August 30, 2013

Our View: Anti-welfare study puts blame in wrong place

It's not rich benefits but a lack of economic opportunities that keep people from working.

Stereotypes die hard as long as there are people willing to believe them. The story of the welfare cheat never seems to go out of style.

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A Cato Institute study that’s critical of the welfare system looks only at the cost of public assistance programs and not at how they support moving from welfare to work.

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The latest version comes in a report by the Cato Institute, "The Work versus Welfare Trade-Off: 2013," which makes the case that people would have to earn so much to replace the cash value of what they receive from the government as welfare that they don't bother trying. They identify the states, Maine among them, in which they say that welfare pays better than a job.

"While poor people are not lazy, they are not stupid either," said Michael D. Tanner, one of the report's authors, in a column published on the Los Angeles Times website. "If you pay people more not to work than they can earn at a job, many won't work."

The answer, Tanner said, is to cut benefits to make work more attractive.

While this attitude is a little more sophisticated than Ronald Reagan's mythical "welfare queen" -- picking up a relief check in a Cadillac -- it's just as distorted (as well as demeaning and insulting). The study is wrongheaded in its methodology, its conclusions and its prescription for the future. It appeals to people's prejudices instead of trying to solve a problem.

The study looks only at the cost of the programs and not at how they support moving from welfare to work. For instance, it counts Medicaid (called MaineCare here) as an expensive benefit, but ignores the fact that many people on the program have jobs or are the children of people who have jobs. If their employers don't provide health insurance, those families would never see a doctor. How does taking away a family's health care make those workers more ambitious?

And the study counts refundable tax credits such as the child exemption and the earned-income tax credit as "welfare" payments. But these are programs designed to help working poor families keep working -- they don't discourage work.

It's true that many low-wage workers can't support their families on what they earn. If conservatives were really interested in eliminating the imbalance, they should have supported two bills that were passed by the Democratic majorities in the Legislature this year, only to be vetoed by Gov. LePage.

If Maine had accepted federal money to expand MaineCare eligibility, low-wage workers would have been able to take jobs that did not offer health insurance without putting the health of their families in danger. If Maine had increased the minimum wage, families at the bottom of the income scale would need less government assistance to cover their needs.

Do some people try to game the social service system to get more aid than they are supposed to? Probably, but persistent poverty is the real reason for the high costs of social services, not unmotivated poor people.

Cutting benefits won't make anyone less poor, but it may make them less able to find or hold a job.

If the idea is getting people to transition from welfare to work, the first step should be making sure that there is work for them to do. The next step should be making sure that their families have the support they need to succeed.

 

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