

With that, Ms. Netus, you may proceed with your testimony. 

Ms. NETUS. Chairman Boustany, Chairman Walorski, thank 

you for the opportunity to speak before the committee today. I 

would also like to thank the House Ways and Means Committee 

Chairman Paul Ryan and the rest of the distinguished committee 

members. My name is Marsha Netus. I am the vice president and 

general manager of America Works of Maryland, Inc. It is my 

pleasure to testify before you today. 

America Works was founded in 1984 and was the first for-profit 

company dedicated to helping individuals become self-sufficient 

through employment and retention services. Founder Peter Cove 

and president and CEO Dr. Lee Bowes made it their life mission 

to improve workforce development programming by connecting socially deemed hard-to-serve job seekers with private sector employment. 

In 1997, the Maryland office located in downtown Baltimore was 

opened with the goal to help long-time welfare recipients find unsubsidized employment. Since then, the Maryland office has expanded its services to assist even harder-to-serve populations, such 

as violent ex-offenders who have been incarcerated for at least 1 

year, long-time SSI or SSDI beneficiaries, disabled veterans, and 

youth aging out of foster care. 

Collectively, we have placed over 10,000 people into stable employment. Our networks of employers rely on us to connect them 

with qualified individuals eager to work. I have been part of this 

branch since its inception, witnessing the implementation of the 

Personal Responsibility and Work Opportunity Act through the 

transition to the Deficit Reduction Act of 2005. 

Through my observation, regardless of the population served, 

Chanel’s testimony demonstrates a true reality for those facing upward mobility. Fear is linked to the reality of the clients we serve. 

Even when finding clients to testify before you today on their realities of life, fear surfaced among them that retribution could occur, 

making an already difficult situation worse, like sanctions for 

choosing to be selective with employment. 


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Individuals will turn down a job for fear their other support services could be interrupted. Here you have Chanel, a single mother 

raising two young children, highly motivated to work, but apprehensive of taking full-time employment because although she will 

earn a livable wage, her daycare copay and the loss of food stamps 

could keep her in the same socioeconomic status as before employment. 

When I met Chanel, she was elated to share she was hired at 

the new Amazon distribution center in Baltimore, a 40-hour-a-week 

job with excellent benefits, but gravely concerned that this opportunity could result in a repeat of the past. She had great jobs before, decent wages, good benefits, and chances to create a career 

path for her family, but lost them because although it sounds like 

a good situation, the reality is she still needed transitional assistance. 

Although she is excited about this new opportunity, she is feeling 

a bit leery about her outcome. Will this really be the chance to get 

off the system? Although our retention team will provide her with 

the guidance and supports needed to succeed, certain supplements 

are simply out of our control. Clients have declined good jobs for 

fear it could affect their extended supports, such as housing, child 

care, medical assistance, and food stamps. 

As wages increase, the likelihood of the client contributing more 

equally increases. Our experience has found that there are others 

that will just take the opportunity, eager and determined to provide more for their families, only to result in being terminated because the reality is they are still relying on public assistance like 

daycare vouchers. 

Without a true support system, they cannot make it work. Sadly, 

once their earnings exceed a federally defined hardship amount, 

they no longer qualify for assistance, and in all likelihood it may 

be eliminated altogether. 

This could be the case for Chanel. Despair enters their world, 

and my staff and I aggressively work to instill hope back into their 

lives. This is even more challenging for those who have gone 

through specialized training programs. 

Chairman BOUSTANY. Ms. Netus, because of the vote schedule, 

can I get you to wrap up on your oral testimony? We have your full 

written testimony for the record. 

Ms. NETUS. Sure. 

[The prepared statement of Ms. McCorkle and Ms. Netus follows:] 


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f 

Chairman BOUSTANY. Thank you. 

Ms. NETUS. Often at a financial cost to themselves, never resulting in employment, yet alone earnings initially marketed to 

them. 

America Works has developed several programs where skills development is in direct correlation with private sector needs, providing the individual with not only the theory aspect of the job, but 

the realistic experience of understanding. 

I petition the committee to truly evaluate the transitional process 

and support systems for helping low-income working families leave 

the welfare system. Unfortunately, the priority is aimed at ensuring full participation of work activity, as defined by the law, to not 

accrue penalties instead of a system designed to guarantee stable 

employment. 

Through our experiences, we know people want to work. With 

proper matching, there is a job for everyone, but we need an unmitigated system to ensure longevity of employment, which will result in reduction of the welfare rolls. 

Thank you for the opportunity to testify before you today. 

Chairman BOUSTANY. Thank you, Ms. Netus. 


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I will inform members that we have just over a minute left on 

the vote if members do want to break out to vote. There are three 

votes. And when we do recess for the vote, we will come promptly 

back and resume the hearing. 

So with that, I will begin questioning of our witnesses. We will 

go through a round of questions. 

These programs, we have a myriad of welfare programs that 

have been created over a course of years. They were individually 

designed to help families in need. But the collective effect of this, 

as we have heard in testimony, can discourage people from working 

and make them actually financially worse off because of cliffs and 

the things that we have heard about. 

Ms. McCorkle, your story is very compelling and very helpful to 

us, to give us a real-life example of what happens, because our goal 

is to help individuals like yourself who are trying to do the right 

thing, working hard day in and day out to do the right thing, taking a job, trying to get ahead, trying to improve, but we want to 

make sure that these programs work appropriately and don’t penalize you when you try to do the right thing. 

So in your opinion, how are we doing, based on your experience? 

Ms. MCCORKLE. Based on my experience, I feel like you are 

doing okay. I just feel like you should allow more time, don’t just 

snatch the benefits away from the client because they found a job. 

Give like a couple of months to get yourself together. If you didn’t 

save money, give you time to save your money, give you time to 

just get yourself established, and then decide if you are making 

enough money, you can handle it, then go ahead and take it out. 

Don’t take it all the way away, just knock it down a little bit until 

they are established enough to actually get off the system. 

Chairman BOUSTANY. So as you were looking to go back to 

work, were you afraid that you might end up worse off? Did you 

encounter fear or were you concerned? And then once you went 

back to work, did you feel like, ‘‘Well, this is not working out for 

me, I am worse off’’? Is that the case? 

Ms. MCCORKLE. When I wasn’t working, I felt like everything 

was okay. I went back to work, I felt like I was worried because 

of the hours I was working. You couldn’t find a daycare open for 

those hours, and then you couldn’t pay the cost, and then you had 

to find people. But then if the people didn’t work out for you, I had 

to call out, so I was worried. 

So I am not working now, but I do start my new job tomorrow. 

I will be back. I am excited. At the same time I am worried about 

losing the vouchers or having the copay too high. You just start 

getting paid, so how are you going to pay your copay, and then you 

have to pay somebody to watch your kids. So it is actually like a 

worry. And then they are going to cut your food stamps, so who is 

to say you made enough to put enough food in your house for your 

kids? 

Chairman BOUSTANY. Did you feel like you were in a trap? 

Ms. MCCORKLE. It kind of does, yes. 

Chairman BOUSTANY. Okay. 

Ms. MCCORKLE. It does. 


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Chairman BOUSTANY. Thank you. Your story is very strong. It 

is a very helpful story to us because it is a real-life example of 

what we are trying to deal with as we coordinate these programs. 

Individually the intentions have been good over time to create a 

good safety net, but the problem is, the way these programs have 

interacted, I think they are not fair to individuals like yourself. 

And so the whole purpose of this in coordinating with the other 

committee is to try to figure out how we can better make these programs work for those that they are intended to help. 

Dr. Steuerle, this problem, I assume you would answer yes, that 

this problem calls for a national answer. This is a national problem. It is Federal policy interacting with State policy. But we need 

certainly guidance from Congress as we clean this up. 

Dr. STEUERLE. I think that is correct, Chairman Boustany. And 

part of the issue, as you say, this issue has arisen over the years 

and the decades, and the question is whether there is any quick 

fix. 

Part of what I am trying to lay out in my testimony is, is if we 

think ahead 15, 20 years when resources in the economy are going 

to be greater, we can, I think—I think we have an established base 

to provide people minimum levels of consumption. I think we can 

start moving on this particular problem. 

So, for instance, primary education, we don’t think of it, creating 

marriage penalties and work disincentives. There are a lot of 

things we do. Visiting nursing programs that a number of people 

are engaged in. 

