Eliminate Poverty with Unconditional Cash

We have a new social contract in the U.S. It’s not in the Constitution. It is technically illegal. But it holds firmer today than the written contract adopted by long dead men over 200 years ago. That contract is the Safety Net. As a nation we have decided we don’t like people starving to death in our back yards. It’s unsightly, smells bad, brings down property values, and makes the sensitive feel rather guilty. If the Supreme Court were to mutate into a bunch of Originalists and require an amendment before the federal government could cut another welfare check or Social Security check, that amendment would pass rather quickly, assuming the Supreme Court wasn’t impeached or lynched first.

Just say no to poverty

Libertarians may lament. Strict constructionists may point out legal niceties not met. But the Safety Net is here to stay. Every prosperous nation has one. Work or Starve may have made sense in a poorer times when laziness results in lack of food overall.* In our abundant modern age, where governments pay farmers not to plant, Work or Starve is needlessly cruel. Work or Live Without the Latest Luxuries, however, is still a good idea. Subsidized access to cable television or Internet service is questionable.

Many libertarian and conservative complaints about the welfare state ring true, however. When you pay people because they are poor, you get more poor people. When you pay people who have children out of wedlock, you have more children out of wedlock. When you pay people who are unemployed, you get more unemployment. When you pay people who are deep in debt, you get more people running up debts. When you try to sort out the truly needy from the moochers, you get red tape and social workers with excessive power.

The solution for today, however, is not no welfare. The civilized solution is unconditional dough. That is, free money for everyone, enough free money to get everyone above the poverty level.

Can we afford it? Let’s run the numbers. The department of Health and Human Services gives the following table for poverty guidelines in the lower 48 states:

The 2009 Poverty Guidelines for the
48 Contiguous States and the District of Columbia
Persons in family Poverty guideline
1 $10,830
2 14,570
3 18,310
4 22,050
5 25,790
6 29,530
7 33,270
8 37,010
For families with more than 8 persons, add $3,740 for each additional person.

In other words it would take about $900/month to lift a single person out of poverty without any need to work. This is a bit more than I arrived at using the budget numbers from the 2011 tax guide and the 2010 census. (When I used 2008 numbers when first setting up this site I came up with $1000/month.) A married couple would be better off. $800/month would be more than enough to get a couple out of poverty without working, and they could even have a child without working and still stay above the poverty line. To keep a married family of four above the poverty line we’d need $918/month according to this chart. If we completely replace welfare with a Citizen’s Dividend of a bit over $900/month, then every poor couple would be entitled to replacement rate breeding (2 per couple) with no need to work. Beyond that, it’s get a job or deal with some local/state/private social workers. (We might be able to stretch out the unconditional family size even more by subsidizing health insurance based on all family members, including children.)

As I mentioned before, if we simplified government as per this proposal, we’d likely get the economy moving again and could get the unconditional dividend up to something like $1000/month.