41–50 of 127 posts
The real issue isn’t just the cliffs themselves — it’s that our welfare system is a set of disconnected programs that interact like poorly designed APIs. For people with zero margin for error, even a small income change can trigger huge losses in healthcare, childcare, or housing. We ended up with a system that’s expensive, complicated, and psychologically brutal — and still fails to do what it was designed to do.
> In practice, however, several of the programs that seem to offer the most generous benefits are severely underfunded, so relatively few families are actually able to obtain them. For example, according to congressional testimony from the Center on Budget and Policy Priorities, 68 percent of poor families with children received Aid to Families with Dependent Children in 1996. By 2015, after the welfare reforms of th…
There are definitely problems with the distribution of these programs, but it’s also a mistake to think that everyone eligible for every program wants to collect every benefit. The housing vouchers are a good example of something that isn’t applicable to a lot of people who, for example, are living with relatives. I have some people in my extended family who fit this description right now. They have housing in a beneficial family situation, so any housing benefits they qualify for aren’t relevant to their current situation.
Not to minimize the problems, but the number of people who should be or want to be receiving every benefit isn’t 100% minus the number of people currently receiving it
Earlier quoted context omitted.
Why continuously differentiable and not just monotonic?
Monotonic is what we have, and it allows cliffs. Suppose, e.g., that you can get $5k/yr in benefits if you make less than $10k/yr in other revenue and $0 otherwise. Unless you have a viable strategy for pushing past $15k/yr it's a strong financial disencentive against actually working, and even then your incremental ROI isn't very good past that cliff (if it takes an extra hundred hours to push to $15.1k/yr, then com…
I usually get downvoted on any of my commentary on poverty or welfare, despite my lived and continued experience in it, but I'll punt again. My family, from grandparents downwards (siblings, aunts, uncles, cousins, across 3 family lines) have all relied on government handouts for a majority of their lives, and had their character destroyed by the system. All rely on a meager amount of welfare to stay alive, not healt…
While I don't downplay your experience; do you know of research that talks about it? The idea that people need incentives is an old one - Bill Clinton's welfare reform talked about 'a hand up, not a hand out', etc. I also remember research, though I don't know how current, that most people in welfare programs are there temporarily - they are in and out, not there on a long-term basis.
What about people who aren't going to make it on their own? Do we just let them die? A similar problem is people addicted to drugs: There is no reliable solution; rehab only works for some, not always permanently, and forcing people into it is almost certain failure (besides being a serious violation of their freedom).
There is research and experience saying 'housing first' - providing housing, which provides stability and much better access to services - helps significantly, but that may be focused on people lacking shelter.
P.S. I hope you drop the whining about downvoting. It's against guidelines and is tactical victimhood.
Earlier quoted context omitted.
If someone in the coming years ran on taking down regulatory capture and returning that as social safety net funding, public goods, and lower taxes, and had the chops to actually deliver, they'd do well. Though best to start local government first, obviously. We're reaching breaking points in so many places...
The problem isn’t that such candidates would never accomplish anything let alone get elected due to the insurmountable amount of resistance from so many incumbents with a vested interest in that not happening, ever.
Simplifying the tax code and balancing the budget is what they talk about but they never walk the walk.
I can't find the original tweet, but someone (half?) jokingly proposed a law that all benefits must be defined as continuously differentiable functions (thus making cliffs impossible). "Yeah, I made $1M last year. Here's my SNAP check for six cents."
They should be. And for the great majority of citizens, they should be calculated automatically along with taxes without the need for filing/paperwork. But we must think of the Intuit shareholders and the harm that that would cause them.
I can't find the original tweet, but someone (half?) jokingly proposed a law that all benefits must be defined as continuously differentiable functions (thus making cliffs impossible). "Yeah, I made $1M last year. Here's my SNAP check for six cents."
It's insane that we cap marginal tax rates for the wealthy below 50% “because they need incentives to work harder” yet the working class family is facing an effective marginal rate near 100% because of reduced benefits.
The solution would simply be to stop making benefits decrease when salary goes up.
“But it's going to be insanely expensive” one may say, but it's an accounting illusion. All we need to do to break the illusion would be to stop counting gross public spendings and taxes and instead count the net public spendings/taxes for each individual (that is, over the whole population you take the difference between what they pay and what they receive and that gives you how much they contribute or how much they cost, instead of the current accounting system where we count people paying for their own benefits).
What's really expensive is the economic inefficiency of the current system.
I can't find the original tweet, but someone (half?) jokingly proposed a law that all benefits must be defined as continuously differentiable functions (thus making cliffs impossible). "Yeah, I made $1M last year. Here's my SNAP check for six cents."
The variable is all transfers, taxes and benefits T = [all taxes - all benefits] as function of income per person (including children). T starts negative (benefits are negative taxes).
Goal: monotonously increasing effective marginal T rate.
Earlier quoted context omitted.
>probably not intentional All the current results were foretold by people screeching warnings about them 50+yr ago. > deeper and more systemic. Nobody's budget ever got bigger or headcount grew or government contract got more lucrative because people got off welfare.
What "current results" are you referring to? No, people 50+ years ago weren't arguing that cliffs can lead to disincentives, they were arguing that the whole system is "socialism" and bad - something that has been repeatedly disproven. There are few things more evil in our society than the breed of conservative that will talk about how their family needed social welfare growing up to survive, how it worked and they d…
In fact, we have disincentives like that because they were arguing that having a flat benefit for everyone would be socialism.
If you don't reduce benefit with income level, these disincentives vanishes and that's how all post-war systems worked in Europe (can't talk about the US) before the neoliberal crew started dismantling everything in the name of “reducing public spendings” for greater economic efficiency.
I remember reading this book called 'The Losers' ( https://www.goodreads.com/book/show/2114133.The_Losers ) about a privileged man who has a car accident, becomes disabled and comes to rely on government support. The book looks at the lives of the working poor and actually poor, who rely on welfare cheques and other subsidies and highlights the social and psychological impacts of these systems of support. It was very…
>probably not intentional All the current results were foretold by people screeching warnings about them 50+yr ago. > deeper and more systemic. Nobody's budget ever got bigger or headcount grew or government contract got more lucrative because people got off welfare.
Their thinking is that poor people are poor, which is bad. So let's check if they're poor, and give them money so they're not poor anymore, which is good. That feels right. Let's do that.
Negative income tax? But that gives rich people money too! Giving rich people money is bad because they're rich already. QED.