Antipoverty Programs
Here are the thirteen welfare programs of the United States. They provide food, shelter, education expense, child care, preschool, energy, cell phone, job training, and general cash support.
Refundable Tax Credits – These are tax credits that pay out cash as welfare. The two programs are the Earned Income Tax Credit (EITC), and the Child Tax Credit. The Internal Revenue Service (IRS) runs the programs. The tax credits include a “refundable” portion that benefits individuals and families that owe no income tax for the year. Therefore, this portion acts as welfare or a “negative income tax”.
SNAP – This is a food program for low-income individuals and families. SNAP stands for Supplemental Nutrition Assistance Program. It used to be called the food stamp program. The United States Department of Agriculture (USDA) runs the program. Participants receive a debit card for the purchase of food. Most grocery stores around the nation accept the cards.
Housing Assistance – The Department of Housing and Urban Development (HUD) runs various housing programs. The programs include rental assistance, public housing, and various community development grants.
SSI – SSI stands for Supplemental Security Income. This is a program to pay cash to low-income individuals if they are blind, disabled or over 65 years of age. The Social Security Administration runs the program.
Pell Grants – This is a grant program to help low-income students go to college. It pays up to $6,000 to students from low-income households. The Department of Education runs the program.
TANF – This is a combined federal and state program that pays cash to low-income households. The goal of the program is to move individuals from welfare to work. TANF stands for Temporary Assistance for Needy Families. The U.S. Department of Health and Human Services (HHS) runs the program.
Child Nutrition – These are food programs that include school lunch, school breakfast, and after-school programs. They target children from low-income households and provide free or reduced-price meals. The USDA (United States Department of Agriculture) runs the program.
Head Start – This is a pre-school program available to kids from low-income families. HHS runs the program.
Job Training Programs – This represents several programs to provide job training, displacement, and employment services. The programs generally target low-income Americans, although this is not always the case. The Department of Labor (DOL) runs the program.
WIC – This is a program to provide Healthy food to pregnant women and children up to five years of age. The program targets low-income households. WIC stands for Women, Infants, and Children.
Child Care – This is a program to support low-income families with child care. HHS runs the program. States and local public and private agencies receive block grants from HHS to provide the services.
LIHEAP – This is a program to help low-income households with their home energy costs. The program is available to help pay for either the heating or cooling of a home. LIHEAP stands for Low Income Home Energy Assistance Program. HHS runs the program.
Lifeline (Obama Phone) – This is a program to provide discounted phone service, including cell phones, to low-income individuals. The Federal Communications Commission runs the program.
In addition to the 13 programs shown above, U.S. Welfare Programs also include the Medicaid Program which provides health care to low-income citizens and certain non-citizens.
Apply for Welfare Programs
Individuals must apply to each program separately to receive benefits. Application information and links to proper agencies are provided to the right.
Definition of Welfare
Aid provided by governmental entities to support low-income Americans is the definition of welfare. The Welfare Definition page includes a description of key attributes of welfare programs such as means-testing and non-contributory.
Purpose of Welfare
Is the purpose of welfare to make lives more comfortable for the poor? Or is the purpose to get the poor back on their feet so they can leave welfare? More.
Does the welfare system help people obtain their financial independence? More
Public Opinion on Welfare
Americans believe strongly in work and that the purpose of welfare should be to get people back on their feet. A strong majority also believe that a work standard or job training should be attached to the receipt of welfare. A majority of poor Americans believe that increased economic growth will do more to help solve poverty than an increase in welfare benefits. A large majority of Americans believe the war on poverty has been ineffective. However, most Americans do not want to see a drop in welfare benefits to the poor, even to pay down the federal deficit. The Welfare Opinion Page includes a full analysis of these and other opinions, including the underlying surveys.
Simplify the Complex
The welfare system is complex and difficult to track because it spans 8 different federal agencies and falls into 13 categories. In addition, rules are complex and unique to each program. This page summarizes the key aspects of the system and creates comparison tables for key aspects of the system. This page simplifies the complexity!
Entitlement
The welfare programs represent entitlements to all Americans, however, benefits are only paid to individuals and families with low-income.
Lacking Coordination
All U.S. welfare programs provide benefits to low-income individuals and families. However, the definition of low-income is unique per program. Therefore, there is little coordination between the programs as to qualification rules. This is due to the fact the system was created one program at a time over the past 70 years. Never has Congress tried to pass legislation to coordinate the programs into a single system with consistent goals and ease of use. As a result, low-income Americans need to navigate each program separately, which is no easy task.
