Girding for disaster: local officials and private charities brace themselves for welfare reform.

There's no great welfare fix on the horizon. That's the bad news for people who voted for President Clinton hoping he would find a way to undo the harsh anti-welfare bill he signed into law shortly before the election.

While Clinton has announced that he wants to make some modest changes in the welfare law--including offering tax incentives to employers who hire welfare recipients, reinstating some benefits for legal immigrants, and restoring food stamps to working families who have high shelter costs--the President's proposals would reverse less than one-third of the $54 billion in cuts to anti-poverty programs over the next seven years.

And that's the best-case scenario. In reality, Clinton is unlikely to win all the welfare-spending increases he asks for during budget negotiations with the Republican-dominated Congress. "Is he really going to push it?" asks Jodie Levin-Epstein, a welfare expert at the Center for Law and Social Policy. "If he doesn't push it at all, then we're going to get zippo."

Even if Clinton's small fixes go through, the big welfare-reform picture isn't going to change much. "Reductions in federal spending are only part of it," says Mark Greenberg, Levin-Epstein's colleague at the Center for Law and Social Policy. "The larger issue is the block-grant structure, which eliminates state and federal responsibility for the poor. It's not obvious how you fix that."

As a result, millions of poor people--most of them children--still face deep economic distress as they lose cash assistance, food stamps, and Supplemental Security Income under the law Clinton signed. Clinton's liberal supporters (the "denial crowd," as Levin-Epstein calls them) have been clinging to the idea that he will undo the damage in the welfare law.

But Clinton has no intention of trying to make any major structural changes to the welfare law, or of changing the block-grant system, according to Michael Kharfen, director of the office of public affairs at the Department of Health and Human Services.

"The President feels it is unfair and wrong for legal immigrants who work and serve in the military to be denied benefits," says Kharfen. "But the other core elements of the welfare law as it was passed by Congress and signed by the President--the financing structure, the flexibility given to the states, work requirements, time limits, and more parental responsibility--those are the core features of what the welfare law is about, and these are the features we have to make work."

Making it work is now up to local governments, churches, charities, and private employers. Clinton has been urging these groups to jump in and help the poor as the federal government pulls out.

"We must not pack our compassion back in the cupboard like fine china that gets used once a year," the President said in his weekly radio address on Thanksgiving, when he urged Americans to pitch in and help move people off the welfare rolls. "The spirit of family and faith and community that shines so brilliantly on Thanksgiving can enable us to meet every challenge before us all year long."

Unfortunately, churches and charitable groups disagree. The American spirit of generosity, as measured in actual donations to charity, won't come close to making up for the cuts in human services that local communities are beginning to experience this year under the new welfare law.

According to a report by Catholic Charities, U.S.A., the cuts in entitlements and other low-income programs under the new welfare law will average $15.1 billion per year over the next seven years, yet charitable giving to churches and human-services groups around the nation amounted to only $11.7 billion in 1995.

"To make up for government cuts, we'd have to more than double charitable giving every year," says Sharon Daly of Catholic Charities, U.S.A. "We don't see that as likely because for five of the last six years, charitable giving has been dropping off."

In Maryland, a coalition of religious leaders openly rebelled when the state began making plans to shift the burden of providing a wide range of social services onto churches. As part of a plan to drug-test welfare recipients, a legislative subcommittee proposed that churches provide food, clothing, and other necessities for the children of parents who refuse to comply with treatment. The legislature even asked the churches to dispense cash benefits, help arrange adoptions, and help provide child care and transportation for the poor, under the state's new welfare-reform plan. Religious leaders representing 250 Christian, Jewish, and Muslim congregations in the Baltimore area met with Governor Parris Glendening to tell him they could not afford to pick up the slack for the state as it sheds its social-service programs.

"There is a general feeling that government is trying to abdicate its responsibility and dump everything on us," Sister Jo Ann Villademoros of Our Lady of Mercy in Potomac, Maryland, told The Washington Post. "We're doing all we can already."

The problem is particularly dire when it comes to feeding the hungry. While the new welfare law will cut an average of $4 billion from the food-stamps program each year over the next six years, "the total value of all the food in all the food banks in the country is $1 billion a year," says Robert Fersh, president of the Food Research and Action Center. "So, theoretically, we'd have to quadruple food donations each year just to make up for the food-stamps cuts."

