Posted on 09/27/2013 10:17:24 AM PDT by ThethoughtsofGreg
The Cato Institute recently released an updated version of a decades-old study analyzing welfare benefits on a state-by-state basis. The study, The Work vs. Welfare Trade-Off, found that the total value of welfare benefits continues to exceed the income that most recipients would earn from an entry-level job in many states. Since the original version of the Cato study was published in 1995, the total value of welfare benefits increased in 32 states and the District of Columbia, while 18 states saw a decline in the value of benefits.
One of the most significant findings in the study is the revelation that welfare currently pays more than a minimum-wage job in 35 states, and pays more than $15 per hour in 13 more states.
(Excerpt) Read more at americanlegislator.org ...
I’m all for stopping fraud.
I’m not for arbitrary cuts to safety net programs that assumes fraud can and will be found to make up for the cuts.
I’m all for stopping fraud.
I’m not for arbitrary cuts to safety net programs that assumes fraud can and will be found to make up for the cuts.
>>>Well for starters the title was “Why work when welfare pays more?”
That has zero to do with calling anyone a deadbeat, which is a moral judgment.
The title asks a rhetorical question regarding different kinds of INCENTIVES that present themselves to people in different situations, which is a foundational issue in economics.
I take it you’ve neither read the article nor have read anything in economics. The former is apparent from your misinformation regarding Cato. The latter is apparent from your nonsense regarding import tariffs.
If it is a government program it is NOT “a safety net”. It is a legislated way, under the guise of compassion, to entrap the people. ANYTHING the government is involved in, is an abject failure.
I would say he's done a great job in all three areas.
He is a master politician and socialist.
The title implies that people are not working because they are getting paid more on welfare. CATO is implying a moral judgement.
I've read the article and I posted my critique of it as not supporting the title.
I've also had masters level economic courses. Which I'm betting is a lot more than you've had.
You can call my comment about tariffs nonsense if you want to. But our founding fathers put up tariffs. And we had tariffs over 15% for the first 190 years of our country's existence. And they served us well.
Our stores are full of Chinese made goods. Many of our industries have been destroyed. Our unemployment sits at 23% (shadow stats.com) and is getting worse not better. There are still at least a couple of hundred million chinese making less than $1.50 a day and would love to come in from the fields and work a manufacturing job for $2/day. And China is doing what they can to acquire our manufacturing knowledge to provide those jobs to their people.
All your posts are duplicated.
Do you have a rogue keyboard macro going there?
Perhaps it’s time to Cloward & Piven the leftist welfare state!?!
I have a rogue finger that loves to double-click.
The solution is that able bodied people MUST work in public works projects. Whether it is clearing ditches, sweeping floors, or filing paperwork, there is something every able person can do. Just like the rest of us, they can put in their 40 hours per week to collect that check. The taxpayer will feel they are getting something for their money & the recipients will appreciate the value of working for something. That may be more valuable to them in the long run that the assistance.
For those unwilling to work, I'd give them bread, water, & a list of public works jobs available.
I believe a good work ethic is learned, not inborn. For most kids, their 1st 18 years or more are completely free. They have no home chores, no reason to get a job when the parents foot the bills. Why would they be expected to get a job & support themselves when they have NO experience in this & their experience has been the complete opposite? Why would they get a job when so many people are eager to give them whatever they want? Why study when the schools will just pass you through to graduation?
They are too immature to understand the personal satisfaction of a job well done & a paycheck well earned. They don't understand the good feeling of being dog tired. They never know what money or savings or property are really worth until they have earned a paycheck. They don't know what they themselves are worth, or even if they have any value at all.
All this must be learned.
>>>The title implies that people are not working because they are getting paid more on welfare. CATO is implying a moral judgement.
The title summarizes the contents of the report: people — including you — follow incentives. One important incentive is money-income. If people can get more on the dole than they can on the job, then many will choose the dole. That’s a value-neutral description of reality, not a normative evaluation.
>>>You can call my comment about tariffs nonsense if you want to. But our founding fathers put up tariffs.
So? They also had slaves. Your point?
>>>And we had tariffs over 15% for the first 190 years of our country’s existence. And they served us well.
The economic growth of the US had nothing to do with tariffs, and everything to do with 1) free trade between the states; 2) mobility of capital and labor; 3) a fairly open immigration policy that also allowed immigrants to bring their wealth — their capital — with them.
The most a tariff can do **in theory** is slightly improve the revenue stream flowing toward one business (or one sector) at the expense another business (or sector) whose revenue stream will worsen. At best, tariffs do nothing except redistribute revenue in a pattern different from what would have occurred under conditions of free trade.
You forgot: the business or sector that suffers usually requires the cheaper import as one of its own economic inputs even for something it’s producing for a domestic market. If it’s a small business, or simply one with thin margins, the higher price it is forced to pay because of the tariff — or the higher price it would have to pay if it bought the domestically produced alternative — could very easily lead it to bankruptcy, or to shift production altogether to something that doesn’t require that particular input (or that doesn’t require as much of that input); or it might seek alternatives to that input if they exist.
