November 28, 2012

Good Intentions Gone Wrong, Part 2: The Welfare Cliff

Marc Comtois

Gary Alexander, Secretary of Public Welfare, Commonwealth of Pennsylvania ~ "The single mom is better off earnings gross income of $29,000 with $57,327 in net income & benefits than to earn gross income of $69,000 with net income and benefits of $57,045." (h/t)

Is it any wonder people have made the economic choice to be more "taker" than "maker"? We've incentivized it. Perhaps one step away from the "fiscal cliff" would be to take a similar one back from the "welfare cliff" by reducing the incentives (ie; benefits)? "Tyler Durden" has much more.

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Nice, balance the budget on the backs of kids living near the poverty line. Just think of the savings if they lose their access to healthcare!

Posted by: Russ at November 28, 2012 3:20 PM

I see the effects of this first hand. I know plenty of people who have dropped out of the labor force voluntarily and still maintain a standard-of-living that's close to mine, even though we're a two-working-parent household in the top quintile.

One question though... Is the problem that the programs are too generous, or that they've been keeping pace with inflation while earnings stagnate? There's got to be a little of each, right?

Posted by: mangeek at November 30, 2012 4:40 PM
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