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While the current policy may be wrong, this issue exists because the issue is hard. You make it sound as if the policy makers are talented engineers who made t

While the current policy may be wrong, this issue exists because the issue is hard. You make it sound as if the policy makers are talented engineers who made the design decision because it was the best compromise on how to deal with the various trade-offs. That's simply not the case. In reality, these welfare policies are a result of a chaotic process of various factions battling to get their hands on dollars. This process is not designed, and the welfare law has simply evolved into a giant mess over the course of many decades. That said, politicians and policymakers are not idiots. They are simply controlled by events larger then themselves. It's the incentives of the political system that are at fault. ( See Government's End by Jonathan Rauch ) How do we subsidise to a minimal level without destroying incentive to work? It's not an easy question to answer. Roll up all the welfare programs into one program - give every American over 21 a check for $10k a year. For people without a job, give a guaranteed government job for $6 an hour. For people who need hands on help, go back to relying on local charities and local government aid. They are closer to the problem and have the right incentives to actually fix things (and empirically, the local welfare systems of the late 1800's worked far, far better than our national system today).

camccann 17y ago
For people without a job, give a guaranteed government job for $6 an hour. This sounds good but in practice would probably be a bad idea, for multiple reasons. The main problem is that government work programs would (by necessity) have to involve jobs that almost anyone is capable of performing, with minimal oversight required. This would be very susceptible to gradually becoming pointless busy-work, variations on the "one person digs a hole, next person fills it back in" pattern. The net result would likely be money spent wasting people's time to do work that creates no value. The ideal goal is to get people into jobs where they're actually creating value, and spending time doing a useless "job" is actually counterproductive because it's time they can't be spending to gain skills or look for other work. We'd be better off paying people $6/hr to get training in a marketable skill, or to search for work matching skills they already have.
- bokonist 17y ago
  Of course it would be make work jobs. But the pay is aimed to be lower than ~98% of the jobs out there. Even McDonald's pays more than $6 an hour. The idea is that this would be a job of last resort. A way for people who can't even hold down a job at McDonald's to at least learn what it means to work. The other point is that it allows people who can't hold down normal jobs not to starve, will not giving them an incentive to go on welfare just because they would rather not work at all. We'd be better off paying people $6/hr to get training in a marketable skill, or to search for work matching skills they already have. Government job training programs have a long history of not working at all. For entry level jobs, the best training is on the job. At a low level, the basic skills needed are: getting to work on time, being reliable, not dropping the f-bomb on your boss, etc. The point of a guaranteed job program is to be that very basic step into the workforce.
  - netcan 17y ago
    You are arguing for a make-work equivalent of dole queues.
netcan 17y ago
You are right. Political systems are not in a good position to design policies in the best possible way. I am completely willing to accept that. But there is some design going on, it is not complete chaos. It's not like neither of these goals has ever had any sort of influence on policy. It isn't as if this is just some big, obvious & uncontroversial policy mistake that everyone would see if they only visit reason.org that politicians have just overlooked. The system, flawed as it is, is "trying" to solve the problem as I articulated, more or less. Take your solution as an example. Don't you think these sort of blog posts could easily criticise it's consequences too? First, the same criticism of perverse incentives applies. It takes more compensation to motivate a person take a job if he already has $10k + $6h/hr. Second, you'd have a lot of people in guaranteed 'make work jobs' that are probably more expensive to run then just giving away money. I'm not yours is a bad idea, but only because the problem is hard. Pretty much every proposed solution is messy & ugly with lots of loose ends & perverse incentives. The elegant solutions can be found on either extreme of the political spectrum where you don't have to worry about one of the conflicting goals. They are also conveniently excused from reality because neither socialism nor capitalism has ever been truly applied.
- bokonist 17y ago
  It isn't as if this is just some big, obvious & uncontroversial policy mistake that everyone would see if they only visit reason.org that politicians have just overlooked. Well, all I can say is this. I've spent too much of my time in life studying politics. I've worked in multiple levels of government ( U.S. Congress, city government, state senate), worked in non-profits trying to help the homeless, tutoring inner city kids, etc. I used to browse my college's social library for fun to read journal articles, and on almost every single issue I've read the top books and articles. My conclusion is that, actually, yes, there is almost always a much, much better, solution, that would make most people much better off, that the political system has simply overlooked. Note, I do not feel this way about things outside of politics and government. At the company I work at, I think the management generally makes the very reasonable decisions given the trade offs involved. But when I worked in government, I thought the process was insane. For a few examples: On the healthcare issue, see my blog post: http://intellectual-detox.com/2009/09/10/the-perfect-healthcare-plan-and-why-well-never-get-it/ http://intellectual-detox.com/2009/09/10/the-perfect-healthc... Or consider Iraq/Afghanistan. If you believe that the U.S. should just get out, then you probably already believe that our current policy is insane. If you believe that the U.S. should stay in and build a workable government/economy, our policy is also insane. For comparison, Britain once ruled Egypt, which at the time had 1/3rd of Iraq's population, with a mere 5,000 soldiers, ruled it so well that Cairo was a notable international destination, and actually turned a profit. The tactics the British used are well documented, and in the end resulted in far, far less bloodshed and collateral damage than our current tactics. Yet we ignore them, and everyone loses. Iraq and Afghanistan remain in chaos and both the Iraqi civilians and the American taxpayer bleed red. Again, insanity. Or consider education: http://steve-olson.com/how-the-public-school-system-crushes-souls/ http://steve-olson.com/how-the-public-school-system-crushes-... and http://www.paulgraham.com/nerds.html http://www.paulgraham.com/nerds.html Again sheer insanity. And again, if you actually study the history and politics of the educational system, you'll find that the system is not the result of balancing hard tradeoffs. It's the result of an insanely dysfunctional political system. And don't even get me started on economics and the financial crisis. Again, I spent a lot of time in the political world and it only slowly grew on me just how insane the system was. I basically went from believing the mainstream academia/NYTimes view ( ie. the American system is flaws, but generally arrives at a workable solution given the constraints) to being legitimately scared at how badly everything is being run. First, the same criticism of perverse incentives applies. It takes more compensation to motivate a person take a job if he already has $10k + $6h/hr. There is still a bit of a disincentive, but it's much, much, much better than a 110% marginal tax rate. Second, you'd have a lot of people in guaranteed 'make work jobs' that are probably more expensive to run then just giving away money. $6 an hour is still a lower wage than ~98% of the jobs out there, so people would still have the incentive to switch to a higher paying, not-make work job.
cabalamat 17y ago
> You make it sound as if the policy makers are talented engineers who made the design decision because it was the best compromise on how to deal with the various trade-offs. That's simply not the case. Indeed; what policy-makers are optimising for is getting themselves re-elected, not helping the economy. > give every American over 21 a check for $10k a year. For people without a job, give a guaranteed government job for $6 an hour. Eminently sensible proposals. The first would be a vote loser because lots of stupid voters would say "but that means giving it to the rich, who don't need it". The second would be resisted by LOSV who would say "but that's socialism!!! it's eeeeeeeeeevil!".