The notion that protected-business-A’s fatter profits are good for the country as a whole — while ignoring the tariff’s effect on business B, C, D, etc. — is lousy economics.
It isn’t a country’s exports that make it economically wealthy, but its IMPORTS; and the lower the cost of the imports, the less that country must sacrifice its own labor and capital to acquire them. It would be even better if some country were willing to ship us lots of stuff completely for free; we wouldn’t have to sacrifice any land, labor, or capital toward producing wealth to exchange. The US would be even more fabulously wealthy than it already is if food, cars, iPhones, televisions, blue jeans, shoes, etc., fell from the sky — like sunshine — free of charge. You can’t get less expensive than “free.”
But according to you, if all these things fell from the sky, heck! We’d have nothing to do all day! Better to take all that free stuff and bury it, then start producing it ourselves — at great cost in time and effort — and sell it overseas.
>>>Our stores are full of Chinese made goods. Many of our industries have been destroyed.
Oh, my! And our stores are also full of FREE AIR and SUNLIGHT!!! Think of all the domestic oxygen and lighting industries that we could “stimulate” if we could only stem this awful tide of “dumping”: these horrible FREE IMPORTS of air and light that the Earth and the sun provide for us.
As for many of our industries having been destroyed, that’s nothing specific to free trade with China or any other country, since technology alone has also destroyed lots of industries: cars killed horse-drawn carriages; kerosene killed whaling; incandescent lighting killed candles and tallow; personal computers killed typewriters; digital photography killed Kodak and emulsion film; CDs killed vinyl records; file downloads killed CDs; etc., etc., etc.
And plain old changes in consumer tastes have also killed lots of industries: people no longer buy snuff; few people dare to buy bell-bottom jeans or Nehru jackets; etc.
So, the killing of industries happens constantly — Joseph Schumpeter called this aspect of capitalism “creative destruction” — and has several different causes, lower labor costs by a competitor being only one.
>>>Our unemployment sits at 23% (shadow stats.com) and is getting worse not better.
Unemployment might, indeed, be 23%, but PRODUCTIVITY — both in output/worker and output/unit-time — is the highest in history AND the highest in the world — you can thank technology (computers, robotics, genomics, chemical industry, etc.) for that; which is the reason our FDI — a measure of how much confidence foreign investors have in getting a return on their investments in the US — is so high (it’s in the trillions).
This last recession hit the less educated and less skilled much harder than it hit those with more education and higher levels of skills. That, indeed, might indicate a real structural change in the US economy, but it won’t get fixed by rejecting free air, free sunlight, or cheap Chinese diapers at Wal-Mart.
You’re confused on some foundational issues in economics, especially something called “comparative advantage.”
A clear explanation of it, along with a solid case for free trade, is made by Milton Friedman in this lecture from 1978 at Kansas State University:
https://www.youtube.com/watch?v=qJCeoFxrDn0
“Free Trade: Consumers vs. Producers”
You might reflect on these quotes from the 19th century economist Henry George, who — though a bit eccentric when it came to the question of land — was otherwise a sound, free-market economist:
1) “In the United States, the East has had over the West all the advantages which protectionists say make it impossible for a new country to build up its manufacturing industries against the competition of an older country – larger capital, longer experience, and cheaper labor. Yet without any protective tariff between the West and the East, manufacturing has steadily moved westward with the movement of population, and is moving westward still. This is a fact that of itself conclusively disproves the protective theory.
The protectionist assumption that manufactures have increased in the United States because of protective tariffs is even more unfounded than the assumption that the growth of New York after the building of each new theater was because of the building of the theater. It is as if one should tow a bucket behind a boat and insist that it helped the boat along because she still moved forward.”
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2) “To assume, as protectionists do, that economy must necessarily result from bringing producer and consumer together in point of space, is to assume that things can be produced as well in one place as in another, and that difficulties in exchange are to be measured solely by distance. The truth is, that commodities can often be produced in one place with so much greater facility than in another that it involves a less expenditure of labor to bring them long distances than to produce them on the spot, while two points a hundred miles apart may be commercially nearer each other than two points ten miles apart. To bring the producer to the consumer in point of distance, is, if it increases the cost of production, not economy but waste.”
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3) “There is no one who in exchanging his own productions for the productions of another would think that the more he gave and the less he got the better off he would be. Yet to many men nothing seems clearer than that the more of its own productions a nation sends away, and the less of the productions of other nations it receives in return, the more profitable its trade. So wide-spread is this belief that to-day nearly all civilized nations endeavor to discourage the bringing in of the productions of other nations while regarding with satisfaction the sending away of their own.”
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4) “To have all the ships that left each country sunk before they could reach any other country would, upon protectionist principles, be the quickest means of enriching the whole world, since all countries could then enjoy the maximum of exports with the minimum of imports.”