If charity alone can't do it, the notion that private business can bail out welfare recipients is an even more slender hope. In January, the President met with thirteen chief executives who have hired welfare recipients, and made an appeal to corporations to create jobs and end the welfare system. Returning to his pulpit, he encouraged religious groups to take advantage of the incentive to hire welfare recipients under a provision of the new welfare law that pays welfare recipients' benefits directly to their employers.

"If every church in America just hired one family, the welfare problem would go way down," Clinton said. "If every church in America challenged every member of the church who had twenty-five or more employees to hire another family, the problem would go away."

The President announced he wants to give tax incentives to employers to hire welfare recipients. But despite all the fanfare, even within the business community, many people are skeptical of the plan.

In an article entitled "Good Politics, Bad Policy: Tapping Big Business to Fix Welfare," Business Week criticized the President's tax-incentive program, pointing out that a similar plan during the Carter Administration did not create many new jobs. "At least nine times out of ten, the subsidy went to a job that the business would have filled anyway," Anthony Carnevale, former head of the National Commission for Employment Policy, told Business Week. "Nor did the credit create opportunities," the magazine reported. "Studies showed that more than half of subsidized workers would have gotten the same jobs without the break. And unscrupulous employers could `churn' the credit by replacing workers when credits ran out."

There may not be many openings for former welfare recipients, in any event. "Big companies," says Business Week, "offer few unskilled jobs suitable for people on welfare."

In inner cities, welfare cuts are actually going to hurt business. The Community Food Resource Center in New York City projected a loss of more than $250 million to the New York state economy because of federal food-stamps cuts over the next three years. Grocery stores and other small businesses in poor neighborhoods may go under as they lose their foodstamps clients.

"While some of the poorest New Yorkers will lose their ability to eat, local food stores will lose sales, and an estimated 2,000 food-industry workers may lose their jobs," the Center projects.

The New York State Food Merchants Association, Inc., recognizing the adverse effects of food-stamps cuts, sent a letter to New York governor George Pataki, urging him to apply for a federal waiver that exempts areas with high unemployment rates or a more loosely defined "labor surplus" from the new food-stamps rules.

Pataki wrote back, saying he would request a waiver in counties where the unemployment rate exceeds 10 percent--but not for the entire state. That did not satisfy the food merchants, who pointed out in their letter that "every $40,000 loss in food stamps results in a lost job to the local food industry."

The new law says unemployed childless adults between the ages of eighteen and fifty can only get food stamps for three months out of every thirty-six-month period. For Pataki to acknowledge the damage the law will do, "He'd have to acknowledge that unemployment is a problem in this state, and that goes against his pro-business, `we're on the move again' stance," says James Rogers, president and C.E.O. of the New York State Food Merchants Association.

The food merchants recognize what Pataki and Clinton won't: that the private sector is not going to suddenly absorb welfare recipients, or solve the problems of hunger and poverty.

"Cities are going to take it on the chin," Robert Fersh told a group of worried-looking local officials from around the nation at the annual U.S. Conference of City Human Services Officials. "I think the enormity of it will rise over time."

The officials met in Washington, D.C., in January to grapple with the massive impact welfare reform is about to have on their communities.

"The federal government has not reformed welfare in so much as it has delegated responsibility for overseeing it to the other levels of government," the U.S. Conference of Mayors recently declared.

Places with large immigrant populations will be hardest hit. Of the $54 billion in "savings" from welfare reform over the next six years, about $23 billion comes from cuts in food stamps and $24 billion from cuts in services for immigrants--a total of about 87 percent of program cuts.

"In Los Angeles, we have about 300,000 people who are about to lose their food stamps," said one California official.

Many officials at the conference seemed depressed about the new welfare law.

"The food-stamp program has always been the major program to fight hunger in this country," said Yvette Jackson, the deputy administrator of the federal foodstamps program. Anyone who was poor enough could get basic nutritional assistance from the government. Not any more, Jackson noted: "A major concern that we have is now, for the first time, we have two categories of people who come to us, and we have to distinguish and say, `We don't mean you.'"

