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IMO "welfare dependency" is by and large a myth. The vast majority of people want to work, want to make money, want to be self-sufficient, and want to participa

IMO "welfare dependency" is by and large a myth. The vast majority of people want to work, want to make money, want to be self-sufficient, and want to participate meaningfully in society. A few people I know who are arguably dependent on government provided benefits (in the US) are that way because they're physically ill, have inadequate or no access to health care, and literally cannot work as a result. The others are full-time employees who work 40 hours a week but are paid wages that can't possibly support their family's existence.

surfmike 10y ago
Agreed but when you have a generous system sometimes it's just easier to stay on benefits and putting off developing career etc. Of course we should help people who cannot be self sufficient. Those who can should be given very clear incentives (and prodding) to join the workforce.
- dublinben 10y ago
  The disincentive to work has more to do with the welfare trap that removes benefits quicker than they are replaced with income. That can happen with any level of generosity in benefits.
  - IkmoIkmo 10y ago
    Yeah I can illustrate a personal example. I lived with my dad who'd been ill for years and on welfare. His income was supplemented to about 950 euros or so a month, however, if I had a part-time job making 350 euros, he'd only receive 600, because the household income was 950. So here I am, a poor student paying my own way through college with no support from my parents, working part-time and going into debt, and they slam this on me. So I was forced to financially support my parents because there's no way to pay rent, food, insurance etc on 650 bucks. After many calls it turns out there was no solution, the -benefits was 1:1 with the +income I was earning. This created an incentive for me to stop working. If I earned 100, my dad got 100 less, if I earned 600 my dad got 600 less. It'd only make sense for me to work if I quit college and got a job that paid more than he'd get in benefits, such that if I made 1k a month, my dad would get 0, I'd give him 950, and keep 50 bucks a month for working full-time at minimum wage. So I stopped working and started desperately looking to move out (so that my income was no part of the 'household' income of my dad's place). Eventually did, got a job again and finished uni. Anyway it's just one of many bad policy planning examples that look sensible in general... which is, if you're working, you don't need benefits anymore. And if you're living with people who are making all kinds of money, there's no need to depend on the state anymore, so they're counted as part of your income that the benefit requirements are tested against. Then there's indeed examples where benefits are replaced quicker than income. Worse than 1:1. Like when you make 900 bucks, you get an exemption from a municipality tax of 150. But if you make 901, you pass the threshold, such that your effective income dropped to 751 by earning 1 euro extra, which puts you in a nasty situation in a country where rent, insurance puts you at 750 already and there's nothing left for food, culture or connectivity.
    - amazon_not 10y ago
      This also creates a really, really strong incentive to look for a job that pays you under the table. Each unreported euro earned is effectively worth two euros (the euro earned plus the euro lost to clawbacks) in addition to any unpaid taxes. Not the kind of incentives a rational policy maker should strive for exactly.
    - allendoerfer 10y ago
      Why didn't you take Bafög?
      - IkmoIkmo 10y ago
        This is just an example of welfare policy issues in general, when edge cases creep up that cause all kinds of problems. It's not a German example however, never lived there. I did receive cheap student loans by the way, but I don't want rack up lots of debt so I liked to work part-time where I could. And even with loans covering tuition fees, for the two of us to live on 950 euros a month (or even 3 when my brother lived with us) is not a great deal even if I didn't have any college costs, or had all of them covered by a state program.
      - eru 10y ago
        I don't know about IkmoIkmo, but I think there are some cases where it's hard to get for some silly reasons.
