5 ms·

>The government subsidizes corporate low wage work But importantly only the lowest of the low wages There is a huge swath of workers that can't get benefits l

>The government subsidizes corporate low wage work But importantly only the lowest of the low wages There is a huge swath of workers that can't get benefits like food stamps or medicaid because they don't qualify via the means testing formula and they can't really afford to live where they live, afford medical insurance etc. Its those folks that have it the worst, IMO. Cost of living keeps you from building any wealth, even in the form of cash savings, but the government has arbitrarily decided you make too much or some other form of disqualification[0]. To add insult to injury, means testing[2] often costs more than the cost of fraud in social benefit programs! Not to mention, the biggest fraudsters with Medicaid are providers not recipients. EDIT: To those whom have questions on the fact that means test cost more than the fraud of social benefit programs, Last Week Tonight did a break down on Medicaid[3] (linked to below) that explains all this better than I can. [0]: often by declaring some aspect of the filing paperwork invalid or the beneficiary unresponsive, more often than not due to errors by the agency rather than the individual(s)[1] [1]: https://www.tampabay.com/news/health/2024/04/12/vulnerable-florida-patients-scramble-after-abrupt-medicaid-termination/ https://www.tampabay.com/news/health/2024/04/12/vulnerable-f... [2]: How an applicant/recipient is screened and continually screened for eligibility [3]: https://www.youtube.com/watch?v=bVIsnOfNfCo https://www.youtube.com/watch?v=bVIsnOfNfCo

