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Welfare pays better than work.

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Well-known member
Feb 10, 2005
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Montgomery, Al
Welfare Pays Better Than Work, Study Finds
$36,000 a Year in Hawaii

Welfare benefits are far more generous than commonly thought and

substantially exceed the amount a recipient could earn in an entry-level

job. As a result, recipients are likely to choose welfare over work,

increasing long-term dependence. Those are the principal findings in "The

Work vs. Welfare Trade-Off" (Policy Analysis no. 240) by Michael Tanner,

director of health and welfare studies; Stephen Moore, director of fiscal

policy studies; and David Hartman, CEO of Hartland Bank in Austin, Texas.

The paper was released at the height of the welfare debate in Congress.

The study examines the combined value of benefits--including Aid to

Families with Dependent Children, food stamps, Medicaid, and others--for

a typical welfare recipient in each of the 50 states. The value of those

tax-free benefits is then compared with the amount of take-home income a

worker would have left after paying taxes on an equivalent pretax income.

The following are among the study's findings.

* To match the value of welfare benefits, a mother with two children would

have to earn as much as $36,400 in Hawaii or as little as $11,500 in


* In New York, Massachusetts, Connecticut, the District of Columbia,

Hawaii, Alaska, and Rhode Island, welfare pays more than a $12.00-an-hour

job--or more than two and a half times the minimum wage.

* In 40 states welfare pays more than an $8.00-an-hour job. In 17 states

the welfare package is more generous than a $10.00-an-hour job.

* Welfare benefits are especially generous in large cities. Welfare

provides the equivalent of an hourly pretax wage of $14.75 in New York

City, $12.45 in Philadelphia, $11.35 in Baltimore, and $10.90 in Detroit.

* In 9 states welfare pays more than the average first-year salary for a

teacher. In 29 states it pays more than the average starting salary for a

secretary. In 47 states welfare pays more than a janitor earns. Indeed, in

the 6 most generous states, benefits exceed the entry-level salary for a

computer programmer.

The authors conclude that if Congress or state governments are serious

about reducing welfare dependence and rewarding work, the most promising

reform is to cut benefit levels substantially.

The study has been the subject of major news coverage. In a September 28

Wall Street Journal guest column, Tanner and Moore wrote, "The welfare

reform proposals just passed by the Senate, and the earlier House version,

are designed to reduce 'hard-core' welfare dependency and reward work. But

we believe the most critical public policy implication of our findings is

that ultimately these goals can be accomplished only by cutting benefit

levels substantially. Unless and until this is done, Congress will have

failed to end welfare as we know it."

Hourly Wage Equivalent of Welfare

Hawaii $17.50 Alaska 15.48 Massachusetts 14.66 Connecticut 14.23 Washington, D.C. 13.99 New York 13.13 New Jersey 12.74 Rhode Island 12.55 California 11.59 Virginia 11.11 Maryland 10.96 New Hampshire 10.96 Maine 10.38 Delaware 10.34 Colorado 10.05 Vermont 10.05 Minnesota 10.00 Washington 9.95 Nevada 9.71 Utah 9.57 Michigan 9.47 Pennsylvania 9.47 Illinois 9.33 Wisconsin 9.33 Oregon 9.23 Wyoming 9.18 Indiana 9.13 Iowa 9.13 New Mexico 8.94 Florida 8.75 Idaho 8.65 Oklahoma 8.51 Kansas 8.46 North Dakota 8.46 Georgia 8.37 Ohio 8.37 South Dakata 8.32 Louisana 8.17 Kentucky 8.08 North Carolina 8.08 Montana 7.84 South Carolina 7.79 Nebraska 7.64 Texas 7.31 West Virginia 7.31 Missouri 7.16 Arizona 6.78 Tennessee 6.59 Arkansas 6.35 Alabama 6.25 Mississippi 5.53

[ Table of Contents (Policy Repor

Liberty Belle

Well-known member
Feb 10, 2005
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northwestern South Dakota
Here's more on the same subject. Sure makes you feel like going to work today, doesn't it?