  - eru 10y ago
    > That can happen with any level of generosity in benefits. Yes, the effective marginal tax rate is important here. (And another argument in favour of giving anyone a universal basic income, and just using the normal tax system to claw back benefits from people who earn enough.) An even better system is to just tax land. There are no disincentives with that at all: the supply is fixed.
  - surfmike 10y ago
    Definitely agree, and that is part of my point. Under many welfare states, you're worse off (utility and something monetary-wise) after you try to enter the labor market, since you're suddenly working 40 hours a week for almost the same amount of money you got for working 0 hours a week.
- bobwaycott 10y ago
  This assumes there is a workforce with openings to join. That is becoming an increasingly more difficult problem for many people. It also assumes that it is good for everyone to join the workforce—which itself intrinsically ignores reality, in which there are simply not enough jobs available to reach 100% employment. There is an odd mental hang up, especially in the US, that invariably and automatically views people who receive social benefits in a viscerally negative light, demonizing them in the public sphere and consciousness. This is, to me, an odd choice versus choosing to recognize as a social positive that there are benefits that can be designed and operated correctly to ensure we do not allow people to fall below a minimum living standard. If we want to realize a society in which every able-bodied member is employed in the workforce, I do not believe we can do so without significantly altering the expectation of full-time employment as a standard. I also seriously doubt we can achieve full employment without realigning the world of business and work toward achieving social incentives first, instead of profit incentives.
  - surfmike 10y ago
    You need high labor force participation to make a system that can support a strong welfare state. Scandinavian countries have arguably the best welfare states in the world, but they also have the highest labor force participation rates in the world. Indeed their benefits like maternity leave help increase the rate, but I don't think they could support their strong welfare programs with less people working.
- facetube 10y ago
  One of the major problems I see is that people are generally bad at distinguishing "can't" from "won't". Things like major depression (which, for anyone unfortunate enough to experience it, feels as physical as being chronically poisoned) have a way of turning in to "you're just being lazy".
  - surfmike 10y ago
    I agree mental health issues like depression are disabilities that can prevent one from keeping down a job. We should support and treat people with depression as a society. But I think at least for mild depression, living off welfare and not having a job can make things worse and spiral into major depression. From personal experience living in Scandinavia, anxiety and depression are known as easy reasons to get on disability pay and stop working. Of course these are real issues in many cases. But there are people who don't suffer from them and use them as an excuse to get government pay.
    - facetube 10y ago
      Provided a doctor was required to certify that the health condition existed and was disabling, I'd consider myself unqualified to second-guess the existence of a diagnosed health condition. I'd be interested in data over anecdotes – everyone seems to have the latter.
blowski 10y ago
I didn't mean to imply that people who are 'welfare dependent' are workshy layabouts, far from it. I meant it in the 'non-pejorative' sense of "somebody who is dependent on welfare for a majority of their income for a significant period of time". That might be because of illness, or some other reason - I make no judgement. So, going back to the original comment, moving to a small village to make your benefits go further makes it harder to find a job. Thus, you remain on welfare for a longer period of time. On the other hand, if you stay in the city, you're more likely to get a job, but it's also harder to eat and find good accommodation. So these things are difficult. It is clearly a big social problem that people have to face these kinds of difficulties.

