The combined effect of benefits cutoff is a huge problem. Think of the nationwide productivity loss due to people avoiding employment that would cause loss of b

The combined effect of benefits cutoff is a huge problem. Think of the nationwide productivity loss due to people avoiding employment that would cause loss of benefits. It's called the "welfare cliff". Check out the shocking graph in this article and/or testimony. (same graph) http://www.learnliberty.org/blog/the-welfare-cliff-and-why-many-low-income-workers-will-never-overcome-poverty/ http://www.learnliberty.org/blog/the-welfare-cliff-and-why-m... http://waysandmeans.house.gov/wp-content/uploads/2015/06/Erik-Randolph-Testimony-062515-HR-5.pdf http://waysandmeans.house.gov/wp-content/uploads/2015/06/Eri... Assuming a 40-hour week (which could be 2 jobs) the worker will want to get $12 per hour. That is the local maxima. To get a better final result, after all the welfare and tax considerations, they'd have to earn $38 per hour. So if you have a job paying $12 per hour, and are offered one paying $37 per hour, you'll lose money if you take it. Basically, welfare keeps people down. It keeps them in low-paying jobs because people get punished when they aspire for better.