Sunday, November 16, 2014

How government benefits hurt the poor in the long run

Minimum wage increases will affect only about 1% of American workers.  This is a political club, not a help for workers. The problem is unemployment, lack of skills, under the table pay, low education levels, but Democrats say changing things for 1% will give those families a great benefit.  Not as long as it pays better to receive government benefits if you don't or can't work: if you would lose your Medicaid if you accepted a raise, why would you try to advance? If you had to move out of Section 8 housing if you got a promotion and the pay wouldn't cover the new apartment, would you?

The authors found that in 11 states, “welfare pays more than the average pretax first-year wage for a teacher [in those states]. In 39 states, it pays more than the starting wage for a secretary. And, in the three most generous states a person on welfare can take home more money than an entry-level computer programmer.”

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