In 1996, with bipartisan support, President Bill Clinton signed welfare reform into law, ending Aid to Families with Dependent Children (AFDC), a federal program established under Franklin D. Roosevelt that provided cash benefits to needy single mothers. The reformed program, Temporary Assistance to Needy Families (TANF), distributes money to states based on their success at moving welfare recipients into jobs. TANF requires welfare recipients to find work within two years; limits cash benefits to five years; and places more stringent restrictions on who can receive Social Security Income benefits and food stamps.

Although TANF has only recently taken effect, some researchers report that the program is already causing a dramatic increase in homelessness. According to Julie Dworkin, a policy specialist for the Chicago Coalition for the Homeless, 25 percent of welfare recipients in Michigan became homeless after losing their benefits; in Ohio, homelessness...