VS1999 2y ago
>To add insult to injury, means testing[2] often costs more than the cost of fraud in social benefit programs! Not to mention, the biggest fraudsters with Medicaid are providers not recipients. Intuitively, I'd expect fraud to go up (at least to some degree) as means testing goes down like a differential equation. The depressing part of this is that it doesn't matter what is actually true, or what either of us are convinced is true, as the system will do its own thing.
- AnthonyMouse 2y ago
  "Eliminate means testing" doesn't mean that you stop verifying if someone qualifies for the program, it means that you stop imposing conditions on qualifying for the program, i.e. turn it into a tax credit that everybody gets unconditionally, and adjust rates to compensate. In principle you can do this without affecting the budget at all -- if there is a benefit that phases out at, say, 20% up to $30,000 in income, this is equivalent to paying the benefit unconditionally and increasing the marginal tax rate by 20% in the same income range. All it does is eliminate the application paperwork. In practice the problem is that there are multiple overlapping programs like this, so the poor aren't paying a 20% marginal rate (on top of any formal taxes), it's more like 60-80% and in some cases it even exceeds 100%. This is a poverty trap. But to get out of it while balancing the budget you'd have to use a lower total phase out rate, requiring higher marginal rates on people who make more money. These people -- as much upper middle-class doctors and computer programmers as Jeff Bezos -- then object to this, and so here we are. Of course, another way to do it would be to cut some other government spending and use the money for this.
ilya_m 2y ago
> To add insult to injury, means testing[2] often costs more than the cost of fraud in social benefit programs! This is not informative. The correct comparison would be of the marginal cost of eligibility testing (both in terms of false positives and false negatives) vs the marginal cost of fraud. In other words, whether the current cost of means/asset testing is more than the current total fraud is irrelevant to the economic case for reducing or increasing funding for eligibility screening.
- AnthonyMouse 2y ago
  > The correct comparison would be of the marginal cost of eligibility testing (both in terms of false positives and false negatives) vs the marginal cost of fraud. There is a much better way to do this, because the way we do it is entirely asinine. On the one hand we say that people who make more money should pay higher marginal tax rates, and set marginal rates on lower income people to low or zero rates. On the other hand we demand means testing at lower income rates, which is equivalent to a tax on marginal income. We should just let these things cancel out, using a flat tax that funds unconditional cash benefits (i.e. UBI) and delete an epic amount of unnecessarily complexity.
  - gruez 2y ago
    >On the one hand we say that people who make more money should pay higher marginal tax rates, and set marginal rates on lower income people to low or zero rates. On the other hand we demand means testing at lower income rates, which is equivalent to a tax on marginal income. Isn't this already the case? It's true that you need to means testing to get access to additional benefits, but the tax rate itself is already progressive even if you don't any means testing.
    - AnthonyMouse 2y ago
      Means testing does the opposite of progressive marginal tax rates. It cancels them out by increasing the marginal tax rate on people who make less money, by the amount of the benefit phase out. There is no point in incurring the complexity of doing both at the same time just to have them delete each other. Another way of saying this is that a flat marginal tax rate combined with a fixed-amount universal tax credit (UBI) is a progressive tax system. But it's a much simpler progressive tax system which is harder to game and doesn't result in unintended nonsense like phase out cliffs or higher marginal rates on lower income people than higher income people.
gruez 2y ago
>To add insult to injury, means testing[2] often costs more than the cost of fraud in social benefit programs! The point of means testing isn't to fight fraud, it's to better divert a limited pool of resources to the neediest people. If you have a pool of money to distribute, only giving it to the poorest 25% (ie. means testing) means the recipients can get 4x the money compared to giving it to everyone. Sure, there are ways this can be done badly through onerous requirements or whatever, but the cost of means testing vs the fraud rate is a completely irrelevant metric.
- vlovich123 2y ago
  The problem is that means testing programs often have a cliff where you go from qualifying to not qualifying instead of being a gradual ramp-off. In other words, earning $1 more can remove $100 in support from the government instead of something more reasonable like only removing 10c at the beginning and up to $0.9 if you’re already on your way out. The common criticism of means testing is that more money is spent on the bureaucracy implementing the testing than if you just took the money you otherwise spent on bureaucracy and gave it directly without means testing.
- malfist 2y ago
  I disagree. There's only so much money to go around, if I chose to spend more money on preventing fraud than the fraud would cost, I'm prioritizing righteousness over helping people. If you have funding for 500 people, and fraud would cost you funding for 10 people. If you spend the cost of funding 40 people on fraud prevention, you're harming the 30 people you can no longer fund to keep those 10 from undeserved funding.
pc86 2y ago
This is exactly what Mitt Romney was referring to during the 2012 election when he said he wasn't worried about the very rich, and he wasn't worried about the very poor. The truth is if you are making $20k/yr in income you're likely in a better position day-to-day than someone making $40k/yr, especially if you're raising a family and especially if you live in a city with functioning social services. He was excoriated in the press for saying he didn't care about poor people, which isn't exactly what he said and isn't at all what he meant.
- johnnyanmac 2y ago
  >especially if you live in a city with functioning social services. that may make sense in 2012. In 2024 I am much less optimistic that this is the case.
- ptsneves 2y ago
  Compare that calibre with this year’s roster and it makes me cry. Why didn’t he run a term later?
  - WorkerBee28474 2y ago
    Let's be honest, no matter who the Republicans run, the candidate will be demonized. Only years later, when the person is not a threat to Democrat dominance will people judge them more positively on their actual value like is happening here (and has happened to McCain, and to Bush...). If you don't get points for running a good candidate, there's no incentive to run a good candidate, only one who can win.
    - ptsneves 2y ago
      Heh dont get me wrong. I think Obama is a philosopher king but by giving such emotional speeches and rhetorics he set the stage for very strong reactions. Reactions that bloomed into the awful culture wars of today. At the time I saw Obama as a good politician but the wrong time for it. Mitt Romney was a good candidate that would likely have normalised the tensions post 9/11. Alas it did not happen so.
torginus 2y ago
> means testing[2] often costs more than the cost of fraud in social benefit programs! This is like saying that since robbery is rare, the cost of permitting robbery is lower than funding the police force, thus we should defund the police. Robbery is rare because the police exists
- deleted 2y ago
  [deleted]
- undersuit 2y ago
  >Robbery is rare because the police exists https://www.techdirt.com/2023/07/17/if-the-crime-rate-goes-down-after-half-a-cop-shop-quits-what-are-we-even-paying-for/ https://www.techdirt.com/2023/07/17/if-the-crime-rate-goes-d...
deleted 2y ago
[deleted]
hi-v-rocknroll 2y ago
This is by design, and not an anti-socialist viewpoint, but another way to treat poor people with disrespect and to encourage class warfare between the working semi-poor and very poor. Keep people trapped by a myriad of low arbitrary thresholds rather than tapering off. In America, you're sometimes "better off" making no or almost no money. Also, the benefits are paltry. If you're completely homeless, have no resources, and out-of-work in, say California, per month you will get MediCal*, $240 for food**, $149 in cash "aid", and that's it. There is an inconsistent patchwork of programs to give slightly more benefits that require a certain range of income threshold and specific demographic strings. Most all of these programs treat recipients like criminals and require regular paperwork and significant time, time during work and transportation that the working-poor can least afford. The elderly and disabled qualify for Medicare***, which isn't quite "Cuba-level" health insurance but administered by a for-profit health insurance company under the vague supervision and standards of Medicare who pays for it. Medicare+MedicAid special needs plan (SNP) and Social Security**** is what a disabled or elderly homeless person would typically have. * Same as the federal program known as MedicAid. It is much worse than Obamacare (health insurance for the working poor), and moderately worse than Medicare (for the disabled and the elderly) and almost no regular doctors take it. Providers who do take it usually are far away and usually serve a specific demographic. While it covers emergency care almost completely and some medications, it's not very good. There is significant healthcare bias in America based on health insurance and age. ** "Food stamps" that used to be actual stamps. In the US, the federal program is either SNAP or WIC (pregnant women, infants, and children). *** Medicare is a federal health insurance system comprising many types of plans run by private corporations with a Byzantine patchwork of limitations and benefits. **** Social Security is monthly cash for disabled (SSIDI) and retired people. SSIDI waives work requirements. Non-disabled elderly receive an amount based on how many years they worked and how much income they received, up to a relatively low limit. There is a debate about cutting off income- and/or asset-rich people from receiving Social Security when they don't need it.
citruscomputing 2y ago
Agreed. I really think we'd be better off if EBT was expanded to everyone. Maybe this is a more palatable step into UBI.

