04 March 2012

Americans Don't Trust The Poor

About 85% of American means tested benefits (i.e. welfare benefits) are now "in kind", like Medicaid, food stamps, and housing assistance. This is a huge surge from that of the late 1960s, when much more welfare was in the form of cash assistance.

A lot of that is due to the same qualitative assistance via Medicaid costing more than it did then (or the rise of Medicaid as a nursing home subsidy program for the lower middle class, as opposed to a health care program for low income non-seniors). The percentage isn't quite as great is unemployment benefits are included, but still greatly increased. It also doesn't really account for the deceased federal tax burden on the poor, working class and middle class.

The measure doesn't included education, which is a major source of "in-kind" non-means tested government assistance at the K-12 level, that is more flexible than it used to be with the rise of school choice. And, it doesn't measure the trend towards decliing non-means tested higher education subsidies through low state tuitions, in favor of scholarships and student loan assistance.

But, the basic trend away from cash benefits still reflects a reduced amount of trust that the poor are just people who lack money, to paraphrase Milton Friedman, as opposed to people who can be trusted to manage the money that they have available to them.

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