A scandal involving former NFL quarterback Brett Favre and the federal welfare program Temporary Assistance for Needy Families (TANF) exploded last week following new revelations that Mississippi officials, including the former governor, misdirected federal TANF money to enrich themselves, their celebrity friends, and other well-connected individuals.

As public scandals go, this one is particularly bold. Mississippi has the fourth-highest poverty rate in the country, even after adjusting for a lower cost of living and counting government benefits, yet officials there used federal dollars earmarked for poor children to benefit themselves and their friends. The head of the welfare department and the director for the nonprofit organization that he funneled money to have already plead guilty to their crimes and more charges could follow.

Naturally, the scandal draws attention to the TANF program. Critics have partly blamed the welfare reform law from 1996, which created TANF, for allowing such fraud. Mississippi Today reporter Anna Wolfe called TANF “essentially a slush fund in any state that wants to use it that way” and Jack Meserve of Vox claimed, “the kind of staggering organized theft that took place in Mississippi was only possible because of TANF’s giant-pool-of-money design.”

The reporters are referring to the way the federal government finances TANF. Instead of an entitlement where government officials distribute money to all eligible people, TANF is a block grant provided to each state to spend on any program or service, on condition that it aims to achieve four goals:

1. Provide assistance to needy families
2. End dependence on government by promoting job preparation, work, and marriage
3. Prevent and reduce the incidence of out-of-wedlock births
4. Encourage the formation and maintenance of two-parent families

As long as the state can justify their expenditures meeting one of these goals, the federal government typically allows it. Regrettably, Mississippi’s scandal is all too familiar whether it involves a block grant or an entitlement program—a corrupt bureaucrat (in this case the state’s welfare chief) funneled government money to a sham nonprofit organization to pay for services that they never actually provided. Officials pocketed the money and poor families in Mississippi dealt with the consequences.

As awful as this scandal is, the fraud and abuse on display in Mississippi is not unique to TANF and not caused by its block grant structure. The Government Accountability Office (GAO) estimated that from 2015–2017 the annual average amount of Supplemental Nutrition Assistance Program (SNAP) benefits (or food stamps) “trafficked,” meaning retailers taking a fraudulent profit, was $1.2 billion. The GAO also found that improper payments in Medicaid, including payments for services not provided, totaled $36.7 billion in 2017. Earlier this month, the Department of Justice charged a nonprofit organization in Minnesota with a $250 million scheme that took federal pandemic-relief money earmarked for a child nutrition program and instead pocketed the funds.

Further, fraud is not unique to state-run programs funded by the federal government. The Inspector General for the Internal Revenue Service (IRS) found that in 2021, federal earned income tax credit improper payments totaled $19 billion and child tax credit (CTC) improper payments another $5.2 billion. And just this week, the IRS reported that the federal government sent $1.1 billion in error under the expanded CTC in 2021, while failing to send $3.7 billion to eligible tax filers. Mississippi’s $70 million TANF fraud is appalling, but it pales in comparison to the level of fraud and improper payments in the government’s entitlement programs.

None of this excuses what happened in Mississippi, but the context is important. Welfare reform, which created TANF, transformed a broken entitlement program—Aid to Families with Dependent Children—into a more effective system that gives states flexibility to address the underlying causes of poverty, including limited employment and unmarried parenthood. These reforms have significantly reduced dependence on cash welfare and increased employment among single mothers, which helped dramatically lower child poverty over the past two decades.

Nonetheless, the federal government can and should strengthen TANF to avoid fraud and theft of public funds. One solution is to strengthen the authority of the Department of Health and Human Services Office of the Inspector General that oversees TANF. Plenty of red flags appeared in Mississippi’s operation of TANF, including state reports showing that they spent 20 percent of TANF funds ($15 million) on fatherhood programs in 2020 compared to between 1–3 percent for neighboring states. Did anyone in the federal government ask why Mississippi spent so much and what they got in return? There is no place for fraud and abuse in any safety net program, but abandoning TANF’s effective approach because of bad actors in Mississippi would likely come at the expense of families in need.

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