Anson Burlingame’s latest post, “Intoxicated by Government”, prompts me to reply with a post of my own, wherein I can access more writing tools than on just a comment.
Anson addresses the age-old conundrum of the relationship between the government and the poor, a.k.a., welfare. He makes valid points such as government assistance being addictive, similar to substance addiction. It is no doubt true, a case in point being a front-page story in today’s Globe, “Winter Triage”.
The story, not entirely available online, reports that the number of people applying for help with utility bills here in Joplin has recently doubled from a typical line of about 50 people to one of about 100. One individual who was about to have his electricity turned off blamed property taxes and court-ordered payments due to a car accident 6 months ago.
One can, I assume, always find an example of both deserving and not-so-deserving recipients of assistance. Demand will always rise to meet the supply. Some people are lazy, some industrious. Some are lucky and some seem to be under a cloud all the time. And in American culture where we have a very low savings rate and are used to living on credit, unexpected misfortune can easily collapse a family’s finances.
As an example, the check engine light came on the other day in our little 1993 Honda, our second car. The Honda dealer charged me $80 just to diagnose it, and would have applied that to the repair, but it was the “cylinder position sensor” in the distributor and a new one would be $813! I have decided I don’t need to know where the cylinders are.
Let’s face it, when you consider the social problems of society, like crime and substance abuse, it’s a wonder that unemployment is only 5% or 6%.
What makes it really hard to dispense assistance fairly is that money is fungible. “Fungible” of course means mutually interchangeable, financially. Assistance money for utilities can free up money from other sources for cigarettes, booze, lottery tickets, or whatever, particularly if the other money is from undocumented sources such as the underground economy.
Anson advocates “tough love”. He says that feeding the addiction solves nothing in the long run, and it’s hard to argue with that. I agree with him that there needs to be a significant contribution from the individual to incentivize her or him to become independent of aid. A prime example of this is Habitat for Humanity which requires “sweat equity” from individuals receiving a cheap or free house. It may be that this is the heart of the problem: life is not meant to be easy. A healthy economy thrives on competition, and that means risk and hard work.
Charitable assistance is typically sporadic and, as Anson notes, does not affect the root causes of the poverty (the parable of teaching a man to fish).
If government assistance is rendered then, it seems that it should be done in a way that incentivizes the individual to re-enter the work force. This means that assistance should always fall short of the comfort level, as in the utility assistance case mentioned above. The Economic Security Corporation runs out of money before the end of every month and then directs people to other sources such as charities.
However, in the current Great Recession it is clear that merely providing incentive to the unemployed is not enough. There’s lots of incentive out there but not lots of jobs. In olden times one could tough it out down on the farm by scrimping or doing without, but now in the age of specialization and
a global economy we are dependent on jobs, mostly from small businesses, and running a small business is not that easy. About half of all new businesses fail in the first five years.
So, where is Wisdom in all this? Republicans say to reduce taxes to encourage business start-ups and meanwhile “starve the beast” by reducing assistance, basically a survival-of-the-fittest philosophy. Democrats say to maintain assistance such as unemployment benefits indefinitely, until the economy improves. I say, we are probably handling it all about as well as we can by compromising for the middle and with neither extreme happy and some driving with their check-engine light on all the time.
As William Blake said,
Without contraries is no progression.Attraction and repulsion, reason and energy, love and hate, are necessary to human existence.”