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News-Sentinel.com Your Town. Your Voice.

When it's easier to be 'poor' than it is to work, something is wrong

Kevin Leininger
Kevin Leininger
Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.The Associated Press

Study just the latest indication that America's economic incentives are self-defeating

Thursday, August 22, 2013 12:01 am
Turn on the TV or radio these days and you're likely to notice a theme uniting otherwise diverse commercials.Not sex, silly. That's passť.

No, this trend provides a sobering reminder of what is happening to a country that used to value and reward ingenuity, thrift, deferred gratification, self-sacrifice, hard work and success but today seems to value . . . what, exactly?

Need money but no bank will give you a loan? Call us and get thousands of dollars fast – at loan-shark interest rates that will make you even worse off than you were before.

Broke? Call our law firm and we'll file bankruptcy for you – so long as you pay us.

Injured in an accident? Have a disease? A negative reaction to a drug or medical

device? Call us and we'll sue somebody for you.

Need catheters discreetly shipped to your door? How about an expensive motorized wheel chair? Call us and you may qualify “at no cost to you.”

Can't work? We'll get you government disability payments.

In Mexico, the Obama administration has been paying for ads that tell people how to apply for food stamps – once they sneak into the United States.

Even conservative radio icons Glenn Beck and Rush Limbaugh – for whom “welfare” and “bailout” are normally four-letter words — regularly air ads informing listeners how best to avoid paying their taxes.

There are, of course, legitimate claims for disability, medical malpractice, food stamps, bankruptcy and the rest. Even so, Americans who go to work each day so they can take care of themselves and their families can hardly be blamed if they feel as though they are being played for suckers.

Especially when the facts back them up.

According to a new study by the libertarian Cato Institute, welfare benefits in 35 states pay more than a minimum-wage job – and in 13 states, welfare pays more than $15 an hour. In Indiana, the $11.01 per hour rate ranks 30th in the nation. Even so, the study warns that “As long as welfare provides a better standard of living than an entry-level job, recipients will continue to choose it over work.”

Some people fool themselves into believing that America's traditional work ethic has not atrophied to the point that people would rather live off others than to earn what they want. But that is obviously not the case. How many times have we been told the country must welcome illegal immigrants because they take jobs “Americans won't do”? If it weren't for 11 million or so people willing to accept substandard wages, those jobs would pay more. And if it weren't for welfare, Americans would be more motivated to fill them.

Beyond that, I know people who didn't actively seek work until their unemployment benefits were about to expire – or refused to move from part-time to full-time jobs because, with the loss of benefits, it would have reduced their income.

I remember a conversation with a local civil-rights leader a few years ago who was lamenting how hard people had to work to be poor, going from agency to that agency in search of help. But, in truth, it should be hard to be poor – much harder than it is to earn a paycheck.

Some argue that the problem is not that welfare is too generous but that the minimum wage is too low — far too little to support a family. But the entry-level, low-skill minimum wage was never intended for that purpose. As the study points out, “a minimum wage job can be a springboard out of poverty.”

That's because good performance usually leads to higher pay or a better job. When you rely on welfare, you'll receive only what the politicians allow you to have – many of whom know that continued dependence equals continued political support.

In a recent article for the conservative Indiana Policy Review, Maryann Keating asked, “If jobs open, will young people take them?” That is not certain, she said, in part because children can now remain on their parents' health care plans until they're 26 and because of the “differential between what people believe they should earn and the wage offered.” When welfare pays more than the average first-year teacher's salary in 11 states, the study suggests, such confusion is not only justified, but inevitable.

America's private economy needs to create more jobs, yes. But the chronically unemployed will return to the work force only if they understand that working is in their own long-term best interest. The message being sent, however, is decidedly mixed – to the detriment of the nation and especially its poor. Strengthening welfare's work requirements would be a good first step.


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