OMG! Poor people getting money!

Eric Massa has weighed in on the crisis of the day: $200 back-to-school grants for "children across the state whose families are on welfare, receiving food stamps, or whose parents are unemployed". Massa thinks that the money is spent without accountability.

In case you've been under a rock, this story has been all over the national, regional and local news. Because the money was dispersed into food stamp accounts rather than as vouchers for back-to-school items, there was chaos at local grocery stores. Also, a local Wal-Mart reported a "run" on high-end electronics.

Though I agree with Massa that this could have been done better, I have to laugh at the agida over this relatively minor, and completely stimulative, expenditure.

The press on this was golden. Is it really a front-page story that some poor people have bad financial judgment? What's next, a treatise on the sun rising in the East? (And please let me know which "high-end" electronic device can be purchased for $200, at a Wal-Mart.)

This little controversy was also a classic New York political moment. It begins with a David Paterson fuckup. It involves Maggie Brooks bitching about welfare allocation. And it ends with Dean Skelos saying that the money could be better spent on STAR tax rebates. Even wicked George Soros got involved, by having the gall to chip in $35 million on this giveaway. The only thing missing was Pedro Espada, but I'm sure he's involved somehow.


Rotten - you've got to get out more often and get to know these poor people. My guess, from personal contact, is that 50% of the money will be wasted. It is a hell of an expense to make people feel good about themselves.

I don't know about 50%, but I'm sure it's a healthy percentage.

I've had a fair amount of personal experience with poverty. I grew up very close to one of the poorest places in the US - a reservation in the Dakotas. I lived in an urban neighborhood surrounded by slums (Barack Obama's neighborhood) in the 80's. I have a beef with the notion that people want to be poor, or enjoy getting government handouts (not that you said they did, but that seems to be a subtext of a lot of the commentary). But I don't have an argument with the fact that a lot of poor people waste money.

In this case, I thought it was funny is that this relatively small amount of cash per person ($200) caused such howls. If we raised the food stamp allotment by, say, 3-5%, we'd probably be paying far more than $200/yr more to the average recipient, but this $200 one-shot deal is somehow different in people's minds.

This is why I love my government:

1. A woman who works for me and is a single mother came to me after getting a raise and asked me to cut her hours from 40 to 39 because she got a letter from New York state telling her she was now making too much money to qualify for New York Plus Health Insurance. It took New York about six months to catch up with this. An incentive to not improve yourself? I don't begrudge a penny that the state gives her.

2. A 45 year old man I know works 30 hours per week flipping burgers at McDonalds - he has been offered a 40 hour work week many times and has refused - apparently between what he makes there and the government aid he gets he needs no more.

So - do people want to be poor? Probably not. Does the government do things that lead them to do less - no question.

(1) is the kind of stuff that drives me nuts. It's so much better for kids to have a working parent as a model, but the whole system is set up to pull out any support as soon as a single mom makes a tiny bit more than the poverty line. Government-sponsored daycare is another example. A friend told me a story about a single mom who qualified for daycare so she could work, but she made a little bit too much at her job (and it was a housekeeping job at a hotel, so it couldn't have been a lot) and the daycare was pulled back.

But, Elmer, I gotta point out that New York Plus is S-CHIP by another name, and a lot of Republicans were howling about raising the eligibility limits for that program. Having good health insurance at an affordable rate (there's still a premium for New York Plus, but it's small) takes away one perverse disincentive to work. It's the kind of "welfare" that makes sense.

I agree, and universal health care could help level the playing field in so many ways. Taking or staying on a job because of employer-provided health insurance limits a person and their family; arbitrary income-based health insurance cut offs do the same thing. The effect is compounded, as you suggest, Rotten, because children, entrepreneurs, and creative people in general are circumscribed by fear and insecurity. And. of course as our auto industry has demonstrated, reliance upon the corporations and the unions for the kind of "benefits" that are necessary to build and sustain a healthy middle class put a huge drag on the US in global competition. Our culture of freedom and self-reliance needs to evolve.

I agree. If even a modest healthcare reform plan passes, one that guarantees access to affordable insurance (private or public, I don't really care, as long as it is a reasonable plan), I think we'll see more risk-taking on the part of middle class entrepreneurs. We'll also have fewer people below the poverty line because there's one less impediment to trying for a better job, and there will be fewer people bankrupted by medical bills.

My point still stands - why do we reward people for a lack of work and penalize people who want to improve themselves? The woman mentioned above lives in subsidized housing and 33% of her income goes toward that. (so she lost a third of her raise - but that's the way it should be). Why can't we charge people a certain percentage of their income for health insurance and let them keep the insurance until they make enough to buy their own?

We can and should. Instead of simply ending eligibilty for health insurance when people reach a certain income level, we should have a sliding subsidy, based on income. That's part of the current bill in Congress, btw: require universal insurance and subsidize those who can't afford it. In fact, that might be the only thing that survives (along with reform of insurance).

New York has one of the best healh insurance plans for low income people in the nation. We also have a program for working poor/middle class who can't afford insurance. it's called Healthy NY. It has eligibility limited by gross income (max is ~$60K for a family of 4). But the premium for a family of 4 is $350-$500/month, which is still a big bite.

So, in New York, for a family of 4, if you make less than $33K, you can get Family Health Plus for free. If you make $34-$60K, you can pay $350-$500/month for Healthy NY. In other words, if you make $33k, you're going need a $6,000 raise to break even. (Those are all Monroe County numbers, btw.)

If we just could raise the eligibility of Family Health Plus to something like $50K for a family of 4, and then phase in a subsidized premium past $33K, we'd have a bunch more people insured, we'd have healthier kids, so they'd be more likely to grow up and be contributors to society, and the parents wouldn't be afraid to try for a job that paid a bit more. It would be a win all around, in my opinion.

I could live with that

It really isn't a hell of a lot different from what Obama wants. The key is universal access (no pre-existing condition limit -- or at least an affordable alternative for those with pre-existing conditions, and no rescission) and subsidies for those who can't afford it. That's it.

Now, can the US afford that? I think we can - it's less ambitious that what Canada or the UK have, and they're able to afford their plans.