Welfare
Return to Common Sense
April 17, 2013
Section:
Culture – Welfare
“Our federal government has made the “temporary
safety net” so comfortable that they have removed the incentive to leave,
creating a permanent dependent “under-class.”
“The democracy will cease to exist when you take away from
those who are willing to work and give to those who would not.”
Thomas Jefferson
Philosophy
(Background, Issues, Objectives):
Welfare programs cost more than $900 billion a
year.
- In 2011, the hidden welfare state is the fastest growing
component of government spending, and this does not in clued Social
Security or Medicare payments.
- Welfare programs
are implemented in over 13 government agencies in 69 separate federal means-tested
programs.
- 12 programs
proving food.
- 10 provide
housing assistance.
- 10 provide
social services.
- 9 provide
educational assistance.
- 8 programs give
out cash.
- 8 deliver
vocational training.
- 7 provide
medical assistance.
- 3 provide
energy and utility assistance.
- 2 deliver child
care and child development.
- The U.S. has
already spent $16 trillion since LBJ launched his “War on
Poverty” in 1964.
o
“Continued dependence
upon relief induces a spiritual and moral disintegration fundamentally
destructive to the national fiber,” President Franklin D.
Roosevelt said in 1935. “To dole out relief in this way is to administer a narcotic, a
subtle destroyer of the human spirit.”
- Department of
Agriculture offers Supplemental Nutrition Assistance Program (SNAP -aka
food stamps) to low income families ($80B annually).
- Department of
Health and Human Services oversees various welfare related programs
o
Temporary Assistance for
Needy Families (TANF) Program (cut AFDC caseload in half)
§
In 1996, President Clinton signed the federal
Personal Responsibility and Work Opportunity Reconciliation Act, often referred
to as the welfare-reform act, and welfare caseloads plummeted by 70%, down to
3.8 million taking 8.8 million people off the rolls.
§
The 2005 Budget Reconciliation Act embraced the
“work-first” philosophy designed simply to get them working, even
in entry-level positions, under the supervision of a caseworker.
§
Healthy Marriage Initiative.
§
Fatherhood Initiative
§
Head Start
o
In 2010, 70.5% of federal spending goes
to dependence programs.
§
In 2010, housing assistance grew to $59.4 billion.
§
In 2010, Medicare grew to $452 billion and Medicaid
grew to $273 billion.
§
In 2010, welfare and low-income health care
assistance grew to $1,137 billion.
·
In 2005, $620 billion was spent on more
than eighty welfare programs funded by federal, state, and local
governments.
o
In 2005, Social Security benefits for those in the
poorest fifth of the population totaled $100 billion.
o
In 2005, Medicare provided another $115 billion.
o
In 2005, educating the children of low-income
families cost $105 billion more.
o
In 2005 $40 billion was spent on uncompensated
medical care and $78 billion in private charity.
- Cato Institute
estimated ‘value’ of welfare programs would require jobs that
paid $30,000 per year.
- OMB and GAO
document widespread fraud in welfare payments that is costing $45 billion
a year.
Welfare system is expensive, over $1
trillion in 2005, and growing.
