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Harvard professor champions a bolder plan for welfare reform

EVEN as Congress hammers out what may be the most extensive welfare reform bill in 50 years, a Harvard University labor economist is proposing a bolder solution. David Ellwood says his five-point plan, in some ways similar to the reform bill approved by the Senate last week, would make welfare a transitional system, enforce child-support payments, raise the minimum wage, and guarantee universal medical coverage for all.

Professor Ellwood's ambitious - and expensive - proposal is significant, other welfare experts say, in that Ellwood is so well respected. He is one of the nation's top welfare experts. But scholars are divided in their opinions of whether the plan would fly.

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Nothing in his proposal is wholly new. ``All the pieces of it are pretty evolutionary,'' Ellwood said in an interview. ``But in the end, if you put them all in place - all of a sudden, when people work they're not going to be poor.'' The five parts:

Provide medical protection for all. Ellwood suggests a federal medical plan of last resort. This would remove what for the working poor can be a devastating burden, he says.

Make work pay, so working families won't be poor. This means raising the minimum wage as well as adding tax credits and other supports. Last year's tax reform bill was a considerable help to the working poor, he says.

Ensure child support payments (this is a significant feature of Congress's welfare reform bills). Identify absent parents and put their social security numbers on the child's birth certificate. Then require the absent parent to pay a ``reasonable'' portion of his wages toward child support. The government would guarantee minimum support.

Make welfare a transitional system. The aid should be ``serious but short-term financial, educational, and social support,'' Ellwood says, with a time span of from 18 months to three years.

Provide minimum-wage private or public-sector jobs for those who exhaust transitional support. Ellwood expects this group will be small. The wage would be sufficient for people to provide for themselves.

William Julius Wilson, a University of Chicago professor who has written extensively on poverty and race, calls Ellwood's book, ``Poor Support: Poverty in the American Family'' (Basic Books, New York, $19.95), ``the best and most authoritative book that I have read on family poverty and welfare receipt.'' Leslie Lenkowski, an adjunct fellow of the American Enterprise Institute, describes it as ``beyond the pale,'' given the price tag: $20 billion to $30 billion - three to 10 times the cost of the House and Senate bills, respectively. And Ellwood's figures are ``probably on the low side,'' says Mr. Lenkowski, given the ``serious administration problems, implementation problems'' of the jobs portion of the Harvard professor's proposal.

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Of the expense, Ellwood asks, ``Is it worth less than 1 percent of the gross national product to change our approach from salving problems with cash to solving them by helping people support themselves?''

Ellwood cites a 1984 survey in which Americans were asked if they supported spending more money on welfare. The answer was a resounding ``no.'' But when ``welfare'' was changed to ``assistance to the poor,'' the answer was an overwhelming ``yes.'' ``It's welfare [that] people hate, not the poor,'' Ellwood concludes.

What makes him so sure that his proposal would work, given the lack of success of so many other welfare reform proposals? It addresses the causes of poverty, not just the symptoms, Ellwood replies.

Back in the 1930s, the builders of America's modern welfare system asked, ``Who are the poor?'' says Ellwood. Then they designed a system to help the disabled, the elderly, and the single parent (who, they assumed incorrectly, would only be a widow). The social security system has worked well for the disabled and elderly, Ellwood says. But AFDC (Aid to Families with Dependent Children) for single parents is widely seen as a failure.

The face that the news media have put on the poor - that of a young, black woman with children living in an urban ghetto - is not a true picture, the Harvard scholar points out. They account for less than 10 percent of America's poverty. Half the poor children in the United States live in two-parent homes. And the ``safety net'' for the parents of these children, many of them the so-called ``working poor,'' is severely lacking, he says.

AFDC ``discourages work, rather than reinforcing and supporting it,'' writes Ellwood. ``It gives few aids or signals to point people toward self-support. It offers only two real options: work all the time or be on welfare.''

Political scientist Lawrence Mead of New York University says Ellwood's suggestion to put time limits on welfare would be ``impolitic'' and ``too great an attack on the entitlement ethos.'' He, too, cites the massive cost and union problems likely to result from a jobs program.

Professor Mead's fundamental reservation, however, centers on his view that welfare recipients ``don't respond to incentives.'' They do respond to public authority, to being told what they must do, he says.

Ellwood, on the other hand, believes that ``most of the poor are in fact quite capable - provided the right supports, given time, and so forth - of providing some modest level of support. And that's what they really want, and that's what they really will use.''