(Adds comments from Democrats, tax credit details)
By David Lawder
WASHINGTON, July 24 Republican U.S.
Representative Paul Ryan proposed a plan to help poor Americans
on Thursday that would allow charities, community groups and
even for-profit firms to compete with the government for federal
money to fight poverty.
The plan from Ryan, a potential Republican presidential
contender in 2016, would allow states to replace 11 programs
ranging from food stamps to housing vouchers with "opportunity
grants" to tailor aid to individual needs.
That would shift the federal government's anti-poverty role
largely to one of vetting state programs to distribute aid, and
they would have to give the poor a choice of providers.
"There wouldn't just be a federal agency or a state agency,"
said Ryan, chairman of the House of Representatives Budget
Committee. "Instead, they could choose from a list of certified
providers. We're talking non-profits, or for-profits, or even
community groups unique to your neighborhood."
Ryan's plan comes at a time when Democrats have made growing
income inequality a major campaign issue before November
congressional elections, promoting proposals such as raising the
federal minimum wage.
The Republican vice presidential candidate in 2012, Ryan is
best known for his budget blueprints marked by deep domestic
spending cuts. But this time, he said his "discussion draft"
would keep overall social safety net funding unchanged.
Should the Wisconsin congressman seek the Republican
presidential nomination in two years, his ideas are likely to
find their way into a campaign platform.
And they share some key principles with those of a potential
rival, Senator Marco Rubio, who also has proposed shifting most
federal anti-poverty funds to state grants.
Illustrating his plan in a speech at the American Enterprise
Institute, Ryan said a 24-year-old single mother of two with a
high school education and dreams of one day being a teacher
could go to a local social services provider for help. Instead
of applying for food stamps, housing vouchers and welfare
checks, she would meet with a case manager and draft an
"opportunity plan" to achieve her goals, targeting money where
it is needed most, such as transportation or child-care costs.
The catch: she would have to sign a contract and meet
certain benchmarks for success, such as learning new skills or
seeking work. Failure would mean a cut in aid while exceeding
expectations would earn her a bonus.
There would be a time limit on assistance, and Ryan said the
plan would need to show strong evidence of positive outcomes and
poverty reduction, arguing such data is lacking in current
House Democrats charged the ideas could not be taken
seriously because Ryan's budgets have consistently prescribed
trillions of dollars in cuts to safety net programs over 10
years to eliminate deficits - a goal they say he is not likely
to give up.
Representative Chris Van Hollen, the top Democrat on the
House Budget Committee, called the plan a "gussied-up" version
of a block grant to turn federal programs over to states.
"Once you've turned something into a block grant, it makes
it a lot easier to cut," Van Hollen told reporters.
Ryan's plan contains some ideas that Democrats have
advocated, including expanding the Earned Income Tax Credit for
childless earners, although they differ in how to pay for this.
The credit provides a tax refund check to the working poor to
supplement their incomes.
But Democrats chided Ryan for supporting legislation that
would allow child tax credits to expire for millions of working
poor families while increasing eligibility for those earning
more than $150,000 a year. A House floor vote on the bill was
scheduled on Friday.
(Reporting by David Lawder; Editing by Doina Chiacu, Bill
Trott, Chizu Nomiyama and Lisa Shumaker)