Full Version: Replacing the Welfare State
Charles Murray has written a book: "In Our Hands: A Plan to Replace the Welfare State." http://www.amazon.com/gp/product/084474223...glance&n=283155
In it, he proposes that we do away with all transfer type transactions by the government and replace it with a monthly lump-sum payments to every American over the age of 21 who isn't in jail. The amount would add up to $10,000 a year. The only requirement is that you go out and obtain health insurance with the money (at least $3,000 must be spend on health care). The amount drops as your income increases starting at $25,000 per year. But regardless of income, every American would get a minimum of $5,000.
Gone would be Social Security. Gone would be Medicare. Gone would be welfare. Gone would be the need for a single payer healthcare system.
Murray discussed his plan here.
Question for debate:
Would a plan of lump sum payments be superior to the current way we provide help to people?
Do you see any drawbacks to this system which do not exist in the current system?
In it, he proposes that we do away with all transfer type transactions by the government and replace it with a monthly lump-sum payments to every American over the age of 21 who isn't in jail. The amount would add up to $10,000 a year. The only requirement is that you go out and obtain health insurance with the money (at least $3,000 must be spend on health care). The amount drops as your income increases starting at $25,000 per year. But regardless of income, every American would get a minimum of $5,000.
Gone would be Social Security. Gone would be Medicare. Gone would be welfare. Gone would be the need for a single payer healthcare system.
Murray discussed his plan here.
Question for debate:
Would a plan of lump sum payments be superior to the current way we provide help to people?
Do you see any drawbacks to this system which do not exist in the current system?
To start I with, I would say that we are at a time when we need the ideas of reformers to help think us through our problems. This plan reminds me to a degree of President Nixon's proposal (with the help of Daniel Moynihan I believe) to have the government provide a minimum income floor for the United States.
Would a plan of lump sum payments be superior to the current way we provide help to people?
I would consider this, but under Murray's conditions this system does not seem workable. With revisions some elements of this program could be improvements. I like getting our health insurance coverage out of the hands of our employer and I would also like to get rid of payroll taxes.
I think this system finds ways to reward individuals for pursuing their economic security without punishing everyone out of the door from government support. Here we have a lump sum that requires us to take care of one responsibility (health care) and apply other needs to us.
Do you see any drawbacks to this system which do not exist in the current system?
But in our economic system there are too many ways to get distracted by every day needs when you have a moderate or low income. I still believe the American society is better off with a safety floor or supplement for Americans when they reach the age of 65 or 70.
Also, there seems to be no accounting for children here. So the key elements of our present welfare state components that make the most sense, supplement for those who are poor and cannot easily fend for themselves (the elderly, and children and while we are at it the disabled) are being stripped away.
We have citizens who need a lot more help than the rest of us. For many this $10,000 a year supplement would leave them with no help. Institutions, need for expensive chronic medical care, services for the deaf, blind, paralyzed etc. So any system would need some exceptions.
In the end this is raises an important discussion but provides an imperfect solution.
[/quote]
Would a plan of lump sum payments be superior to the current way we provide help to people?
I would consider this, but under Murray's conditions this system does not seem workable. With revisions some elements of this program could be improvements. I like getting our health insurance coverage out of the hands of our employer and I would also like to get rid of payroll taxes.
I think this system finds ways to reward individuals for pursuing their economic security without punishing everyone out of the door from government support. Here we have a lump sum that requires us to take care of one responsibility (health care) and apply other needs to us.
Do you see any drawbacks to this system which do not exist in the current system?
But in our economic system there are too many ways to get distracted by every day needs when you have a moderate or low income. I still believe the American society is better off with a safety floor or supplement for Americans when they reach the age of 65 or 70.
Also, there seems to be no accounting for children here. So the key elements of our present welfare state components that make the most sense, supplement for those who are poor and cannot easily fend for themselves (the elderly, and children and while we are at it the disabled) are being stripped away.
We have citizens who need a lot more help than the rest of us. For many this $10,000 a year supplement would leave them with no help. Institutions, need for expensive chronic medical care, services for the deaf, blind, paralyzed etc. So any system would need some exceptions.