Welfare Spending
Program Expenditures
The figures in the table below represent billions of dollars of spending each year. The fiscal year (FY) for the federal government ends on September 30. More
Percentage of Federal Budget
Welfare made up 18% of federal expenditures in the fiscal year 2023. Medicaid was 8% of spending, and the thirteen welfare programs were 10%. More.
Picture of the Welfare System
The graph below is a picture of the welfare system from 1963 through 2023. It shows expenditures per year adjusted for inflation. The programs are shown from the bottom of the chart to the top based on when the programs began operations. Expenditures have generally increased over the timeframe as programs were formed and expanded. The drop in costs in 2017 – 2019 is generally from the reduction of users based on the strong economy experienced in those years. The large increase in 2021 and 2022 is from Coronavirus relief expansion. More on welfare growth.
Want the data behind the picture?
Want to peruse the federal budget?
Yep – only for nerds! A great place to review federal government activity is USGovernmentSpending.com.
Welfare Problems, Issues, and Reform
The welfare system is one of the most controversial functions of the federal government. This has been true since its inception. Proponents of the system believe the programs are indispensable in the war on poverty. They would like to see the system strengthened and expanded. Opponents argue that the system is ineffective. They point out that the cost of the system has grown dramatically over the last 70 years, but the poverty level has remained constant. Everyone agrees that the system could be improved. But, there is little consensus as to how.
The welfare issues page shows the challenges and problems with the welfare system. These include the marriage penalty, why the system misses those in extreme poverty, and why the system doesn’t encourage work. Fraud within the system is shown on the Welfare Fraud Page.
Qualification Comparison of Welfare Programs
Low-income Americans are the target of all welfare programs. Therefore, each program has a limit on the income that an individual or family can earn and still qualify for the program. Income includes wages from jobs or self-employment and usually also includes income from investments. If the income of the individual or family is below the qualification standard, they can participate in the program. If the income is higher, they cannot participate. Shown below are the maximum income levels for each program. More can be found on each program page linked above.
EITC – Approximately $48,000 – $57,000 depending on the number of children in a family.
SNAP – 130% of the poverty threshold.
Housing Assistance – 50% of median income in a local area (50% of median income totaled about $34,000 for the U.S. as a whole).
SSI – Approximately $20,000 for an individual and $30,000 for a couple.
Pell Grants – Complex formula taking into account ability to pay and tuition and other costs. Most awards are to households under $30,000 in income.
TANF – Unique by state but generally 50% – 100% of the poverty threshold.
Child Nutrition – 130% of the poverty threshold, partial benefit below 185% of the threshold
Head Start, Child Care, Job Training – Unique by state and program.
WIC – 185% of the poverty threshold.
LIHEAP – 150% of the poverty threshold or 60% of state median income.
Lifeline (Obama Phone) – 135% of the poverty threshold or participation in certain other programs.
Benefit Comparison
The benefits paid to welfare recipients are either cash or “in-kind.” In-kind is anything other than cash, such as food or rent vouchers. Cash can be spent by the recipient as they choose, but in-kind benefits are structured to channel the benefit toward a prescribed purpose. The following table presents a comparison of the benefits of each of the welfare programs.
Administration of the Welfare Programs
There is no department of welfare in the federal government. Instead, eight federal agencies run the programs. This makes welfare hard to track, understand, and use. It’s further complicated because the eight agencies have other responsibilities in addition to their welfare responsibilities. In some cases, welfare is a small part of what the agencies do. As an example, the FCC runs the Lifeline Program which is under 1% of its budgeted outlays. This split of responsibilities is unusual for the federal government. Most activities are run by a single agency. For example, defense is run by the Department of Defense and Social Security by the Social Security Administration. Listed below are the agencies that run the welfare programs.
- Internal Revenue Service – Refundable tax credits
- United States Department of Agriculture – SNAP, Child Nutrition, WIC
- Department of Housing and Urban Development – Housing Assistance
- Social Security Administration – SSI
- U.S. Department of Health and Human Services – Medicaid, TANF, Head Start, Child Care, and LIHEAP
- The Department of Education – Pell Grants
- The Department of Labor – Job Training
- Federal Communications Commission – Lifeline (Obama Phone)
Our Welfare System
Americans are big-hearted people. The welfare system proves that. The system was created solely to help the less fortunate among us. It is a central pillar of the function of the federal government. However, the programs are complex and are run by eight different federal agencies. Therefore, the system is uncoordinated and frustrating to use. Each year billions of dollars in benefits are paid to millions of Americans. Unfortunately, the poverty rate has remained unchanged. Therefore, the effectiveness of the programs is questioned by a majority of Americans. But, one thing that cannot be doubted is the desire to help our fellow man. Someone once said to solve poverty we must be “big-hearted and hard-headed”. We have the big-hearted part down, but maybe not so much the hard-headed part.