On Paul Ryan’s “Opportunity Grant” Rollout

You’re probably not going to hear a whole lot about this outside of it being reported as a precursor to his potentially running for president in 2016, which is how policy reporting is sugar-coated for the hooples who’d rather go watch the Kardashians, but earlier today Rep. Paul Ryan (R-Wisconsin) wrote a column at USA Today and gave a speech at the American Enterprise Institute on a way to do welfare reform which is really quite exciting.

Exciting in a policy-wonk sort of way, yes, but it’s more than that. While there are some critiques to be made of what Ryan is putting forth, he’s getting something fundamentally right here.

If you’d rather hear Ryan talk about his idea than read my writing about it, we’ll supply the video. He gives a 15-minute speech, and then the next 40 minutes of it involves a question-and-answer period.

Basically, while Ryan embraces a number of ideas put forth by others in Congress – accreditation reform for colleges in order to make higher education more affordable, for example, or criminal justice reform, or expanding the earned income tax credit to incentivize more early 20-somethings to join the workforce – the main thrust of the speech and the USA Today column which went with it is to introduce the idea of turning the federal welfare state into something of a marketplace.

Specifically, he’d set up a pilot program where some 11 streams of federal assistance – food stamps, welfare payments, housing assistance, child-care, etc. – are melted into a block grant down to states which participate in the program, and the states would be charged with coming up with better ways of delivering assistance to clients of the social safety net and moving them toward work.

All of which so far is fairly standard Jack Kemp empowerment-society boilerplate. Some of it was part of the welfare reform Newt Gingrich and Bill Clinton managed to hammer out in the 1990’s which was pretty successful before the Obama administration came along and completely abandoned it in favor of giving away as much free swag to create dependent Democrat voters as it could. University of Maryland economist, cable news pundit and occasional office-copier pitchman per excellence Peter Morici hails these ideas as promoting work and deflating the welfare state.

Where it gets interesting, though, is when Ryan says that block grant money can’t just go into the states’ general funds. Participating states are required to bring in at least one competitor to the state welfare office. What that means is now you’re bringing the civil society back into the fight against poverty that the feds have been crowding out for decades.

And that’s potentially a great thing. Because if you turn the safety net into a self-help marketplace, in which people down on their luck can choose a method of getting out of lousy situations and social workers can operate in an entrepreneurial fashion rather than as part of a mindless bureaucracy, you’re beginning to build something with a real chance of generating some results.

And if you’re seeing this as a way in which you can do some serious damage to the Democrats’ vote plantations in poor communities, you’re catching some of the political advantage to it for the GOP.

We’ve been saying for a while that the challenge and opportunity for the Republican Party, and one of the central theses I’m actually going to base a book I’m writing about, is to sell the public on the proposition that we might seem to be telling politicians on Election Day that we want big government but it’s not true. We actually hate big government. What we want is for the services associated with big government to be available to those who need them. But we can sell the public, which is willing to listen (particularly after the abject failure of the Obama administration), is there are means to provide those services which are a whole lot more efficient and effective than big government; in fact, big government is the worst possible provider of most of them. And all that’s needed to prove this to the public is the power of example.

Another central theme is that one reason the public is so down on the federal government, and in fact government in general, is that we are a 21st century information society in which your average American has in her smart phone more computing power than it took to go to the moon and more access to information than can be found at any public library, and in which she can summon an endless array of consumer choices in almost any commercial venue you can imagine from food to cars to electronics to vintage clothing. But that society is being governed by a one-size-fits-all 20th century Industrial Age colossus of a government, in which most if not all key policy decisions are made in Washington either by unaccountable bureaucrats or by a Congress which is hopelessly in the clutches of special interests. And in fact, special-interest politics is a 20th century Industrial Age phenomenon which is largely obsolete because there are fewer and fewer things which truly need to be decided in one fell swoop for everyone.

What Ryan is proposing, at least with his Opportunity Grant idea but with some of the others as well, is to decentralize the provision of welfare and other benefits to the poor and plug them into that 21st century society, in which they are charged with making the same kinds of choices the rest of us make but to be paired with a partner – corporate, government or otherwise – of their choosing to help them navigate those options on their way out of poverty. And to reward the successful partners with the kinds of incentives that produce innovative ways to truly alleviate poverty and improve people’s lives.

Ryan’s example is worth returning to…

Take an example. Let’s call her Andrea. She’s 24. She has two kids ages four and two. Her husband left the family six months ago, and she does not know how to contact him. Andrea graduated from high school, but her only work experience was a two-year stint in retail. She and her kids now live with her parents in a two-bedroom mobile home. Her parents can’t support her over the long haul. She’s been trying to find work for the last five months. She doesn’t have a car. She can’t afford child care. And her dream is to become a teacher.

Under this plan, Andrea would go to a local service provider. She would sit down with a case manager and develop an “opportunity plan.” That plan would pinpoint her strengths; her opportunities for growth; her short-, medium-, and long-term goals. The two of them would sign a contract. Andrea would agree to meet specific benchmarks of success, a timeline for meeting them, consequences for missing them, and rewards for exceeding them.

Andrea’s short-term goal is to find a job. But her long-term goal is to find the right job—to become a teacher. So she might find a job in retail to pay the bills. Meanwhile, her case manager would help pay for transportation and child care so she could take classes at night. Over time, Andrea could go to school, get her certification, and find a teaching job. The point is, with someone to coordinate her aid, Andrea would not just find a job; she would start a career.

And all this time, a neutral third party would keep tabs on each provider and their success rate. It would look at key metrics agreed to by the state and federal government: How many people are finding jobs? How many people are getting off assistance? How many people are moving out of poverty? And so on. Any provider who came up short could no longer participate. And at the end of the program, we would pool the results and go from there.

There is probably still too much government in this example, though it’s really striking how much it differs from the dystopian “Life of Julia” vision the Obama 2012 campaign offered in an effort to pull the female vote. But you can see in it a completely different idea of how to administer the services we currently expect to produce using the sterile, take-a-number-and-wait bureaucracies.

This isn’t a perfect idea, but it definitely reflects the beginning of a sea change in how to think about government that the GOP, and the country, desperately needs to have. The Republican Party cannot continue to sell the same message it has been recycling since Ronald Reagan perfected it a generation (or two) ago, and the Democrats offer something far more ancient than Reagan; Obama’s economic and domestic platform is a cross between Italian fascism and Woodrow Wilson’s War Socialism, both of which were failures when first introduced 100 years ago.

The public wants something new. There will be a race to offer it. That’s a race the GOP can win if it will pick up ideas like Ryan’s.

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