·
In 2011, the federal government funds and
operates 126 different welfare and anti-poverty programs spending more than
$668 billion per year:
|
Name (Sorted by Cost) |
Cost
$ Millions |
Number
of Participants |
|
Medicaid |
228,000.0 |
48,900,000 |
|
Supplemental
Nutrition Assistance Program (SNAP) |
75,000.0 |
44,200,000 |
|
Earned
Income Tax Credit (Refundable
Portion) |
55,000.0 |
27,000,000 (households) |
|
Supplemental
Security Income |
43,700.0 |
8,100,000 |
|
Federal
Pell Grants |
41,000.0 |
9,614,000 |
|
Temporary
Assistance for Needy Families |
21,000.0 |
4,492,000 (monthly avg) |
|
Section
8 Housing Choice Vouchers |
18,100.0 |
2,000,000 (households) |
|
Very
Low to Moderate Income Housing Loans- Sec. 502 |
16,700.0 |
131,370 (units) |
|
Title
1 Grants to Local Education Agencies |
14,100.0 |
N/A (formula grants) |
|
Children’s
Health Insurance Program |
13,459.0 |
7,705,723 |
|
National
School Lunch Program |
10,900.0 |
31,000,000 |
|
Adjustable
Rate Mortgages |
10,600.0 |
43,687 (units) |
|
Maternal,
Infant, and Early Childhood Home Visiting Program |
7,500.0 |
N/A (formula grants) |
|
Special
Supplemental Nutrition Program for Women, Infants, and Children (WIC) |
7,170.0 |
9,180,000 |
|
Head
Start |
7,100.0 |
904,000 |
|
Child
Care and Development Block Grant |
5,000.0 |
N/A (formula grant) |
|
Low
Income Home Energy Assistance |
4,700.0 |
N/A (formula grants) |
|
Foster
Care Title IV |
3,976.0 |
N/A (formula grants) |
|
Public
and Indian Housing |
3,900.0 |
1,100,000 (units) |
|
State
Administrative Matching Grants for SNAP |
3,403.0 |
N/A (formula grants) |
|
Child
Care and Development Mandatory and Matching Funds |
2,917.0 |
N/A (formula grants) |
|
School
Breakfast Program |
2,900.0 |
11,600,000 |
|
Adoption
Assistance |
2,480.0 |
N/A (formula grants) |
|
Public
Housing Capital Fund |
2,307.0 |
N/A (project grants) |
The impact of food stamps, Section 8 housing subsidies,
Medicaid, and other support programs has been to create a permanent welfare
class which, in terms of skills and attitudes, is poorly equipped to return to
work.
- In 2011, the number of
Americans receiving food stamps was risen to over
26 million, and has grown by 72% in the previous 4 years.
o
In
2011 one in seven Americans are receiving food stamps.
o
States
have made households automatically eligible (categorical
eligibility) for food stamps if they receive other federal benefits like
TANF or counseling services.
o
Duplication
of benefits between other federal programs in rampant (ie.
Food stamps and free school lunches)
- The children of welfare moms are nurtured
in a mentality that perpetuates dependency from generation to generation.
- The destructiveness of welfare goes beyond
political dependency.
- The
welfare system contributes greatly to the breakdown of the family.
- The more welfare that families receive from
government, the less necessary fathers are for their support.
o
Lacking
the role model of a responsible father, children grow up to believe that
dependency is a natural condition of life.
o
A
great deal of evidence points to a close relationship between crime and
welfare.
- Obama was schooled in the Chicago patronage
system which equates dependency with votes.
- Support for {permanent)
government safety nets is declining.
The IRS administers "one
of the federal government's largest benefit programs for working families and
individuals."
- By claiming certain "credits,"
primarily the Earned Income Tax Credit (EITC) and the Additional Child Tax
Credit, eligible tax filers receive a check from the IRS even if they have
paid no federal income tax during the year.
o
EITC
is the "largest cash assistance program
targeted at low-income families."
o
In
2008, of the approximately 142 million Forms 1040 filed, 25 million included
EITC claims totaling $51.6 billion - the IRS paid out $45 billion in EITC
benefits for the 2008 tax year.
o
In
2009, over 26 million people received nearly $59 billion in EITC benefits.
o
In
2008, another $20.5 billion was paid for Additional Child Tax Credits.
- In 2011, the IRS has an extensive marketing
campaign to find more EITC claimers, asserting that one in five eligible
recipients is missing out on government largesse.
Poverty is the anchor that binds people
into welfare dependence.
- Only a small portion of the 37 million persons classified as
“poor” are truly destitute.
o
Official poverty measures
count just family's cash income.
§ The
2009 poverty rate was income below $11,161 for an individual,
or below $21,756 for a family of four.
o
Official poverty ignores
additional sources of support such as:
§ Housing
subsidies;
§ Food
stamps;
§ Medicaid;
Ø
The number of Americans on food stamps is rising
dramatically, now approaching 40 million people in 2009.
§ Fuel
assistance; and
§ Earned-Income
Tax Credit.
o
The typical American categorized as
“poor” in 2007 has many amenities formally thought of as luxuries.
§
43% of all poor households own their own home.
§
80% of poor households have air-conditioning.
§
Only 6% of poor households are overcrowded, two
thirds have more than two rooms per person.
§
Typical poor American has more living space than
the average individual living in Paris, London, Vienna, Athens, and other
cities throughout Europe.
