Is this the end of the welfare state? — with Norman Ornstein (1995) | THINK TANK

Is this the end of the welfare state? — with Norman Ornstein (1995) | THINK TANK

Ben Wattenberg: Hello, I’m Ben Wattenberg. The Republican Senate is stirring. Liberal programs long thought to be off limits
to politicians are on the table. Some observers say that what is going on signals
the repeal of the New Deal, the death knell of the Great Society. Others say it’s not what it seems. Joining us to cut through the rhetoric surrounding
this issue are Robert Reischauer, former head of the Congressional Budget Office from 1989
to 1995 and now a senior fellow at the Brookings Institution; Norman Ornstein, resident scholar
at the American Enterprise Institute and author of the recent book, “Intensive Care: How
Congress Shapes Health Policy”; John Dilulio, professor of politics and public policy at
the Woodrow Wilson School at Princeton University and author of “Fine Print,” which is an
assessment of the new Congress; and David Mason, an eight-year veteran of Capitol Hill
and now vice president of the Heritage Foundation, where he recently published the study “The
Ruling Class: Inside the Imperial Congress.” The topic before this house: Is this the end
of the welfare state? This week on “Think Tank.” The House of Representatives, led by Newt
Gingrich, acted vigorously on a variety of issues earlier this year. Now the Republican Senate is catching up. Among the proposals on the table are turning
over to the states many of the main welfare programs, cutting the growth of Medicare and
giving seniors more choice, sending Medicaid back to the states, cutting corporate welfare,
lowering farm subsidies, and some of President Clinton’s favorite programs are also under
the gun, such as defunding AmeriCorps, his domestic Peace Corps, and zeroing out Goals
2000, a favorite federal education program. The Senate welfare reform bill provoked a
passionate response. Patrick Moynihan [from videotape]: I had no
idea, Mr. President, how profound what used to be known as liberalism was shaken by the
last election. No president, Republican or Democrat, in history
— well, in 60 years’ history — would have dreamed of agreeing to the repeal of
Title IV.A. of the Social Security Act, the provision of the national government for children. I cannot understand how this could be happening. It has never happened before. Ben Wattenberg: Sen. Moynihan is right. The welfare reform bill is unprecedented. But — but — three-fourths of the Democratic
senators joined with Republicans in 87–12 vote in favor of welfare reform, and President
Clinton says he supports it. First question. Bob Reischauer, let’s begin with you. You were serving at the Congressional Budget
Office until earlier this year. Are we seeing the end of the welfare state
in America? Robert Reischauer: Well, we’re certainly
not repealing the welfare state. Social Security, unemployment insurance, many
of these programs will continue. But the notion that the federal government
will share the risk of uncertainty for helping the poor with the states will now be gone,
and that’s a big shift from policy that has existed since 1935. Ben Wattenberg: David Mason of the Heritage
Foundation, are we ending the welfare state? David Mason: Ben, the idea of the welfare
state is dead — the idea that the government is going to take care of you cradle to grave,
take care of your needs, and so on like that. But there’s a lot of questions left about
how fast it’s going to decline and exactly what these programs are going to be replaced
with. Just because the idea is dead doesn’t mean
the programs and the political ideology won’t live on for a long time. Ben Wattenberg: John Dilulio. John Dilulio: I don’t think we’re repealing
anything. Ben Wattenberg: [Laughs.] Well, let’s go home. John Dilulio: Let’s go home. I think Republicans can talk about devolution
and de-entitling and deregulating all they want. Ben Wattenberg: Devolution is sending it back
to the states. John Dilulio: Sending it back to the states. The fact of the matter is that most Americans
continue to believe that government, including the federal government, has a substantial
role to play in making the lives of ordinary citizens better. That’s why a majority say they’d rather
preserve Medicare and Medicaid and Social Security and college loans rather than balance
the budget, if it came down to a choice. So this is about pumping brakes; it’s not
about slamming on the brakes. Ben Wattenberg: Norman Ornstein, American
Enterprise Institute. Sir. Norman Ornstein: Gee, I agree with all my
colleagues. We’re probably in the midst of taking two
steps forward, and then we’ll take one step back. Americans believe things haven’t been working. Ben Wattenberg: Or two steps backward and
one step forward. Norman Ornstein: Well, maybe just dancing
around, too. Americans believe things haven’t been working. And clearly, it’s not going to be the same
as it was in our attitudes towards government or the way in which we approach problems now
or in the next several years. But the idea that we are going to have a complete
reversal, that this vision that Speaker Gingrich has of the opportunity society with government
playing the most minimal role is long into the future, if there at all. And as John suggested, Americans want it to
work, and if that involves a substantial role for government — and Americans believe it
will — then they’re going to want it. And if what we do is send things back to the