The other issue, which nobody wants to address a lot, is a lot of 

this has arisen jurisdictionally when spending used to be determined by the expenditure committees and taxes were basically paying for public goods. Now that we have about $35,000 on average 

per household in transfers coming from the government, now the 

tax-writing committees do transfers, the spending committees do 

taxes. 

And so I think there is a jurisdictional issue too that you are trying to address by having this joint committee of how you can make 

joint decisions about these issues, and I don’t think that is resolved 

at all. 

Chairman BOUSTANY. Right. Yeah. Well, I think we are just 

getting started on that, and hopefully we will be able to clear up 

a lot of this. But then the other issue is how do you empower those 

closest to those in need, working with the States and people at the 

State level to coordinate those efforts? Because we have to do work 

up here, but we also have work at the State level since these are 

combined programs. 

Dr. STEUERLE. So I have a lot of options in my testimony, but 

one of them is to think about giving at the State level, there is this 

debate about whether you actually give grants to the States, but 

you could give State workers more flexibility to, say, combine some 

of the programs, provide the same level of benefits, say, to somebody who is getting these benefits, but merge them in a different 

way. Maybe they need transportation, maybe they are willing to 

sacrifice something to do education. To create a little more of those 

types of options I think—— 


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Chairman BOUSTANY. More of a customized casework approach 

perhaps, with the flexibility built in. 

Ms. GOLDEN. Can I comment? 

Dr. STEUERLE. In conjunction with the client. 

Chairman BOUSTANY. Yeah, Ms. Golden, quickly, because I 

have to run to vote here. 

Ms. GOLDEN. I am just going to comment on Ms. McCorkle’s situation and your courage. 

First of all, you should be a reassured. Given the numbers in 

Maryland, you should end up with your income almost doubling, 

and that is because of one thing that is Federal, just to highlight 

the committee’s jurisdiction, the Earned Income Tax Credit and the 

Child Tax Credit. 

But second, I want to highlight your concern about child care, 

which again goes to that Federal-State relationship, is an enormous issue for mothers across the country, and the challenge there, 

I think, is not flexibility but money. The State of Maryland does 

enable people who leave welfare to stay on child care, but you 

couldn’t get on before when you were working because they have 

a waiting list, and that is because, flexibility or not, they just need 

those resources and they can’t stretch them far enough. So I think 

that is a piece of the Federal-State dynamic. 

Chairman BOUSTANY. Thank you. 

I am going to have to recess the hearing now. We have votes. We 

have three votes. We will resume immediately upon concluding the 

last vote. So with that, the committee stands recessed. 

[Recess.] 

Chairman BOUSTANY. The subcommittee will now resume proceedings. And given that I have concluded my questioning of the 

witnesses, I will now turn to Mrs. Walorski for questioning. 

Mrs. WALORSKI. Thank you, Chairman Boustany. And, again, 

thank you to the panel for being here. 

Ms. McCorkle, I didn’t get a chance to say hi when you came 

here, and we just came back from votes. But thank you so much 

for being here and testifying, Ms. Netus as well accompanying her. 

We have all the experts here. We have seen the graphs, so we have 

studied this. But you are the one that has actually lived through 

the process. So when we talk about, we have been talking about 

this cliff, this welfare cliff. And so my question to you is do you 

think the welfare cliff is real, and if so, can you just talk about the 

challenges of this whole process of reentering the workforce. 

Ms. MCCORKLE. Yes, I believe the cliff is real. It is what I am 

experiencing. The process of going through work is it is really easy 

to find the job. It is really easy to get the job. It is just really hard 

to keep the job if you don’t have the support you need to help with 

child care and child care is being a big issue, then it is kind of hard 

to keep your job. 

Mrs. WALORSKI. And so, Ms. Netus, if you could also kind of 

fill in here, and with what your organization does, and kind of like 

tie in this network and web together. So is Ms. McCorkle an exception to the rule? Do you see this pretty much as a—they have a 

new phenomena of this cliff? 

Ms. NETUS. Chanel is actually—she is common. Most of the people coming through the door that have moved on into permanent 


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employment, as I stated earlier, are very fearful because, not only 

Chanel, her greatest fear is child care. I have a number of participants whose fear is housing. The moment they start working, their 

housing expenses start to rise. We also have a number of individuals that deal with just food stamps. As Chanel mentioned as well, 

too, that once they start working, the month after, their food 

stamps are more than likely adjusted. 

Mrs. WALORSKI. Yes. I need to pause you there. 

Ms. NETUS. So it is common. 

Mrs. WALORSKI. Mr. Steuerle, I just have a really quick followup on something you said as well when you talked governors and 

changing mind sets, things like that. What can local and State governments do? What kind of role can they play in this whole mobility issue? 

Dr. STEUERLE. I don’t know what they can do directly. I do 

sense, as I responded to Chairman Boustany, I think we can give 

them more options to think about combining or merging programs 

or giving—say, a recipient is eligible for a given level of benefits, 

to take that level of benefits and split it some other ways maybe 

for transportation, education, or something. Maybe they are willing 

to accept a little bit less food stamps. The complication is a lot of 

cases, they don’t have the jurisdiction. There is a huge jurisdictional splits. It is also an issue that my colleagues have dealt with 

a lot. There is not one-stop shopping for the client as well. So there 

is all sorts of coordination. One thing you might try to provide incentives as far as just figure out ways to get these data sets together so we can actually figure out what is going on state local 

levels. 

Mrs. WALORSKI. I appreciate it. My time is up. Mr. Chairman, 

I yield back my time. Thank you. 

Chairman BOUSTANY. Now I yield to the ranking member of 

the subcommittee, Mr. Doggett. 

Mr. DOGGETT. Thank you. And thanks to each of you for your 

important testimony. I am pleased to note that as you have been 

testifying, Chief Justice Roberts writing for six members of the 

United States Supreme Court has upheld the health care security 

of many of the people that we are talking about right now. As he 

wrote, quote, ‘‘Congress passed the Affordable Care Act to improve 

health insurance markets, not to destroy them.’’ And he rejected 

the rejectionist argument that he said would, quote, ‘‘likely create 

the very death spirals that Congress designed the Act to avoid.’’ 

So I hope that as we address the issues that you are raising in 

your important testimony, that we will learn from the Affordable 

Care Act; we will cease the 60-plus attempts to repeal it, and get 

about the business of how we improve and strengthen it. And as 

it relates to this whole question of cliffs, how we can learn from the 

important legislative changes that were made in the Affordable 

Care Act. 

Let me ask you, Ms. Golden, I appreciate your answer to the last 

question, to talk a little more about what I refer to as the blockheaded approach of giving States like Texas that are rejectionist 

States, that have rejected the Affordable Care Act, despite the 

800,000 Texans that are benefiting already from these marketplaces and the many more who could benefit from the expansion 


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of Medicare, what the likely effect is of providing Texas and other 

such States a block grant, and how block granting programs like 

SNAP are giving the States the option of pushing multiple programs into one block grant program? What will that likely actually 

do for the working poor, for the people that are out there struggling 

with two or three jobs but don’t really have a living wage? 

Ms. GOLDEN. So I think we know—— 

Mr. DOGGETT. Would you turn your—— 

Ms. GOLDEN. We know a lot about the disadvantages of block 

grants, that they risk turning back the successes of the safety net 

and making the work issues worse. You note the State choice 

around Medicaid. Ms. McCorkle doesn’t have to worry about her 

health insurance because Maryland made the right choice on Medicaid expansion. In Texas, she would have to worry about it. 

So a couple of things about block grants. One is that they, in 

every case I can think of in the poverty and human services area, 

they go down over time. TANF is down by 40 percent. Child care, 

my written testimony says, we are serving, you know, the fewest 

people we have for a dozen years. And not only do they go down 

over time, they don’t respond to economic trouble. 

So during the recession when family need was greatest for those 

struggling low-income working people, SNAP and Medicaid responded to that need, kept people access to health insurance and 

food, TANF as a block grant did not. 

As you know, they raised the big problem of State—of differences 

by State. So that the benefits for children that I talked about, depend on where a child is born. And the forth thing, which I think 

is a very big issue, they don’t solve the problem that has been identified today. If the State of Maryland, which we were just hearing 

about, is not able to provide sufficient child care benefits, to make 

sure that people are able to keep that for, you know, for the long— 

a long time, or to get it when they are in low-wage work, that is 

not about flexibility. It is not that that family needs child care instead of healthcare coverage for their kids, it is about dollars. 