§
Nearly three quarters of poor households own a car;
31% own two or more cars.
§
97% of poor households have a color television;
over half have two or more TVs.
§
78% have a VCR or DVD player.
§
62% have cable or satellite TV reception.
§
89% own microwave ovens; more than have a stereo.
§
More than a third have an
automatic dishwasher.
o
Official poverty
ignores Medicaid, housing allowances, food stamps and other federal and local
government subsidies to the poor.
§
$40,000 has been labeled as the breakaway point
for many government welfare programs (a little less than $20 per hour).
o
Rather than materially poor, many of
America’s “poor”
suffer from the effects of “behavioral
poverty.”
§
A breakdown in the values, and conduct conducive to
healthy families and self sufficiency.
§
Mean testing benefits are reduced as the
non-welfare income rises.
§
Welfare eligibility rules (AFDC) incent fathers to
leave the home, undermining basic values.
o
The bottom quintile has a 35% increase in income
compared with the 2nd, 3rd, and 4th quintiles.
§
Earnings up, welfare down caused by welfare reform,
not government payments.
§
Earned income tax credit accounted for the second
biggest increase in income.
o
AEI maintains that including all market income
reduces 2004 poverty rate from 12.7% down to 5.4%, demonstrating an incredible
reduction in real poverty in this country.
o
Statistically considering all
compensation, private and government, the actual poverty rate should be in the
range of 1 to 3 percent.
- Income as measured by the
federal government is not a reliable indicator of well-being, but
consumption is.
o
In constant dollars, consumption by people in the lowest quintile
rose by more than 40% over the past four decades.
o
Spending is vital because it is the principal determinant of
standard of living.
o
Measuring income on an after-tax basis and including transfers
reduces real and perceived inequality.
o
The Census Bureau data is reported by household, and composition of households have changed over the past 30
years.
- Food insecurity is a
term created by the U.S. Department of Agriculture for its annual report
on the status of hunger in America.
o
Food
insecurity is not synonymous with starvation, chronic hunger, and substandard
nutrition.
o
Low
food security is “reduced quality,
variety, or desirability of diet with little or no indication of reduced food
intake”; and
o
Very
low food security is “multiple
indications of disrupted eating patterns and reduced food intake.”
§ Food security does not
indicate reduced food intake, only disrupted eating patterns.
·
Recent studies have
shown that people do not remain stagnant
in their income level.
o
The Treasury
Department’s latest study found that during the 10-year period starting
in 1996, roughly half of the taxpayers who started in the bottom 20% had moved
up to a higher income group by 2005.
o
Less than half of people in the top 1 percent in 1996 were still
there in 2005.
o
Nearly half of the families in the lowest fifth of income earners
in 2001 had moved up within six years.
o
More than a third of those in the highest fifth of income-earners
in 2001 had moved down.
o
Another recent survey
of over 500 successful entrepreneurs found that 93% came from middle-class or
lower-class backgrounds.
§ Most were the first in their families to launch a
business.
Britain is reversing a
dole-based system, reaching back to the 1600s and Queen Elizabeth I, for a work-based system.
- After 250 years, England is embracing a
system supporting work.
- The overriding principle is: the purpose of
welfare is to help people into work.
- Work is the surest route out of poverty; it
structures lives; unlocks potential; builds confidence; forges
friendships; cements communities; provides mental well-being.
- Across the country households will be
better off, because they will have the chance of a better life for
themselves, and a better life for their children.
Principles:
Embrace the ‘Culture of Belonging” encouraging the combination of
“work, wedlock, and worship.”
- Design welfare
to provide for bare necessities.
- Design as
“uncomfortable safety net.”
- Encourage
temporary nature as a stepping stone to rejoining the free market society.
- Discourage
permanent dependence as “under-class.”
Defend and strengthen marriage and
the family in federal and state law and policies.
- Re-write the
Defense of Marriage Act, defining marriage as the union of one man and one
woman.
- Ease economic
and other burdens on families (remove disincentives).
- Encourage
healthy marriages through welfare reform and other social service
programs.
Obey the principles of “calculated” compassion:
- Do not help the
needy completely; merely help those who will help themselves.
