Evidence anti-poverty programs work. So why not?

Image result for federal reserve bank of St. Louis.

St. Louis Federal Reserve: “As the sole manufacturer of dollars, whose debt is denominated in dollars, the U.S. government can never become insolvent, i.e., unable to pay its bills.


I’ve been promulgating the Ten Steps to Prosperity (see the end of this post) for several years. It is a program designed to narrow the income/wealth/power Gaps between the rich and the rest of us.

As the St. Louis Federal Reserve and many others say,  federal deficit spending is infinitely affordable for our Monetarily Sovereign government.

Now comes evidence that programs incorporating elements of the Ten Steps do work, though by themselves still are insufficient:

There’s now clear evidence that anti-poverty programs like welfare and Social Security work
By: Ethan Wolff-Mann, Senior Writer, Yahoo Finance, May 11, 2018

Poverty-alleviation programs like food stamps (SNAP), Social Security, and other “welfare” programs are broadly effective at reducing poverty, a new study from University of Chicago researchers found.

Researchers Bruce Meyer and Derek Wu, conducted a more comprehensive analysis than found in most studies, because it used administrative data from the programs’ payment records, not just survey data of recipients from the Census Bureau.

The effectiveness question is often at the crux of the dispute, and the study finally answers it in a more complete way for six major programs: SNAP, Supplemental Security Income (SSI), Temporary Assistance for Needy Families (TANF), Social Security, housing assistance, and the Earned Income Tax Credit (EITC).

Wu told Yahoo Finance. “Even though single-parent are still relatively underserved by the safety net, the effects of certain programs (like Social Security, SSI, and Public Assistance) on their poverty rate more than double when we bring in administrative data.”

Respondents in Census surveys often significantly under-reported the effects of these programs, failing to count 50% of public assistance dollars, 42% of SNAP dollars, and 16% for SSI.

The research found that all programs except for the EITC “sharply” reduces deep poverty, (50% below the poverty line — income of $12,140 for an individual and $20,780 for a family of three).

The EITC has a bigger impact on families around 150% of the poverty line, an income level often described as “working poor.” The researchers called the tax credit, along with SNAP, the “most effective” of the means-tested programs.

For the elderly, Social Security benefits slash poverty by 75%.” Social Security’s overall effect on all poverty is also enormous, responsible for by far the largest poverty reduction among all these programs, the study said.

When it comes to alleviating deep poverty “many of the means-tested transfers (like SSI, SNAP, and housing assistance) play a substantially larger role than Social Security, which pays out more for those who put more in.

The income/wealth/power Gaps constitute the single most important problem in economics.

Wide Gaps negatively affect poverty, health and longevity, education, housing, law and crime, war, leadership, ownership, bigotry, supply and demand, taxation, GDP, international relations, scientific advancement, the environment, human motivation and well-being, and virtually every other issue in economics.

Social benefit programs narrow the Gap between the rich and the rest. Such programs not only are easily affordable for our Monetarily Sovereign government, but they do not lead to an uncontrolled inflation (See: Deficit spending does not cause inflation).

So why have we not instituted the Ten Steps, which would focus on Gap reduction? Answer:

The rich do not want Gap reduction, and they have brainwashed the public into believing help for the poor is immoral and unnecessary.

Gap Psychology, the human desire to separate oneself from those below on economic scales, and to come closer to those above, aids the rich in their brainwashing efforts.

The populace is all-too-ready to believe that the poor are lazy takers, who could, if they wished, lift themselves by the bootstraps. Much of the populace falsely believe that aids to the poor encourage the poor to remain lazy and poor.

Further, the populace has been trained to believe that for the poor to receive benefits while not working is sinful (though perfectly fine for the idle rich).

The notion that the poor are so lazy they prefer poverty to work, has no basis in fact, and is beyond contemptible. But it provides a handy excuse for Gap Psychology.

In summary, there are no economic reasons not to institute the Ten Steps to Prosperity.  They would benefit not only the poor, but the entire economy.

We should begin without further delay.

Rodger Malcolm Mitchell
Monetary Sovereignty
Twitter: @rodgermitchell; Search #monetarysovereignty
Facebook: Rodger Malcolm Mitchell


The single most important problems in economics involve the excessive income/wealth/power Gaps between the have-mores and the have-less.

Wide Gaps negatively affect poverty, health and longevity, education, housing, law and crime, war, leadership, ownership, bigotry, supply and demand, taxation, GDP, international relations, scientific advancement, the environment, human motivation and well-being, and virtually every other issue in economics.

