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comment by cgod
cgod  ·  5018 days ago  ·  link  ·    ·  parent  ·  post: Giving money directly to the homeless.
It's not a novel idea, this is Milton Friedman's prescription for an efficient welfare state. I remember a quote he gave regarding the idea something like this "if the problem with the poor is that they don't have enough money, than the solution is to give them some." Tons of people were pissed at the idea, fiscal conservatives who push for the destruction of the welfare state hated it, as did liberals who thought the incentives provided by a paternalistic welfare were necessary for ethical welfare.

Friedmans logic was this. Many welfare programs in the US will take away $1 in benefits for every $2 dollars that a recipient earns. If a welfare recipient is enlisted in several programs, (childcare, direct welfare, health care, food stamps, ect) the recipient has a disincentive to work because making two dollars in wages could result in the loss of more than $2 dollars in benefits. Friedman said that every one would be entitled to $15k a year and for every $2 dollars a person made they would lose $1 dollar of their $15k. (I made up these numbers, I don't know if he gave a specific number or suggested enough to bring people over the poverty line or what he suggested).

Such a program would be bureaucratically efficient, would alleviate poverty, avoid paternalism and prevent disincentives to work that can be found in some welfare programs. The idea was never really considered and was mostly disliked. I thought it was clever as are many of Miltons ideas. If you ever want to research specific economic I would recommend seeing if Milton wrote on it and see what he had to say. Even when I disagree with his ethics I usually find his commentary educational and thought provoking.

PS. I like the economist despite it's stuffy conservatism, but this concept is such a classic Friedmanist idea that I'm shocked that they didn't give him a nod in the article. It's really part of the economic conservative DNA to be aware of the ideas of the most prominent conservative economist of the current era.





greedo  ·  5003 days ago  ·  link  ·  
This thread is a bit old, but I just read about Singapore's Central Provident Fund, and it made me think about it. 1/5 of everyone's income. http://www.economist.com/node/18359852?story_id=18359852&...
steve  ·  3350 days ago  ·  link  ·  

that was the devil's comment

simbha  ·  3602 days ago  ·  link  ·  

Nice ID

mk  ·  5018 days ago  ·  link  ·  
That logic makes sense at first glance. What are the main criticisms?

I'm not sure how this fits, but this, and recent travels lead me to post this: http://hubski.com/pub?id=552

cgod  ·  5015 days ago  ·  link  ·  
objections to giving the poor money.

1. it cost money from those of us who work, the idea offends peoples sense of fairness.

2. the reduced bureaucratic hurdles to get the money would make it way to easy for people to just coast on the dole, econ speak it provides a disincentive to work.

3. Current welfare programs incentiveise good behavior, you have to buy food to feed the kids with food stamps, you have to look for work to get unemployment. Just giving people money will let them buy drugs gasp!!!

4. Many conservatives oppose all welfare programs regardless of their Cost/Benefits. By libertarian philosophy this is just plain old robbery.

5. Public employee unions would lose a lot of workers that currently pay dues if the welfare state was stripped down to just 1 program. Current bureaucracies in the welfare system give push back to these kinds of programs. Every program in existence has some public representative that brought it to and ensures it's existence (Senators pet project kind of thing).

I'm sure there are other things that would stand in the way of this kind of program.