Field Hearing at Saginaw Valley State University

April 2, 2002

Congressman Camp, I want to thank you, Chairman Herger, and other members of the committee for asking me to testify today. I also appreciate that this field hearing is happening in the State of Michigan, a state that has a proud record of welfare reform success.

Not only is the state well represented by Congressman Camp, but we are privileged to have Congressman Sander Levin as a member of this subcommittee as well.

I’d also like to acknowledge the hard work of Matt Weidinger and his staff at the subcommittee, as well as the staff of the minority subcommittee.

I am grateful for the opportunity to take a few minutes to testify before this committee and ask that the additional information I am submitting on Michigan’s welfare reform success be included in the record.

In 1996, after two vetoes, federal welfare reform was signed into law on August 22. Many skeptics had their doubts, saying bad things would happen – even HHS employees resigning in protest -- effectively arguing that states weren’t as concerned or compassionate about their residents as Washington. Some said two million children would be added to the child poverty rolls. They were wrong!

Welfare reform has worked and exceeded the expectations of many of its staunchest supporters. States took seriously the authority that was devolved and earned acclaim and trust through their actions and successes. The federal legislation succeeded because the Congress debated, focused on and set overarching goals, such as families going to work and making assistance temporary, and left the strategies and methods to the states. The key word: flexibility. Michigan and other states have proven that given flexibility, states can design a better program, deliver better services, and get better outcomes for families and taxpayers. Michigan’s reforms alone have resulted in over 308,000 Michigan families leaving welfare with earned income.

As we move forward, everyone agrees it is important to maintain work in unsubsidized private sector employment as the key goal. Employment reduces welfare dependency, strengthens families, and exposes our next generation of children to the all-important work ethic. If we lose work as the central theme, we risk losing much of the gains we have made over the last decade.

President Bush’s proposal keeps work as a central focus, and I support his efforts to raise the bar. While some of the details are still emerging, we believe there is opportunity within the President’s proposal, as well as others, to fine-tune the details so that current successful state programs can continue. I look forward to being part of a process of states, Congress, and the Administration in arriving at a final product that recognizes a goal of work, while balancing the changing mix of our caseloads, current state programs, available resources, and maximizing flexibility to the states. The President’s proposal is a tremendous starting point, particularly given where we began back in 1995.

Welfare reform is about strengthening families, and work strengthens families. However, for some families, work alone cannot be the only strategy to strengthen the families. We have done many things in Michigan to support strong family structures, including fairer eligibility standards for two-parent families, targeted paternity establishment, reducing out-of-wedlock births, family reunification and preservation initiatives, and other family formation activities. However, as with the focus on work, it is critical that family formation strategies be left up to the states.

I am also pleased that the President has proposed keeping the block grant level while also addressing other critical financial issues, such as a meaningful contingency fund, the ability of states to formally obligate unspent funds, and the ongoing commitment of a multi-year block grant.

Nevertheless, given states’ current fiscal situations, we will still be looking for any opportunities to include other economic increases or inflation factors to further supplement our base TANF funding.

Another key opportunity is in allowing states to align and simplify other programs. The President’s proposed "super-waiver" authority could be one of the most exciting, innovative, and effective things to come out of Washington in years.

Families who receive cash are often caught in the trap of multiple and conflicting bureaucratic systems and programs – like food stamps, housing, education and training systems, and workforce systems. Many of these systems don’t work well together because of different federal rules, priorities, and definitions. Different programs send conflicting messages to families; they create ominous hurdles for staff who try to make them work together; and they aggravate the public, the dedicated workers trying to help families, the families themselves, and me because we want a system that works better. I believe it can and should work better.

This is not about making one or five or ten changes in Congress each year. It is about giving states flexibility and authority to make real-time changes to align programs in a way that gets better services to families, makes program administration more manageable, and provides more bang for the taxpayers’ dollars. I believe the bottom line is this: the more challenging the families’ problems are, the more flexibility the states need to address the problems. The adage "one size fits all" is especially wrong for these families. For those who say this will not work and is not possible, I ask them if they are the same people that said the AFDC entitlement could not be eliminated or said a TANF block grant would not work.

Governors and legislatures are closer to the people needing the services. The states are willing to be held accountable, but the states must have the responsibility and authority that goes with the accountability. To those who do not believe that greater flexibility for states is a deserving and worthy goal, I ask this: What would it take to convince you? Opposing flexibility is the equivalent of saying that better services to families and more streamlined, efficient programs are not worthy and deserving goals. In 2002, opposing state flexibility means more mandates and rules from Washington. We tried that for 40 years, and it did not work.

I am very proud of our record of reform in Michigan. I am proud of what Republican and Democrat governors across America have done. I am also pleased with the relationship that Congress developed with governors and states in 1995 and 1996 during the welfare reform debate. Those debates resulted in historic reforms, and this year, let us seize the opportunity to ensure that those historic reforms continue and rise to the next level of success.

With that, I would be happy to take questions.