Social Policy, Transfers and Entitlements

The progressive hits keep coming from the Biden Administration, and the latest is the $1.8 trillion American Families Plan introduced in broad strokes on Wednesday. It’s more accurate to call this the plan to make the middle class dependent on government from cradle to grave. The government will tell you sometime later, after you’re hooked to the state, how it will force you to pay for it. Read More

The Census Bureau fails to count two-thirds of all government transfer payments to households in the income numbers it uses to calculate not only poverty levels but also income inequality and income growth. In addition to not counting refundable tax credits, which are paid by checks from the U.S. Treasury, the official Census Bureau measure doesn’t count food stamps, Medicaid, the Children’s Health Insurance Program, rent subsidies, energy subsidies and health-insurance subsidies under the Affordable Care Act. In total, benefits provided in more than 100 other federal, state and local transfer payments aren’t counted by the Census Bureau as income to the recipients.

If the Census Bureau had included the missing $1.9 trillion in transfer payments, child poverty would have been only 3.2% in 2017, compared with the official rate of 17.5%. Government transfer payments that were distributed in 2017 had already cut child poverty by 82%. Read More

Working Americans sense that taxes and transfers now leave them little better off than those who work less.

An article on…the most comprehensive accounting to date of how taxes and government payments affect income distribution in the U.S. …The most surprising finding is the astonishing degree of equality among the bottom 60% of American earners, generated in part by the explosion of social-welfare spending… Read More

Researchers gave cash to low-income people. It led them to spend more and work less.

Did pandemic stimulus payments harm lower-income Americans? That’s the implication of a new study by social scientists at Harvard and the University of Exeter.

Liberals argue that no-strings-attached handouts encourage better financial decisions and healthier lifestyles. The theory is that low-income folks become more future-oriented if they’re less stressed about making ends meet. The Harvard study put this hypothesis to the test and found the opposite. Read More

A short lesson in basic economics Read More

The U.S. economy clearly has the power to iron out the natural problems of restarting production, but the very nature of the subsidies in the $6 trillion Biden administration stimulus, relief and infrastructure bills constrain production. In its modern incarnation, socialism denies that government incentives and constraints have anything to do with people’s decisions to work, save and invest. Experience teaches otherwise.

The clearest example is the federal supplement to unemployment payments. The federal payments have made not working a viable or even preferred option to working. And it isn’t only excessive jobless compensation… Read More