surfmike 10y ago

Agreed but when you have a generous system sometimes it's just easier to stay on benefits and putting off developing career etc. Of course we should help people who cannot be self sufficient. Those who can should be given very clear incentives (and prodding) to join the workforce.

dublinben 10y ago
The disincentive to work has more to do with the welfare trap that removes benefits quicker than they are replaced with income. That can happen with any level of generosity in benefits.
- IkmoIkmo 10y ago
  Yeah I can illustrate a personal example. I lived with my dad who'd been ill for years and on welfare. His income was supplemented to about 950 euros or so a month, however, if I had a part-time job making 350 euros, he'd only receive 600, because the household income was 950. So here I am, a poor student paying my own way through college with no support from my parents, working part-time and going into debt, and they slam this on me. So I was forced to financially support my parents because there's no way to pay rent, food, insurance etc on 650 bucks. After many calls it turns out there was no solution, the -benefits was 1:1 with the +income I was earning. This created an incentive for me to stop working. If I earned 100, my dad got 100 less, if I earned 600 my dad got 600 less. It'd only make sense for me to work if I quit college and got a job that paid more than he'd get in benefits, such that if I made 1k a month, my dad would get 0, I'd give him 950, and keep 50 bucks a month for working full-time at minimum wage. So I stopped working and started desperately looking to move out (so that my income was no part of the 'household' income of my dad's place). Eventually did, got a job again and finished uni. Anyway it's just one of many bad policy planning examples that look sensible in general... which is, if you're working, you don't need benefits anymore. And if you're living with people who are making all kinds of money, there's no need to depend on the state anymore, so they're counted as part of your income that the benefit requirements are tested against. Then there's indeed examples where benefits are replaced quicker than income. Worse than 1:1. Like when you make 900 bucks, you get an exemption from a municipality tax of 150. But if you make 901, you pass the threshold, such that your effective income dropped to 751 by earning 1 euro extra, which puts you in a nasty situation in a country where rent, insurance puts you at 750 already and there's nothing left for food, culture or connectivity.
  - amazon_not 10y ago
    This also creates a really, really strong incentive to look for a job that pays you under the table. Each unreported euro earned is effectively worth two euros (the euro earned plus the euro lost to clawbacks) in addition to any unpaid taxes. Not the kind of incentives a rational policy maker should strive for exactly.
  - allendoerfer 10y ago
    Why didn't you take Bafög?
    - IkmoIkmo 10y ago
      This is just an example of welfare policy issues in general, when edge cases creep up that cause all kinds of problems. It's not a German example however, never lived there. I did receive cheap student loans by the way, but I don't want rack up lots of debt so I liked to work part-time where I could. And even with loans covering tuition fees, for the two of us to live on 950 euros a month (or even 3 when my brother lived with us) is not a great deal even if I didn't have any college costs, or had all of them covered by a state program.
    - eru 10y ago
      I don't know about IkmoIkmo, but I think there are some cases where it's hard to get for some silly reasons.
- eru 10y ago
  > That can happen with any level of generosity in benefits. Yes, the effective marginal tax rate is important here. (And another argument in favour of giving anyone a universal basic income, and just using the normal tax system to claw back benefits from people who earn enough.) An even better system is to just tax land. There are no disincentives with that at all: the supply is fixed.
- surfmike 10y ago
  Definitely agree, and that is part of my point. Under many welfare states, you're worse off (utility and something monetary-wise) after you try to enter the labor market, since you're suddenly working 40 hours a week for almost the same amount of money you got for working 0 hours a week.
bobwaycott 10y ago
This assumes there is a workforce with openings to join. That is becoming an increasingly more difficult problem for many people. It also assumes that it is good for everyone to join the workforce—which itself intrinsically ignores reality, in which there are simply not enough jobs available to reach 100% employment. There is an odd mental hang up, especially in the US, that invariably and automatically views people who receive social benefits in a viscerally negative light, demonizing them in the public sphere and consciousness. This is, to me, an odd choice versus choosing to recognize as a social positive that there are benefits that can be designed and operated correctly to ensure we do not allow people to fall below a minimum living standard. If we want to realize a society in which every able-bodied member is employed in the workforce, I do not believe we can do so without significantly altering the expectation of full-time employment as a standard. I also seriously doubt we can achieve full employment without realigning the world of business and work toward achieving social incentives first, instead of profit incentives.
- surfmike 10y ago
  You need high labor force participation to make a system that can support a strong welfare state. Scandinavian countries have arguably the best welfare states in the world, but they also have the highest labor force participation rates in the world. Indeed their benefits like maternity leave help increase the rate, but I don't think they could support their strong welfare programs with less people working.
facetube 10y ago
One of the major problems I see is that people are generally bad at distinguishing "can't" from "won't". Things like major depression (which, for anyone unfortunate enough to experience it, feels as physical as being chronically poisoned) have a way of turning in to "you're just being lazy".
- surfmike 10y ago
  I agree mental health issues like depression are disabilities that can prevent one from keeping down a job. We should support and treat people with depression as a society. But I think at least for mild depression, living off welfare and not having a job can make things worse and spiral into major depression. From personal experience living in Scandinavia, anxiety and depression are known as easy reasons to get on disability pay and stop working. Of course these are real issues in many cases. But there are people who don't suffer from them and use them as an excuse to get government pay.
  - facetube 10y ago
    Provided a doctor was required to certify that the health condition existed and was disabling, I'd consider myself unqualified to second-guess the existence of a diagnosed health condition. I'd be interested in data over anecdotes – everyone seems to have the latter.

blowski 10y ago

I didn't mean to imply that people who are 'welfare dependent' are workshy layabouts, far from it. I meant it in the 'non-pejorative' sense of "somebody who is dependent on welfare for a majority of their income for a significant period of time". That might be because of illness, or some other reason - I make no judgement. So, going back to the original comment, moving to a small village to make your benefits go further makes it harder to find a job. Thus, you remain on welfare for a longer period of time. On the other hand, if you stay in the city, you're more likely to get a job, but it's also harder to eat and find good accommodation. So these things are difficult. It is clearly a big social problem that people have to face these kinds of difficulties.