entitlements

The Poor: How far should government go?

by asmwizard

(As published in the Leavenworth Times Community Blog, May 2013.)

   There is no greater mess than public assistance (PA, for short) in the United States.  Kenneth L. Gentry writes:  Americans have long been known to be a charitable people. Unfortunately, government intervention could be changing that. The government has entered and gained monopolistic ascendancy in this field as in so many others. Being charitable makes it a bit difficult for us to speak out against public welfarism, lest we appear to be unconcerned for the needs of the poor. However, there are numerous compelling reasons why we can legitimately decry public welfarism and still maintain — even emphasize — our concern for the less fortunate in our society. Link to: The problems in public welfare   Dr. Gentry lists numerous problems.  It’s worth reading.

   A general discussion of public assistance can be found at Link to:  Wiki article

   As I see it, public assistance is fraught with fraud, political chicanery, and bureaucratic inefficiency.  It is unsupportable – more people are becoming dependent on fewer workers.  But, it’s necessary.  It varies a lot by state, because states administer it, often with federal funds.   

   I’d like nothing better than to list several things wrong with PA and propose a direct, effective solution for each.  But, it isn’t that simple.  Every family or recipient has a different situation.  Some people want to work, but can’t.   Others work part time, but can’t make enough, or blow what they make.  Some are poorly educated, perhaps can’t read.  Many are dishonest, and try to cheat the system.  They have different abilities, or none at all.  They have children or spouses with various needs.  Some do drugs or gamble.  Some have prison records.  Some are mentally disturbed or deficient, or have no sense of purpose.  I’m forced to admit, one size doesn’t fit all.

  There are some principles I’d like to apply, and these pertain to how much government at all levels should support PA.  Many of these principles are already being applied.

  Cash is a temptation to cheat, so the government should deal as little cash as possible.  Give benefits in kind, if it can be done.  To the extent possible, make sure that money from the government is spent for its intended purpose. 

First, limit the benefit total from all programs.  We’ve all heard stories that some people receive a total benefit that puts them well into the middle class.  There should be an absolute limit of something like 1.5 times the poverty rate.

  Second, pay the recipient very little directly.  Instead, provide vouchers or debit cards.  To a large extent, this is done now: Section 8 housing assistance is paid in vouchers; The SNAP program for food assistance comes with debit cards, etc.  The government has actually gotten quite a bit smarter – note how tough it is to get SNAP if you’re not a Hmong or a Martian.  Ultimately, people with little or no income need a bit of cash – but if the government provides it, it should be on a card.

  Third, make it possible for the government to review their participant’s spending.  Every participant should be reviewed at least quarterly.  This may require someone to visit the participant.  When they do, they should take pictures of the recipient and dependents to prove their existence (and leave an audit trail – you have to watch the social workers, who could cheat too.)   If the family has an income of 1.3 times poverty level or more, the only assistance they should be receiving is for health care. 

  Fourth, shut down the underground economy to the greatest extent possible.  Many people work for cash only, and don’t report their income.  Make the penalties for that severe – on both employer and worker.  People who work and are paid in cash may be cheating the government (and all the rest of us) by claiming they have no income.  It might be possible for people on public assistance who do odd jobs for individuals to bypass normal taxes on the payment, if the worker reports it.  The government needs to know about the income, not necessarily collect revenue out of it.

  Fifth, and this will be controversial but I’ll say it anyway:  when a woman on public assistance has a child (for a total of two or more) benefits should not be increased.  The government should offer to pay for having her tubes tied.  The worst possible thing is to keep having children that must grow up in poverty.  TANF — The Temporary Assistance for Needy Families Act  is a pretty good solution. 

  Sixth, no benefits whatever to illegal aliens or people on drugs.

  Seventh, luxuries owned or subscribed to by PA folks should be taken into account – and should reduce PA benefits.  Example: the recipient subscribes to cable and has HBO (a premium).  The cost of HBO should not be paid by the taxpayers – subtract it from his benefits.  Only basic cable should be subsidized, and then only if broadcast reception isn’t available.  The taxpayer pays extra for premium internet service? – deduct it from his benefits.  The recipient owns or leases or makes payments on a car that is worth more than some reasonable amount (such as $20,000), or owns two cars but only needs one?  Deduct.  You get the idea.

  Finally, the government should check, check, check on benefit participants, particularly those claiming disability – if they claim they can’t walk, they shouldn’t be discovered running marathons.  The social worker should have authority to disqualify them on the spot for cause.  Dependents claimed should be personally verified and photographed in their homes. 

  Charities might choose to help families with money or benefits.  That’s very welcome, but they should follow the same principles.  They might help in finding people who need assistance and showing them how to get it. 

  Public assistance is a necessary evil, and should only function as a safety net for those who have no other choice.  It should provide a “no-frills” existence, with adequate food, shelter, and clothing for the needy, but should be unsatisfying for the greedy.   It shouldn’t be an opportunity to scam the government or become a permanent way of life. 

  It appears that government at all levels is following many of these principles now.  It’s a constant struggle.  

 

Cain–Gingrich Debate–November 5, 2011

by asmwizard

Herman Cain and Newt Gingrich met for a special debate on November 5.  It was held in Texas and televised on C-SPAN.  Billed as a Lincoln-Douglas style debate, it lasted about an hour and a half and concentrated on entitlement reform.  An relatively small in-house audience of two or three hundred (my estimate) was present.

Supposedly, there would be no moderator, only a timekeeper.  Actually, there was a moderator plus another questioner, but they only asked questions.  The debate met the objectives of allowing the candidates to speak at length to answer a question thoroughly.  Cain and Gingrich were very friendly and uncritical toward each other, with no “gotcha” style remarks.  Both men came across as very likeable.  However, last night there wasn’t a debate in the true sense – there was no argument back and forth – no criticism of the other’s position.  The two men just took turns giving their perspectives on a question.

Herman Cain surprised me with the depth of his knowledge and his ability to relate entitlement reform to his business experience.  I no longer consider him a flyweight as a potential president.  He tends to favor most features of the Paul Ryan reforms to Social Security and Medicare.  He also mentions the reforms made in Chile, and I had thought he was talking about health care reform there, and had been a bit critical of that.  Last night, he mentioned Chile in relation to Social Security reform, citing the fact that people have personal retirement accounts in Chile as part of the government plan.  

Newt Gingrich probably impressed viewers as having considerably greater knowledge and understanding of issues.  He favors allowing people to choose from options rather than outright mandate from government.  I had heard him say he isn’t in favor of advancing the retirement age, and doesn’t advocate means testing for Social Security and Medicare, and I had wondered why.  It turns out that he doesn’t want to limit choice.  He’s in favor of premium-defined plans  with flexibility rather than one-price government-defined benefit packages, and wants them structured so that wealthier people will choose to self-insure.   He emphasized the use of computer systems to greatly reduce fraud in the entitlements, would form a consortium of IBM and the credit card companies to administer the entitlements with an emphasis of catching crooks trying to defraud the system.  

Both men favor block granting Medicaid to the states, while giving them fewer federal guidelines to follow.  I had thought this was a cop-out from a very difficult problem, but it does make sense.  The risk I see is that some states may be less competent than others in delivering health care.

I would like this format used between two men who disagree with each other, and don’t like each other so much.  Gingrich–Obama or Cain–Obama debates in this style would produce some real fireworks, in my opinion.