Cash Strapped Kansas limits Welfare withdrawals from ATM

[frigidmagi]

bloomberg

Kansas is in trouble. After slashing income taxes in 2012, the state faces a revenue gap of more than $400 million. Republican Governor Sam Brownback and state legislators are debating how to make up the shortfall. So far they’ve agreed on one way to control how state money is spent. Starting in July, people on the dole will be limited to a single ATM withdrawal of no more than $25 per day. The law also prohibits spending public-assistance cash at movie theaters, swimming pools, and video arcades. Nail salons and tattoo parlors are out, too.

“The primary focus is to get people back to work, because that’s where the real benefit is—getting people off public assistance and back into the marketplace with the dignity and far more income there than the pittance that government gives them,” Brownback said when he signed the Kansas bill into law in April.

Kansas is among several Republican-controlled states that have recently cut or limited public-assistance funds. In Arizona, which faces a $1 billion budget shortfall, lawmakers voted on May 18 to limit welfare to a year, the shortest window in the nation. On May 5, Missouri’s Republican legislature overrode Democratic Governor Jay Nixon’s veto to enact a bill that cut thousands of low-income families from aid rolls by reducing how long people can claim cash from five years to fewer than four. Michigan’s GOP-controlled legislature passed a bill on June 2 that strips cash assistance from families with chronically truant children. “During the recession there were lots of blue states, for fiscally driven reasons, that were cutting welfare,” says Liz Schott, a senior fellow at the liberal Center on Budget and Policy Priorities, a Washington think tank. “This year’s cuts feel more ideologically driven.”

A September 2014 survey by the Pew Research Center found that 73 percent of Republicans feel the government can’t afford to do much more to help the needy, compared with 32 percent of Democrats. “If you look at cycles in history, you’ll see that there is compassion, then compassion fatigue, and then blame,” says Patricia Baker, a senior policy analyst at the Massachusetts Law Reform Institute, a Boston nonprofit that researches poverty. “This happens because there’s impatience with the solution.”

The number of families receiving cash through Temporary Assistance for Needy Families (TANF), the federal-state aid program that grew out of the 1996 federal welfare reform law, peaked in 1994 at 5.1 million families, according to the Congressional Research Service. It’s since plummeted to 1.5 million at the end of 2014. In Kansas 6,478 families were on welfare at the end of last year, down from 7,553 in 2013. Monthly payments for a family of three range from $386 to $429, depending on a county’s population and cost of living.

The restrictions on ATM withdrawals could eat up as much as 10 percent of that in transaction fees, according to Shannon Cotsoradis, president and chief executive officer of the advocacy group Kansas Action for Children. She says state lawmakers acted on anecdotes about TANF cards being used at casinos and, in one instance, on a cruise ship. “This is not a data-driven policy decision,” she says. “This is a solution seeking a problem.”

Duane Goossen, a former Republican state lawmaker who served 12 years as Kansas’s budget director under governors of both parties before leaving the post in 2010, says the restrictions won’t do anything to help fix the budget crisis. It will have “zero” effect, he says. Others say the political calculus for lawmakers facing reelection next year is clear. “Now they can go home and say they made it really tough on” the poor, says Burdett Loomis, a professor of political science at the University of Kansas. “No more free ride, blah-blah-blah.

Damn guys, really?