- Give the poor
the satisfaction of “earned achievement” – instead
of rewarding them without achievement.
- Allow the poor
to climb the “appreciation ladder”
– from tents to cabins; from cabins to cottages; and from cottages
to comfortable houses.
- Where emergency
help Is provided, do not prolong it to the point
where it becomes habitual.
- Strictly enforce
the scale of “fixed responsibility”- first with
the individual; next is the family; then the church; next is the
community; finally the county, and in a disaster or emergency, the state. (Under no circumstances is the federal government to
become involved in public welfare)
Recommendations:
Short
term, Promote
marriage as an institution and a cure for poverty.
- Expand Healthy
Marriage Initiative to increase number of two parent married families:
o
Conduct
public education campaigns within low-income communities on the importance of
marriage;
o
Provide
marriage education classes to at-risk students in middle and high schools;
o
Provide
life skills training, relationship building, and marriage education programs to
interested young adults who are likely to become single parents.
- Eliminate
penalties for married couples under government means tested welfare
programs.
- Encourage a
delay in the onset of sexual activity among young people.
Transfer Food Stamp Program from the
Department of Agriculture to the Department of Health and Human Services.
Strengthen work requirements under
the Temporary Assistance to Needy families (TANF) program to restore welfare as
temporary assistance program.
- Restore the
original work requirements to TANF.
o
Include a guaranteed offer of work for everyone who
reports to local welfare office before 9am.
o
Local welfare office would provide free daycare for
participants small children.
o
For those who work a minimum numbers of hours each
month would get a Medicaid voucher to purchase health insurance.
- Add work
requirements (30 hours per week) to other welfare programs, such as public
housing and food stamps.
o
Mandate large scale, multi-site experimental
evaluations of implementations to tune programs prior to final adoption.
o
Treat a portion of welfare aid as a loan to be
repaid by able-bodied recipients.
Reform the other welfare programs to include
work requirements to dis-incent government
dependence.
Long
term, Abolish federal
Department of Housing and Urban Development as not covered under enumerated
powers (63 billion annually).
- End federal rental assistance programs
($27.1 billion annually).
- End community development subsidies ($13
billion annually).
- End housing finance subsidies (12 billion
annually).
- End urban renewal and public housing
subsidies ($9 billion annually).
- End
American/Hawaiian programs ($893 million annually).
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“The
Misleading Tale of Income Inequality” by Diana Furchtgott-Roth
dated March 8, 2012 published by Real Clear Markets at http://www.realclearmarkets.com/articles/2012/03/08/the_misleading_tale_of_income_inequality_99555.html
.
“The
American Welfare State: How We Spend Nearly $1 Trillion a Year Fighting Poverty
– and Fail” by Michael Tanner dated April 11, 2012 published by
The Heritage Foundation at http://www.cato.org/publications/policy-analysis/american-welfare-state-how-we-spend-nearly-$1-trillion-year-fighting-poverty-fail .
“The Dirty Needle That is
Government Dependency” by Robert Rohlfing
dated April 18, 2012 published by Intellectual Conservative at http://www.intellectualconservative.com/2012/04/18/the-dirty-needle-that-is-government-dependency/
.
“What I
Learned in the Poverty War” by Peter Cove dated Autumn
2012 published by City Journal at http://www.city-journal.org/2012/22_4_poverty.html
.
“Restoring a True Safety Net” by David J. Armor and Sonia Sousa dated Fall 2012 published by National Affairs at http://www.nationalaffairs.com/publications/detail/restoring-a-true-safety-net .
“Pew Research Center survey finds declining support for government safety nets” by Berry Hawes dated October 14, 2012 published by The Post and Courier at http://www.postandcourier.com/article/20121014/PC1602/121019592/1165/pew-research-center-survey-finds-declining-support-for-government-safety-nets .
“The
Comfort of Welfare” by Charles Payne dated February 1, 2013 published
by Town Hall at http://finance.townhall.com/columnists/charlespayne/2013/02/01/the-comfort-of-welfare-n1502419
.
“Work
Disincentives, Still Crazy After All These Years” by Arthur Laffer dated February 8, 2013 published by The Wall Street
Journal at http://online.wsj.com/article/SB10001424127887324235104578243373468081096.html?KEYWORDS=work+disincentives
.