Monday, September 02, 2013

Welfare is a disincentive to work

“The current welfare system provides such a high level of benefits that it acts as a disincentive for work,” Tanner and Hughes write in their new paper. “Welfare currently pays more than a minimum-wage job in 35 states, even after accounting for the Earned Income Tax Credit,” which offers extra subsidies to low-income workers who take work. “In 13 states [welfare] pays more than $15 per hour.”

“In Hawaii it is $60,590 in annual welfare benefits, once you account for the fact that welfare benefits are tax-free to the recipient, compared to work-related wages. That’s the equivalent of $29.13 an hour.”

Do you make that much?

Forbes

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