And the Congress has come to a bipartisan reauthorization of 

child care legislation. There is money proposed by the authorizing 

committee for that. There is a proposal by the President in his 

budget for expanding dollars. Child care is very flexible. States get 

to make lots of choices about how to spend it, but flexibility doesn’t 

compensate for not having the resources to meet the needs that you 

have got. 

Mr. DOGGETT. Thank you, so much. I yield back, Mr. Chairman. 

Chairman BOUSTANY. Now I go to Mr. McGovern. 

Mr. MCGOVERN. Well, thank you. And I appreciate your answer 

to Mr. Doggett’s question, because I think—you know, I think we 

want to be clear here, that when people are talking about block 

granting programs, they are not talking about expanding the resources that States have to be able to do more. And, you know, earlier, I think Ms. Netus was talking about Ms. McCorkle’s issue 

with day care. But that was—that was a problem with the day care 

block grant in Maryland. And my colleague from Illinois, Mr. 

Davis, when he comes back, might be able to respond with some 

information about how Illinois is doing a better job with their day 


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care block grant. But it points out, I think, how States have to 

make tough choices when it comes to block grants that are—you 

know, that don’t mean that we are expanding resources. 

On the issue of the cliff, I understand, because I bumped into 

people, you know, who have told me their stories. But the challenge 

is, the problem they talk about is that the benefits earn—end too 

soon. They would like them to continue. I think that is something— 

I think we should have that discussion. But let’s be honest, that 

is going to require additional resources, which I think—I don’t 

know where the mind set of the current leadership in this Congress 

is, but it is probably not in that direction. 

But, Ms. Golden, I mentioned in my opening statement that I 

think if you work in this country, you ought not to have to live in 

poverty. And it infuriates me that, you know—that there are too 

many workers in this country who earn such abysmally low wages 

that we tolerate here, in some cases even encourage by some of our 

policies here, but these people still qualify for a lot of these benefits, including SNAP. 

The American taxpayer is subsidizing low-wage work in this 

country. Can you talk about how raising the minimum wage to a 

livable wage might actually help people transition off of SNAP? Because a livable wage is what we want here. It is not just going to 

get people into the workforce. We are doing that, and people are 

still so poor. How do we—how could that help here? 

Ms. GOLDEN. So, I am glad you raised that, because one of the 

things I highlight in my testimony is that the problem for low-wage 

workers is a lot about the labor market. The public safety net programs are doing a lot of what they need to do very successfully, but 

when you look at, say, kids in poverty, 70 percent of them are living with someone who work, a third of are living with someone who 

works full-time full year. So the issues are wages that are too low 

and hours that are insufficient, and jobs that are transient and impermanent. 

So addressing the problem of wages essentially offers the opportunity for someone to raise kids and work in a family-sustaining 

setting. And I want to note that I think it also probably makes it 

easier for them to above up beyond that. Because we do a lot of 

work at CLASP also on workforce training, post-secondary education. And if you are trying to balance work, school, and raising 

kids, having enough income from the work piece so that you can 

do the whole thing is virtually impossible at the minimum wage. 

So I think that that is a very important piece. 

Mr. RANDOLPH. May I interject, Mr. Chairman, and answer 

that same question? 

Chairman BOUSTANY. Quickly. 

Mr. RANDOLPH. When we modelled the welfare cliff in Illinois, 

actually increasing the minimum wage would not help the family 

that we looked at. Because if you actually take a look at the charts 

that are provided in the data, that if a person moves from the minimum wage up to $12 per hour, that it is relatively flat. There is 

not much advantage at all. If you raise it beyond that, you push 

them off the cliff so that they are actually harmed. 

Mr. MCGOVERN. By the way, I am talking about a livable wage. 

Chairman BOUSTANY. The gentleman’s time has expired. 


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Mr. Young, you are recognized. 

Mr. YOUNG. Thank you, chairman. You know, I have long been 

intrigued by what has become a very popular formulation. I think 

J.F.K. first said it, or at least it first caught fire when he said, a 

rising tide lifts all boats. And I think that generally is the case. We 

need to do those macroeconomic things, like reform our Tax Code, 

reduce the number of burdensome regulations, and so forth so that 

that tide can rise. But I think it is clear now, when you look at 

the data, when you visit with enough people, that there are some 

boats that require patching. 

And I see a unique role, not necessarily for the Federal Government, in many cases for State governments to tailor programs to 

unique needs of, say, the State of Indiana where I hail from as opposed to Massachusetts or California. I also see a real role for what 

still, to this day, is the most vibrant civil society in human history. 

Mr. Randolph, perhaps you could speak to some of those interventions we have seen at the State level, the local level, our churches, 

our not-for-profits, what role do they have ensuring that people get 

back to work and enter sort of the path to upward mobility? 

Mr. RANDOLPH. Yes, thank you. 

I think you are right. If we really want to solve the problem and 

really help people, you want to involve these nonprofit organizations. A number of them are faith-based, and they can be extremely 

helpful. There are a number of them around the country, that they 

call pathways, I think what, pathways out of poverty. And they actually provide coaching and a number of things to help individuals 

come out. 

Did I understand your question correctly? Did I answer the question? 

Mr. YOUNG. You did indeed. 

Mr. RANDOLPH. Okay. 

Mr. YOUNG. The purpose of this program—this hearing, rather, 

is to investigate some of the distortions that are created by our government programs, the disincentives created for someone going 

back to work. So I was particularly struck by your example. I think 

the calculations you made work, someone from Lake County Indiana, a single parent, working at $12 an hour, which amounts to 

$22,000 a year, would rationally say, no, I am not going to take 

this $18-an-hour job offer, which amounts to $40,000 a year because, you know, it is—I would end up losing money in the whole 

course of this sort of calculation. And this is—this is an abomination and something we need to solve here. 

Mr. RANDOLPH. You are correct again. I mean, just think of it 

from the point of view of that single parent. I mean, they have children to take care of, and their decision is going to be in the best 

interest of their family and their children. So if we put them in a 

position where they have to turn down a higher paying job, then 

that is wrong. And it happened. I mean, it happened in Maryland, 

but it happens in other places. It happens in Illinois; it happens 

in Pennsylvania. I actually helped managed a focus group in Pennsylvania that looked at some of these issues, and we heard a number of different stories that said basically the same thing. 


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Mr. YOUNG. So two tracks here: Patching the boats and removing the disincentives created by the Federal Government, and I 

think we will be in a better spot. I yield back. 

Chairman BOUSTANY. I thank the gentleman. 

Next we will go to Ms. Fudge. 

Ms. FUDGE. Thank you very much, Mr. Chairman. I appreciate 

it. 

I am not even sure where I want to begin today. But let me just 

say this about the historic nature of this hearing today. The only 

thing that is historic is we have spent about 6 or 7 various hearings on SNAP. We have spent almost that many on child nutrition 

just as if there is nothing else going on in the world or in this Congress. That is what is historic, that we have spent so much time 

feeding one issue today. 

I sit and I listen to people talk about how people calculate wheth- er they are going to take a job making $18 an hour from one making 11 because they are going to lose it. The average person has 

no clue what the value of their benefits are. They don’t sit and 

make that kind of a calculation. And there is nothing that you can 

say to give me any data that they do, other than what you said to 

them. 

There is nothing. There is no proof anywhere that being on public assistance discourages work. There is no proof of it. It is just 

something that people want to talk about. Absolutely no proof. 

Maybe what we should be discussing is ways to lift people out of 

poverty by raising the minimum wage, extending paid sick and 

family leave for all workers so that their parents don’t have to risk 

losing their jobs to take care of a sick child or a parent, and we 

need to be talking about enhancing and permanently extending tax 

credits for working families. 

But maybe what we should talk about is corporate welfare. What 

is their disincentive? They get more money from the Federal Government than all the poor people that you are talking about. Why 

don’t we talk about corporate welfare? These are people who work 

every day? They are not lazy, but they get corporate welfare. Even 

in the Tax Code they call it an entitlement. But we never talk 

about them. We only talk about poor people. And at some point you 

just have say to yourself, what is the point? What is it that we are 

trying to do? We are talking about SNAP incentive farm bill. We 

passed the farm bill. It was a 5-year farm bill. Why are we talking 

about it? It is done. I don’t understand we are wasting this kind 

of time. 

