Study Links State Prison Reforms to Drops in Welfare Spending

Prison reforms may result in better conditions for inmates, but those improvements come at the expense of welfare cash assistance and other government relief for the needy, according to a study released this month by Rice University and Louisiana State University.
July 30, 2013

By Elizabeth Koh

Prison reforms may result in better conditions for inmates, but those improvements come at the expense of welfare cash assistance and other government relief for the needy, according to a study released this month by Rice University and Louisiana State University.

“We find statistically that there is this link that higher prison spending leads to less welfare spending,” said Rice University professor and study co-author Richard Boylan.

The study, published July 13 in the Journal of Law, Economics, and Organization with Louisiana State University professor Naci Mocan, examined 12 states — including Texas — where statewide court rulings required sweeping prison reforms. Those states saw diminished welfare expenses that remained even when the reform orders were lifted, Boylan said.

Boylan said the cause would vary from “state to state, year to year,” but that the overall data from the states in the study, including Alabama, Arkansas, Florida, Louisiana, Mississippi, New Mexico, New Hampshire, Oklahoma, Rhode Island, South Carolina and Tennessee, supported the link.

“This is an average effect,” he said.

Texas enacted systemwide prison reforms after a federal district court prohibited inhumane conditions like overcrowding and ordered improved access to health care for inmates in the 1980 case Ruiz v. Estelle.

Boylan said that despite concerns over Texas prison conditions, the study suggested Texans “should be very careful in making the leap that these terrible prison conditions should be changed.”

“Even though it’s clear that [prisons] should be improved, new maintenance and so on, you need to think about the full consequences once you increase spending in corrections,” he said. “It’s possible that the resources may be coming from where they’re more important."

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The exact cost of the orders associated with the Ruiz case are difficult to estimate because the orders “came out incrementally over time and they had varying degrees of impact,” Jason Clark, a spokesman for the Texas Department of Criminal Justice, said in an email.

Though Clark did not estimate a cost, he said “the Ruiz case had a significant impact on the agency and its operations.”

The give-and-take between welfare and prison reform is somewhat “self-evident,” said Marc Levin, director of the Center for Effective Justice at the Texas Public Policy Foundation. Spending more money on one part of the budget leaves less money for other portions, he said.

Some public policy advocates, though, disagreed with the report's findings and said cuts to welfare spending in Texas were unrelated to prison reform.

“We hardly did anything at all for poor families even before the prison boom,” said Eva DeLuna Castro, a senior budget analyst for the Center for Public Policy Priorities.

In Texas, about 100,000 of the more 4.5 million residents who live below the poverty line qualify annually for cash assistance, Castro said. “In other states, you can qualify for cash assistance if you’re below the poverty line,” she added.

For programs like the Temporary Assistance to Needy Families, which provides cash payments to low-income families, the qualifying standard is an annual income of less than 14 percent of the poverty level, said Linda Edwards Gockel, a spokeswoman for the Health and Human Services Commission.

Gockel said TANF spending alone did not accurately reflect welfare assistance in Texas because the program was “relatively small.”

The program has also been “trending downwards” in part due to welfare reforms in the 90s that sought to encourage self-efficiency, Gockel said.

TANF awarded $93.4 million to Texas residents during the last fiscal year.

Boylan said the study sought to examine how states respond to outside “shocks” in spending.

“You can always argue that if you have more everything you would be better off,” he said. But “when you have to make choices, where should you be spending more money?”

The answer, he said, was “for your children," adding that economists agree funding is most effective when it is used early in people’s lives.

“You’re better off spending it in preschool than in prisons, in preschools than in high schools and so on,” he said.

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