December 29 2011
Government Charity Isn't Charity
The political dialogue these days is depressing. It's not just the bad news about our nation's continued debt crisis, joblessness and financial struggles, or ongoing uncertainty about the fate of the European Union, which may make our current woes worse. People are angry, and politicians are encouraging that resentment.
Speaking in Osawatomie, Kansas, two weeks ago, President Obama said of conservatives, "They want to go back to the same policies that have stacked the deck against middle-class Americans for too many years. Their philosophy is simple: we are better off when everyone is left to fend for themselves and play by their own rules... Sure, there will be winners and losers. But if the winners do really well, jobs and prosperity will eventually trickle down to everyone else. And even if prosperity doesn't trickle down, they argue, that's the price of liberty."
Yet Americans, particularly in this holiday season, should recognize that President Obama is creating a false choice. America's options aren't government-provided "compassion" or a world without a safety net in which everyone must "go it alone." Those who oppose the President's efforts to further expand government recognize that a too-big government safety net can erode the very real sources of security and help that have always been part of American society.
Consider that right now, there are more than 70 federal means-tested welfare programs. If these programs are supposed to lift Americans out of poverty, they are failing. In 2010, there were 49 million Americans categorized as impoverished, and this number is going up.
One problem is that government is simply inefficient. If we were to divide the roughly $950 billion spent on anti-poverty programs in 2011 by the 49 million Americans who are poor, we'd have nearly $19,400 per person. That's $77,600 for a family of four, which would clearly surpass the federal poverty line ($22,350 for a family of four).
Of course, instead of going directly to the poor, government money passes through the pipeline of federal, state and local-level bureaucrats paid to administer welfare programs. These additional costs mean fewer resources go to the people in need.
Even more scandalous than the wasted dollars are the wasted opportunities that result from these programs. We've created a situation where more than 15 percent of our population depends on government for basic support. This isn't good for our country as a whole, but it is particularly harmful to the people that the welfare state was intended to help.
The welfare state has a damaging effect on the incentive structure that normally helps Americans make prudent decisions. While some receiving assistance may truly not be able to find gainful employment, others are making a rational, though short-sighted, decision not to work.
In many cases, the wages that low-skilled, entry-level workers could earn are less than government assistance programs provide. And working is often less enjoyable that not working. But in the long run, undesirable minimum-wage jobs are necessary first steps toward earning more, achieving financial independence, and climbing up the economic latter. That's a process that our welfare system discourages to the detriment of just about everyone.
Furthermore, our welfare state doesn't just discourage work, skill-building, and the happiness that comes from earned success: It also facilitates self-destructive behavior and discourages family formation. In fact, research has shown that early welfare policies that explicitly penalized marriages helped lead to an explosion of < href="http://www.downsizinggovernment.org/hhs/welfare-spending%234">out-of-wedlock births, particularly in the African-American community, which has had a devastating impact that persists today.
Understanding the unintended consequences of government's too-big safety net doesn't mean one has to support a society in which everyone must fend for themselves. Overwhelmingly, Americans recognize that many need help and are prepared to give their hard-earned dollars to support that mission. Compared to other nations, Americans are the most generous people on the planet, and even during present tough economic times, there are plenty of examples of people helping neighbors and even helping strangers through charitable voluntary transfers.
The biggest difference between charity and the welfare state isn't efficiency or costs: The biggest difference is the holistic approach private charities can take to bettering the lives of individuals.
We should commit ourselves to real charity this time of year, and open our pocketbooks - and our hearts - to the less fortunate, even depraved members of our communities. But we should keep in mind that pouring more money into government spending on welfare isn't charitable, or loving, or humanitarian. In fact, we could better work to restore the dignity of our downtrodden neighbors by scaling back the influence of our bureaucratic welfare state, and paving the way for real, effective, heartfelt charity and economic freedom for all.