states and it doesn’t work, they’re going to say, “All right, you’re out of there. We’ll bring in some people who can make
it work.” Ben Wattenberg: David Mason, let me ask you
a question. You said that the idea of the Great Society
and the New Deal and the welfare state is gone. And yet your major conservative politicians
in America are the number-one promoters of the flagship programs of the New Deal and
the Great Society. I mean, they all say, “We’re taking Social
Security off the table because,” quotes Gingrich, “It is sacred.” They are saying they are going to save Medicare. It’s those irresponsible Democrats who are
really going to bankrupt this wonderful Lyndon Johnson program, and we — these conservative
Republicans — we will save your Medicare, dear Mr. and Mrs. Elderly American. Now, there is a disconnect there. Either the leaders are lying, or what you’re
saying isn’t right. David Mason: Well, there’s a distinction,
first, between the New Deal programs that fundamentally worked pretty well and need
some adjustment and a lot of the things that came in the Great Society, the kind of welfare
idea. And we’re changing the latter pretty rapidly
and readjusting the former. Ben Wattenberg: Medicare came in the Great
Society. David Mason: Medicare came in the Great Society. But everybody agrees that needs to be changed. Bill Clinton says it needs to be changed;
the Republicans say it needs to be changed. Bill Clinton’s Medicare trustees say if
we don’t fix the program, we’ve got big problems. And so that’s an area where there’s a
substantial amount of agreement. But back on welfare, Pat Moynihan agrees the
program is broken and it doesn’t work. Bill Clinton won’t defend it. As you pointed out, the majority of senators
voted for those reforms. So there’s no one who believes the current
program works. What the Republicans are saying is we don’t
know the perfect answer to fix it, and so we’re going to send it back to the states
and give them a try. Ben Wattenberg: So you are saying, in effect,
that selectively, the New Deal and the Great Society and big government liberalism, selectively
it is being phased out. David Mason: Well, and some of these programs
work better than others. Some of them are more efficient than others. And the welfare programs in particular, people
have come to the conclusion they are pernicious. They don’t work. And there are a lot of things about Medicare
that don’t work, and we’re going to have to fix those, though probably more slowly. Ben Wattenberg: Bob? Robert Reischauer: What we’re doing is making
rather radical changes in the programs that affect low-income people. Low-income people aren’t going to go away
as a result of these reductions in resources. And I agree with Norm, to the extent that
states can’t solve these problems because they don’t have the resources, they don’t
have the political will, this will be bounced back up to the federal level fairly soon,
after the first major recession probably. Norman Ornstein: Let me get to the question
that you asked Dave. I think we all have to agree that there is
some disingenuousness here on the part of some of the Republican leaders, who want to
phase out as much as they can of the New Deal and the Great Society. Many of them talk in other occasions about
how Social Security ought not to be there; we ought to be moving towards a very different
kind of program. It ought to be privatized; people ought to
be able to take their money and put it into retirement accounts and manage them more. They’d prefer not to have a Medicare program,
to have it much more of a private system, to have the reforms that they’re taking
in modest steps, medical savings accounts, for example, and have them ultimately supplant
the existing Medicare program. When they talk about sending things out to
the states, for many that’s as a way station to send them out of government entirely. And this is a tactical step. Talking about saving Medicare is as much as
anything a tactical step because they don’t want to have the government be basically the
prime mover here. David Mason: I agree with you except your
allegation that this is disingenuous or that people are trying to fool. You’re right, they’re taking a lot of
small steps in the direction of some major reforms. I think that’s a great thing, and in fact,
as you said, they’ve laid out where they want to go. Now, the public may not be sure that’s going
to work, and so I think it’s a perfectly acceptable intermediate step to say we’re
going to go a little bit in that direction. John Dilulio: I think the interesting thing
is that even if we take what Republicans are saying at face value, what exactly are they
promising to do? They’re promising to make these massive
cuts in Medicare and Medicaid and welfare and de-entitling it, and at the end of the
rainbow, there is what? A balanced budget. A budget balanced at what? A federal establishment that will represent
still about $1.6 trillion. I mean, going back to the question you asked
at the beginning, I think if you had the opponents, the conservative opponents of the New Deal
here and they were looking at this, this is going to be the conservative nirvana. We’re going to stand pat at a federal establishment
that is involved in environmental and crime and still a role in housing and welfare, and
this is the great conservative revolution — Ben Wattenberg: But John, I think the case
the conservatives are making — you know the old metaphor of the ship of state being
