In a 1986 radio address to the American public on welfare reform, Reagan said that the "most insidious effect of welfare is its usurpation of the role of provider." Reagan understood the escape from poverty as within the individual's control, who through sheer grit could escape the cycle of poverty. His model of rugged individualism assumes that either irresponsibility or laziness holds back the American poor and that an American commitment to increased welfare support would condition the poor to expect reward without work, further exacerbating poverty and misusing the rich's money.
His ideology brings up an interesting dilemma: will the American poor create, build, and increase technological advancement if the government provides them with a living income?
This aid would eliminate the need to work for financial stability, but will people who are financially disincentivized actually work less? We can look to the Catholic moral teaching on human nature for some intuition. A fundamental aspect of the Church's social teaching on human nature is transcendence: the constant desire of humans to achieve more, expand more, and earn more. We can understand this premise outside of the context of Catholicism --- after all, lots of billionaires still work, constantly striving for more status, personal fulfillment, or impact on society even though their practical buying power barely changes. People work to build wealth beyond the bare minimum to feel socially valued, to enjoy luxuries, and so on. All humans work to further their current conditions; it seems unlikely that someone on welfare faces entirely different urges that contradict most people's. Intuitively, it seems reasonable to assume that people who happen to be on welfare will still desire that larger house or nicer TV and play into the capitalist struggle, in turn serving their role in the humanity's transcendent push toward advancement.
Looking at this human drive more definitively, insights from economic experiments in other countries may indicate how governmental aid impacts the poor labor supply and overall economic growth. In Kenya, the NGO GiveDirectly established a universal basic income (UBI) twelve years ago. Last year, MIT economics professor Abhijit Banerjee and his colleagues analyzed the outcomes of this intervention, concluding that a UBI did not result in less work or earned money but instead in striking economic growth. For communities that received long-term money transfers, enterprise counts increased by 14% and net revenues by 52%. Notably, when participants received lump sum transfers, this trend became even more apparent, likely due to the fact that poor households tend to accumulate money in order to make larger lump-sum purchases. While there are valid challenges to the idea of a UBI, the fact that an economy holstered with a UBI results in increased economic expansion proves that directly aiding the less fortunate does not necessarily come at the cost of technological advancement and in fact, may benefit it. Other studies have analyzed the use of targeted transfers to reduce poverty. In Peru and Indonesia, aid programs that target the poor have been shown to result in improvements in societal welfare and not at the cost of the poor labor supply. As opposed to universal programs, targeted ones restrict benefits to only a select number, which could result in desperate communities not qualifying for aid or decreased popularity from the more wealthy. Regardless, at least internationally, a tentative correlation has been established between providing aid to poor communities and economic stimulation. It's unlikely that these wishful international experiments could become US legislation in the near future (maybe Andrew Yang would beg to differ), but they serve as critical indicators as to how governmental interaction with the poor affects the free market and societal wellbeing.
There are several pros and cons to a UBI system. Those hesitant at committing to a UBI may feel as though the money would be more efficiently spent on programs like education and nutrition, where the money is almost certainly being spent on causes that benefit those suffering. Also, UBIs, by definition, include paying incomes to the rich, money that may be better used in further investment into the poor. On top of this, US corporations could easily respond to a UBI by decreasing how much they pay their employees, defeating its purpose; preventing this would require further government regulation. And, ultimately, a UBI would be extremely expensive to implement. Critically, a well-implemented UBI policy (that provides a living wage) would eliminate the need for other governmental aid.
[^^ TODO: address that just spending more for a UBI would lead to massive inflation; obviously the current budget would have to be redistributed]
While welfare policies in much less developed countries like Kenya, Peru, and Indonesia might spur economic growth, is there any evidence that this trend would continue in the US? [TODO: talk about working requirements for welfare programs and their effectiveness] [TODO: US welfare statistics & research]
Regardless of how the money is spent, it is critical to understand that financial disincentivization of creating tech companies does not correlate with decreased productivity. Now, this brings up a broader question about whether or not welfare, defined as a redistribution of wealth (directly or indirectly) should be enforced. In this context, a direct redistribution of wealth would be through say, progressive taxation to provide lump-sum payments to the poor, while an indirect one would be say, tax breaks on charity organizations that improve educational resources in low-income districts. Note that as a first step, a redistribution of wealth broadly can be desired without specific foresight into implementation. First, let's understand the issue with extreme poverty: it's not inequality but instead that some live without their basic needs met (in a society where immense luxury exists). Fundamentally realizing these unmet needs as an issue relies on the axiom that all humans deserve basic human rights and dignity. Pulling from MIT's living wage calculator, these basic needs might include childcare, food, health care, housing, internet & mobile, transportation, civic engagement, and other necessities (e.g. clothing, etc.). We can think of welfare as a tool that the government uses to ensure that everyone has the tools to have their needs met.
