Unemployed Parents

In this second report on the Aid to Families With Dependent Children (AFDC)--Unemployed Parents program, GAO finds mixed evidence on whether the program's presence affects AFDC-Basic caseloads. Proponents of program expansion argue that the availability of assistance would encourage stability among poor families. Opponents believe that adding program benefits could decrease family stability over the long-run and increase the AFDC-Basic caseload by undermining parental responsibility for supporting their children. This report does not provide conclusive support for either side of the debate over the possible consequences of the recent program expansion.

GAO found that: (1) in eight states, there was no evidence that the AFDC-UP Program destabilized two-parent families, since the AFDC case loads did not grow at a faster rate while AFDC-UP was in place; (2) there were slower rates of growth in AFDC case loads in four states when AFDC-UP Program was present and there was no consistent association between AFDC-UP and AFDC case loads in the four other states; (3) Oregon showed the strongest evidence that the presence of the AFDC-UP reduced the rate of growth in the AFDC case load when it reinstated AFDC-UP in 1986 after it had been suspended for several years; (4) after AFDC-UP was suspended in Colorado, its AFDC case load began increasing at a faster rate, partially due to the implementation of the Deficit Reduction Act; (5) there was no evidence in Missouri, South Carolina, Utah, and Washington that AFDC-UP affected the AFDC case load or changed depending on which variables were included in the models; and (6) the change in AFDC-UP policy in all four of those states occurred at or near the same time as another major policy change. GAO used an interrupted time series design to evaluate changes in each state's AFDC case load associated with the implementation or withdrawal of AFDC-UP.