Many people believe that the government needs to be involved in many aspects of peoples' lives. It sounds like a good idea to feed the poor, pay for college and healthcare and other things. This blog will address various government programs over a period of time.
This week's topic is welfare, which was created under FDR and greatly expanded during the Johnson Administration. Here are some interesting facts:
Government welfare gets 25% of our tax dollars to the needy. The other 75% of their budget goes to pay for administration. This is such a tremendous waste of our tax dollars. Charity in the private sector typically gets 90% to the beneficiaries, and 10% (often less) is spent on administration.
Government welfare is seen as "free" money in a way that private charities are not. There was never multi-generational welfare in the United States until the Johnson Great Society programs destigmatized welfare and exponentially increased the funding. The truth of the matter is that there is no such thing as "free money", it has to come from somewhere, but the recipient is shielded from that fact. By contrast, private efforts gave a face to the largesse and fostered a desire by the recipients to get back on their feet and "pay it forward."
In the 1880's there was an effort to consolidate private charities at the federal level. The effort was disbanded within a few years because it was so terribly inefficient.
Another pernicious thing about government welfare is that it is an "all or nothing" system. If one gets a minimum wage job - the first step on the economic ladder of success - he or she loses all welfare benefits and may lose housing assistance as well. This discourages people from taking low wage jobs, as well as providing a strong disincentive for marriage. Wouldn't it be better to 'step' assistance rather than eliminate it entirely? This way, one could get decreased assistance as their wages increase, encouraging recipients to work at entry jobs that will lead to something better, and restoring their pride and self-esteem.
Next week's topic will be Public Education.