Politics

CATO’s Schizo on Welfare

Michael Tanner of CATO produces one of those infuriating studies showing that if you pile up seven different welfare benefits** you can wind up getting more than you’d make working full-time at a low-paying job in many states. That’s true. Too bad CATO’s open-bordersism*** would have this sort of low-paid work pay even less--much less–because those workers would now be competing with desperate, hungry immigrants from around the globe. **** You knew I would say that. But you’d think Tanner would at least acknowledge the contradiction. …

P.S.: One of the lessons of welfare reform was that Tanner’s type of economistic comparison between welfare and work only takes you so far. For one thing, liberals always have an answer ready, which is to make the welfare-state’s benefits available to workers too, or even to everyone. Does Medicaid make it pay to be on the dole? Well, hey, give Obamacare to people who aren’t on the dole, etc. Many of the attempts to provide a smooth incentive ladder off of welfare wind up making welfare programs both bigger (because benefits are extended up the income ladder) and perversely more attractive (because you can now go on welfare and mix it with a bit of work–one of Charles Murray’s big points).

Still, if the only thing that mattered in terms of getting people off welfare was providing an economic incentive to work, maybe these liberal answers would do the job. Experience has shown they’re not enough, though–as long as people can get by on welfare (or by working sporadically off the books while collecting welfare) a good number will wind up doing just that, even if they’d be financially better off taking a minimum wage job and applying for the Earned Income Tax Credit and Obamacare, etc.  One reason might be that (as Tanner notes) if you go to work you have to, you know, work.

The key to welfare reform, it turned out, wasn’t luring people off the rolls. It was making it impossible to stay on the rolls without working, by requiring work–which is why the debate over the Obama administration’s attempt to relax the law’s work requirements was not an insignificant distraction. … Better still would be not offering welfare at all, but only offering a low-paid WPA-style job. That’s undoubtedly too tough for Obama and too much government for CATO. …

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**–They are: Temporary Assistance to Needy Families (the successor to the old AFDC program); food stamps, Medicaid, public housing, Women Infant’s and Children nutrition (WIC), utility assistance and Emergency Food Assistance.

***–CATO’s open-bordersism is the real thing, like the Wall Street Journal‘s open-bordersism–not just a charge I’m hurling for effect.  At a debate with Alex Nowrasteh of CATO he made it clear he thinks there should be a border–it just shouldn’t keep out any willing worker whom an employer might hire (see about 24 minutes into the video). …

****–CATO’s Nowrasteh even suggested

if we’re really really worried about people …Americans who are adults who have less than a high school degree having their wages driven down there are much cheaper and easier ways to help those invididuals than distorting international labor markets with socialistic regulations that stop the flow of labor.

Why do I think these “cheaper and easier ways” are “transfer payments”–i.e. welfare? So the end result of CATO’s schizophrenic policy efforts will be a worse welfare-vs.-work tradeoff and more Americans on the dole?

Update: Via twitter, Nowrasteh says he meant only “private charity or shaming them for making horrible life decisions.” So unskilled American workers who do the right thing (by going to work every day) wind up having their wages driven down, but they get a lecture–no a shaming!–for having made horrible life decisions. What if their “horrible life decision” was not being all that smart (yet they went to work, etc.)?  Screw ‘em? Anyway, it remains true that CATO’s open-borders policy would make welfare, in Tanner’s comparison, relatively more attractive than wages (by lowering the wages).