In the end this is raises an important discussion but provides an imperfect solution.
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QUOTE(Eeyore @ Apr 6 2006, 09:40 AM)
Also, there seems to be no accounting for children here. So the key elements of our present welfare state components that make the most sense, supplement for those who are poor and cannot easily fend for themselves (the elderly, and children and while we are at it the disabled) are being stripped away.
We have citizens who need a lot more help than the rest of us. For many this $10,000 a year supplement would leave them with no help. Institutions, need for expensive chronic medical care, services for the deaf, blind, paralyzed etc. So any system would need some exceptions.
In the end this is raises an important discussion but provides an imperfect solution.
We have citizens who need a lot more help than the rest of us. For many this $10,000 a year supplement would leave them with no help. Institutions, need for expensive chronic medical care, services for the deaf, blind, paralyzed etc. So any system would need some exceptions.
In the end this is raises an important discussion but provides an imperfect solution.
I believe that our nation, prior to a welfare system in its current form, helped the elderly and handicapped in a fashion probably just as dignified and well intended as any nominal gov't check possibly could.
Privatized giving is a large part of what makes many of us "American", and allows for a number of orphaned children, sick, and elderly Americans to have a life that no government check would ever have provided. Religious organizations and other benevolent causes help to create something better than "just getting by".
If we were to minimize the tax burden created by welfare and it's spin-offs, I believe that these causes would fall by the way side, and that the elderly and handicapped wouldn't be withering in a corner to fend for themselves. That's inherently anti-American, or at least anti-Chrisitian (not up for debate... a large portion of the US is admittedly Chrisitian).
The problem with any government program, using Katrina as a benchmark, is that it negates a large portion of those in need, inefficiently allocates funding, and is a pillar of financial waste. Consider that millions of dollars was pumped into very short-sided and largely useless programs that won't leave New Orleans in any better shape or with hope of a sincere recovery. The Welfare programs run by the gov't require thousands of employees, red-tape, and inefficiency.
You also have to consider privatized charity work like the Heart Association, when privatized, accountability becomes tantamount and the money is more likely to get to those in need. I would imagine that if welfare began to fall off the map, that organizations for the elderly, blind, deaf, etc would begin to pop up all over the country.
The problem that I have with the current welfare system is that there is little government transparency, accountability, and reform seemingly is more of a political ploy than an earnest attempt to reform a generation of apathy. The trap that welfare can create in a community is not necessarily simply financial, but mental and emotional at the same time. Work ethics, dignity, and motivation are often crippled in the process.
There may be an imperfect system around every corner, but we now know that 25+ years of welfare as it exists today hasn't been effective, and possibly short-handed a large number of poor Americans into a life of poverty. What's that notion about "give a man a fish"???
If society had told me that I would never amount to anything due to my race or gender, if our government had provided sustenance for all of my living years, and had I lived in abject poverty believing that I would never crawl out... who knows what would've become of me!
QUOTE(aevans176 @ Apr 7 2006, 01:48 PM)
I believe that our nation, prior to a welfare system in its current form, helped the elderly and handicapped in a fashion probably just as dignified and well intended as any nominal gov't check possibly could.
What by forcibly institutionalising them in hellholes, or starving them to death?
Why do you think nations around the planet were moving to welfare systems near the turn of the century? because the status quo was simply not working.
It doesn't take much of a study of history to learn that the 17th and 18th centuries were terrible ones for anyone who found themselves poor, handicpped, injured or mentally disabled. They tended to die in squalor.
While most people see Dickins as a writer, he was forst and foremost about social commentary, notice the theme running through his bookd of the horrors of poverty, and the complete blindness to the problem by the middle class and the wealthy, even the Christians.
No state would currently HAVE a social welfare system if, as you say, everything fas just peachy for the poor, eldrly and disabled back in the day. Go to the history section of any bookstore, and you will find works after works after works on the plight of the urban poor and the disabled in 18th and 19th centure US and Europe. I don't think you will find a single one that shares your view that pre welfare, things for these socially disadvantaged people were 'just fine'.
say what you will about the modern welfare state, certainly you are correct that it has its problems, but to imply everyone would just get along fine without it flies in the face of reality.
