Paul Ryan wants to help the poor help themselves. And he's come up with a plan to do just that...give a lump sum to each state to pass on to community based organizations. Simple, right?
Well no..not exactly. Here's his plan in a nutshell:
In describing what this would look like, Ryan outlines the minimum requirements:
• A contract outlining specific and measurable benchmarks for success
• A timeline for meeting these benchmarks
• Sanctions for breaking the terms of the contract
• Incentives for exceeding the terms of the contract
• Time limits for remaining on cash assistance
There would be bonuses for people who meet their goals ahead of time, such as finding a job before the time allotted, although the bonus wouldn’t likely come in the form of cash but in something like a savings bond. But if they miss those goals — say, in the current American economy where there are more than two job seekers for every opening, they struggle to find a job in that time period — the poor person would face consequences, “most likely immediate sanctions and a reduction in benefits,” Ryan writes.
http://thinkprogress.org/...
While the plan may seem simple, there are many pros and cons to consider. Go over the elaborate dollar sign for a run down on both
The pros:
-The plan will consolidate all the currently running federal programs ( food stamps, housing vouchers, etc)
- Each state will run the program through community based organizations
- The plan would maintain the safety net spending at the current level without contributing to the deficit
- These are not budget cuts
- The plan can provide financial planning advice to those who need it.
The cons:
- The plan would cut the government safety net programs Ryan proposes to bundle
- How will he reconcile the fact that 2/3 of cuts are coming from moderate and low income( cuts from the very programs that already help the lower and moderate income families) and 1/3 of the cuts come from from the elite 1%?
- this "universal credit" won't be responsive to economic conditions, such as recessions. The funding will remain the same despite raises in the cost of living. The Temporary Aid for Needy Families Program (TANF) did well until the recession hit and funding suddenly didn't cover enough, fewer families were helped.
- Ryan fails to account for the fact that many low income families are already working...wages are simply too low to support a family.
- Streamlining may mean time off work for keeping appointments where a person often will have to stand in line to see a social worker.
- Some states already have integrated programs for the needy ( CHIP, SNAP, childcare subsidies)
But none of the pros and cons address one very simple fact:
that Paul Ryan doesn't think that low income people can be trusted to manage their own money. Several studies done in Africa show what happens when you give poor people control over their allotted funds:
In Uganda, the government gave about a year’s worth of income, or about $380, to a group of applicants, and denied it to the other half. There were no conditions on the money, but those who got it invested most of it in “skills and business assets,” ending up 65 percent more likely to practice a skilled trade. Recipients worked an average 17 hours more than those without the money. And compared to the group that didn’t get the cash, those who did saw a 49 percent increase in earnings two years later and a 41 percent increase four years out, indicating that the effects last.
A similar study in Kenya found that after poor families in rural Kenya were given an average of $513 by an NGO, their assets and holdings were 58 percent higher than a control group a year later, incomes were 33 percent higher, hunger was significantly reduced, and their psychological wellbeing increased.
Similar programs in South Africa, Mexico, and Liberia have all found similar results.
So poor people
can be trusted to manage their money well...after all, they're poor, not stupid!
The list of cons are not the only concerns this plan raises. Here are some more I gleaned from the comments section:
- That most of the money would go to administrative and salary costs ( thousands of new workers would have to be hired to cope with the increase in case loads)
- That some "community based organizations" may be religion based and their idea of measurable benchmarks may include things like attending their services, leading a righteous life, praying their gay away, forbidding birth control and abortions, pushing single moms to marry.
- What if there is an "opt out" option? Who helps the poor then?
- What are the penalties for not accomplishing the goals? No money? Jail?
- What if someone wants to move. Does their case follow them to the new state?
- Who gets to decide what is right or wrong for someone else?
Many were shaking their heads over a Republican who wants smaller government, yet wants thousands of case workers in the field and on the government payroll. And many wanted to hold the House accountable by the same standards as they plan on using on the poor. I can get behind that last one! And lastly, a few stated that if low income workers were paid a decent minimum wage ($11 per hour), then the need to micromanage the poor wouldn't be necessary. Another excellent suggestion.
And another parting thought
“If someone was designing a system for scratch it’s hard to imagine someone would come up with our current very complicated system,” Lower-Basch said. “But in order to simplify you either need a whole lot more money or there will be people losing benefits. In theory things that can be done more logically, but a lot of times people use simplification to actually try to cut benefits.”
http://thinkprogress.org/...