I'm reading a good book about the Obama campaign and the youth vote (Obama Zombies by Jason Mattera), and there are a couple of startling numbers in Chapter 7 (on economics). Chew on these for a while:
The US has spent more on poverty reduction ($16 trillion) since 1964 (the start of the "War on Poverty") than it has spent on all military wars in its history combined ($6.4 trillion). We won most of those wars, of course, but we have yet to come close to eradicating poverty.
In 2007, the amount of money that would be required to raise all impoverished households out of poverty was $148 billion. However, the US spent $550 billion on poverty reduction programs in that year. If that doesn't show how wasteful and inefficient government is, and how undeserving of our money it is, I don't know what does.
Subscribe to:
Post Comments (Atom)
Something doesn't add up there.
ReplyDeleteI'm guessing $148 billion is the amount of cash you would give to people below the poverty line, in order to raise their income to the poverty line? Can you confirm?
$550 billion sounds like the amount spent on Social Security in 2007?
Hmm, how do I describe this... Did $550 billion provide more services than a person could get simply by having poverty-level income? I.E. is the US actually providing (poverty-level * 4) of support?
The source the author cites is here:
ReplyDeletehttp://s3.amazonaws.com/thf_media/2009/pdf/sr0067.pdf
I'm scanning the doc quickly, and I see on page 18 that the "pre-welfare poverty gap" is calculated as the difference between a poor family's non-welfare income and the appropriate poverty level (i.e. $22K for a family of four). This is the $148K he cites. Then they state that all welfare spending that year was $653B, but $101B was spent on people in nursing homes, so that is discounted and produces the ~$550B number.
Reading a little further, it has a comment about how the census (which produces the poverty stats) pretty much ignores all public assistance as "income" when they write down their stats. So, I guess you might be able to say that spending $550B does eliminate poverty in terms of pure income level, at least if you assume that it all goes to legitimate recipients (and I don't think you can make that assumption). However, do you also think that the people in Washington handing out the money have a vested interest in techincally eliminating poverty (i.e. giving people just enough money to live on to be able to threaten them with taking it away at election time if they don't get their votes) but also continuing to claim that millions still live in poverty and that they need more of our tax dollars? I do.
I appreciate that report, since it uses actual facts! I'm still reading it. Lots of good info.
ReplyDeleteSide note: "War on XYZ" slogan are stupid. We could probably eliminate poverty by killing everyone below the poverty level. Now *that* would be a War on Poverty. The War on Drugs is similar nonsense. :)
Back on topic now... Looking at chart 4 on page 9, it is clear that the bulk of the increase is due to Medical welfare (Medicaid only?). With the recently passed health reform, there will be a lot more people eligible for Medicaid (everyone below 133% of poverty beginning in 2014 if I read it right). Since the Heritage report was published in Sept 2009, I wonder how their projections for the next decade might be changed.
The Heritage report recommendations for controlling costs seem reasonable to me, although I have reservations about steps 8 and 9. Vouchers could provide reduced benefits but may also lower costs. Step 9 advocates shifting the burden of long-term (nursing home) care to states. This might save money if the states squeeze more efficiency out of the program OR if they reduce benefits. I'm worried that long-term care might be subject to the whims and cycles of state budgets though.