in a fact a ship, a great ocean liner. You don’t make U-turns or sharp right turns
or sharp left turns, but once you move the nose of that ocean liner a degree or so and
then another degree or two, pretty soon you’re — and that’s what you’re talking about. David Mason: And among conservatives, for
instance, there is some disappointment now — and understandably so — that we haven’t
done more already. But the question is: Is this the first of
two years or the first of 20 years? And if this is the first of 20, then we’re
going to have some very significant changes further down the road. John Dilulio: The bet that I’m making is
that this is — there’s going to be feedback from this, as Norm and Bob suggested. Two to three years down the road, after we
have the first recession, what you’re going to have is people saying, “Hmm, there are
some real severe problems here that aren’t being addressed.” Who’s responsible for that? Whose fault is it? I think at that point, I don’t say we’re
ever going to go back to what we’ve had, in particular on welfare. It’s one thing to agree that welfare has
had perverse and unintended consequences. Everybody agrees with that, all points of
the political spectrum just about. It’s quite another thing to say that the
answer to that is to de-entitle welfare and send it back to the states. Norman Ornstein: You’ve got a couple of
interesting themes in this revolution. One is aimed at poor people and aimed largely
at culture. And what you focused on with welfare is the
illegitimacy question, but of course the main question that we focused on with welfare before
is: Is it a disincentive to work? And what we’re going to try to do is provide
incentives for people to work. We want welfare to be a work-fare kind of
program, and it is a springboard to work. But if you look at the panoply of programs
that we’re pursuing here, the incentives that we’ve tried to build into the system
to encourage people to move off welfare and onto work are now being cutback as well. And we’re going to see a squeeze here. Ben Wattenberg: But they haven’t worked,
Norman. They haven’t. The numbers of people on welfare have gone
up while those numbers of programs have gone up. Norman Ornstein: We have a significant squeeze
here that is going to come with tax increases for lower-income working people even as you’re
pushing people off of welfare, and it’s going to provide I think some feedback that’s
going to be negative. Ben Wattenberg: Let’s go to a better place,
to a higher level. In the 1960s and I guess up through the early
1970s, there was a word that always struck me when you went to these international conferences. People said that the growth of the welfare
state — welfare in that context meaning not just as we call it welfare, but this whole
panoply of supports that keep people through their government in pretty good shape — they
said that the growth of the welfare state is “inexorable.” That was the word that always used to haunt
me. I said, you know, these are people living
in democracies; the whole idea of democracy is that nothing is inexorable unless you have
the sovereign people behind it saying that’s the way we want to go. Three of you — John Dilulio, Robert Reischauer,
and Norman Ornstein, without using that word, are saying — what I am hearing is inexorable. Here we have this system. You can tickle it a little bit, you can tweak
it a little bit, you can do something with welfare — Bob Reischauer says, hey, it’s
going to come right back to you; you’re going to be doing the same old thing again. Are you people status-quo-niks? Is that what you’re talking about, that
you can’t move the ship? I mean, what are we doing inside the Beltway
here if we don’t have some democratic ability to change things, seriously? Robert Reischauer: Well, remember, the welfare
state is largely redistributing resources among the middle class. It’s largely pensions for the elderly, health
care for the elderly. And there is no them versus us in this. It’s society deciding that certain things
should be collectivized: We should make sure that people do save enough for retirement,
so we set up a program to do that. Health care is a tremendous cost. People, given their retirement incomes, can’t
pay for it. We should develop some collective way of resolving
that issue. The problems aren’t going to go away, and
I think that — Ben Wattenberg: People say that — look,
I mean there are the middle class — you made the point, there are these middle-class
entitlements and there are the lower-class entitlements. People have made the case that the entitlements
going to the poor have created a dependency crisis in this country that have made poor
people — have increased crime, have broken up our education system. And you’re saying — I mean, is that your
point there also, well, there’s sort of nothing we can do about it? Robert Reischauer: No, I’m not talking about
those — Ben Wattenberg: It is much worse than it used
to be. Robert Reischauer: I’m not talking about
those programs at all. I’m saying, when we talk about the welfare
state, make no mistake about it: Two-thirds, three-quarters of it isn’t the money going
to low-income poor people, dysfunctional people. It’s — Ben Wattenberg: No, but don’t measure everything
in dollar signs. I mean, it may be only one-third are going
to poor people, but that is causing two-thirds or three-fourths of the problem in this country. I mean, there is some of this — and in my
