5 Times the Trump Team Told Americans To Accept Being Poorer
https://reason.com/2025/05/02/5-times-the-trump-team-told-americans-to-accept-being-poorer/
Tag: poor
What if everyone qualified for welfare benefits?
“In an ideal world, everyone who qualifies for an aid program ought to receive its benefits. But the reality is that this is often not the case. Before the pandemic, for example, nearly one-fifth of Americans who qualified for food stamps didn’t receive them. In fact, millions of Americans who are eligible for existing social welfare programs don’t receive all of the benefits they are entitled to.”
…
“Means testing a given social program can have good intentions: Target spending toward the people who need it most. After all, if middle- or high-income people who can afford their groceries or rent get federal assistance in paying for those things, then wouldn’t there be less money to go around for the people who actually need it?
The answer isn’t so straightforward.”
…
“Implementing strict eligibility requirements can be extremely tedious and have unintended consequences.
For starters, let’s look at one of the main reasons lawmakers advocate for means testing: saving taxpayers’ money. But that’s not always what happens. “Though they’re usually framed as ways of curbing government spending, means-tested benefits are often more expensive to provide, on average, than universal benefits, simply because of the administrative support needed to vet and process applicants,” my colleague Li Zhou wrote in 2021.
More than that, means testing reduces how effective antipoverty programs can be because a lot of people miss out on benefits. As Zhou points out, figuring out who qualifies for welfare takes a lot of work, both from the government and potential recipients who have to fill out onerous applications. The paperwork can be daunting and can discourage people from applying. It can also result in errors or delays that would easily be avoided if a program is universal.
There’s also the fact that creating an income threshold creates incentives for people to avoid advancing in their careers or take a higher-paying job. One woman I interviewed a few years ago, for example, told me that after she started a job as a medical assistant and lost access to benefits like food stamps, it became harder to make ends meet for her and her daughter. When lawmakers aggressively means test programs, people like her are often left behind, making it harder to transition out of poverty.
As a result, means testing can seriously limit a welfare program’s potential. According to a report by the Urban Institute, for example, the United States can reduce poverty by more than 30 percent just by ensuring that everyone who is eligible for an existing program receives its benefits. One way to do that is for lawmakers to make more welfare programs universal instead of means-tested.”
…
“There sometimes is an aversion to universal programs because they’re viewed as unnecessarily expensive. But universal programs are often the better choice because of one very simple fact: They are generally much easier and less expensive to administer. Two examples of this are some of the most popular social programs in the country: Social Security and Medicare.
Universal programs might also create less division among taxpayers as to how their money ought to be spent. A lot of opposition to welfare programs comes from the fact that some people simply don’t want to pay for programs they don’t directly benefit from, so eliminating that as a factor can create more support for a given program.
In 2023, following a handful of other states, Minnesota implemented a universal school meal program where all students get free meals. This was in response to the problems that arise when means testing goes too far. Across the country, students in public school pay for their meals depending on their family’s income. But this system has stigmatized students who get a free meal. According to one study, 42 percent of eligible families reported that their kids are less likely to eat their school meal because of the stigma around it.
Minnesota’s program has proven popular so far: In September 2023, shortly after the program took off, the amount of school breakfasts and lunches served increased by 30 percent and 11 percent compared to the previous year, respectively.
While it might not be politically feasible — or, in some cases, necessary — to get rid of means testing for all public subsidies, free school meals also offer an example of what a compromise might look like at the national level. Though Congress hasn’t made school meals free to all, it passed a provision in 2010 that allows schools to provide free meals to all students in districts where at least 25 percent (originally 40 percent) are eligible. The program showed that providing free meals to all lowered food insecurity, even among poor students who already qualified for free meals, by removing stigma. (The community eligibility provision now serves nearly 20 million students.)
As for how universal programs can be paid for, the answer is, yes, imposing higher taxes. It might seem inefficient to give people a benefit if you’re going to essentially take it back from them in taxes, but what you actually end up with is a much more efficient program that is more easily administered and doesn’t leave anyone out.”
https://www.vox.com/policy/393227/means-testing-income-restrictions-universal-welfare-programs
Medicaid is popular. So why are Republicans still trying to cut it?
“There is a certain logic to Republicans’ commitment to pursuing Medicaid cuts: Social Security and Medicare are universal programs. Everyone pays in while they work, and then enjoys the benefits when they retire. Medicaid, on the other hand, is targeted to people who have low incomes. Republicans argue that this program, like food stamps and cash welfare, discourages people from seeking work, since they only qualify for benefits if their income is below a certain threshold.
