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Boustany Opening Statement: How Our Welfare System Can Discourage Work

June 25, 2015

WASHINGTON, DC — Today, House Ways and Means Human Resources Subcommittee Chairman Charles Boustany (R-LA) delivered the following opening statement during a joint hearing held by the subcommittee and the House Agriculture Nutrition Subcommittee on how certain welfare programs and related benefits can discourage work as a result of the high effective marginal tax rates they impose on certain populations.

“Welcome to today’s hearing. As Chairman of the Human Resources Subcommittee, I am honored to welcome Chairman Conaway along with Chairwoman Walorski and our colleagues from the Agriculture Nutrition Subcommittee for today’s joint hearing.

“This is an historic event. Since 1995, our subcommittee has held joint hearings with other committees only twice, and never with our colleagues on the Agriculture Committee. That’s despite the wide overlap between the programs we oversee that assist millions of Americans with food stamps and other welfare benefits. So today’s joint 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 doesn’t always make families better off.  This poverty trap may be unintended, but for those in its grip, it is all too real. We need to review how we got here, how real people are affected, and how we can reform this 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. As this chart shows, one thing we know for sure is that work, and especially full-time work, is the only cure for poverty. Less than three percent of people who work full-time are poor; in contrast, people who don’t work are eight to ten times more likely to be poor.

Share of Working Age Population in Povery by Employment Status 2013 Source: Brookings Institution. Close to home: Social mobility and the growing distance between people and jobs

“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 only find part-time work.  But unless we are willing to tolerate excess 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.

“Again, I welcome all of our colleagues and guests, and I look forward to our testimony today.”