It is believed[citation needed] that the widespread outsourcing of human services formerly provided by government agencies to for-profit companies began with the Personal Responsibility and Work Opportunity Act, signed by president Bill Clinton in 1996.
Funds provided by the federal government to help vulnerable populations are misused and funneled towards private companies and in addition to that used by the states, which often have a tight budget, as a mere revenue stream.
[citation needed] Among the private companies providing these services are those known for integral roles in the United States defense industry – like Lockheed Martin and Northrop Grumman.
Maximus received the nation's first privatized welfare contract in 1987 from Los Angeles County and by 1990 was generating $19 million in revenue, Mother Jones reported in 2019.
[5] The 2014 documentary Poverty Inc. explored the poverty-industrial complex as a multi-billion dollar market of NGOs, multilateral agencies, and for-profit aid contractors turning the most vulnerable members of society into profit generators and misappropriating funds.