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 Screwed Again: A Trumped-Up War on Welfare

One way the top 1 percent is trying to ease concerns about inequality is pretending that our safety net is too generous to the bottom 1 percent.

By Bob Lord

You’re the top 1 percent. You pocket one out of every five dollars of the nation’s income — more than double your slice of that pie in 1976. You want even more, but the masses are catching on. What do you do?

You get your minions to attack the bottom 1 percent to distract the 98 percent in the middle.

That’s why the Cato Institute recently launched a woefully contrived “study” that reached the pre-ordained conclusion that welfare pays more than work — minimum wage work that is. Forbes, a leading business publication that calls itself a “capitalist tool,” proclaimed “On Labor Day 2013, Welfare Pays More Than Minimum-Wage Work In 35 States.”

Cato is a libertarian think tank funded and dominated by the multi-billionaire brothers Charles and David Koch.

Forbes of course trotted out the obligatory “compassionate” lines about how welfare creates the wrong incentives and “mires people in permanent poverty.” But the intended take-away was how the “national welfare championship” went to Hawaii, which according to Cato’s calculations lavishes up to $60,590 in annual welfare benefits on certain households.

Wow! $60,590 for being on welfare? Not really. ...

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The actual benefit package Cato conjures for Hawaii totals less than $30,000 in most other states. Hawaii’s exorbitant cost of living, 65 percent higher than the national average, explains the difference.

Who are those freeloaders to whom Forbes and Cato refer?

The neediest of the neediest of the needy, that’s who. If you round up, they’d be the bottom one percent of the population. But they’re more likely the bottom .01 percent. They may not even exist at all. Forbes fails to mention this reality and the Cato Institute makes you work hard to figure it out.

You see, to become one of Cato’s champion freeloaders, you need to be a mother of two minor children receiving seven different forms of benefits. Let’s call it the “Cato benefit package.”

It’s either extremely hard or impossible to qualify for this bundle of benefits. If the father of your children is paying any child support, you’re out. You also must be pregnant or have a child under age 5 to qualify for the Women, Infants and Children program, or “WIC,” one of the benefits Cato included in its package.

Cato also includes $23,798 per year in housing assistance in this jackpot, but the waiting list for housing assistance in Hawaii is between two and five years long. By the time you reach the top of the list, you likely no longer will qualify for another benefit, Temporary Assistance for Needy Families (TANF) because it’s, well, temporary. And if your youngest child has passed her fifth birthday before you get housing help, your WIC benefits will have stopped as well.

How many Hawaiian mothers actually fit the profile of Cato’s demonized welfare beneficiary, the one raking in the equivalent of $30,000 in other states? Cato and Forbes don’t say. Chances are there are either few or none.

According to the Center on Budget and Policy Priorities, the Hawaiian families with children receiving housing assistance number 6,800, including two-parent households, one-child households, and single fathers. So figure perhaps 4,000 Hawaiian mothers of two children receive housing assistance. And how many of those 4,000 moms qualify for all six of the other benefits in the Cato package? Quite possibly zero, but almost certainly fewer than 1,000. Hawaii’s adult population, by the way, is about 1 million.

Do the mercenaries for the top 1 percenters promoting the war on welfare recipients know they’re attacking the neediest 1 percent of Americans? Of course. But their goal isn’t to highlight a welfare crisis that doesn’t exist. It’s to distract from the horrific inequality crisis that pervades our society.

If Cato and other champions of the 1 percent can direct our anger towards those mythical welfare freeloaders living large on our tax dollars, our anger over inequality may subside. So too will the pressure on politicians to do something about it.


Bob Lord, a veteran tax lawyer and former congressional candidate, practices and blogs in Phoenix, Arizona.
Distributed via Otherwords.org


This article is licensed under a Creative Commons Attribution-No Derivative 3.0 License, and distributed by Otherwords.org, a project of Institute for Policy Studies, IPS


[12 September 2013]

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