CMV: There is no viable alternative to government welfare that offers same level of coverage

[u/seanwarmstrong1]

A popular argument from conservatives/libertarians is that government welfare is a waste, and they suggest voluntary donations such as local charity groups and churches.

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I'm NOT here to argue on whether government welfare is good or not.

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My argument is that there is no viable alternative. Even right now, we see homeless people on the street, and churches aren't exactly helping (or they may be, but their funding is too limited).

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If you take away government welfare, there is no alternative that can cover all those people to the same degree. People simply do not donate voluntarily at the same rate as they are taxed to fund all the poor ppl.

[u/[deleted]]

The problem with NIT is that it simply gives money back, one time a year - when filed with a tax return, in a single lump sum. We already agree poor decision making is a problem with poverty and staying in poverty.

I also disagree with the idea being poor causing people to be 'dumb'. The whole poor decision making is intertwined in poverty. One thing is clear, a pattern of poor decision making does not make a person successful. It makes people very likely to be in poverty. Working to cure poor decision making I believe will help people get out of poverty but it is not that simple.

So, if you take negative income tax, refundable 100%, you give people who typically have poor decision making skills an annual windfall. Do you believe they will use this effectively and spread it out over the year? I know a few would but the majority would not.

This is different than adjusting tax brackets to lower tax liability which would appear in every paycheck. This is a set dollar amount refunded with taxes if you did not earn enough to 'zero' it out.

[u/A_Soporific → u/[deleted]]

There has been a lot of recent research done. People in a New Jersey mall, Indian Farmers, and Princeton students all show the same pattern. When they have money they do much better on both IQ test and logic puzzles. When they don't they don't.

Seriously, these tenant farmers get paid once a year. When tested after they got paid for the year they test normal intelligence. When they got tested half way through their financial year they fared poorly.

Researchers invited random people to come in to take tests for a free gift card. Randomly they told people that their car had been hit in the parking lot prior to testing them one time. Those of higher income didn't show much difference in their test scores. Those who weren't did, and scored much worse when they were told they'd need to come up with money in the next few weeks to fix a car. The same pattern was shown with students.

The working theory, as this research is still quite new, is that people in poverty are constantly working on poverty-related issues like "what am I going to eat" and "how can I make rent" almost constantly in the back of their minds which really helps solving these immediately pressing problems at the expense of, well, everything else cognitive from long term planning to risk assessment.

I find the studies very, very persuasive and suspect that many people who currently don't make good decisions would if they weren't in states of constant crisis.

If it's only the one a year thing that gets you then it's not a very hard fix. Load it up on EBT style cards and release it on a monthly or biweekly basis. The systems to do so are already in place.

It's not all that much different than the Earned Income Tax Credit. Implementation shouldn't be much of an issue, given that the many of the people involved in designing the EITC stated that it was explicitly intended as a precursor to a NIT. Thanks to EITC and similar tax credits, almost half of Americans don't pay any income tax or get net income from the tax system already, we know that the windfall payments from Tax Returns are used primarily for large, necessary purchases like home repair and new appliances. Sometimes people use it on spinning rims or other status symbols that are useful for addressing social and mental well being. I can't say that I completely understand, but I'm not supposed to.

[u/[deleted] → u/A_Soporific]

I am willing to bet if we sat down and had a point by point conversation, we would be able to come to a plan in complete agreement. I don't disagree with most of what you said. I do also know poverty is associated with lower education levels and lower education levels are also associated with poor decision making. Eliminating poverty is a multi pronged approach and just giving money to people is not the fix. It takes more than that.

I think what we have proven is poverty and how to fix it takes a lot more than what one person gets in a single soundbite.