Ms. Golden, could you tell me why you think you are here today 

really? 

Ms. GOLDEN. I think that—so, first of all, may I just support 

your point that these facts don’t make sense to you, because I think 

we have looked at some of the calculations in Mr. Randolph’s report, and the housing calculation. In fact, it doesn’t work that way. 

People don’t get pushed off when their income hits. They stay on. 

They just can’t come in new at that level. So I think one of the lessons is many theoretical calculations, in fact, aren’t true the way 

the program happen on the ground. 

In terms of the reasons for this hearing, I will tell you my hope. 

I won’t tell you what I would worry about. My hope is that we are 


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here to talk about the extraordinary successes of the safety net, 

Like the fact that we have sharply reduced poverty; we have insured that the safety net supports work for the vast majority of 

low-income people, and that we are getting evidence about how it 

supports children’s life-long effectiveness, and then maybe we will 

talk about some of the practical next steps that you have highlighted that the committees could take, like extending the earned 

income tax credit further, like increasing investment in child care. 

So those would be my hopes for what would come out of it. 

Ms. FUDGE. Thank you, Mr. Chairman. I yield back. 

Chairman BOUSTANY. I thank the gentlelady. 

Next we will go to Mr. Davis. You are recognized. 

Mr. RODNEY DAVIS OF ILLINOIS. Thank you, Mr. Chairman, 

and thank you for letting us, poor Ag Committee members come 

into such a nice spacious committee room. We know how good you 

have it here on Ways and Means now. 

Chairman BOUSTANY. You only have 3 minutes. Get to your 

questions. 

Mr. RODNEY DAVIS OF ILLINOIS. I am not yielding back. Actually, I just want to welcome my friend, Mr. Randolph, from the 

great State of Illinois. It was nice, my colleague, Mr. McGovern, 

was interesting in some of the policies that are being implemented 

in Illinois, and I can’t wait to have that discussion with him in a 

future hearing. 

I appreciate your work and your discussion on the cliff that you 

are talking about. As somebody who is a supporter of SNAP programs, I want to make sure that those who need benefits get them 

and that those who are on those benefits have the ability to transition into that workplace and not have to make a decision between 

getting benefits or getting a higher wage. 

You have talked about the cliff, now I want to hear some of your 

suggestions that we might be able to take into consideration in this 

institution on how to make it better. What can we do to fix it? So 

I would ask you that. What can we do to fix some of the problems 

that you have identified? 

Mr. RANDOLPH. Thank you. I mean, we have got to keep in 

mind that what is important is that we are talking about these single moms, we are talking about the families that want to help their 

lives. So we shouldn’t—we shouldn’t get jealous of jurisdiction or 

Federal control over the States. So I think the important thing is 

to rise above that and then realize that if we are going to really 

solve the problem, we have to allow flexibility at the State level for 

them to address. 

And just this past Monday, I was at—did you want to say something? 

Mr. RODNEY DAVIS OF ILLINOIS. No. Go ahead. 

Mr. RANDOLPH. Just this past Monday I was at a group where 

there were 20 different secretaries for human services across this 

country, and they all were telling me the same thing, and that is 

that if they were given more flexibility, there is more things that 

they can do to manage these programs better. 

Mr. RODNEY DAVIS OF ILLINOIS. What are a couple of examples that you can give as to how they are managing those programs 


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better? What can we do in a State like Illinois to do exactly what 

you are talking about? 

Mr. RANDOLPH. Right. What I would like to see is I would like 

to see that, like, for example, in the SNAP program, that there is 

flexibility that the funds could be fungible with other welfare programs so that when you are at a State level, you look at the person, and you say, okay. You have these various needs. Right now 

we can’t move any of the SNAP money over to child care. We can’t 

move the child care money over here. If you would blend the programs together, similar to the document put together for the opportunities grants, that would be a great way to allow States to have 

flexibility to better serve the needs of the individuals and the families. 

Mr. RODNEY DAVIS OF ILLINOIS. Great. My time has expired. 

I will yield back my one second. But I look forward to working with 

you, Mr. Randolph. 

Chairman BOUSTANY. I thank the gentleman. 

Next we will go to Mr. Ashford. 

Mr. ASHFORD. Thank you. And I am not sure who to direct this 

question to exactly, but maybe to Ms. Golden. Back in Nebraska, 

I served as an executive director of the Omaha Housing Authority, 

and one of the—for 3 years. And one of the real tragedies of that 

appearance was that halfway through my tenure there, the self-sufficiency program at the Housing Authority—at HUD was defunded. 

So essentially, what the rule was, is look at, you are a housing 

agency, you are not an employment agency. You are not a workforce agency. And actually, in Nebraska, we passed welfare reform. 

It was my bill. It was 1994, one of the early welfare reform bills 

prior to 1996. And in that bill, we—and as a result of it, we have 

reduced, as has been the case generally, reduced welfare rules. I 

thought Chairman Ryan was absolutely correct when he said, I 

don’t know how we structure all of these things, but when we look 

at—the numbers we are seeing today are the same numbers—not 

the same numbers, but the same kinds of percentages to a certain 

degree that I have been seeing since 1986, as long as I have been 

in public life. 

And it is frustrating because it seems to me that the issue and 

the 80 programs are out there, and there are still a lot of people 

in poverty. And, clearly, and I will shut up here, clearly, running 

the Housing Authority, I learned the cliff is dramatic. It is absolutely dramatic. And there are so many young families that stayed 

in the Housing Authority generationally also, not because they 

didn’t want to work or be part of the workforce, but because they 

could not get out. 

And so I am on the side of anything that will enhance workforce. 

I also notice in CNBC this morning, they listed the States that 

were the most viable economic States in the country, and one of the 

States that had moved up dramatically to number 1, actually, was 

Minnesota, because of the indicia being workforce investment. 

So I guess my question is, no matter how we structure TANF or 

how we structure food stamps, if we don’t figure out a way—the 

first job is not a job that will make it for these families. So we have 

got to enhance incomes as fast as possible, and that can only come 

from job training, and I don’t—could you respond to that? 


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This is the most frustrating issue in my whole professional life 

I have ever been involved in, because it is not working the way it 

should be right now. 

Ms. GOLDEN. So let me highlight the job. You have raised a lot 

of issues. Let me start with the job-training one, which I think is 

really important. So one of the things Congress did in a bipartisan 

way in 2014 was pass the reauthorization of the Nation’s workforce 

program, but not put additional dollars into it. And so that is another point where there are many positive things in that law. For 

example, one of the past challenges of that law was that it didn’t 

really focus on, above all, on the low-income, low-skilled people you 

are talking about. And the Congress changed the incentives in 

order to make it more. 

So I actually think that focusing a lot on that and the Nutrition 

Subcommittee, of course, and the reauthorization of the farm bill, 

the TANF training pilots, that is another opportunity to really get 

that right. And I am—I am sorry. You were going to say something? 

Mr. ASHFORD. No. I am not. I am just—I am leaning forward. 

I am sorry. 

Ms. GOLDEN. The other thing that I—I guess, two things I want 

to say looking forward. One is I do think the workforce legislation 

and the opportunities there are crucial. Second, I think that—you 

know, I have spent a lot of my career at the State and local level 

and worked a lot with States, and I think there are big opportunities for States to seize these moments, but SNAP E&T is an example, they have lots of flexibility; they don’t draw it down. So they 

need to see the importance of doing that. 

On the cliffs, I would just note that I think there has been important progress. You described since 1986, and an example is that 

back then there was essentially no child care resources. But what 

has happened is that families are working more than ever in struggling low-waged jobs, and so adding the capacity to address the 

cliffs I think is needed to solve it, too. 

Chairman BOUSTANY. The gentleman’s time has expired. 

We will next go to Mr. Dold. You are recognized. 

Mr. DOLD. Thank you, Mr. Chairman. 

I want to thank our witnesses for taking the time to come and 

testify before us today. And I want to thank the chairman for holding this joint hearing, because the topic that we are talking about 

is very important. We have 80 or so different programs that are out 

there right now are welfare programs. We want to make sure that 

these dollars are actually stretching the furthest that they possibly 

can. And ultimately, our goal is that we want to make sure that 

people who are on welfare, that they are able to get up and out of 

welfare and stand on their own two feet, raise their families, and 

carry out the lives as they choose. 