Would a plan of lump sum payments be superior to the current way we provide help to people?
It would be superior in many ways, but the devil's in the details. One of the big advantages would be not only the fact that even the poorest among us have some money (indeed, the equivalent of a $5 an hour job before they work a day) but the fact that everyone knows that everyone has this baseline income.
The author answers some of the questions brought up by Eeyore: (link)
TANF in Texas gives out monthly grants of $208 for a family of three. Texas TANF FAQ
$833 a month seems superior to that. Actually, it is $583 ($7000 a year) plus health insurance. Still superior.
Do you see any drawbacks to this system which do not exist in the current system?
The drawback I see is for current retirees who have not built up a nest egg. The grant is $583 a month plus health insurance. The average Social Security check is around $926 a month ($11,100 a year) and retirees get Medicare on top of that. Without the assumption of a built up nest egg (as Murray suggests) these people will be out in the cold (perhaps literally). I haven't seen any consideration for transition costs here. Although the working assumption is that since retirees children will have more money themselves, they could chip in.
I tend to agree with Murray when he says that the welfare state drains life from life.
I think people gain great satisfaction from helping others and institutionalized, standardized "help" is a disincentive to help others. I can't help but call to mind the (admittedly stereotypical) mother in "Million Dollar Baby" : "Why'd you buy me a house? How am I going to get my welfare if they find out I have a house?" The mother casts aside the selflessness of the act because she fears losing her benefits. Although stereotypical, there does currently exist a disincentive to work because earned income detracts from benefits This plan takes that away.
It would be superior in many ways, but the devil's in the details. One of the big advantages would be not only the fact that even the poorest among us have some money (indeed, the equivalent of a $5 an hour job before they work a day) but the fact that everyone knows that everyone has this baseline income.
The author answers some of the questions brought up by Eeyore: (link)
QUOTE
Lopez: Where are the safety nets? Drug-addicted single mother blows her money on drugs; what happens to the kids? These questions will be endless. Aren’t they legitimate concerns?
Murray: Start with cases involving children, and distinguish between two types: neglect and abuse as defined by the criminal code, and people who don’t treat their children as well as we think they should. Neglect and abuse are treated exactly the same under the Plan as under the current system. A legal system is obligated to provide for the enforcement of its decisions, and that means financing and providing services to children of convicted parents. Children in the second category don’t get rescued by the current system anyway. Inferior parenting does not qualify you for welfare and doesn’t bring squads of child-development advisers to your door either. Thankfully.
Suppose instead we’re talking about safety nets more generally, for someone who fritters away his check. The safety net is very simple: Next month he gets another check, and has another chance to make other choices. If the fritterer is a mother, she gets another check too. So do her parents. So do her friends. So do her neighbors. So does everyone around her. And that, I will say very briefly (I’ve got to leave something for the book), is one of the key points in thinking about the dynamics of the Plan — not that individuals get their checks, but that everyone gets a check, and everyone knows that everyone else is getting a check. A lot of expectations and demands to do better can be put on people who have income streams than on people who don’t.
One other point here: The children of these parents also have a better safety net. It’s not just the mother who has $10,000 to replace her current welfare benefits. The father also has $10,000 going into a known bank account. It makes no difference if he’s jobless or wants to disappear. The only way he can disappear is to forfeit his grant. Under the Plan, child support enforcement suddenly nears 100 percent — a reality that will not be lost on single males who watch their buddies suddenly having to pay a substantial portion of their grant to their former girlfriends.
Murray: Start with cases involving children, and distinguish between two types: neglect and abuse as defined by the criminal code, and people who don’t treat their children as well as we think they should. Neglect and abuse are treated exactly the same under the Plan as under the current system. A legal system is obligated to provide for the enforcement of its decisions, and that means financing and providing services to children of convicted parents. Children in the second category don’t get rescued by the current system anyway. Inferior parenting does not qualify you for welfare and doesn’t bring squads of child-development advisers to your door either. Thankfully.
