Welfare, Social Security, and Unemployment Insurance
As a thirty year plus veteran on the ground administrator of Florida "Welfare Programs" it has been a long and winding road. The big changes brought on by "welfare reform included time limits on benefits, participation requirements, and incentives to making work pay. The money provided to the State of Florida was conditioned on having people look for work(really), attend training classes if needed, (after failing in job search), and participating in work experience activities or educational activities to improve reading skills or language skills for speakers of other languages. Successful participants received short term help with bus passes or gas cards, child care or in a small number of cases money to move to places where there were better job opportunities. The goal of these programs were to get people off of public assistance and initially were successful because the economy was humming along and we probably hassled enough people that if they were working under the table they just dropped off the roles. The number of single parent families has also been reduced. Food stamps or the SNAP Program as I believe it is called now feeds a really significant number of people. The fact that the food is distributed through grocery stores is a positive and initially required a single person work or participate in a program to receive benefits after they had exhausted all but a minimum of their resources.
The programs did not do as well for many chronic problem clients and I am sure this is still the case.
The Unemployment Program as operated by the State of Florida provided limited benefits for a maximum of 26 weeks. The number of weeks has been extended but the basic program funded by the State of Florida is in the process of trying to reduce the number of weeks an unemployed person can participate in the program to 20 weeks. Eligibility for the program is limited to covered employees who have worked sufficient weeks to qualify for benefits and then lost their jobs through no fault of their own. Being fired for cause may disqualify you for benefits. And not surprisingly with many small employers, many workers are not required to be covered.
The Social Security System pays benefits to many workers who have reached retirement age. 62, 65, 66. The article calls lumps this program with welfare programs. Almost all workers who have worked long enough in the SS system would disagree with this characterization. They have paid into the system. There will of necessity need to be some adjustments in the level of benefits promised if contributions remain at the same levels and longevity increases and especially if the costs for medical care continues to increase beyond the inflation rates.
The "Welfare Programs" as such are targeted to the poor, elderly, working poor, long term unemployed, and to help support children that may participate through food programs at schools.
In Florida the levels of support are not extravagent and from experience there is little effort to do anything to increase participation of people that might be eligible, in many places just the opposite might be the rule.
In any case, welfare being something to help support children, the poor, elderly, unemployed, and underemployed is helpful to the local economy and is definitely countercyclical in a state where the unemployment rate is still over 10%.
There is still the opportunity to sell food stamps or use them for items that are not food, medicare fraud rings exist and could use more staff to uncover and prosecute fraud, and there are too many people working off the books that continue to receive payments or in some cases identity fraud that mucks up the process but the overall need for some kind of program like these will continue.
Arguements to the contrary seem to be wishful thinking as we become older, or may experience significant periods of unemployment and still need money to pay for housing, food, transportation, and to raise a family.
The programs did not do as well for many chronic problem clients and I am sure this is still the case.
The Unemployment Program as operated by the State of Florida provided limited benefits for a maximum of 26 weeks. The number of weeks has been extended but the basic program funded by the State of Florida is in the process of trying to reduce the number of weeks an unemployed person can participate in the program to 20 weeks. Eligibility for the program is limited to covered employees who have worked sufficient weeks to qualify for benefits and then lost their jobs through no fault of their own. Being fired for cause may disqualify you for benefits. And not surprisingly with many small employers, many workers are not required to be covered.
The Social Security System pays benefits to many workers who have reached retirement age. 62, 65, 66. The article calls lumps this program with welfare programs. Almost all workers who have worked long enough in the SS system would disagree with this characterization. They have paid into the system. There will of necessity need to be some adjustments in the level of benefits promised if contributions remain at the same levels and longevity increases and especially if the costs for medical care continues to increase beyond the inflation rates.
The "Welfare Programs" as such are targeted to the poor, elderly, working poor, long term unemployed, and to help support children that may participate through food programs at schools.
In Florida the levels of support are not extravagent and from experience there is little effort to do anything to increase participation of people that might be eligible, in many places just the opposite might be the rule.
In any case, welfare being something to help support children, the poor, elderly, unemployed, and underemployed is helpful to the local economy and is definitely countercyclical in a state where the unemployment rate is still over 10%.
There is still the opportunity to sell food stamps or use them for items that are not food, medicare fraud rings exist and could use more staff to uncover and prosecute fraud, and there are too many people working off the books that continue to receive payments or in some cases identity fraud that mucks up the process but the overall need for some kind of program like these will continue.
Arguements to the contrary seem to be wishful thinking as we become older, or may experience significant periods of unemployment and still need money to pay for housing, food, transportation, and to raise a family.
I think the article is saying that the delivery of the welfare benefits by the federal government is not efficient. Alternatives such as private enterprise, charity, and local aid would have a better economic return.
ReplyDeleteMuch of the delivery of welfare benefits has been shifted to the states through block grants and the states have shifted the administration of the programs to counties or groups of counties and local boards. These groups receive funds by formula which spreads the money out. The bureaucracy does not go away and there are indeed problems administering the programs. Private companies are a mixed bag, as are charities, and local governmental agencies. The further I get from direct contact with the players, there is an awful lot of wasted efforts due to professional planning getting subverted by continued funding of outdated programs and other aspects of poor targeting of scarce resources because of flawed legislation. Ultimately, legitimate evaluation gets watered down and these programs are not able to respond to problems as quickly as needed and the current political response is to either throw the baby out with the bath water or promote duplication and eventual waste.
ReplyDeleteTwo things I'd like to point out as we continue. First, I consider "payroll taxes" as not welfare. You will receive a benefit based on your contribution. This is typically social security and health. So by welfare I mean food stamps, housing, and disability. I understand the arguments and examples that point to the lack of funding for the programs we have. This does not prevent my trying to understanding what is not working and what can't be sustained. Second, I think fraud and waste are endemic to programs run by the Federal government. As soon as the money to be spent is sent to Washington in the form of taxes we lose 35% of it. Like driving a new car off the lot, its worth less as soon as it hits the street.
ReplyDeleteThe promises made in the law that fund Social Security and Medicare are the biggest unfunded liabilities that the ggovernment has. The personal experience of my parents is that they received a great deal more in benefits than they would have based on paid in "taxes". This benefit is increased life expectancy and a higher quality of life as they got older. Housing is subsidized for the middle class through interest deductions. This has certainly compunded the housing bubble we are recovering from. Rather than go crazy about marginal tax rates that are usually avoided let's work at reform which avoids talking points that do little to improve the situation. I'm amused by the comment that 50% of Americans pay no taxes. Given the tax code, how much should a family of 4 with a gross income of $40,000 pay. Oh well, I'm trying to understand this as well.
DeletePart the blame for the housing bubble lies with the ratings agencies that put Triple-AAA ratings on the dubious housing debt. That started the whole thing.
ReplyDeleteCould not agree more. i was part of a committee that"managed" an endowmwment fund at my church. A significant portion of money was put into a fund that had some bad triple AAA debt and even the Charles Schwab advisor we paid to give us advice did not understand how crappy the fund was. They eventually repaid us for about 35% of our loses on that fund after I contacted an attorney and was referred to their in house mediator to recover some of our loses. Triple A meant one thing but I don't think it means much of anything now.
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