A Report from Congressman Ernest Istook, Oklahoma

A new report says welfare often pays more than work.
Although no single welfare program pays this much, recipients typically combine benefits from multiple government assistance programs, adding together such subsidies as AFDC (Aid for Families with Dependent Children), cash payments, food stamps, Medicaid, housing subsidies, help paying utility bills, plus Women, Infants and Children benefits, and other food assistance.

Typically, those who describe benefits as low are speaking only about one program (AFDC), as though it were the sole public assistance program. But qualifying for one program typically makes you eligible for additional benefits, and these add up.

The Cato Institute added up the value of the programs, state by state. They then computed the equivalent annual income and hourly wage for recipients. Please note: These benefits are tax-free, so a non-welfare worker would have to earn even more, to have these amounts left over after taxes. Here's what Cato reported:
• A single parent with two children in Oklahoma can receive an average of $16,642 per year in welfare benefits. To get this in take-home pay requires earning $17,700 before taxes. This is the equivalent of being paid $8.51 an hour for 40 hours a week, 52 weeks a year. This is more than the entry-level pay of many jobs.
• Hawaii's welfare spending is the highest among the 50 states. A person with two children could receive government assistance equal to making $36,400 a year before taxes, the equivalent of $17.50 per hour. Lowest is Mississippi, where the comparable income would be $13,033, equal to $5.53 an hour.
• Welfare benefits exceed the poverty rate and minimum wage in all 50 states as well as the District of Columbia. Welfare exceeds 150 percent of the poverty level in 21 states. In fact, Cato reports families on welfare today would have to take a cut in income if they were to find jobs. This explains why 65 percent of those on welfare have been on government assistance for 8 years.

Despite spending an estimated $5.5 trillion on programs for the poor since 1965, our nation's welfare system has failed. The Republican welfare reform plan would freeze welfare spending, saving taxpayers $66.3 billion over 5 years. It would give states control over welfare spending, empowering them to accommodate their individual needs. Finally, it would force recipients to work for AFDC benefits after 2 years and limit any welfare recipient to a total of 5 years of being dependent on the taxpayers.



Well-known member
Jul 4, 2005
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ROTFLMAO! You two are so funny.

From Mike's post:
The paper was released at the height of the welfare debate in Congress.

Well, duh. Earlier I posted several links that showed welfare payments are down from in state after state. And here old Mike posts something damming the poor that has no date and no link. I have to say that I'm ashamed of you, Mike. I would have expected better of you than to use old data to insult the poor.

And Liberty Belle gives us a paper written in 1995!

While you guys weren't watching, a Democratic president and a mostly Republican Congress reformed welfare. I have a neighbor on welfare. She's a young widow with six children. I don't have a clue what she draws, but don't begrudge her a cent of it.

Liberty Belle

Well-known member
Feb 10, 2005
Reaction score
northwestern South Dakota
Okay dis, here's another article for you. We HAVE become a nation of welfare junkies, and yes, that does include the farm program, as well as other corporate welfare programs. Until the burden of welfare is put back on the county level, I don't see any chance of changing things for the better. None of us wants to see the poor go hungry or naked, but neither to we want to support generations of welfare recipients who refuse to work for a living because they are too lazy and working doesn't pay as well as sitting on your rear.

Welfare Junkies
By Robert J. Samuelson
Thursday, March 24, 2005; Page A19

We are a nation of closet welfare junkies, which helps explain why we can't have an honest debate about Social Security. Social Security and Medicare are our biggest welfare programs, but because Americans regard "welfare" as shameful, we've found other labels for them. We call them "social insurance" or "entitlements." Anything but welfare. Democrats and Republicans alike embrace the deception. No one wants to upset older voters. Well, if you can't call something by its real name, you can't discuss it honestly.

Welfare is a governmental transfer from one group to another for the benefit of those receiving. The transfer involves cash or services (health care, education). We have welfare for the poor, the old, the disabled, farmers and corporations. Social Security is mainly welfare. Workers' payroll taxes pay the benefits of today's retirees. The taxes aren't "saved" for the workers' own retirement. There have been huge disparities between taxes paid and benefits received.

