Hey Buddy, Can You Spare a Dime?

I hear that now over 46 million of our fellow citizens are living in “poverty”. I hear that our system is unfair. That poverty and unemployment are the result of the rich getting richer. In fact, the rich are just too rich. And to make matters worse, at a time when we should be spending to help the poor, conservatives want to cut spending. What are they thinking?

Probably the same thing I’ve been thinking for a long time. That over the past 50 years, welfare programs have helped create a “poverty” class of citizens having neither the hope nor the incentive to strive for something better. To get a perspective on this I suggest you read Robert Rector’s congressional testimony, April 2011, titled: “Uncovering the Hidden Welfare State: 69 Means-tested Programs and $940 Billion in Annual Spending”
(http://waysandmeans.house.gov/UploadedFiles/Robert_Rector_Testimony.pdf).

Now admittedly, Mr. Rector works for The Heritage Foundation, an ultra-conservative think tank. And while his report certainly represents one point of view, I am inclined to believe that the information he uses is essentially correct, give or take a $100 billion. The reality is that a lot of those 46 million folks living in poverty are effectively living on the equivalent of $50,000 or more annual income for a family of four (assuming they have earned income near the $22,350 poverty line.) Do I want to trade places with them? No. Do I think they are living the “good life”? No. But do I think that the majority of these 46 million poor are suffering severe hardship and deprivation? No.

When you peel back the welfare onion and add in all of the other charitable programs (food banks, churches, charities, etc); what was once a “safety net” has become the subsidy for a marginal standard of living that is now a way of life for 1 in 7 Americans. It may or may not be poverty. But it’s not good and it’s not sustainable. Since LBJ started his War on Poverty back in the 60’s, we’ve spent over $15 Trillion dollars on welfare. No doubt some of that money has been well-spent. There are thousands of success stories out there. Children who grew up in poverty, survived with government assistance, succeeded and are now productive, tax-paying citizens. But I think it’s fair to say that we are still way “in the hole” with regard to a payback on that $15 Trillion investment.