The new rules, and the accompanying layers of bureaucracy, create their own problems. Besides dealing with tight budgets and more poverty, local officials are faced with a serpentine system of regulations that requires them to sort out the "deserving" from the "undeserving" poor, as defined by the new law. Federal officials at the conference explained how the new rules work.

As of August 22, 1997, all legal immigrants are ineligible for food stamps. Refugees and those who have been granted asylum can get an exemption for the first five years of their residence in the United States, as can immigrants who have served in the military. People with forty quarters (about ten years) of work history in the United States can also get food stamps.

But, "the Social Security Administration is not prepared to deal with documenting forty quarters of work for every immigrant," said Jackson. Until this problem is solved, states will be allowed to continue providing benefits. However, "if it turns out you have thirty-nine quarters of work instead of forty, the state will have to file an overpayment claim," Jackson said. "I won't go into what our collection rate is, but that's the idea."

Some of the local officials laughed.

"You have to give the surplus cheese back?" someone next to me mumbled.

The Immigration and Naturalization Service (INS) is also expected to help sort out poor people who qualify for benefits from those who don't. "We are now in the business of verifying not only alien status, but also the status of U.S. citizens," said Barbara Stratt of the policy and planning department of the INS. "It's a very complicated task. And, of course, the INS has received no additional resources to meet the additional burden."

Because the welfare law places such a high premium on U.S. citizenship, the INS is struggling to deal with a flood of new citizenship applications. In fiscal year 1996, the agency received 1.3 million new applications for citizenship, compared with only 340,000 in fiscal year 1992, Stratt says. The agency is expecting a new high of 1.8 million applications this year.

Meanwhile, the new links between the INS and social-service agencies--and the threat of sudden, massive cutoffs--have alarmed immigrants and their advocates.

"We're not looking forward to what's going to happen in terms of panic in immigrant communities when the cutoffs arrive," says Jane Park of the National Asian Pacific American Legal Consortium.

"Many elderly refugees will be in deep trouble," says Karen Narasaki, the legal group's executive director. "We may be looking at a new group of elderly and disabled homeless. We are worried a lot of these people will hurt themselves." Her office has already received reports of suicide attempts by elderly immigrants who have heard that they are going to lose their Supplemental Security benefits, and whose families will be hard-pressed to support them, Narasaki says.

One such story appeared in the Philadelphia Inquirer in August. Wilzon Lescay, a fifty-one-year-old Cuban immigrant who was diagnosed schizophrenic, hanged himself after learning he would no longer qualify for public assistance because he was not a U.S. citizen.

Lescay had been collecting unemployment benefits after he was laid off from his job as a busboy. When his unemployment checks ran out, he went to the local welfare office, where he received two months' worth of food stamps, and an application for general assistance. But a social worker told him that, as a noncitizen, he no longer qualified for state aid. Nine days later, he killed himself

"He just couldn't get over it," Sister Angela Newman, who runs the home for destitute men where Lescay lived, told the Philadelphia Inquirer. "I think he became so severely depressed at the thought of not being able to obtain benefits that it was too much for him."

Narasaki and others urged the local officials at the conference to document the human casualties of welfare reform, so they could take these anecdotes to Congress and lobby for change.

Advocates hope they can press for more humane policies, especially for legal immigrants, whose cause President Clinton has said he will champion.

"If we get another dramatic story about a seventy-two-year-old legal immigrant who worked all her life and killed herself because she lost her SSI benefits, maybe we'll see some Congressional action on these issues," says Jodie Levin-Epstein.

Still, it's a ghoulish prospect. Advocates for the poor are now reduced to praying for horror stories.

There were plenty of awful anecdotes floating around the conference: toddlers in Wisconsin left in hallways and basements all day because their mothers had to go to work but couldn't find reliable day care; a baby who died in a hot car in Texas, waiting for her mother to come back from her workfare job; a Chinese woman in California who died of severe burns because her illegal-immigrant relatives heard that using the Medicaid system might get them turned in to the INS.

On the last day of the conference, Rolando Morales, acting director of the department of community initiatives in San Antonio, Texas, stood up and said, "It's good to gather all this data, but what are we going to do with all this documentation once we have it? At some point, I think we have to stand up and say that what's happening is wrong.".