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.
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.
These programs are pure paternalism as Milton Friedman and John Stuart Mill would point out. They are about telling people what they ought to buy rather than allowing them to decide for themselves what they want to buy. On those grounds alone, I find these programs pernicious. You're right, Matt, that WIC is probably the worst. I couldn't imagine shopping as a WIC recipient, looking for those little WIC-approved labels. I suppose you get used to it and enjoy the strawberry yogurt as best you can, but it shouldn't be that way.
Child care certainly is not my area of subject matter expertise, but--on the off chance someone knows more--wouldn't it make sense just to pump money into local school districts so that they could provide child care from a very young age? Obviously public schools are not perfect but they are existing local bureaucracies that cover the entire country, have expertise in taking care of pretty young children (especially in places where pre-K is already offered) as well as expertise in property acquisition, building maintenance, and all the other stuff you'd need to implement a national network of child care providers. If people want to pay to send their children to a fancy, private provider, they could do that instead, but the option of free (or highly affordable) child care would be there for any one who wants it.
My perspective comes from a childhood spent on food stamps, among many other families in the same boat. And, frankly, giving coupons for food and limiting those choices is a good thing. In general, we and the recipients I knew were not well-versed in nutrition, so giving us boring but mostly healthy food was a good thing for us and, especially, our kids. You were also flooded with recipes for cheap, easy meals. In other words, the government was actually doing something personally and directly useful to the poor. I'm enraged every time I hear of cuts, because we absolutely have an obligation to feed our poor families. And yeah, Matt, not thrilled to hear you were contributing to the Repub stereotypes with your cigarette trade.
It seems like the difference between voucher and public financing is also how complicated or opaque the product is. If I get a cash grant, I can make pretty informed decisions about my food and housing but healthcare is a bureaucratic nightmare.
I think this commentary elides the fact that a lot of people and politicians don't view the point of the welfare state as improving the general Utility of the population. Instead, it is intended to avoid specific privations (e.g. "healthcare is a human right" "no one should go hungry in the richest country on earth").
In that context, even an inefficient program that addresses specific needs is better than a more efficient program that leaves those needs potentially unaddressed. If you replaced SNAP with cash assistance, it seems highly likely that more people would go hungry even though the aggregate benefit to the populations is higher. Is that a good thing or a bad thing? I tend to think it's good, but I think there would be significant variance in people's responses.
It seems to me that direct public provision and/or tied public subsidies are only preferable to unrestricted cash grants when there's either some sort of market failure or else a positive externality associated with consumption of the good. It's clear enough why health care and education qualify on those grounds, but I don't think housing does.
One of the arguments for YIMBY is that middle-class urbanites aren't the only ones who need it; you can't have additional public housing without relaxing land-use rules. But a different argument for YIMBY is that there are positive spillover effects when highly skilled people live in close proximity. I doubt that aggregating poor people produces positive externalities and it may produce some negative ones (which has been an argument for preferring Section 8 to government-owned housing projects).
So wouldn't it be correct to say that targeted assistance for the housing costs of poor people living in dense urban areas is an *especially* bad alternative to cash aid with no strings attached, and that building public housing in those areas is the worst alternative of all?
In a future YIMBY utopia market forces will exclude the poor from central cities. They'll still get support from government but it will be monetized and if they work in the city center, they'll be spending the aid on transportation.
This reads more like a case against poorly designed coupon government rather than coupon government in general. Obviously the government shouldn't be choosing which flavor of yogurt you can buy. But the idea that the government should use its leverage as some people's primary food buyer to promote healthy choices seems like a good thing to me. And it would be if people like Matt didn't help people break the rules. You could flood the program with massive amounts of fresh fruits and vegetables and little else as an extreme example. And I bet most people on the program would end up eating more fruits and vegetables. If instead you gave everyone the equivalent in cash, I'd bet even more that people would eat very little fruit and veg and lots more cigarettes and soda.
Crazy idea... rich progressives want to give people cash. Republicans don't. Why don't we have more non-profit entities set up to provide the service of transferring cash from wealthy elites who want to help people to the people who need it? I mean, there are foodbanks, Habitat for Humanity, things like that... I've seen micro-lending non-profits but they are primarily outside of the US in developing nations. What am I missing, why is this a terrible idea?
I'm not super knowledgeable about the details, but I think that's what happened on the way to Bolsa Familia in Brazil. There were all these voucher programs that were collapsed in this simpler program to send people cash.
I don’t have strong feelings about the child care coupons but I concur that it’s not a good idea to have conceptual arguments about SNAP. It’s pretty politically popular and efforts to cut benefits have been less successful than efforts to expand them, I think in part because ag interests like seeing money targeted at food. I do not trust that a means tested cash benefit would be as popular.
"Now, again, if the city wants to create a public child care center with a low staff ratio and everyone has a certain certificate and it’s on the ground floor of a building somewhere, that seems great to me. A public option can put pressure on the private sector to raise its game. But the point is we actually need to increase the supply of good child care, not keep squeezing the sector with regulations so that kids leak out into unregulated arrangements."
Great point!!
One of the thins I agree on with US conservatives is that there are too many regulations raising the cost of healthcare in the US. Back where I come from, private healthcare is much more lightly regulated. The government doesn't need to make sure that private hospitals won't collude to raise prices, because in that case citizens will just go to public hospitals. Here you have all shorts of weird regulations like mandating the percentage that insurance companies have to pay for claims etc.
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.
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.