“Assistance programs are supposed to be temporary, not permanent,” McCarthy said. “A hand up, not a handout. A bridge to independence, not a barrier.”
The problem is their diagnosis may be wrong. For starters, about two-thirds of the people covered by Medicaid — those who are children, elderly, or disabled — are usually exempted from work requirement proposals. Working-age adults who are expected to meet them can end up losing coverage even if they are attempting to satisfy it, if they have irregular work hours for example, or if they have trouble filing the necessary paperwork. One estimate of a Medicaid work requirement proposal in Michigan found that only about one-quarter of the people expected to lose their coverage were considered “out of work,” meaning they could work but weren’t. The rest were already working, retired, caring for a loved home at home, or unable to work for some other reason.
In Arkansas, where implementation of a work requirement was eventually blocked by a court order, nearly 17,000 people lost coverage after the requirement was put in place. Analyses later found that Medicaid beneficiaries had not started working more or earning more money as a result of the policy. Instead, lots of people got kicked off Medicaid, but it didn’t lead to an improvement in their economic status; they simply became uninsured.”
Biden’s Earth Day order aims to ease pollution in poor communities
“Under current procedures, regulators typically assess pollution from new facilities or projects on a plant-by-plant basis rather than in conjunction with existing emissions from other sources. This method underestimates the health risks, community advocates say.
By instructing agencies to research and incorporate new data on those cumulative impacts and involving communities early in the process, Biden marries two of the “four historic crises” he identified on the campaign trail in 2020: climate change and racial inequality. Most people who face outsized health and climate vulnerabilities from concentrated pollution sources are people of color and low-income households.”
When the Government Makes Poverty Worse
“a survey of more than 1,000 low-income Pennsylvanians found that taxes are often a major barrier to economic security—ranking ahead of more commonly discussed problems such as credit card debt and student loans. Among those surveyed, all of whom have incomes below 200 percent of the federal poverty level (about $53,000 annually for a family of four), the average respondent reported paying $4,575 per year in taxes.”
…
“The paper asks officials to consider a counterfactual history: If Pennsylvania had enacted a rule in 2003 that capped future government spending increases at a combination of inflation and population growth (and had returned the surplus to taxpayers), the average low-income resident of the state would have an extra $20,000 in the bank today, simply due to the lower tax burden.”
Climate disasters hit poor people hardest. There’s an obvious solution to that.
https://www.vox.com/future-perfect/23574798/climate-adaptation-anticipatory-cash-transfers-givedirectly
Zoning Police Continue To Find New Ways To Punish the Poor
“Some people live together by choice. Others share space out of necessity. Lack of affordable housing forces many families to adjust, but the zoning police remain rigid in Cobb County, Georgia.
Even during a nationwide housing crisis, code enforcers northwest of Atlanta continue to enforce a narrow vision of suburbia. One rule limits overnight parking based on property size. Families can have one car for every 390 square feet of living space, which effectively prevents more than two vehicle owners from living together in a 1,000-square-foot unit.
Teen drivers are out of luck. So are adult children, college students, mothers-in-law, and any guest who stays longer than one week. The city does not concern itself with individual circumstances, nor does it care if vehicles remain in good condition with current tags. It counts newer models and clunkers the same.”
The Biden Administration Is Taking From the Poor and Giving to the Rich
“Biden announced that he will—unilaterally, mind you, and for no apparent reason that I can see—extend the pause on student loan payments until the end of the year and forgive up to $10,000 for those persons making less than $125,000 a year. This generosity with other people’s money extends up to $20,000 for Pell Grant recipients.
As David Stockman, a former director of the Congressional Office of Management and Budget, reported recently, “Only 37% of Americans have a 4-year college degree, only 13% have graduate degrees and just 3% have a PhD or similar professional degree. Yet a full 56% of student loan debt is held by people who went to grad school and 20% is owed by the tiny 3% sliver with PhDs.”
Picture two young married lawyers who together earn just under $250,000 and are on their way to making even more mon ey in the future. They will be able to collect from Uncle Joe a nice bonus of $40,000, taken from the pockets of the many people who didn’t go to college—perhaps because they did not want to take on debt—and from those who have responsibly already paid back their debt.”
What’s the best way to help extremely poor people? After 20 years, the evidence is in.
“On a certain level, it seems intuitive that doing more for people — giving assets and training and cash — will produce better outcomes than just giving one thing, like cash. But the downside is that it takes more time, effort, and money to run a more complex intervention.
