Because of the “southern veto,” the majority of black workers found themselves confined to the least generous and most vulnerable wing of the new welfare state. The public assistance programs established by Social Security, notably aid to dependent children and to the poor elderly, were open to all Americans who could demonstrate financial need. But they set benefits at extremely low levels and authorized the states to determine eligibility standards, including “moral” behavior as defined by local authorities. As a result, public assistance programs allowed for widespread discrimination in the distribution of benefits. Because recipients did not pay Social Security taxes, they soon came to bear the humiliating stigma of dependency on government handouts, which would soon come to be known as “welfare.”
In 1942, the National Resources Planning Board noted that because of their exclusion from programs “which give aid under relatively favorable conditions,” blacks were becoming disproportionately dependent on welfare, a program widely viewed with popular disfavor. The situation, the report concluded, seemed certain to stigmatize blacks as recipients of unearned government assistance, and welfare as a program for minorities, thus dooming it forever to inadequate “standards of aid.” Over time, this is precisely what happened, until the federal government abolished its responsibility for welfare in 1996, dining the presidency of Bill Clinton.