Coming from the great State of Illinois, Mr. Randolph, we certainly appreciate your work at the Illinois Policy Institute. I wanted to follow up on some of the things that you had talked about 

before. 

The study that you had mentioned before was done in Lake 

County, Illinois. That happens to be an area that I represent. I 

think the study that you did was talking about a single mother 


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with two children and the differential between making $12 an hour 

and the benefits that that family would receive versus what I think 

most people would think would be a natural evolution to say, okay, 

I am doing well. I would like to get that raise and get a raise, and 

$18 an hour. And ultimately, that would be economically a detriment to that family. 

Can you kind of talk—in your experience, you know, is that a 

common thing that we are seeing that cliff? 

Mr. RANDOLPH. I think it is common. This is something that 

people face. I mean, we have a panelist here who has a similar situation that she encountered. You know, we see it—you know, we 

study three counties in Illinois, and it was true for all three of 

those counties. So my answer would be, I believe it is common. It 

is a real issue, and I am very happy that you are holding this hearing to try to solve it. 

Mr. DOLD. Well, and that is one of the things that I hope we 

can get. And obviously, we have got a very short period of time, but 

we would like to get some solutions. This isn’t just an opportunity 

for us to talk. Hopefully we are highlighting a scenario that is out 

there that is a problem that we need to fix, and we need your help 

to come up with some solutions. Because we don’t want to discourage that individual from getting the raise, from trying to pull 

themselves out of poverty to try to better their family. 

Ms. Netus, let me just ask you, from your experience working 

first hand with individuals, do you think that the people are generally aware of the phase out rates for the programs that they receive and are disincentivized to work for advancement? 

Ms. NETUS. I think they are very familiar with it. I mean, 

amongst just talking to each other, they can hear what is going on 

out there. Often they are finding out these situations a little too 

late. By the time they take the job, they now get a letter in the 

mail that says, your benefits are going to expire. 

So, yeah, I think they are familiar with it. And I think that once 

one person goes through it, they tend to share it with the others. 

And so Chanel is a perfect example of someone who has gone 

through it, and she is going to talk to her peers. And true enough, 

you know, they will be able to make decisions based on that. 

Mr. DOLD. Well, I certainly appreciate that. And what I will 

hope, and I do hope, is that we can figure out a way to make sure 

that our safety net, that our welfare programs, don’t disincentivize 

people from trying to get themselves out. That needs to be all of 

our goal because we want that social safety net, but when we have 

created it in such a way where there is disincentive to advance, I 

think we all lose. 

My time has expired, Mr. Chairman. 

Chairman BOUSTANY. The gentleman’s time has expired. 

Next, we will go to Ms. DelBene from Washington State. 

Ms. DELBENE. Thank you, Mr. Chair. And thanks to all of you 

for being with us today and taking the time. 

This Congress, the Agriculture Committee has been conducting 

what has been billed as a top-to-bottom review of programs like 

SNAP. And the title of today’s hearing, How Welfare Benefits Can 

Discourage Work, makes me think that not enough of us has been 


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listening. SNAP doesn’t discourage work. If anything, we have 

learned that the benefits aren’t adequate enough. 

Ms. Golden, your testimony talks about available workforce development funding and SNAP employment and training that is 

only used by a handful of States. In fact, my home State of Washington is one of the leaders in the E&T programs. I introduced a 

bill last Congress that was the basis for $200 million in new SNAP 

E&T pilot programs in the farm bill, and I am definitely proud that 

these pilots are based, in part, on criteria from Washington State’s 

program that has helped participants achieve self-sufficiency. 

As you know, these programs differ widely in participation and 

success across the States, but even at the height of the recession, 

60 percent of those enrolled in Washington’s E&T programs found 

employment, and in one study, less than half remained on government assistance 2 years after starting the program. 

So I was wondering, Ms. Golden, can you further explain how 

E&T programs promote, not discourage work when jobs are available? 

Ms. GOLDEN. Sure. I think I would highlight a couple of things 

you said and then build on them. You have highlighted the way 

SNAP encourages, not discourages work. And it is a fact in stabilizing people’s lives so they can work and move up. And second, the 

role of employment training programs. There is a big barrier for 

the low-income person trying to make that jump is typically going 

to be about getting the promotion, having the skills, in doing bipartisan workforce reauthorization that the Congress did, the Congress, both parties, said really, a post-secondary credential is likely 

to be crucial for moving up. 

So that puts employment and training front and center. And 

Washington State, as you say, is a leader. What the farm bill includes, in addition to the unlimited matching funds that exist for 

employment and training in SNAP, as I said, many States are not 

seriously drawing down, it adds pilots, 10 pilots, which ought to 

create lessons about doing this really, really well. And one of the 

things that we are excited about is that there has been a lot of innovation in the employment and training arena, community colleges, workforce programs, but it isn’t necessarily known to SNAP 

agencies. And so building that connection, using those pilots to people can make that leap I think is a very excited next step. 

Ms. DELBENE. And in the end, we should be focused on results 

we are seeing. In our State we have seen strong results strong results from these programs, and hopefully the pilot will give us innovative new ideas that different States are trying that continue 

to inform everyone in the program going forward. 

Ms. GOLDEN. Absolutely. And the issue for States is not the 

flexibility to do those things. They have that. It is having the ideas 

and making them work. 

Ms. DELBENE. Thank you. 

I yield back, Mr. Chair. 

Chairman BOUSTANY. The gentlelady’s time has expired. 

Mr. Meehan. 

Mr. MEEHAN. Thank you, Mr. Chairman. And I want to thank 

all of the panelists for your presence here. 


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Mr. Randolph, I thank you for your testimony and your submitted testimony as well. I know one of the things that you introduced was a chart that described activity in my own home State 

of Pennsylvania, in which you had done some work. And curiously, 

you were able to identify a circumstance in which a single mother 

who was making—was better off earning an income of—gross income of $29,000 with $57,000 net income and benefits than to be 

earning $69,000 with a net income and benefits of $57,000. 

Could you elaborate what you meant by that in the chart? 

Mr. RANDOLPH. Certainly. Now, that chart that you are referring to was an earlier version of the same computational model. 

The one in Illinois is actually more sophisticated, and that was 

when I worked at Pennsylvania’s Department of, Public Welfare 

when that was developed. And what was discovered with that 

model was that it is the same cliff effect. It is essentially, the same 

thing that it turned out in Illinois, that someone can earn up to 

a certain point, that they earn some sort of salary, but once they 

would earn more or have the potential to earn more, they lose benefits. So it is the same track. It is the same cliff effect. It is in 

Pennsylvania, and it is in Illinois. 

Mr. MEEHAN. Well, I thank you for describing, you know, the 

cliff issue, which is one of the things we are looking at about. How 

those affected by changing circumstances, and particularly a lot of 

times, I think some of the times you were looking, the issue of a 

recession. You know, we have economies that aren’t flat; they are 

cyclical. And during the period of time when I was in Pennsylvania 

looking at this particular issue, we actually saw an expansion of 

the activities supporting, in my own Montgomery County, 118 percent increase in the total number of persons receiving SNAP, 173 

percent increase in children receiving SNAP. 

But these were children, and this was during a period of time in 

which, notwithstanding the fact that some of them may have been 

put back into jobs, the nature of the—you know, the nature of the 

job was that the wages were such that they weren’t sufficiently escaping poverty to the point that they were able to also escape the 

need for the assistance for the food. 

Can you give me some insights about how a recession affects 

things? 

Mr. RANDOLPH. Well, yes. I mean, we have a safety net for situations. And certainly, during times of recession, economic recessions, more people are going to need it. Much of what my model 

was looking at, however, is the ladder that people have to climb, 

the opportunity ladder or the career ladder, if you will. And what 

has happened is, there are a whole bunch of rungs kicked out. So 

they climb up maybe a third way up the ladder, and now they can’t 

reach the next step. 

And that is what we are—that is my understanding we are trying to solve. That is what the modeling that we have done has 

shown. It has shown that the way the current system is designed— 

and it is a hodgepodge, if you will. It has been designed, you know, 

haphazardly. You know, no one person is at fault. You know, you 

have a bunch of programs, and you kind of layer one on top of the 

other, and the aggregate effect is that you have got rungs kicked 

out of the ladder and people get stuck on the third way up. 


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Mr. MEEHAN. Thank you. My time has expired. 