So a major question looms over the graduation program: Is it worth spending that money on the program or is it more efficient to just give all the money directly to people in need? In other words, is it really useful to teach the person to fish or should you just give them the damn fish already?”
…
“In recent years, development experts have moved toward an important idea called “cash benchmarking,” which basically says that cash is the benchmark against which all other anti-poverty interventions should be judged. Since giving people cash is easy, efficient, and respectful of their autonomy, aid agencies should only run a different type of program if testing shows that it works better than cash would.
Nowadays, when studies come out showing positive results for graduation programs, there’s a tendency to think that this particular combination — cash plus assets plus training — does work better than simply giving cash. But just because the graduation approach works great in some scenarios doesn’t mean it’s always the most efficient approach.
For starters, though, let’s look at the evidence suggesting that cash-plus programs work better than simple cash programs. Three studies have run this sort of comparison.
In South Sudan, a study looked at what happened to 250 households that got a full graduation program, compared to 125 households that got only cash and 274 households that received neither. Both graduation and cash increased consumption, but only the graduation group saw a significant increase in assets, a sign of more durable wealth. Although the cash group shifted a bit from agriculture to other types of work, they didn’t set up their own lasting businesses that may have been higher-paying.
In Uganda, researchers evaluated a graduation-style program run by a group called Village Enterprise. It offered training and a capital grant to extremely poor people so they could start a small business. The researchers found that it worked well, increasing self-employment income and consumption. In fact, it outperformed cash on these measures. The authors speculate that, “left to themselves — without training and mentorship — beneficiaries [of cash transfers alone] struggled to make productive investments, maintain them, and derive sustained value from them.”
In Niger, a new randomized study has highlighted the benefits of taking a multifaceted approach to extreme poverty. The study evaluated women who were already enrolled in a government cash transfer program. The goal was to understand how psychosocial issues — like feeling depressed or disconnected from your community — might make it harder to seize economic opportunities. The study found that the women who got psychosocial support showed rates of returns that were higher than those who got only cash. Offering psychosocial support was the most cost-effective route 18 months after the intervention.”
…
“while graduation programs appear to work great in some places, they’re dependent on the market — and they can run into problems in places where the market is either too dysfunctional or, ironically, too functional.
One randomized trial in India, published in 2012, is an example of the latter. It found that a graduation program yielded no net impact. Although it shifted participants away from agricultural jobs to other sorts of work, they could’ve earned just as much in their original agricultural jobs. While those original jobs were far from big money-makers, wages for agricultural labor had been improving in India, thanks to programs like the ambitious National Rural Employment Guarantee, so adding in a graduation program didn’t really help.
Dysfunctional markets produce their own obstacles. Abed told me about his experience trying to run a graduation program in Balochistan, an extremely dry, desert-like province in southwestern Pakistan, where participants were taught how to run a small business. One problem: There wasn’t a functional market for the businesses to thrive in. “Once they graduated, there wasn’t much to go to,” said Abed. “And there wasn’t microfinance available. So it was very, very difficult.””
…
“Another way a graduation program can flop is if it fails to be cost-effective. In the huge 2015 randomized study that looked at graduation programs in six countries, Banerjee and his co-authors note that although the program proved extremely cost-effective in some places, easily paying for itself within 10 years, other countries don’t have such low costs and high benefits in the short run. In Peru, for example, such a program wouldn’t break even.”
…
“Abed is convinced that graduation is the best approach for the ultra-poor, but he acknowledges that what makes the most sense for the moderate poor is a somewhat open question. Also, while graduation may be best for ultra-poor people who are young and healthy enough to go start businesses if given half a chance, it may not work for those who are elderly or disabled. For those groups, the answer may well be cash transfers.”
The Politics of DNA
“”Luck,” E.B. White once said, “is not something you can mention in the presence of self-made men.” They worked hard, no doubt, to get where they are. But they also benefited enormously from good fortune, not just in life but in life’s building blocks. A fortunate combination of thousands of slight genetic differences boosted their intelligence, motivation, openness to experience, task perseverance, executive function, and interpersonal skills.
“Like being born to a rich or poor family, being born with a certain set of genetic variants is the outcome of a lottery of birth,” the behavioral geneticist Kathryn Paige Harden argues in The Genetic Lottery. “And, like social class, the outcome of the genetic lottery is a systemic force that matters for who gets more, and who gets less, of nearly everything we care about in society.””