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5) “Consider, moreover, how sharply this theory of protection conflicts with common experience and habits of thought. Who would think of recommending a site for a proposed city or a new colony because it was very difficult to get at? Yet, if the protective theory be true, this would really be an advantage. Who would regard piracy as promotive of civilization? Yet a discriminating pirate, who would confine his seizures to goods which might be produced in the country to which they were being carried, would be as beneficial to that country as a tariff.
Whether protectionists or free traders, we all hear with interest and pleasure of improvements in transportation by water or land; we are all disposed to regard the opening of canals, the building of railways, the deepening of harbors, the improvement of steamships, as beneficial. But if such things are beneficial, how can tariffs be beneficial?”
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6) “Trade is not invasion. It does not involve aggression on one side and resistance on the other, but mutual consent and gratification. There cannot be a trade unless the parties to it agree, any more than there can be a quarrel unless the parties to it differ. England, we say, forced trade with the outside world upon China, and the United States upon Japan. But, in both cases, what was done was not to force the people to trade, but to force their governments to let them. If the people had not wanted to trade, the opening of the ports would have been useless.
Civilized nations, however, do not use their armies and fleets to open one another’s ports to trade. What they use their armies and fleets for, is, when they quarrel, to close one another’s ports. And their effort then is to prevent the carrying in of things even more than the bringing out of things—importing rather than exporting. For a people can be more quickly injured by preventing them from getting things than by preventing them from sending things away. Trade does not require force. Free trade consists simply in letting people buy and sell as they want to buy and sell. It is protection that requires force, for it consists in preventing people from doing what they want to do. Protective tariffs are as much applications of force as are blockading squadrons, and their object is the same—to prevent trade. The difference between the two is that blockading squadrons are a means whereby nations seek to prevent their enemies from trading; protective tariffs are a means whereby nations attempt to prevent their own people from trading. What protection teaches us, is to do to ourselves in time of peace what enemies seek to do to us in time of war.”
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All quotations from:
“Protection or Free Trade”
1886
http://www.econlib.org/library/YPDBooks/George/grgPFT6.html
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Finally, you might also be interested in listening to a podcast by economist Lee Ohanian (professor, UCLA) interviewed by Russ Roberts (fellow at the Hoover Institution and host of “EconTalk”, a series of podcasts on economics). It’s from August 2012 and deals mainly with the question of why the “recovery” since 2009 is so anemic.
http://www.econtalk.org/archives/2012/08/ohanian_on_the.html
Of course, Ohanian (like other economists) blames some of it on “Regime Uncertainty” caused by bloated programs like Obamacare, and vague cumbersome regulations like Dodd-Frank; but he also says that something else seems to be occurring in the US labor market — some real structural changes that can’t simply be traced to competition from low-skill, low-value-added Chinese imports.
Enjoy!
I wouldn’t be surprised to find out that post 31 wasn’t first written in Mandarin and then translated to english.
Double- and triple-dipping makes it even more lucrative.
They claim under multiple names, multiple baby-daddy and baby-mamma scams, and multi-state (as the move along the illegal immigrant pipeline)
I have the greatest problem with multi-generational welfare families who often eat themselves into a state of disability. Let them start to clean gyms for their pay. No TVs allowed IMO.
We need to also stop paying for all the births for the poor and illegals. Over half in the United States are born into welfare and many are to families already on welfare who are expanding their poor families on someone else’s wallet.
We need to maybe at most pay for one child and that is it.
Here in CA it is much worse, we have a third of all welfare and instead of half born into welfare I think the number is well above 85%, most of that is not from people born in the USA.
“Making, producing, creating fulfills a sense of worthfulness deep within us.”
Sure some of these folks rely only on Welfare.
But you fail to recognize that “Making, producing, creating” is still performed by many folks on welfare/unemployment but they are paid under the table.
Welfare/unemployment/ebt (providing more than work) coupled with work under-the-table, for which employers and customers have a distinct incentive to provide, especially in the age of Obama, adds up to a very respectable compensation package to which many Americans subscribe.
This is an entirely rational financial decision to these folks. It allows them a great deal of freedom and flexibility, and great reward. They leave the moral component to the suckers who are known as law-abiding taxpayers.
“These folks are rolling in the money.”
Exactly - multiple independent untaxed income streams.
That's the metaphor I've always used. I don't "hate" people on welfare (except for the ones who live better than I do). I feel pity for them in the same way I feel pity for animals in the zoo.
Sadly, I have to agree with you RFEngineer.
Those who sit on their hands as welfare leeches, when they could be working, are bad enough.
Are those who work but lie to receive welfare worse? I think they are thieves. Are thieving leeches worse than lazy leeches. Probably not. But thieving is illegal.
The only solution for all welfare is to drop it altogether. An intermediate solution would be to require one hour of work for one hour of welfare payment. Neither one is likely to happen.
Sometimes I wonder if it isn’t better just to let this economy crash.
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