camccann 17y ago

For people without a job, give a guaranteed government job for $6 an hour. This sounds good but in practice would probably be a bad idea, for multiple reasons. The main problem is that government work programs would (by necessity) have to involve jobs that almost anyone is capable of performing, with minimal oversight required. This would be very susceptible to gradually becoming pointless busy-work, variations on the "one person digs a hole, next person fills it back in" pattern. The net result would likely be money spent wasting people's time to do work that creates no value. The ideal goal is to get people into jobs where they're actually creating value, and spending time doing a useless "job" is actually counterproductive because it's time they can't be spending to gain skills or look for other work. We'd be better off paying people $6/hr to get training in a marketable skill, or to search for work matching skills they already have.

bokonist 17y ago
Of course it would be make work jobs. But the pay is aimed to be lower than ~98% of the jobs out there. Even McDonald's pays more than $6 an hour. The idea is that this would be a job of last resort. A way for people who can't even hold down a job at McDonald's to at least learn what it means to work. The other point is that it allows people who can't hold down normal jobs not to starve, will not giving them an incentive to go on welfare just because they would rather not work at all. We'd be better off paying people $6/hr to get training in a marketable skill, or to search for work matching skills they already have. Government job training programs have a long history of not working at all. For entry level jobs, the best training is on the job. At a low level, the basic skills needed are: getting to work on time, being reliable, not dropping the f-bomb on your boss, etc. The point of a guaranteed job program is to be that very basic step into the workforce.
- netcan 17y ago
  You are arguing for a make-work equivalent of dole queues.