VS1999 2y ago

>To add insult to injury, means testing[2] often costs more than the cost of fraud in social benefit programs! Not to mention, the biggest fraudsters with Medicaid are providers not recipients. Intuitively, I'd expect fraud to go up (at least to some degree) as means testing goes down like a differential equation. The depressing part of this is that it doesn't matter what is actually true, or what either of us are convinced is true, as the system will do its own thing.

AnthonyMouse 2y ago
"Eliminate means testing" doesn't mean that you stop verifying if someone qualifies for the program, it means that you stop imposing conditions on qualifying for the program, i.e. turn it into a tax credit that everybody gets unconditionally, and adjust rates to compensate. In principle you can do this without affecting the budget at all -- if there is a benefit that phases out at, say, 20% up to $30,000 in income, this is equivalent to paying the benefit unconditionally and increasing the marginal tax rate by 20% in the same income range. All it does is eliminate the application paperwork. In practice the problem is that there are multiple overlapping programs like this, so the poor aren't paying a 20% marginal rate (on top of any formal taxes), it's more like 60-80% and in some cases it even exceeds 100%. This is a poverty trap. But to get out of it while balancing the budget you'd have to use a lower total phase out rate, requiring higher marginal rates on people who make more money. These people -- as much upper middle-class doctors and computer programmers as Jeff Bezos -- then object to this, and so here we are. Of course, another way to do it would be to cut some other government spending and use the money for this.

ilya_m 2y ago

> To add insult to injury, means testing[2] often costs more than the cost of fraud in social benefit programs! This is not informative. The correct comparison would be of the marginal cost of eligibility testing (both in terms of false positives and false negatives) vs the marginal cost of fraud. In other words, whether the current cost of means/asset testing is more than the current total fraud is irrelevant to the economic case for reducing or increasing funding for eligibility screening.

AnthonyMouse 2y ago
> The correct comparison would be of the marginal cost of eligibility testing (both in terms of false positives and false negatives) vs the marginal cost of fraud. There is a much better way to do this, because the way we do it is entirely asinine. On the one hand we say that people who make more money should pay higher marginal tax rates, and set marginal rates on lower income people to low or zero rates. On the other hand we demand means testing at lower income rates, which is equivalent to a tax on marginal income. We should just let these things cancel out, using a flat tax that funds unconditional cash benefits (i.e. UBI) and delete an epic amount of unnecessarily complexity.
- gruez 2y ago
  >On the one hand we say that people who make more money should pay higher marginal tax rates, and set marginal rates on lower income people to low or zero rates. On the other hand we demand means testing at lower income rates, which is equivalent to a tax on marginal income. Isn't this already the case? It's true that you need to means testing to get access to additional benefits, but the tax rate itself is already progressive even if you don't any means testing.
  - AnthonyMouse 2y ago
    Means testing does the opposite of progressive marginal tax rates. It cancels them out by increasing the marginal tax rate on people who make less money, by the amount of the benefit phase out. There is no point in incurring the complexity of doing both at the same time just to have them delete each other. Another way of saying this is that a flat marginal tax rate combined with a fixed-amount universal tax credit (UBI) is a progressive tax system. But it's a much simpler progressive tax system which is harder to game and doesn't result in unintended nonsense like phase out cliffs or higher marginal rates on lower income people than higher income people.

gruez 2y ago

>To add insult to injury, means testing[2] often costs more than the cost of fraud in social benefit programs! The point of means testing isn't to fight fraud, it's to better divert a limited pool of resources to the neediest people. If you have a pool of money to distribute, only giving it to the poorest 25% (ie. means testing) means the recipients can get 4x the money compared to giving it to everyone. Sure, there are ways this can be done badly through onerous requirements or whatever, but the cost of means testing vs the fraud rate is a completely irrelevant metric.

