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David Abbott's avatar

Cash assistance makes sense if and only if the distortions of coupon government are worse than the political odor of stories about people using benefits to buy iphones, big screen TVs and vacations.

I haven’t convened any focus groups, but I did read Hillbilly Elegy. The belief that takers are living better off assistance than low wage workers can live off of their wages is one of the biggest obstacles to working class political solidarity. Furthermore, the distortions aren’t that big. It’s not as if SNAP benefits are materially larger than the cost of feeding a family.

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Eric Kumbier's avatar

I would throw student loans into the mix. College was much cheaper when it was essentially a public good. Allowing 18 year olds to take out an almost limitless amount of cash that they can only use to finance education is one reason universities are in a facilities and administrative arms race to compete for the "free" cash given to students. This further increases cost, and colleges have no reason to lower tuition since government will provide whatever the student and her family cannot afford--and charge her interest for it.

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