Mr. Chairman, I yield back. 

Chairman BOUSTANY. I thank the gentleman. We will next go 

to Ms. Adams. 

Ms. ADAMS. Thank you, Mr. Chairman. 

And thank you all for your testimony today. 

You know, I have talked about this issue for a long time, where 

some poverty is pretty high in North Carolina. People are working 

hard every day, two and three jobs. Working hard is not enough 

if you don’t make enough. 

You know, according to Feeding America, the 12th District of 

North Carolina, which is the district I represent, ranks 9th in the 

Nation for food insecurity with a rate percent of over 26 percent. 

And I have serious concerns about efforts to block grants, SNAP 

program, and I am pleased that North Carolina is participating in 

the work support strategy initiatives to make applying for SNAP 

and other safety net programs more efficient, both for families that 

want to work and for State government. 

Ms. Golden, can you elaborate on how the work supportive strategies initiatives helps families get back to work in North Carolina, 

and how it benefits families applying for SNAP while also saving 

the government money? 

Ms. GOLDEN. Sure. I am glad you highlighted that because 

work support strategies initiative, which is a foundation-funded initiative that we are leading at CLASP with two other national partners, we are working with six States trying to do exactly what you 

say, deliver Medicaid SNAP, and child care subsidies using the 

flexibility that is already there, not anything that would need new 

laws to work well for working families. 

As you mentioned, North Carolina, the others are Republican 

and Democratic governor States, Colorado, Idaho, Illinois, North 

Carolina, South Carolina, Rhode Island. And what I would highlight is that one of the big things that the States have been doing 

is getting rid of barriers that are not in policy. They are certainly 

not in Federal policy, sometimes they are in State policy, that were 

keeping working families out. Like if you have to, in North Carolina, if you used to have to stand in two separate lines for a whole 

day to be able to take care of your health care and your nutrition 

needs, then if you were working a low-wage job where you were 

going to be fired or miss your paycheck for missing hours, you were 

not going to be able to get that help, and that was going to destabilize your family. 

So what these States are doing is taking advantage of the existing flexibility to deliver it better. They do, as you say, save some 

administrative dollars because they are able to use information and 

data they have already got rather than having to process things 

multiple times over. But it is crucial to them that they have the 

Medicaid and SNAP structures as they are now, because that is 

how you can get the benefits to people quickly. So I think that is 

a great example of flexibility that exists now. 

Ms. ADAMS. Thank you. As a follow-up, how is service deliveries 

designed to not be a hindrance to working families, and how is the 

program structured to encourage families to work without disproportionately losing benefits? 


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Ms. GOLDEN. Well, I think both SNAP and health benefits. So 

starting with SNAP. So, first of all, it is key that it is not a block 

grant program. It doesn’t require somebody to spend hours interviewing you before you get your help with your nutrition. It is a 

program that responds to recession. I think Mr. Meehan highlighted that. 

So when somebody needs the help, it can happen based on a determination of their eligibility that you can do very quickly and in 

an automated way. SNAP also is important as a work support because of the gradual way that dollars phase out. So it takes into 

account the fact that you will have more expenses when you—when 

you work, and that gets taken into account. 

A number of States, about half the States have chosen an option 

that makes it even more—even less likely to have a cliff, which is 

the categorical eligibility option. So the Federal policy framework 

allows States to deliver it in a very effective way, and those States 

that take a hard look at their own delivery systems, their own computers, their own local offices, are able to then live up to that 

promise. 

Ms. ADAMS. Great. Thank you very much. 

Mr. Chair, I yield back. 

Chairman BOUSTANY. The gentlelady’s time has expired. 

We will next go to Mr. Thompson. 

Mr. THOMPSON. Mr. Chairman, thank you for this hearing. It’s 

very important. 

To all the members of the panel, thank you very much for coming, lending your experience, your expertise. I want to start out 

with Mr. Mulligan. 

In SNAP, we expected the program rules to increase with the recession. They did, rising by 81 percent since 2007 before finally 

peaking in 2013. Since that peak, we have only seen a decline of 

3 percent. Can you talk more about what that data says about the 

situation, or are you at all surprised? 

Mr. MULLIGAN. Sure. Yeah. Our data is maybe a year or two 

out of date. I looked at SNAP before and during the recession 

through about 2011, and I saw that State by State, the rules had 

changed. And probably the biggest thing that had happened is the 

asset tests were eliminated, which eliminated some of the barriers 

bringing people into the program. So now it is easier to get into the 

program than it used to be. And so naturally, you have more people 

on the program. That is natural. The other economic side of it is 

you have to disincentive. Especially for unmarried people, it is a 

kind of new unemployment assistance program that can go far beyond 99 weeks. 

Mr. THOMPSON. Thank you. 

Ms. GOLDEN. Could I just add to that? Because I think the answers that most economists have come up with who have looked 

into that is that it is now going down. SNAP rose with the recession. It is now going down. You would expect it to be somewhat a 

delayed effect, because the effect of better income for the bottom 

end of the labor force has happened last. So most people think it 

is about the economy, not about the policy changes. 

Mr. THOMPSON. I want to talk a little bit about within the 

process of the resources that are out there, because we talk about 


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obviously, providing incentives, job training. I co-chair with a good 

friend of mine from Rhode Island, Jim Langevin, Career and Educational caucus. And so I want to talk about not so much a process, 

but the pathway in terms of job training. And we are preparing an 

education and workforce with the Perkins Act, which is all about 

job training, career and tech ed funding. And I am not sure I am 

going to have time to get input from someone, but if you have 

thoughts, I would appreciate you sending those to me in writing. 

So my question is I am looking for that response from, in your 

experiences, what are the key considerations to assure access to effective job training? In other words, job training that actually leads 

to a job, family-sustaining job and a greater—and a greater opportunity, put folks on that pathway? I do believe that our programs 

that we have, our safety net programs, SNAP, welfare—the other 

welfare programs, I think they really need to be defined by—as 

workforce development. 

Dr. STEUERLE. Mr. Thompson, if I could quickly answer. I 

think there are a lot of efforts in the educational area that are 

promising. I think apprenticeships are one of them, for instance, 

where we have done very little. But I would also like to comment, 

just general course of this hearing, there are these programs that 

I think namely aimed at mobility, education, training, I would 

probably include things like the earned income tax credit, and 

there are other programs that mainly aimed at consumption. It’s 

the programs that are aimed at consumption, providing minimum 

levels of consumption that provide a lot of these cliffs and issues 

that we are facing. 

If you look at the budget for children, we mainly have been talking about programs for children, they are actually pretty much in 

decline. The earned income credit is an index. It doesn’t grow with 

the economy. The child credit is an index for inflation. I am guessing SNAP benefits in real terms per person are not going up. They 

have expanding number of people getting them. TANF has certainly been declining rather than the economy. So those programs, 

children’s programs, are actually well in decline. That is a separate 

subject, because all of our social welfare budget is going to health 

and retirement. So that is a different issue. So I think that what 

has happened to children’s budget is it is eventually going to be 

turned around. I see an opportunity, when that turnaround comes, 

to start devoting more money to these mobility efforts. I am not 

saying that every mobility effort works, but these types of things 

like training and education do not create the types of disincentive 

effects that we are actually talking about here. Generally speaking, 

they are all in the positive incentive effect. I am not saying they 

all work, but I think there are a lot of opportunities about thinking 

about what a future budget would be if it moves in the direction 

you are talking about. 

Mr. THOMPSON. Thank you. 

Chairman BOUSTANY. The gentleman’s time has expired. Mr. 

Davis your are—I am sorry—Mr. Davis, you are recognized. 

Mr. DANNY DAVIS OF ILLINOIS. Thank you very much, Mr. 

Chairman. I want to thank all of the witnesses for having been 

here. 


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Dr. Golden, I know that you have done some work in Illinois, and 

you were here when Ms. McCorkle testified. I think maybe her situation may have been a little bit different in Illinois. Could you 

comment on that and why it may have been. 

Ms. GOLDEN. Sure. So Illinois is one of the 6—— 

Chairman BOUSTANY. Please use your microphone. 

Ms. GOLDEN. Illinois is one of the six States that we are working with. And I would say a couple of things, both similarities and 

differences to Ms. McCorkle’s situation. Illinois and Maryland have 

both made the choice to expand Medicaid. So they are both States 

where taking a job—leaving welfare and taking a job isn’t going to 

force a parent to lose their health insurance. So that is very important. 

