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This article describes the principles and strategies of the Reagan Administration's welfare policies, its effects on the lives of the poor, and its implications for the social work profession in the United States. The article first briefly discusses statistical information on social welfare expenditures and policies of the past federal administrations since 1935. Then in contrast to these, the social welfare principles and strategies advanced by the Reagan Administration are discussed. These may be summerized as follows: 1) Cutbacks in federal budget, particularly social programs in order to boost defense spending, 2) advocates "small" government; fewer regulations and interventions, 3) transfer of federal welfare responsibilities to local and state governments, and 4) reliance on private resources such as foundations, charities, and self-help groups. The Reagan Administration also proposed the preservation of the "social safety net" which vaguely defined the eligible welfare recipients as well as explained the administration's expectation of the welfare recipients' behaviors. Such examples are the principles of "self-help," "work fare," and "use of resources in the private sector." In response to the Reagan Administration's welfare policies, social workers have been fighting back against the cutbacks and structural changes along the side of labor unions and other liberal-minded organizations. However, social workers have also learned a few important lessons through the experience. One such lesson is greater recognition that social workers must become more active with all levels of the political systems in order to achieve their professional goals. In particular, the advent of "block grant" appears to make more demands on social workers to be involved in local and state political processes where major decisions for welfare appropriations are expected to be made in the future. Innovations in service deliveries also should be promoted in view of the limited resources available for social services. Development of more effective use of self-help groups and volunteers, efforts for community organizing, and more efficient and effective use of professional manpower are a few such examples.