Ida May Fuller, the first retiree to receive benefits, in 1940, paid $24.75 and got almost a thousand times that ($22,888.92). In the 1950s and '60s, many beneficiaries received 10 or more times the amount their payroll taxes would have returned if invested in U.S. Treasury bonds and kept for retirees (they weren't). Indeed, most beneficiaries who retired before 2000 have received -- or will receive -- a surplus in benefits over what their taxes would have returned if similarly invested, write Sylvester Schieber and John Shoven in their history of Social Security, "The Real Deal." This surplus now has a present value of almost $16 trillion, says Schieber, head of research for the consulting firm Watson Wyatt Worldwide. (Shoven is a Stanford University economist.)

Naturally, the elderly don't see themselves as freeloaders. They think they've "earned" their Social Security benefits by paying payroll taxes. As Schieber and Shoven note, the term "social insurance" dates to Bismarck in 19th-century Germany. But applying it to Social Security involved much political license. In normal usage, insurance suggests protection against something you don't expect to happen -- a house fire, a car accident. By contrast, most people expect to grow old. Using the "terminology of insurance . . . [was intended] to mask the huge welfare payments being made," they write. People falsely believe they're "only getting what they have paid for." That is even less true of Medicare. In 2006 the Congressional Budget Office expects Medicare to cost $383 billion. Medicare premiums (paid by recipients) pay 12 percent; payroll taxes, 49 percent; general taxes and borrowing provide the rest.

This mass deception may seem harmless. After all, most Social Security recipients have been responsible citizens and productive workers. Why accuse them of living on government handouts? The answer is that today's myths perpetuate unrealistic expectations and prevent honest debate. Americans regard "earned benefits" and "welfare" differently. The first is a right, the second a privilege. In theory, welfare should serve some public purpose and not just enrich the recipients. By admitting that Social Security and Medicare are welfare, we allow relevant questions to be raised. Do all beneficiaries "need" or "deserve" their welfare? Is the cost "unfair" to taxpayers or burdensome to the economy? Have the social and economic conditions that originally justified the welfare changed?

For Social Security, they have. In 1935 Americans 65 and older were 6 percent of the population. They're now 12 percent and by 2030 are projected to be 20 percent. Most Americans can now save for their own retirement, including the cost of health insurance. The Social Security debate ought to involve moral values and economic realities. How generous a "safety net" for the elderly can a decent society afford without overtaxing the young or harming the economy? How can changes be made without being too disruptive? Instead, the debate has degenerated into an obscure technical exercise focused on baffling accounting concepts (trust fund "solvency," "unfunded liabilities").

Despite what you've heard, the real issue is not Social Security's "solvency." It is the total cost to the government of baby boomers' retirement, including Social Security, Medicare and Medicaid (which covers much nursing home care). The real issue is preventing those costs from becoming economically oppressive and politically poisonous. Even if the Social Security trust fund is made permanently "solvent" -- in the sense that taxes cover benefits -- the costs of all federal retirement programs may still become undesirably high. In 2004 Social Security, Medicare and Medicaid were 8 percent of national income. Left alone, they'll reach 14.5 percent by 2030, the Government Accountability Office projects. The CBO has made a similar projection.

If these costs are too high (and I think they are), the only way to curb them is to cut benefits. Neither Democrats nor Republicans want to face that reality. President Bush's proposal for "personal accounts" diverts the debate. To enhance their appeal, he promises to exempt anyone 55 or older (anyone born in 1950 or earlier) from any benefit cuts. Some other proposals lower the exemption to 45 (anyone born in 1960 or earlier). Well, that covers most of the baby boom, which stretched from 1946 to 1964. If the real problem is the baby boomers' retirement costs and you exempt baby boomers from benefit cuts, then by definition you ignore the problem.

On these issues, we can't think straight unless we talk straight. We can't control our welfare habit unless we admit our addiction. Don't hold your breath.

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