One of the things that Ms. McCorkle highlighted in Maryland 

was about child care, right? It was about not only your challenges 

in the co-pay now, but the fact that when you were working before 

you went on welfare, you couldn’t get compiled care, because Maryland has a waiting list. Illinois, by contrast, has a historic commitment to not having a waiting list and to serving family, but the 

challenge right now is that in terms of dollars, it goes back to that 

point that what the States need is not flexibility, but resources. 

They are very stressed trying to be able to keep that commitment. 

And so additional Federal dollars to address child care needs for 

low-income working families, I think will be very important in the 

future as Illinois seeks to keep that commitment. 

Mr. RANDOLPH. Can I interject on that? This is an issue that 

we have studied. We have studied the child care issue specifically 

in Illinois, and I have also worked with the program in Pennsylvania and a couple of other States. It is true that in Illinois, you 

do not have a waiting list for child care. However, there are a number of steps that they can take administratively to reduce the cost. 

The child care program in Illinois is costing approximately $1.2 billion with a State budget general fund of only $34 billion. So it is 

a significant program, but there is certainly steps they can take administratively to bring the costs down. You do not need to increase 

Federal dollars to give to the State to solve the problem. A lot of 

the problem can be solved simply by the States better managing it. 

Mr. DANNY DAVIS OF ILLINOIS. Thank you both very much. 

And by no stretch of imagination would I suggest that Illinois does 

not have problems and unmet needs. But I did want to point out 

this difference because of the fact that there was a strong advocacy 

effort on the part of citizens who made it happen, and I simply 

wanted to give them an accolade for that. 

So thank you very much, Mr. Chairman, and I yield back. 

Chairman BOUSTANY. I thank the gentleman. 

Next, we will go to Mr. Crowley. You are recognized now for 3 

minutes. 

Mr. CROWLEY. Thank you, Mr. Chairman. I did miss the Chairman Ryan’s opening statement, but I did take note in his printed 

version of it that he quoted a very popular person to quote these 

days, Pope Francis. And he said where there is no work, there is 

no dignity. I think we can all find agreeance in that. I know Mr. 

McGovern and Ms. Fudge talked about the importance of a living 

wage. So here is another quote from Pope Francis, and I quote, ‘‘A 


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just wage enables human beings to have adequate access to all the 

other goods which are destined for our common use.’’ And that is 

from Joy of the Gospel 192. So I hope this means we can consider 

legislation to raise the minimum wage since Pope Francis said that 

as well. We won’t quote the climate change; I don’t have enough 

time right now for that. But I do want to thank the chairman. I 

want to thank our colleagues from the Ag Committee for joining us 

today as well. 

Let me start by saying that I think the majority of us here want 

to support, and do support work while we strengthen our safety net 

programs. It is not an either/or situation. 

Ms. Golden, you mentioned explicitly in your testimony that 

there is overwhelming evidence that the safety net supports work. 

So that is important to recognize. But I do want to make sure we 

are clear on what it means to support and encourage work. To me 

that meaning strengthening, not weakening programs like the 

earned income tax credit and the child tax credit. These are programs that directly and without doubt reward work for lowest income families. It gives them the net effect of earning more, puts 

more money in their pockets. We need to extend the expiring provisions of these program and ensure they are reaching their full potential for the families that they serve. 

Enhancements like linking the amount of the child tax credit 

through inflation, making permanent the higher credit amount set 

in the American Recovery and Reinvestment Act, and make the tax 

credits fully refundable. Another critical part of the encouraging 

work through the safety net is child care. And I appreciate the discussions before my testimony. 

No matter what problem we are looking at, if we want to help 

people work, we need to help them find and afford child care for 

their children. If they simply will not work, we will just be piling 

on to the social ills of a society which the other side of the aisle 

would decry at the same time. 

So otherwise, you can add in as many work requirements, restrictions and other burdens you think of, and all you will end up 

doing is forcing people off these programs to make those tough 

choices, and quite frankly, spiraling them further into deeper poverty. We need to make a significant investment in child care to 

make sure it reaches more people who need it. I will soon be reintroducing my Child First Act to make a greater investment in 

funding for child care. 

President Obama has proposed investing $82 billion over 10 

years in mandatory funding for child care, which provide more 

than an additional 1 million children under age 4 with access to 

quality child care, not only helps the child, but helps the family, 

helps society, and helps people work. 

And with that, I will yield back to the chairman. 

Chairman BOUSTANY. I thank the gentleman. 

Next we will go to Ms. Grisham. You are recognized for 3 minutes. 

Ms. LUJAN GRISHAM. Thank you, Mr. Chairman. In this committee, my arms are barely long enough to actually reach the button for the microphone, so thank you for your patience. 


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I am also very appreciative for the joint committee hearing. And 

Mr. Chairman, I appreciate the opportunity to talk about not only 

basic benefits, but a benefit that in my State is incredibly important, which is the SNAP benefit. 

And I really appreciate the remarks of my colleague, Mr. Crowley, because I agree that we have a tendency, as policymakers, to 

do an all-or-nothing design that we believe potentially, and based 

on some of the testimony, that welfare or entitlements or government support programs actually create a disincentive to work. 

And in my opinion, and in my experience, a disincentive to work 

is poverty. A disincentive to work is hunger. A disincentive to work 

is lack of adequate education and support and investment. Environmental barriers, transportation barriers, there are no dearth, 

and they are all really devastating aspects and barriers to work. 

Now in my State, we have one of the worst economic recoveries 

in the country. We also have the hungriest children in the country. 

Not something I am very proud of. And I would love to see Congress and my State legislature declare a war on poverty and assure 

that no child in my home State ever goes hungry ever, ever again. 

It is devastating. 

We also have one of the hungriest adult populations in the country. And while I tell you this, because of this debate, our State is 

enhancing our work requirements on young families, mothers who 

are 19 without the education, training, or support even in a productive job market to attain that work requirement. 

We don’t have jobs. We are the only State in the country where 

we have a migrating effect where people have to leave the State 

to get jobs. This only translates to families losing benefits, which 

means they have no opportunity to have their basic needs met 

while we, as policymakers, figure out those balances so that we create a safe and effective environmental effort. 

With whatever time I have left, can anyone talk about making 

sure that there are ideas for States like New Mexico where you 

cannot meet even the basic work requirements but we don’t want 

to minimize that people do want dignity and want effective productive work available to them in a meaningful way. 

Ms. GOLDEN. Let me underline—I am sorry. 

Mr. RANDOLPH. I can. You are correct that we still have an 

issue of poverty in this Nation, absolutely. However, I just want to 

say that if we attempt to solve the problem one piece at a time, 

we are not going to get the answer. And let me just go to what we 

talk about, training. I sat in a focus group. I was not the participant. I was helping managing the focus group, where we have had 

people who received training, but they ran into that ladder, where 

the rungs are kicked out and they had to give up a better job that 

offered more because they would lose benefits. 

So if we continue to look at this piece, just the SNAP alone or 

another program over here, and hope that that is somehow going 

to solve the problem, we will never get at the answer. You have to 

approach it systemically. You have to look at all the programs together and how do you combine the programs. 

Ms. LUJAN GRISHAM. As long as, Mr. Randolph—I am going 

to reclaim part of my time. 

Mr. Chairman, I don’t know how much time I have. 


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Chairman BOUSTANY. You still have time. 

Ms. LUJAN GRISHAM. Can I go to Ms. Golden? 

Ms. GOLDEN. Yes. So what I would highlight is that, first of all, 

you are absolutely right about the extent to which poverty itself is 

a barrier to work. And the research supports that and says that if 

you are able to eat and your life isn’t disrupted, and you are not 

constantly evicted, that contributes to working and moving up. So 

I think that is exactly right. 

And I do think that the other—with only one moment to say, 

that job training for adults ought to go hand in hand with investment in kids with children not being hungry. That is an opportunity investment, right? We know that when kids are not hunger 

and are able to get their health taken care of and in early child 

care, that in itself is an opportunity investment in their later lives. 

So we ought to be putting these things together. 

Ms. LUJAN GRISHAM. Thank you, Mr. Chairman I yield back. 

Chairman BOUSTANY. The gentlelady’s time has expired. 

Ms. Noem. 