ignorance about Medicare I would say, look, the Medicare things we’re talking about
is mostly it’s costing too much. Let’s cut it here. That’s fine. That’s an interclass redistribution. Some of the things about poor people in this
country are a major ideological, philosophical difference. Robert Reischauer: But I think it would be
wrong to say these programs are the result of the welfare system. They’re the result of racial discrimination,
of a poor education system, of jobs that aren’t available, lots of things — and exacerbated
by various aspects of our welfare system. But if the welfare system was wiped off the
map tomorrow, these problems wouldn’t go away, and they’d be probably almost as large
as they are right now. Ben Wattenberg: Do you think you would have
had a roughly sevenfold increase in out-of-wedlock births if we didn’t have a major welfare
net in this country, growing? Robert Reischauer: We’ve seen that occur
across the globe, that increase. Ben Wattenberg: Across the globe in countries
with high welfare — Robert Reischauer: We have also seen movie
stars, lawyers, people who are unaffected by the welfare system have children out of
wedlock. There’s been a change in values in this
country. Ben Wattenberg: But if Murphy Brown has a
baby, Norman doesn’t have to pay for it, Bob, I don’t think. Robert Reischauer: Those are cultural norms. John Dilulio: But Ben, even if you change
the cultural norm — even if you take — let’s not even argue about the relationship between
the rate of nonmarital births among AFDC recipients on the one side and welfare payments. We can spend a lot of time on that, and everybody’s
eyes will glaze over. Let’s assume that the diagnosis you’ve
given is correct. Over the last 30 or 40 years, welfare spending
has had these perverse incentives. It has killed the black, two-parent, inner-city
family. It has increased illegitimacy. It has had all these terrible consequences. Let’s assume that’s true. I believe that assuming that running the monetary
incentives in reverse is sort of tantamount to assuming that a guy who was murdered 30
years ago with a knife stuck in his chest can come along 30 years later, pull the knife
out, and expect that he’s going to come dancing back to life. Okay? It doesn’t make any sense. Ben Wattenberg: Yeah, but that is a terrible
metaphor. John Dilulio: I don’t think so. I think it’s a good one. Bill Bennett thinks — even more important,
Bill Bennett thinks it’s a good one. Ben Wattenberg: Let me present you with a
metaphor, which is you’re going down a road and you have a fork in the road. And you take — Norman Ornstein: Take it. Ben Wattenberg: Yeah, take it, right. [Laughter.] You take this fork, and you find a bad place
and the roads are bumpy and you don’t like it. And then you say, “Hey, you know, I don’t
like this way,” and you go back to the fork and you go the other way. I should have reversed that left and right. John Dilulio: Fine, go back and reverse it. Ben Wattenberg: But that’s not pulling a
dagger out of somebody’s heart. John Dilulio: Fine. Go down the road, use what metaphor you please,
run the monetary incentives in reverse, de-entitle it. But remember that what Sen. Moynihan said
is a brute social fact. This is where the feedback comes in. There are 40 million kids aged 10 or under
in this country today. A growing fraction of these kids, for whatever
reasons, are at risk — at risk of growing up jobless, at risk of growing up drug dependent,
at risk of getting criminally victimized and becoming criminals. They are there, and they are going to be there
no matter how you structure these programs or run them. That is a problem that Americans are going
to deal with, and they’re going to deal with it either via Washington or via the states. But they’re going to have to deal with it. And the question intellectually is: Is it
going to be possible at the margin to deal with this better than we are now if we devolve
and de-entitle? Ben Wattenberg: All right, we have now set
the stage for our one revolutionary here. These guys are all blowing smoke as far as
you’re concerned, is that right? David Mason: Look, I agree with John. Just reversing the welfare state isn’t going
to solve our problems, and that’s why we’re convinced — Ben Wattenberg: The welfare state or this
particular welfare system? David Mason: This particular program. And that’s why we’re convinced that you’ve
got to focus on things like illegitimacy. You can’t just take away the money and think
that will make it better. But let’s get to your question about inexorability. It’s not inexorable. We have reached the limits of the tax collection
system to fund programs. You go to Canada — in health care, you get
rationing. You get big cuts in Britain. A lot of the same problems in the United States. We’re reaching the limits of the ability
to pay for these welfare programs, particularly middle-class welfare. And so we get caught in a cruel vice between
increasing taxes or cutting benefits in a program like Medicare. And what the Republicans are saying is we’ve
got to figure out a better way, and we think we know the beginning of some answers to the
better way. And that involves, for instance, bringing
the free market in to provide competition. Norman Ornstein: You asked the question based
on the premise the growth of the welfare state is inexorable. Well, obviously, as the great thinker Herb
Stein once said, things can’t go on forever, and if something can’t go on forever, it