Suppose instead we’re talking about safety nets more generally, for someone who fritters away his check. The safety net is very simple: Next month he gets another check, and has another chance to make other choices. If the fritterer is a mother, she gets another check too. So do her parents. So do her friends. So do her neighbors. So does everyone around her. And that, I will say very briefly (I’ve got to leave something for the book), is one of the key points in thinking about the dynamics of the Plan — not that individuals get their checks, but that everyone gets a check, and everyone knows that everyone else is getting a check. A lot of expectations and demands to do better can be put on people who have income streams than on people who don’t.
One other point here: The children of these parents also have a better safety net. It’s not just the mother who has $10,000 to replace her current welfare benefits. The father also has $10,000 going into a known bank account. It makes no difference if he’s jobless or wants to disappear. The only way he can disappear is to forfeit his grant. Under the Plan, child support enforcement suddenly nears 100 percent — a reality that will not be lost on single males who watch their buddies suddenly having to pay a substantial portion of their grant to their former girlfriends.
TANF in Texas gives out monthly grants of $208 for a family of three. Texas TANF FAQ
QUOTE
What's the most help I can expect?
The amount of each family's grant depends on a number of things, including income, assets, and need. The maximum grant is $208 per month for a family of three. Each August families also get a $60 school payment for each TANF child.
The amount of each family's grant depends on a number of things, including income, assets, and need. The maximum grant is $208 per month for a family of three. Each August families also get a $60 school payment for each TANF child.
$833 a month seems superior to that. Actually, it is $583 ($7000 a year) plus health insurance. Still superior.
Do you see any drawbacks to this system which do not exist in the current system?
The drawback I see is for current retirees who have not built up a nest egg. The grant is $583 a month plus health insurance. The average Social Security check is around $926 a month ($11,100 a year) and retirees get Medicare on top of that. Without the assumption of a built up nest egg (as Murray suggests) these people will be out in the cold (perhaps literally). I haven't seen any consideration for transition costs here. Although the working assumption is that since retirees children will have more money themselves, they could chip in.
I tend to agree with Murray when he says that the welfare state drains life from life.
QUOTE
Lopez: What does this statement mean? “The welfare state drains too much of the life from life.”
Murray: A meaningful friendship does not consist of sharing backyard barbecues; a satisfying marriage does not consist of two people living together; a vibrant community is not created by yard sales. All of these relationships are given weight and consequence by the elemental events of life — birth, death, raising children, paying the rent, comforting the sad, joining together to do things that need getting done and (crucial point here) having responsibility for getting those things done. The welfare state says of too many important functions in life, “We’ll take care of that.” The natural human response is to say, “Okay, you do it.” And in this transfer of responsibility the welfare state has drained too much of the life from life.
Murray: A meaningful friendship does not consist of sharing backyard barbecues; a satisfying marriage does not consist of two people living together; a vibrant community is not created by yard sales. All of these relationships are given weight and consequence by the elemental events of life — birth, death, raising children, paying the rent, comforting the sad, joining together to do things that need getting done and (crucial point here) having responsibility for getting those things done. The welfare state says of too many important functions in life, “We’ll take care of that.” The natural human response is to say, “Okay, you do it.” And in this transfer of responsibility the welfare state has drained too much of the life from life.
I think people gain great satisfaction from helping others and institutionalized, standardized "help" is a disincentive to help others. I can't help but call to mind the (admittedly stereotypical) mother in "Million Dollar Baby" : "Why'd you buy me a house? How am I going to get my welfare if they find out I have a house?" The mother casts aside the selflessness of the act because she fears losing her benefits. Although stereotypical, there does currently exist a disincentive to work because earned income detracts from benefits This plan takes that away.
Would a plan of lump sum payments be superior to the current way we provide help to people?
