Given the argument that you want to make, I do not see anything wrong with this thesis statement.  I really like the way that you structure it -- how you have the bit at the start about what proponents think and then you transition into what you think is true.

If you wanted to add one more sentence, you could put something in about the waste of money that you mention in the question.  I would say something like

This means that welfare programs spend large amounts of taxpayer money while producing results that are the opposite of what is intended.

That's a good start for a thesis.  I would include a clarifying sentence to follow that one about the economics of welfare.  Argue that it is fiscally (financially) unsustainable to spend government tax dollars providing unending basic support payments to a significant portion of the population while the federal budget continually requires deficit spending to cover all programs.

This covers the economic aspect while the first sentence addresses the social issues associated with the welfare debate.  In addition to that or instead of it, you could also include an argument about welfare not producing either work or workers, and the long range negative impact that has on an economy.