will stop. And what we’re seeing is — Ben Wattenberg: Why didn’t I think of that? Yeah, right. [Laughter.] Norman Ornstein: What we’re seeing is that
the growth of the welfare state is not inexorable, and we have probably come pretty close to
the limits of what we will spend as a proportion of our gross national product in government
and what we will raise. And that has been relatively stable over a
long period of time. Certainly what we’ve raised has — around
19 percent of our gross national product. And what happened is our spending went up
to around 23, 24 percent, the growth coming — driven largely by these entitlement programs
for the elderly. We will restrain them, that’s at one level,
and restrain their growth. But they’re not going away. Now, there are some tactically who want them
to go away, but know tactically that they can’t get it now. So they want to change them, bring in the
market system now, and hope eventually you can phase them out. You’ve got to be, I believe, skeptical of
that. Then you get these other programs, which,
as you suggested, are not necessarily expensive. In a $6, $7 trillion economy, welfare is a
trivial sum of money. It is a question of what signals it sends
in terms of values in the society. And while I do not — I believe, as John
suggested and as Bill Bennett said, that if government was a significant part of the cause
of a problem, that moving down a different path, taking government out, will not solve
that problem. On the other hand, debating values at the
governmental level in society, changing some programs so that you can have an impact on
the broader society’s values is also potentially a very good thing. If we can get back to a point where people
see that there’s a sense of — there are things that are wrong, there’s right and
there’s wrong, which we have gotten away from, not just because of government — when
Murphy Brown has a child out of wedlock, that’s saying to the American people nothing wrong
with this. It doesn’t say only if you can pay for it. It says there’s nothing wrong in this, what
used to be, you’re having a child out of wedlock. Whether it’s a rich bastard or a poor bastard,
it’s still a bastard. That’s no longer a value in society, and
having that debate is probably a good thing. Does that mean the end of the welfare state? I would suggest no. Does it mean we will no longer grow inexorably? I would suggest yes. Ben Wattenberg: You have moved from your FDR
position to your Dan Quayle position. [Laughter.] Norman Ornstein: I wouldn’t use those analogies,
but — Ben Wattenberg: Right. Bob Reischauer, is this ferment we are seeing,
does it concern costs or does it concern ideology? This is a pretty important question because
one is sort of a mechanic’s job, and the other is these guys, these outlanders from
the hills coming and saying, “You’re doing it all wrong. The idea structure is wrong. That’s why you’re in trouble. That’s why you have cost problems. Change the ideas.” Robert Reischauer: From the standpoint of
the vast majority of Americans, I think this is a cost problem. From the standpoint of a smaller group of
ideologues, it’s a matter of principle. It’s a matter of ideas, that government
is trying to do too much and it is doing what it does the wrong way. And they’ve come together in this effort
to balance the budget, and they’ve come together at a time when the opposition is
particularly weak, where the opposition has, quite frankly, fallen flat on its face on
a number of fronts. Ben Wattenberg: The Democrats. Robert Reischauer: The Democrats. And whether this coalition is viable over
the long run and is viable as the implications of these cutbacks become felt by the average
American, I think is a very open question at this point. Ben Wattenberg: Last word to David Mason because
you are outnumbered. Is it cost or ideology? David Mason: Well, it’s getting the ideas
right. I actually disagree about the cost of the
welfare system. I think it costs tremendously too much, but
I think the touchstone of this is the government is too big and it does too much. And people are convinced that that in itself
is a problem. Even if we could save money on the margin,
getting the government out isn’t by itself going to reinvigorate our communities. But I think it’s a necessary first step
because in a lot of ways, the voluntary organizations, the neighborhood organizations are sort of
smothered by the heavy hand of government, and we need to get that off. And even if that means some uncertainty as
to what comes in to replace it, we’ve got to do that if we want our communities to work
again. Ben Wattenberg: Okay. Thank you, John Dilulio, Robert Reischauer,
David Mason, and Norman Ornstein. And thank you. Please send your comments to New River Media,
1150 17th Street, NW, Washington, DC, 20036. Or we can be reached via email at [email protected]
or on the World Wide Web at For “Think Tank,” I’m Ben Wattenberg. Announcer: This has been a production of BJW
Inc., in association with New River Media, which are solely responsible for its content.

4 thoughts on “Is this the end of the welfare state? — with Norman Ornstein (1995) | THINK TANK

  1. Lol.. no politician in their right mind will attack welfare.. America has to collapse to end welfare..

    Too many women and children

  2. It’s not about welfare take Ireland for example it’s to small a country for a welfare collapse. It’s about white Genocide.

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