netcan 17y ago

You are right. Political systems are not in a good position to design policies in the best possible way. I am completely willing to accept that. But there is some design going on, it is not complete chaos. It's not like neither of these goals has ever had any sort of influence on policy. It isn't as if this is just some big, obvious & uncontroversial policy mistake that everyone would see if they only visit reason.org that politicians have just overlooked. The system, flawed as it is, is "trying" to solve the problem as I articulated, more or less. Take your solution as an example. Don't you think these sort of blog posts could easily criticise it's consequences too? First, the same criticism of perverse incentives applies. It takes more compensation to motivate a person take a job if he already has $10k + $6h/hr. Second, you'd have a lot of people in guaranteed 'make work jobs' that are probably more expensive to run then just giving away money. I'm not yours is a bad idea, but only because the problem is hard. Pretty much every proposed solution is messy & ugly with lots of loose ends & perverse incentives. The elegant solutions can be found on either extreme of the political spectrum where you don't have to worry about one of the conflicting goals. They are also conveniently excused from reality because neither socialism nor capitalism has ever been truly applied.

bokonist 17y ago
It isn't as if this is just some big, obvious & uncontroversial policy mistake that everyone would see if they only visit reason.org that politicians have just overlooked. Well, all I can say is this. I've spent too much of my time in life studying politics. I've worked in multiple levels of government ( U.S. Congress, city government, state senate), worked in non-profits trying to help the homeless, tutoring inner city kids, etc. I used to browse my college's social library for fun to read journal articles, and on almost every single issue I've read the top books and articles. My conclusion is that, actually, yes, there is almost always a much, much better, solution, that would make most people much better off, that the political system has simply overlooked. Note, I do not feel this way about things outside of politics and government. At the company I work at, I think the management generally makes the very reasonable decisions given the trade offs involved. But when I worked in government, I thought the process was insane. For a few examples: On the healthcare issue, see my blog post: http://intellectual-detox.com/2009/09/10/the-perfect-healthcare-plan-and-why-well-never-get-it/ http://intellectual-detox.com/2009/09/10/the-perfect-healthc... Or consider Iraq/Afghanistan. If you believe that the U.S. should just get out, then you probably already believe that our current policy is insane. If you believe that the U.S. should stay in and build a workable government/economy, our policy is also insane. For comparison, Britain once ruled Egypt, which at the time had 1/3rd of Iraq's population, with a mere 5,000 soldiers, ruled it so well that Cairo was a notable international destination, and actually turned a profit. The tactics the British used are well documented, and in the end resulted in far, far less bloodshed and collateral damage than our current tactics. Yet we ignore them, and everyone loses. Iraq and Afghanistan remain in chaos and both the Iraqi civilians and the American taxpayer bleed red. Again, insanity. Or consider education: http://steve-olson.com/how-the-public-school-system-crushes-souls/ http://steve-olson.com/how-the-public-school-system-crushes-... and http://www.paulgraham.com/nerds.html http://www.paulgraham.com/nerds.html Again sheer insanity. And again, if you actually study the history and politics of the educational system, you'll find that the system is not the result of balancing hard tradeoffs. It's the result of an insanely dysfunctional political system. And don't even get me started on economics and the financial crisis. Again, I spent a lot of time in the political world and it only slowly grew on me just how insane the system was. I basically went from believing the mainstream academia/NYTimes view ( ie. the American system is flaws, but generally arrives at a workable solution given the constraints) to being legitimately scared at how badly everything is being run. First, the same criticism of perverse incentives applies. It takes more compensation to motivate a person take a job if he already has $10k + $6h/hr. There is still a bit of a disincentive, but it's much, much, much better than a 110% marginal tax rate. Second, you'd have a lot of people in guaranteed 'make work jobs' that are probably more expensive to run then just giving away money. $6 an hour is still a lower wage than ~98% of the jobs out there, so people would still have the incentive to switch to a higher paying, not-make work job.

cabalamat 17y ago

> You make it sound as if the policy makers are talented engineers who made the design decision because it was the best compromise on how to deal with the various trade-offs. That's simply not the case. Indeed; what policy-makers are optimising for is getting themselves re-elected, not helping the economy. > give every American over 21 a check for $10k a year. For people without a job, give a guaranteed government job for $6 an hour. Eminently sensible proposals. The first would be a vote loser because lots of stupid voters would say "but that means giving it to the rich, who don't need it". The second would be resisted by LOSV who would say "but that's socialism!!! it's eeeeeeeeeevil!".