“programs for the poor are only a tiny portion of the U.S. welfare state. In fact, the Congressional Budget Office estimates that more than 60 percent of American households receive more in government benefits than they pay in taxes. To get an idea of just how big the American welfare state has become, consider that those transfer payments from the federal government are equal to 34 percent of all wages and taxes in the U.S.”
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“The largest transfer programs are the middle-class entitlements, Social Security and Medicare. In addition, a large portion of the third biggest entitlement program, Medicaid, actually goes to the middle-class elderly and disabled individuals, not the poor. Those three programs alone now make up more than half of all federal spending.”
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“we need to understand that, in practice, when an individual pays Social Security taxes, none of those taxes are set aside for that individual’s benefits. Rather, they are used to pay benefits to those who are currently retired. Social Security is merely a transfer payment from workers to retirees. In that sense, it operates exactly the same as any other transfer or welfare program.”
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“Many individuals will receive more than taxes paid plus a reasonable amount of interest on those taxes.”
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“according to the Social Security system’s trustees, the program faces a future shortfall of more than $43 trillion7 (measured in discounted present value over an infinite horizon—that is, if the government put away $43 trillion today and earned 3 percent interest on those funds, it would have enough money so that, combined with payroll taxes, it could pay all future benefits). Unfortunately, however, the federal government doesn’t have an extra $43 trillion. As a result, there is simply no way that Social Security can pay future benefits without a massive tax increase.”
“A rule that creates new barriers to low-income immigrants seeking to enter the US went into effect on Monday, bringing to fruition the kind of vast restrictions on legal immigration that President Donald Trump has long sought.
The so-called “public charge” rule, published in August by the Department of Homeland Security, establishes a test to determine whether an immigrant applying to enter the US, extend their visa, or convert their temporary immigration status into a green card is likely to end up relying on public benefits in the future.
Immigration officials will now have more leeway to turn away those who are “likely to be a public charge” based on an evaluation of 20 factors, ranging from the use of certain public benefits programs — including food stamps, Section 8 housing vouchers, and Medicaid — to English language proficiency.”
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“Trump has justified the rule as a means of ensuring that immigrants are “financially self-sufficient” and has argued it will “protect benefits for American citizens.””
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“The rule, which has been anticipated for more than a year, has had a chilling effect already: Noncitizens have been needlessly dropping their public benefits out of fear that they will face immigration consequences. It’s difficult to quantify just how many immigrants have unenrolled already, but one survey suggested that about one in seven had done so as of 2018.
Many immigrants aren’t eligible for public benefits unless they have green cards or certain humanitarian protections — and not all public benefits are available to noncitizens.”
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“It also makes getting into the US much harder for immigrants sponsored by family members, the phenomenon Trump has excoriated as “chain migration.”
The rule is only one of several policies the Trump administration has pursued to dramatically shift which immigrants are legally able to come to the United States. Under Trump, the legal immigration system increasingly rewards skills and wealth over family ties to the US, while shutting out a growing number of people from low-income backgrounds.”
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“With the public charge regulation, Trump is painting immigrants as abusing public benefits. But they are actually “less likely to consume welfare benefits and, when they do, they generally consume a lower dollar value of benefits than native-born Americans,” according to the Cato Institute, a libertarian think tank.”
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“few immigrants would end up being penalized, under the final version of the rule, for using public assistance. But the rule has already been effective in dissuading many immigrants from continuing to access the public benefits they need.”
““When we decide how much to redistribute, how progressive the tax should be, the thinking is: I’m putting some weight on everyone in the economy, measuring how much I value $1 given to Dylan, $1 given to Stefanie,” Stantcheva told me, laying out the model. “The weight we put mentally depends on many characteristics of those people: how poor they are, how hard they work, etc.”
Voters often put a lower weight on immigrants’ welfare, which means the more immigrants they think are getting money from the government, the less likely they are to support redistribution overall. But the picture is more complicated than that. Alesina and Stantcheva’s model also assumes that voters put a low weight on “freeloaders”: people they perceive to be cheating the welfare system, as opposed to the “deserving poor,” who are getting benefits they ought to be receiving. If voters think that a higher share of immigrants than natives are freeloaders, that will also reduce support for redistribution.
“Misperceptions and biases against immigrants can interact and reinforce each other,” Alesina and Stantcheva write. “If the bias against immigrants is already high … even a small over-estimation of the share of free-loaders among immigrants can tilt preferences towards less redistribution. Similarly, if the bias against immigrants is high (or if the perceived share of free-loaders is high), even a small overestimation of the share of immigrants can reduce support for redistribution.”
And what their survey work with Armando Miano finds is that these kinds of misperceptions are incredibly common, and especially common among people disposed negatively toward immigration.”