I see a few advantages, to this, and some disadvantages as well. One advantage is that we could eliminate a rather large buraucracy, in terms of the Federal government, with regard to administering the various different programs we currently have. Having several thousand people to administer and enforce the program would certainly be better than the several hundred thousand required in all of the different programs we have now.
Another would be doing away with all of the confusing and sometimes arcane rules and "jumping through hoops" that folks have to do now, particularly in the area of medicaid and medicare.
Do you see any drawbacks to this system which do not exist in the current system?
Yes, several. No controls on the health insurance industry, for one. If people are going to be required to purchase health insurance with some of this money, we would have to ensure that the insurance companies are better regulated in some fashion.
For example, with everyone required to purchase insurance with the grant, I would want to make sure that the insurance companies don't jack up the price of premiums to the limit of the grants, in an effort to gain some huge windfall. Any price increases would have to be tied to the cost of living index, or some such.
Also, current exclusions popular with insurance companies would need to be eliminated. No more lack of benefits, or reduced benefits for a year or two, because of "prior existing medical conditions", that sort of thing. If you are required to buy insurance, it should all be available to you from day one.
And if we are going to use this grant to eliminate Social Security, we need a couple of things:
1. A higher amount distributed to people above a certain age, to prevent a loss of income that they would ordinarily be entitled to under the current Social Security system. Assuming we could change to this system tomorrow, there will be far too many people that simply couldn't make it in retirement on $10,000 a year.
2. A requirement that a portion of the money, say $2500 per year be put into an IRA, 401k, or something similar, with a stipulation that it cannot be withdrawn until retirement age. You could, of course, if you wanted, put all of the balance after paying for health insurance into your retirement fund, and could elect to lower or raise the amount put in at any time, provided you paid in at least the minimum.
Otherwise, we will be back at square one, prior to the establishment of Social Security. Everyone will spend what they have available, with nothing left over for retirement. I don't think that any of us really wants to go back to those days.
I really wouldn't have a problem with this program at all, with those kinds of stipulations. It would certainly be cheaper in the long run than what we have now.
I see a few advantages, to this, and some disadvantages as well. One advantage is that we could eliminate a rather large buraucracy, in terms of the Federal government, with regard to administering the various different programs we currently have. Having several thousand people to administer and enforce the program would certainly be better than the several hundred thousand required in all of the different programs we have now.
Another would be doing away with all of the confusing and sometimes arcane rules and "jumping through hoops" that folks have to do now, particularly in the area of medicaid and medicare.
Do you see any drawbacks to this system which do not exist in the current system?
Yes, several. No controls on the health insurance industry, for one. If people are going to be required to purchase health insurance with some of this money, we would have to ensure that the insurance companies are better regulated in some fashion.
For example, with everyone required to purchase insurance with the grant, I would want to make sure that the insurance companies don't jack up the price of premiums to the limit of the grants, in an effort to gain some huge windfall. Any price increases would have to be tied to the cost of living index, or some such.
Also, current exclusions popular with insurance companies would need to be eliminated. No more lack of benefits, or reduced benefits for a year or two, because of "prior existing medical conditions", that sort of thing. If you are required to buy insurance, it should all be available to you from day one.
And if we are going to use this grant to eliminate Social Security, we need a couple of things:
1. A higher amount distributed to people above a certain age, to prevent a loss of income that they would ordinarily be entitled to under the current Social Security system. Assuming we could change to this system tomorrow, there will be far too many people that simply couldn't make it in retirement on $10,000 a year.
2. A requirement that a portion of the money, say $2500 per year be put into an IRA, 401k, or something similar, with a stipulation that it cannot be withdrawn until retirement age. You could, of course, if you wanted, put all of the balance after paying for health insurance into your retirement fund, and could elect to lower or raise the amount put in at any time, provided you paid in at least the minimum.
Otherwise, we will be back at square one, prior to the establishment of Social Security. Everyone will spend what they have available, with nothing left over for retirement. I don't think that any of us really wants to go back to those days.
I really wouldn't have a problem with this program at all, with those kinds of stipulations. It would certainly be cheaper in the long run than what we have now.
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