If the recently enacted $787 billikon economic “stimulus” package is intended to save or create jobs, why does it encourage states to move people from work back to welfare? Yes, you read that correctly. With virtually no debate on the issue, Congress approved the new law with provisions that effectively reverse the historic welfare reform law of 1996. That reform, crafted by a Republican Congress and signed by Democratic President Bill Clinton, moved millions of people from welfare to work, while dramatically cutting poverty among single mothers and children.

That’s the assessment of the Heritage Foundation’s Robert Rector, the main think-tank architect of the 1996 reform. As Rector and others have noted, a key element of that reform was to eliminate federal incentives for states to pad their welfare rolls to garner more federal money. Instead, the 1996 reform rewrote federal payment formulas to reward states for helping people find jobs (or get job training or other education). It worked beautifully: Welfare caseloads dropped in a decade from 12.6 million to less than five million, saving taxpayers billions of dollars even as the truly needy actually received greater benefits.