Mrs. NOEM. Thank you, Mr. Chairman. One of the tenets of the 

American dream is that no matter what your circumstances are, if 

you work hard here in America, that you can succeed. In South Dakota, we have a very strong work ethic and many are willing to put 

in long, hard hours to make life better for their families. It is those 

values that I try to instill in my own children, and I follow when 

I am serving the people of South Dakota here in Congress. 

But, unfortunately, the Federal Government doesn’t always operate that way. Instead of encouraging work and taking home higher 

pay, the programs can create disincentives to work, and we have 

heard some of that testimony by all of here today. It might not always make sense economically for a family to work more hours or 

at higher wages in the current system that we have today with a 

lot of our programs. 

So, Ms. Netus, I wanted to ask you specifically, setting aside the 

work disincentive effects of these programs, does the shear complexity behind multiple benefit programs and tax programs help or 

hurt families? Does it promote work and self-sufficiency? 

Ms. NETUS. I think it promotes work with limitations. I mean, 

we have people that are eager to go to work so they want to do so, 

but it is kind of they are tossed as to whether or not they should 

take a full-time job versus a part-time job. 

Mrs. NOEM. So would it help to streamline the programs in a 

manner that wouldn’t be so complex to help them utilize it in a 

manner better to allow them to work and potentially have a transitional program? 

Ms. NETUS. I think so. I mean, we are looking more so for a 

longer transitional period. I do know that in Maryland, they do provide that, but, again, it is the timeframe or it is kind of immediate 

that the transition happens, not often giving the person the time 

or chance to really be able to build and save. So it would be—you 

would need a transitional period. A little bit more extended than 

what they have right now in order for the person to be able to 

maintain. 


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Mrs. NOEM. Do you feel that most people need assistance from 

an organization like yours in order to navigate the programs that 

are currently available? 

Ms. NETUS. They do. They need us because we know how to essentially walk them through the system. Most people who are going 

through this process, they have no one to tell them how to do it. 

So when they come to our organization, we can help explain a lot 

of the changes they are going to undergo. And so a company like 

ours would definitely be able to help a person like Chanel as we 

plan to do as she goes through her next transition into employment. 

Mrs. NOEM. Well, Ms. McCorkle, I wanted to ask you that. Do 

the agencies providing you benefits give you clear information 

about what happens if you work and if you earn more money? Have 

you ever discussed with live people that are a part of these agencies and departments what the consequences are? Did you need an 

organization like Ms. Netus is a part of in order to have that kind 

of clarification? 

Ms. MCCORKLE. I actually did need America Works to help it 

because when you are applying for your benefits, you don’t actually 

speak to anybody. Nobody actually tells you what is going to happen when you get your job. It just happens that they find out you 

work, the letter comes in the mail telling you this is cut, this is 

cut, and this is what is happening. 

And then you are at the office. You come to the office and you 

want to talk to somebody. Half the time you don’t get your caseworker, you just get a different representative. They don’t explain 

it. They just tell you what happened. They don’t actually explain 

anything. It just comes through the mail. 

Mrs. NOEM. Okay. I appreciate that testimony. That is very 

helpful. 

Thank you. I yield back, Mr. Chairman. 

Chairman BOUSTANY. Mr. Smith. 

Mr. SMITH. Thank you, Mr. Chairman. 

Ms. McCorkle, it is a pleasure to hear your testimony earlier, 

and I just thought it was very troubling, whenever you look at the 

journey and the path that you had to take, but it shows that you 

are a remarkable human being and you are doing an amazing job, 

and I am extremely proud of you, to see everything. 

When I look at your testimony, that it talks about the child care, 

that you couldn’t get the childcare vouchers when you had a job, 

but when you didn’t have a job, you could get the childcare vouchers when you are home. The whole process just isn’t working. And 

I just appreciate you being here before the committee, and I just 

want to say thank you. 

In regards to Mr. Mulligan and Mr. Steuerle, I would like to hear 

if you both would like to add some additional comments of how you 

could help incentives that we could try to break this poverty trap 

to the benefits curve. 

Dr. STEUERLE. Mr. Smith, as I said in my testimony, I think 

the real way around this trap to break the Gordian Knot is to start 

thinking in the future—because government does gradually grow, 

and the social welfare budget does grow just because the economy 

grows, it might be a smaller share of the economy or larger—is to 


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think about orienting more and more resources towards things that 

provide mobility. It is education, it is wage subsidies, it is a lot of 

the other items we have talked about. And I think we have been 

moving in that direction. If you look at both what welfare reform 

did, moving away from AFDC, we have sort of been moving in that 

direction. 

When we just try to provide minimum levels of consumption by 

itself, initially, when people are starving or something, it doesn’t 

look good, but above certain levels it provides a lot of discouragement. But things like primary, secondary education doesn’t discourage. So if we start moving the budget towards this mobility front, 

I think we can go a long way. 

And I would just like to clarify one earlier part of this debate between whether these programs do or do not discourage work. The 

movement we had recently has moved us away from a poverty trap 

to what one of my colleagues and I nowI call a twice poverty trap 

or three times poverty trap, it is from about zero to about $15,000 

of income. 

We have moved our programs in the direction of encouraging 

work. And if you take most of the examples that people around the 

table have given, when you get to about $15,000 of income up to 

about $55,000 of income, now you have got average tax rates of 

maybe 66 percent in universal programs, 70 or 80 percent in the 

non-universal, and then you add on child care, and you can get this 

type of trap. 

So I think you have to distinguish where we are talking about 

these traps encouraging, and right now, it is this trap where if you 

move, as I say, beyond a part-time job, you marry, you get a second 

job, that is where we really are discouraging work quite a bit, or 

moving to a higher-paying job, as several people have mentioned. 

Mr. MULLIGAN. I will also speak for something that hasn’t been 

represented, and that is the marketplace, the employers, they are 

teaching people things. It is not just government programs that 

teach people things, not even just schools, even though I come from 

one. 

And things like the minimum wage go exactly in the wrong direction. What the minimum wage says is you have to—a job is a mix 

of things you learn and cash to take home, and the minimum wage 

says: Look, you have to put it all into cash and very little into 

learning. And that is only going to make these kind of traps worse. 

Human capital is many most important asset in America and in 

the world, and policies like these discourage the accumulation of 

human capital and keep people’s incomes low. 

Chairman BOUSTANY. I thank the gentleman. The gentleman’s 

time has expired. 

Before we close this hearing, I want to read two quotes out for 

the record. One is from Harvard Professor Jeff Liebman, former 

economic adviser to President Obama, and I quote: ‘‘Despite the 

EITC and child credit, the poverty trap is still very much a reality 

in the U.S.,’’ end quote. 

And then the second quote comes from Congresswoman Gwen 

Moore, who during a June 2012 Human Resources Subcommittee 

hearing said, I quote: ‘‘I once had a job and begged my supervisor 


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not to give me a 50-cent-an-hour raise, lest I lose daycare,’’ end 

quote. 

The fact is, we still have poverty, the poverty trap still exists, 

and the problem is complicated by the fact that we have a myriad 

of programs that have been created over the course of years without good coordination. And so this hearing, this joint hearing is a 

start in trying to unravel that Gordian Knot so that we have these 

programs that will work best for those that they are intended to 

work for. 

And with that, Ms. McCorkle, I think your personal story was 

very compelling, very helpful to us. I just want to say thank you 

for your courage in coming forward to present it. 

I want to thank all of our witnesses for the tremendous expertise 

you bring to the table. And as we try to deal with this complex 

problem of how the program has disincentives to move into the 

work world, you all did a terrific job to help us shed light on these 

issues. I think members may have additional questions, which we 

will submit to you in writing, and we would appreciate your responses for the record within 2 weeks. 

Chairman BOUSTANY. I also want to close by thanking our colleagues on the Nutrition Subcommittee, starting with Chairwoman 

Walorski, Ranking Member McGovern. From my perspective, working together like this can only be helpful in our efforts to provide 

better, more coordinated services for those in need. 

I want to thank Chairman Ryan and Chairman Conaway and the 

rest of our colleagues also on the Ways and Means Committee. I 

thank you and your staff for working with us to make this joint 

hearing a reality. I look forward to working more with everyone 

concerned in the weeks ahead. 

And with that, the subcommittee now stands adjourned. 

[Whereupon, at 12:08 p.m., the subcommittees were adjourned.] 


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[Submission for the Record follow:] 

Feeding Texas 


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