By contrast, the Cato Institute's Daniel J. Mitchell bases his
findings on figures released by the Census Bureau. Those figures paint a damning picture of leftist re-distribution schemes, revealing that the largest decrease in the percentage of poor Americans occurred
before LBJ's War on Poverty began. From 1950 to the late 1960s, Census Bureau data show the poverty rate in a dramatic decline.
Immediately after LBJ's "Great Society" programs kicked into gear, the poverty rate began to stagnate. And it has more or less stagnated ever since, despite
trillions of dollars of government spending on means-tested programs. Mitchell concludes there could be alternative explanations for such stagnation, but he wonders aloud whether "government intervention may be encouraging poverty by making indolence more attractive than work."
A 2013
study published by the Cato Institute's Michael Tanner and Charles Hughes provides some daunting insight. "The current welfare system provides such a high level of benefits that it acts as a disincentive for work," Tanner and Hughes write. "Welfare currently pays more than a minimum-wage job in 35 states, even after accounting for the Earned Income Tax Credit, and in 13 states it pays more than $15 per hour."
Tanner and Hughes further contend that if political officials are serious about reducing dependence and rewarding work, "they should consider strengthening welfare work requirements, removing exemptions, and narrowing the definition of work. Moreover, states should consider ways to shrink the gap between the value of welfare and work by reducing current benefit levels and tightening eligibility requirements."
Unfortunately, the Obama administration has been moving in the opposite direction. In 2012 they
gutted much of the welfare reform instituted by
The Personal Responsibility and Work Opportunity Reconciliation Act of 1996. Better known as the Welfare Reform Act of 1996, the bill was enacted during the Clinton administration with the kind of
bipartisan majorities in both chambers of Congress for which today's Democrats ostensibly yearn. And it was gutted in a move that has become depressingly familiar: Congress was bypassed, and a
policy directive was issued by the Department of Health and Human Services (HHS). It was gutted despite the reality that in the four years following its passage, welfare caseloads and childhood hunger numbers were cut nearly in half, even as employment surged, and poverty among single mothers and black Americans dropped to historic lows.
That leftists would be more excited about studies that require "new measurements" to promote the value of dependency on government programs, as opposed to
empirical evidence that demonstrates unquestionable success in promoting independence and work, is quite revealing.
Equally revealing was the Obama administration's efforts to promote their own set of "new measurements" with regard to poverty itself. A 2010 article by National Review's Robert Rector
explained the change, noting that the old poverty measure was based on "absolute purchasing power--how much steak and potatoes you can buy," he wrote. "The new measure will count comparative purchasing power--how much steak and potatoes you can buy relative to other people."
The reason for the change is obvious: once poverty is relative, it becomes impossible to eliminate--along with the government programs and the massive amounts of bureaucracy needed to do so. Furthermore, as Rector illuminates, "if the real income of every single American were to magically triple over night, the new poverty measure would show there had been no drop in ‘poverty,' because the poverty income threshold would also triple." Rector then gets to the issue that is very much in the forefront of President Obama's current populist pitch. "In honest English, the new system will measure income inequality, not poverty," he wrote three years ago.
Most Americans are undoubtedly inclined to help the poor. Yet as a Heritage Foundation study released in 2011
reveals, the term has largely lost its meaning, at least in terms of material wherewithal:
In 2005, the typical household defined as poor by the government had a car and air conditioning. For entertainment, the household had two color televisions, cable or satellite TV, a DVD player, and a VCR. If there were children, especially boys, in the home, the family had a game system, such as an Xbox or a PlayStation. In the kitchen, the household had a refrigerator, an oven and stove, and a microwave. Other household conveniences included a clothes washer, clothes dryer, ceiling fans, a cordless phone, and a coffee maker.
Such an inconvenient reality underscores the Obama administration's need to promote poverty in
relative terms. If Americans were largely aware of the true nature of American poverty, a safety net that has engendered a significant portion of our $17 trillion debt bomb would be a prime target for serious reformation.
Thus, the American left is once again hard at work, pulling on the public's heartstrings. A good example of that effort is a five-part
New York Times story dedicated to the travails of a New York City family, and the hard-heartedness of a town where income inequality looms large. Yet as the rival
New York Post reveals, the "hooey" presented by the
Times downplays some critical facts, including the reality that the family's "shelter, rental assistance and food stamps alone have added up to nearly half a million dollars since 2000. In addition, Medicaid covers health care." They further note that the parents of the eight children are a couple "with a long history of drug problems and difficulty holding jobs."
Thus, the
Post reaches an alternative conclusion. "If the city is at fault here, it might well be for having been too generous--providing so much that neither the father nor mother seems much inclined to provide for their kids."
If there is one thing the left depends on when it comes to pushing the expansion of the welfare state, it is the idea that such disinclination can never be measured statistically. Moreover, it would be utterly anathema for those promoting statist solutions to all of our problems to do so. Better to characterize
any effort to reduce government dependency as "mean-spirited," and any effort to weed out fraud, such as obtaining fingerprint IDs from welfare recipients for example, as
stigmatizing.
All of that being said, the "wealth gap" that ostensibly antagonizes the president is in fact occurring. The word "ostensibly" is critical because it is precisely this administration's embrace of the Federal Reserve's Quantitative Easing policy most responsible for it. As the
New York Post's John Crudele
reiterates, it has caused the "largest wealth redistribution in the history of mankind." "Those who've saved and rely on interest income are being screwed," he explains. "Those wealthy enough and courageous enough to put their money into the stock market have seen their wealth soar."
What Crudele doesn't explain is why the Fed's interest rate has been kept at virtually zero for the longest stretch of time in the history of the nation. It's because the vast amount of deficit spending necessary to underwrite the welfare state--and the unconscionable amount of interest payments generated as a result--would be virtually impossible to continue doing at historically normal interest levels. Furthermore, what amounts to little more than a debasement of our currency, represented by the $85 billion per month of newly-created money, exacerbates the wealth gap even more: devalued currency amounts to a de facto tax on everything Americans buy.
Yet while this utterly misguided policy has been a boon for the rich, the massive amount of government "stimulus" that has necessitated it has done virtually nothing for the poor, other than providing an increasing disincentive to work. And while the poor may be less poor in material terms relative to the rest of the world, they still remain afflicted by the same dignity-sapping dependency that relying on the tender mercies of bureaucrat masters inevitably engenders. It is precisely the
maintenance of that dependency--rather than the liberation from it--that forms the heart of progressive policy-making.