vlovich123 2y ago
The problem is that means testing programs often have a cliff where you go from qualifying to not qualifying instead of being a gradual ramp-off. In other words, earning $1 more can remove $100 in support from the government instead of something more reasonable like only removing 10c at the beginning and up to $0.9 if you’re already on your way out. The common criticism of means testing is that more money is spent on the bureaucracy implementing the testing than if you just took the money you otherwise spent on bureaucracy and gave it directly without means testing.
malfist 2y ago
I disagree. There's only so much money to go around, if I chose to spend more money on preventing fraud than the fraud would cost, I'm prioritizing righteousness over helping people. If you have funding for 500 people, and fraud would cost you funding for 10 people. If you spend the cost of funding 40 people on fraud prevention, you're harming the 30 people you can no longer fund to keep those 10 from undeserved funding.

pc86 2y ago

This is exactly what Mitt Romney was referring to during the 2012 election when he said he wasn't worried about the very rich, and he wasn't worried about the very poor. The truth is if you are making $20k/yr in income you're likely in a better position day-to-day than someone making $40k/yr, especially if you're raising a family and especially if you live in a city with functioning social services. He was excoriated in the press for saying he didn't care about poor people, which isn't exactly what he said and isn't at all what he meant.

johnnyanmac 2y ago
>especially if you live in a city with functioning social services. that may make sense in 2012. In 2024 I am much less optimistic that this is the case.
ptsneves 2y ago
Compare that calibre with this year’s roster and it makes me cry. Why didn’t he run a term later?
- WorkerBee28474 2y ago
  Let's be honest, no matter who the Republicans run, the candidate will be demonized. Only years later, when the person is not a threat to Democrat dominance will people judge them more positively on their actual value like is happening here (and has happened to McCain, and to Bush...). If you don't get points for running a good candidate, there's no incentive to run a good candidate, only one who can win.
  - ptsneves 2y ago
    Heh dont get me wrong. I think Obama is a philosopher king but by giving such emotional speeches and rhetorics he set the stage for very strong reactions. Reactions that bloomed into the awful culture wars of today. At the time I saw Obama as a good politician but the wrong time for it. Mitt Romney was a good candidate that would likely have normalised the tensions post 9/11. Alas it did not happen so.

torginus 2y ago

> means testing[2] often costs more than the cost of fraud in social benefit programs! This is like saying that since robbery is rare, the cost of permitting robbery is lower than funding the police force, thus we should defund the police. Robbery is rare because the police exists

deleted 2y ago
[deleted]
undersuit 2y ago
>Robbery is rare because the police exists https://www.techdirt.com/2023/07/17/if-the-crime-rate-goes-down-after-half-a-cop-shop-quits-what-are-we-even-paying-for/ https://www.techdirt.com/2023/07/17/if-the-crime-rate-goes-d...

deleted 2y ago

[deleted]

hi-v-rocknroll 2y ago

This is by design, and not an anti-socialist viewpoint, but another way to treat poor people with disrespect and to encourage class warfare between the working semi-poor and very poor. Keep people trapped by a myriad of low arbitrary thresholds rather than tapering off. In America, you're sometimes "better off" making no or almost no money. Also, the benefits are paltry. If you're completely homeless, have no resources, and out-of-work in, say California, per month you will get MediCal*, $240 for food**, $149 in cash "aid", and that's it. There is an inconsistent patchwork of programs to give slightly more benefits that require a certain range of income threshold and specific demographic strings. Most all of these programs treat recipients like criminals and require regular paperwork and significant time, time during work and transportation that the working-poor can least afford. The elderly and disabled qualify for Medicare***, which isn't quite "Cuba-level" health insurance but administered by a for-profit health insurance company under the vague supervision and standards of Medicare who pays for it. Medicare+MedicAid special needs plan (SNP) and Social Security**** is what a disabled or elderly homeless person would typically have. * Same as the federal program known as MedicAid. It is much worse than Obamacare (health insurance for the working poor), and moderately worse than Medicare (for the disabled and the elderly) and almost no regular doctors take it. Providers who do take it usually are far away and usually serve a specific demographic. While it covers emergency care almost completely and some medications, it's not very good. There is significant healthcare bias in America based on health insurance and age. ** "Food stamps" that used to be actual stamps. In the US, the federal program is either SNAP or WIC (pregnant women, infants, and children). *** Medicare is a federal health insurance system comprising many types of plans run by private corporations with a Byzantine patchwork of limitations and benefits. **** Social Security is monthly cash for disabled (SSIDI) and retired people. SSIDI waives work requirements. Non-disabled elderly receive an amount based on how many years they worked and how much income they received, up to a relatively low limit. There is a debate about cutting off income- and/or asset-rich people from receiving Social Security when they don't need it.

citruscomputing 2y ago

Agreed. I really think we'd be better off if EBT was expanded to everyone. Maybe this is a more palatable step into UBI.