“The history of recent decades has involved replacing what worked with what sounded good.” — Thomas Sowell
According to an old story, a small town in Italy was having a problem with vipers. So the town council established a “viper bounty” to pay people for bringing in dead vipers. The result was that people started breeding vipers in their basements.
This illustrates one of the basic laws of economics: People respond to incentives. They do more of something when the reward increases; they do less of something when the penalty or cost increases.
Much of our public policy suffers from a failure to understand the basics of human behavior. Politicians perceive a problem, rush to pass a law that sounds good, pat themselves on the back, then go on to the next problem. They rarely look back to examine whether their “solution” actually fixed the problem or made it worse. If the program doesn’t work, their answer always is that it needs more money. They never admit that they were wrong.
Consider our many programs to help the poor and vulnerable. We are a caring and generous society. We donate hundreds of billions of dollars and countless millions of hours of our time to helping others. Caring for the vulnerable attracts almost universal support. But good intentions don’t automatically produce good policies.
Shouldn’t the goal of our anti-poverty programs be to help people move up out of poverty? Most if not all of the programs don’t even try to reduce poverty. Instead, they simply hand out money so the poor will be a little less destitute. Those unfortunate people remain in or near poverty, dependent on government sometimes for their entire lives – and their children’s lives.
To paraphrase Winston Churchill: “They want to give you a line where you can wait for a handout… I want to offer you a ladder so you can reach for your dreams.” Democrats measure success by how many people receive assistance. Republicans measure success by how many people no longer need assistance.
The myriad of welfare programs reward people for being poor and penalize those who try to move out of poverty and up the income ladder. Someone who works harder, takes a second job, learns more skills, might earn $10,000 more but lose $15,000 of benefits. Hence, many say “I can’t afford to take that job. I’d lose my benefits!” With perverse incentives like these it is no wonder that we have more people in poverty and fewer people making the effort to better themselves.
New York Times columnist Nicholas Kristof recognized the problem: “This is painful for a liberal to admit, but conservatives have a point when they suggest that America’s safety net can sometimes entangle people in a soul-crushing dependency. Our poverty programs do rescue many people, but other times they backfire.”
Democrats like to claim that they are for the poor, that Republicans are for the rich. The truth is that we Republicans are for all people to have the opportunity to become rich. The Democrats are for policies that keep people poor. If they really cared for the poor, they would fix a system that traps people in poverty. They would reward, not penalize, people who try to better themselves and escape poverty.
Bad policies are condemning people to lifelong poverty, trapping them there, and killing all hope of a better life.
Three simple rules will keep most people out of poverty: “finish high school, get a full-time job, and wait until age 21 to get married and have children.” Follow all three rules and you have just a 2% chance of falling into poverty. Break all three rules and your chance of winding up in poverty is 76%. Tragically, government policies create incentives to break all three rules.
Welfare programs pay more to a teenage girl who has children, and pay less if she gets married, thus violating the third rule. ObamaCare provides a terrible incentive for businesses to limit employees to part-time work. This year 96% of all new jobs are part-time jobs, making it very hard to follow the second rule.
But the worst incentive of all is the government school system in too many parts of the country. In the inner cities the school systems are so bad that half the children drop out before they graduate and half those who do graduate are functionally illiterate. They will never get a decent job or a shot at the American dream.
The politicians and even the teachers know that the schools are terrible. That is why they send their own kids to private or parochial schools. Parents cry out for voucher programs that would let them send their kids to the same good schools that the politicians and teachers use for their kids. But the politicians and teachers care more about teachers’ jobs than they care about the kids whose lives they are destroying.
Did I mention which party runs all of these cities, has held the mayoralties, the city councils, the school boards for more than fifty years? Democrats run the welfare and school systems; they have created the policies that ruin the lives of the recipients of their handouts. And these are the people who say they care for the poor. They like the poor so much that they want more of them.