[Now, with this established, it's fundamental to understand that the actual implementation of these policies is tough.]
[TODO: transition] This form of government intervention should prioritized over complete fiscal conservatism (an unrestrained free market) because the needs of underprivileged and hard-working individuals matter more than extra luxury for the rich. This is justifiable under Kantian ethical principles that value human dignity, especially considering the inevitable luck that factors into an individual's wealth. [TODO: argue this using Kantian ethics?; research the connection between Kantian ethics and conservatism vs. liberalism]
Currently, welfare serves groups not expected to work (e.g. children, seniors, and the disabled) --- it is the collective responsibility of society (though taxation) to provide those unable to work with a basic living wage and the government's responsibility to facilitate that. With this in mind, the primary focus of this article is poor, working-age adults.
However, increasing the standard of living of the poor may not be in conflict with the contention that welfare should be decreased. If one assumes that people who do not have to work to survive will not work, they could conclude that the temporary cost of poor suffering enables the wider, constant push toward technological advancement, which in turn raises the worldwide standard of living. In this way, decreasing welfare would, at the temporary cost of the current poor, create a more comfortable world for everyone in the long term. In another framing, decreasing welfare taxation would incentivize corporate America to create more products and technology, which would raise the universal standard of living. In this understanding, increasing welfare would disincentivize the progression of technology.
Next, to achieve a more well-rounded understanding of how financial aid might benefit low income areas, we should first understand why they struggle to improve their situation. Drawing from Reagan's rugged individualism, many Republicans today feel that the individual, not the system, should be wholly (or primarily) blamed for financial hardship. With the premises that all individuals have unbiased free will and access to all of the resources available online, they conclude that faulty decision making, moral degradation, or laziness must be causing poverty, placing the burden of poverty on the poor themselves. However, this fails to recognize the external, systemic barriers preventing social mobility. Sure, black teenagers in Chicago can pursue a cybersecurity certificate online, but the lack of infrastructure and violent culture imbued into their lifestyles from a young age fosters young adults that disregard education and see crime as a practical solution to survive. Fundamentally, they still desire the same good things all humans do: a warm house, food on the table, and a loving family. However, their path to those universal goods shifts according to the conditions of their upbringing. [TODO: what are the systemic barriers holding the poor back from making money? --- education? why? what else? + specific examples in some cities] [TODO: discuss moral degradation with regard to black culture -- why is drug dealing & violence seen as an okay option?] [TODO: discuss decrease in social mobility over the years]
The larger question at hand is how to use welfare dollars to address the larger problems within American society. Choosing to hand out lump sum payment to the poor may temporarily reduce poverty but a more sustainable and efficient solution may be to funnel the money into communal resources. The poor face systemic disadvantages in money-making through a lack of education. [TODO: cite] Through the internet, they have the resources (as all American do) to make money, but factors out of their control, such as the culture or educational system within their area, subconsciously prevent them from increasing their fiscal wellbeing. Education expands social mobility by equipping students with the resources to create and contribute more, increasing universal standard of living. A compromise might be an extra condition to be checked in which welfare benefits are only extended to hard-working individuals. The beneficiaries of welfare should not be people who splurge without attempting to better their situation, so this would act as a safeguard to prevent a misuse of taxpayer dollars.
[TODO: discuss how welfare policies should account for the fact that people receiving it should be hard-working; refer to Clinton '96 policy (must be job-seeking)]
[Another critical place to examine as far as implementation is the current Federal budget.]
and that a fundamental aspect of the government's role in society should be guaranteeing human needs. Achieving a pragmatic understanding of this issue also requires understanding the practicality of increasing the welfare budget. Currently, the US spends 7.6% ($__) of its budget on all of its poverty, food, and housing programs [TODO: add Medicaid; explain why SS and Medicare not included; cite from Dalton] in contrast to __ ($1.7T) on the military. Researching online, you might find that their actual budget cites $880B but that hides defense-related funding in other departments like the Department of Energy (nuclear research). While national defense should certainly be a priority for the government, this excessiveness forgets other more pertinent issues (such as, arguably, welfare). [TODO: discussion of how much is too much; welfare matters more than spending extra on military ← need to find a good source.] Relative to other countries, the US spends disproportionately more money on their military. Also, policy-makers almost certainly have alternative motives in deciding the budget. Those with stock in companies like Lockheed Martin or who'll mysteriously receive donations from leadership at these companies aren't choosing to support a defense-heavy budget just to protect Americans [TODO: cite with funny example].
[TODO: more directly and conclusively give personal opinion and why]
Note: simply realizing that UBIs or increasing the welfare budget would create a better society is in no way associated with the implementation of these policies, but that is beyond the scope of this article. However, having this as a political view gives citizens direction in what reform they would like to see legislators advance.