These programs are pure paternalism as Milton Friedman and John Stuart Mill would point out. They are about telling people what they ought to buy rather than allowing them to decide for themselves what they want to buy. On those grounds alone, I find these programs pernicious. You're right, Matt, that WIC is probably the worst. I couldn't imagine shopping as a WIC recipient, looking for those little WIC-approved labels. I suppose you get used to it and enjoy the strawberry yogurt as best you can, but it shouldn't be that way.
Child care certainly is not my area of subject matter expertise, but--on the off chance someone knows more--wouldn't it make sense just to pump money into local school districts so that they could provide child care from a very young age? Obviously public schools are not perfect but they are existing local bureaucracies that cover the entire country, have expertise in taking care of pretty young children (especially in places where pre-K is already offered) as well as expertise in property acquisition, building maintenance, and all the other stuff you'd need to implement a national network of child care providers. If people want to pay to send their children to a fancy, private provider, they could do that instead, but the option of free (or highly affordable) child care would be there for any one who wants it.
"She and I both liked Diet Coke and Camel Lights."
Couldn't encouraging people to form friendships over shared vices be a major social benefit of SNAP over cash gifts?
My perspective comes from a childhood spent on food stamps, among many other families in the same boat. And, frankly, giving coupons for food and limiting those choices is a good thing. In general, we and the recipients I knew were not well-versed in nutrition, so giving us boring but mostly healthy food was a good thing for us and, especially, our kids. You were also flooded with recipes for cheap, easy meals. In other words, the government was actually doing something personally and directly useful to the poor. I'm enraged every time I hear of cuts, because we absolutely have an obligation to feed our poor families. And yeah, Matt, not thrilled to hear you were contributing to the Repub stereotypes with your cigarette trade.
It seems like the difference between voucher and public financing is also how complicated or opaque the product is. If I get a cash grant, I can make pretty informed decisions about my food and housing but healthcare is a bureaucratic nightmare.
I think this commentary elides the fact that a lot of people and politicians don't view the point of the welfare state as improving the general Utility of the population. Instead, it is intended to avoid specific privations (e.g. "healthcare is a human right" "no one should go hungry in the richest country on earth").
In that context, even an inefficient program that addresses specific needs is better than a more efficient program that leaves those needs potentially unaddressed. If you replaced SNAP with cash assistance, it seems highly likely that more people would go hungry even though the aggregate benefit to the populations is higher. Is that a good thing or a bad thing? I tend to think it's good, but I think there would be significant variance in people's responses.
I know I'm going to regret this, but here goes.
It seems to me that direct public provision and/or tied public subsidies are only preferable to unrestricted cash grants when there's either some sort of market failure or else a positive externality associated with consumption of the good. It's clear enough why health care and education qualify on those grounds, but I don't think housing does.
One of the arguments for YIMBY is that middle-class urbanites aren't the only ones who need it; you can't have additional public housing without relaxing land-use rules. But a different argument for YIMBY is that there are positive spillover effects when highly skilled people live in close proximity. I doubt that aggregating poor people produces positive externalities and it may produce some negative ones (which has been an argument for preferring Section 8 to government-owned housing projects).
So wouldn't it be correct to say that targeted assistance for the housing costs of poor people living in dense urban areas is an *especially* bad alternative to cash aid with no strings attached, and that building public housing in those areas is the worst alternative of all?
In a future YIMBY utopia market forces will exclude the poor from central cities. They'll still get support from government but it will be monetized and if they work in the city center, they'll be spending the aid on transportation.
This reads more like a case against poorly designed coupon government rather than coupon government in general. Obviously the government shouldn't be choosing which flavor of yogurt you can buy. But the idea that the government should use its leverage as some people's primary food buyer to promote healthy choices seems like a good thing to me. And it would be if people like Matt didn't help people break the rules. You could flood the program with massive amounts of fresh fruits and vegetables and little else as an extreme example. And I bet most people on the program would end up eating more fruits and vegetables. If instead you gave everyone the equivalent in cash, I'd bet even more that people would eat very little fruit and veg and lots more cigarettes and soda.
Crazy idea... rich progressives want to give people cash. Republicans don't. Why don't we have more non-profit entities set up to provide the service of transferring cash from wealthy elites who want to help people to the people who need it? I mean, there are foodbanks, Habitat for Humanity, things like that... I've seen micro-lending non-profits but they are primarily outside of the US in developing nations. What am I missing, why is this a terrible idea?
Let's not forget that Section 8 vouchers promote housing discrimination; many landlords will not accept them. All landlords accept cash.
Oh great. There goes my plan to simplify the holidays by giving Substack coupons.
I'm not super knowledgeable about the details, but I think that's what happened on the way to Bolsa Familia in Brazil. There were all these voucher programs that were collapsed in this simpler program to send people cash.
I don’t have strong feelings about the child care coupons but I concur that it’s not a good idea to have conceptual arguments about SNAP. It’s pretty politically popular and efforts to cut benefits have been less successful than efforts to expand them, I think in part because ag interests like seeing money targeted at food. I do not trust that a means tested cash benefit would be as popular.
"Now, again, if the city wants to create a public child care center with a low staff ratio and everyone has a certain certificate and it’s on the ground floor of a building somewhere, that seems great to me. A public option can put pressure on the private sector to raise its game. But the point is we actually need to increase the supply of good child care, not keep squeezing the sector with regulations so that kids leak out into unregulated arrangements."
Great point!!
One of the thins I agree on with US conservatives is that there are too many regulations raising the cost of healthcare in the US. Back where I come from, private healthcare is much more lightly regulated. The government doesn't need to make sure that private hospitals won't collude to raise prices, because in that case citizens will just go to public hospitals. Here you have all shorts of weird regulations like mandating the percentage that insurance companies have to pay for claims etc.