When I saw the recent headlines and FB hand-wringing (Overbeck article, Hawaii Reporter article) about how great it is to be on Welfare in Hawaii I was skeptical, but curious. Could government benefits be that generous in Hawaii? Sixty thousand dollars a year in free money? I mean, what kind of an idiot am I? I already live here! I should just check out and live on the government dole, why not?
Why not, indeed.
To start, the recent uproar is about a report from 2013 (CATO Institute article about CATO report; link to CATO report), which by most standards is old news. I’m sure it was hashed over at the time. But I’m a sucker for punishment, so let’s do it again!
The CATO Institute report likes to refer to government assistance as a “benefits package“ because nothing says entitlement like a benefits package. The report claims the value of the Hawaii Welfare benefits package is $49,000—wait—what, you say? Isn’t it $60,000? Well, what they meant was, in pre-tax wage equivalent speak, you would need to hypothetically earn $60,000 at a real job to hypothetically equal what you are hypothetically getting from your hypothetical $49,000 benefits package. Having covered that, we will move on.
For a family with one adult and two children, the benefits package includes an average TANF payment of $636 per month, SNAP benefits of $736 per month, Medicaid insurance valued at $8,352 per year, housing benefits averaging $23,796 per year, and miscellaneous benefits of about $561. I was especially interested in fact-checking the housing figure, which looked pretty substantial. So I tried to open an online application for benefits. What I found, was this:
LINK TO APPLICATION FORM
Waiting List
There are no open waiting lists at this time. Please try again later.
August 31, 2015 at 2:35PM (HT)
and this
WAIT LIST CLOSED
The wait list for Section 8 housing vouchers is closed. That means, even if you qualify, you can’t apply. But surely this is temporary, right? Except, it’s probably not. The last time the wait list was closed, it was closed for several years. On January 30, 2015, the Oahu Civil Beat reported that 300 Hawaii residents were about to receive their housing vouchers. Some families had been on the wait list since 2006. Well 300 sounds like a lot. Except that the government is reporting that when they opened the wait list again May 2014, 14,351 applications were received, but only 3,100 applications were randomly selected for the Section 8 Housing Choice Voucher wait list. (link to story in KHON local news) That is about 21% of the applicants, who were wait-listed—not who received benefits. And they can expect to wait 2 to 5 years to get a voucher. (link to Hawaii housing site)
Reporter Anita Hofschneider of the Oahu Civil Beat also noted that many landlords discriminate against people with housing vouchers, making them difficult to use. So even if you are lucky enough to get randomly selected for the waiting list, and get the voucher after waiting for from between 2 to 5 years, then maybe you can find a landlord who will rent to you.
So most people in Hawaii who have a Welfare Benefits Package don’t benefit from the housing assistance, since at this time they can’t even apply for it. So if we reduce the $49,175 package to an amount closer to what most people are actually receiving, it is more like $25,377. That still sounds pretty good, right? Tent on the beach, living the life…
Ok so $8,352 of the package is the value of Medicaid benefits. No explanation is provided as to how the value is arrived at, except that it is about one-third higher than the actual amount the state pays per person, according to the report. Unfortunately for our intrepid study authors, in Hawaii, a single person earning $30,000 per year can get insurance for about $200 per month. I’m sure family coverage would be more, but credits would reduce the amount, and lower income would reduce the amount, so let’s just say ballpark $2,400 per year is a more realistic figure than $8,352 for the value of the Medicaid benefits, being based on the actual cost of the insurance and all. Now that $25,377 is down to $19,425. Still looking ok, though, right? Life on the beach… no worries…(except for those pesky two kids I need to inflate my monthly payment, amiright?)
Well actually you might have to live on the beach. Remember, only $636 per month is actual cash to you. For your rent, utilities, bus pass or other travel expenses, child care, clothing, toiletries (not SNAP eligible). The SNAP benefits might cover your food expense, but $736 per month (that’s $184 a week) isn’t much for a family of three, or a family of one, for that matter. And that figure is probably an overestimate. The figures provided by Hawaii state government for 2013 show that the average SNAP benefits paid each month per household is $458, not $736. (link to Hawaii state budget)
I don’t know, it still sounds pretty good, right?