Implementation of The Ten Steps To Prosperity can narrow the Gaps:

Ten Steps To Prosperity:
1. ELIMINATE FICA (Ten Reasons to Eliminate FICA )
Although the article lists 10 reasons to eliminate FICA, there are two fundamental reasons:
*FICA is the most regressive tax in American history, widening the Gap by punishing the low and middle-income groups, while leaving the rich untouched, and
*The federal government, being Monetarily Sovereign, neither needs nor uses FICA to support Social Security and Medicare.
This article addresses the questions:
*Does the economy benefit when the rich can afford better health care than can the rest of Americans?
*Aside from improved health care, what are the other economic effects of “Medicare for everyone?”
*How much would it cost taxpayers?
*Who opposes it?”
3. PROVIDE A MONTHLY ECONOMIC BONUS TO EVERY MAN, WOMAN AND CHILD IN AMERICA (similar to Social Security for All) (The JG (Jobs Guarantee) vs the GI (Guaranteed Income) vs the EB (Economic Bonus)) Or institute a reverse income tax.
This article is the fifth in a series about direct financial assistance to Americans:

Why Modern Monetary Theory’s Employer of Last Resort is a bad idea. Sunday, Jan 1 2012
MMT’s Job Guarantee (JG) — “Another crazy, rightwing, Austrian nutjob?” Thursday, Jan 12 2012
Why Modern Monetary Theory’s Jobs Guarantee is like the EU’s euro: A beloved solution to the wrong problem. Tuesday, May 29 2012
“You can’t fire me. I’m on JG” Saturday, Jun 2 2012

Economic growth should include the “bottom” 99.9%, not just the .1%, the only question being, how best to accomplish that. Modern Monetary Theory (MMT) favors giving everyone a job. Monetary Sovereignty (MS) favors giving everyone money. The five articles describe the pros and cons of each approach.
4. FREE EDUCATION (INCLUDING POST-GRAD) FOR EVERYONE Five reasons why we should eliminate school loans
Monetarily non-sovereign State and local governments, despite their limited finances, support grades K-12. That level of education may have been sufficient for a largely agrarian economy, but not for our currently more technical economy that demands greater numbers of highly educated workers.
Because state and local funding is so limited, grades K-12 receive short shrift, especially those schools whose populations come from the lowest economic groups. And college is too costly for most families.
An educated populace benefits a nation, and benefitting the nation is the purpose of the federal government, which has the unlimited ability to pay for K-16 and beyond.
Even were schooling to be completely free, many young people cannot attend, because they and their families cannot afford to support non-workers. In a foundering boat, everyone needs to bail, and no one can take time off for study.
If a young person’s “job” is to learn and be productive, he/she should be paid to do that job, especially since that job is one of America’s most important.
Corporations themselves exist only as legalities. They don’t pay taxes or pay for anything else. They are dollar-transferring machines. They transfer dollars from customers to employees, suppliers, shareholders and the government (the later having no use for those dollars).
Any tax on corporations reduces the amount going to employees, suppliers and shareholders, which diminishes the economy. Ultimately, all corporate taxes come around and reappear as deductions from your personal income.
7. INCREASE THE STANDARD INCOME TAX DEDUCTION, ANNUALLY. (Also refer to this.) Federal taxes punish taxpayers and harm the economy. The federal government has no need for those punishing and harmful tax dollars. There are several ways to reduce taxes, and we should evaluate and choose the most progressive approaches.
Cutting FICA and corporate taxes would be a good early step, as both dramatically affect the 99%. Annual increases in the standard income tax deduction, and a reverse income tax also would provide benefits from the bottom up. Both would narrow the Gap.
There was a time when I argued against increasing anyone’s federal taxes. After all, the federal government has no need for tax dollars, and all taxes reduce Gross Domestic Product, thereby negatively affecting the entire economy, including the 99.9%.
But I have come to realize that narrowing the Gap requires trimming the top. It simply would not be possible to provide the 99.9% with enough benefits to narrow the Gap in any meaningful way. Bill Gates reportedly owns $70 billion. To get to that level, he must have been earning $10 billion a year. Pick any acceptable Gap (1000 to 1?), and the lowest paid American would have to receive $10 million a year. Unreasonable.
9. FEDERAL OWNERSHIP OF ALL BANKS (Also, click: The end of private banking and How should America decide “who-gets-money”?)
Banks have created all the dollars that exist. Even dollars created at the direction of the federal government, actually come into being when banks increase the numbers in checking accounts. This gives the banks enormous financial power, and as we all know, power corrupts — especially when multiplied by a profit motive.
Although the federal government also is powerful and corrupted, it does not suffer from a profit motive, the world’s most corrupting influence.
10. INCREASE FEDERAL SPENDING ON THE MYRIAD INITIATIVES THAT BENEFIT AMERICA’S 99.9% (Federal agencies)Browse the agencies. See how many agencies benefit the lower- and middle-income/wealth/ power groups, by adding dollars to the economy and/or by actions more beneficial to the 99.9% than to the .1%.
Save this reference as your primer to current economics. Sadly, much of the material is not being taught in American schools, which is all the more reason for you to use it.

The Ten Steps will grow the economy, and narrow the income/wealth/power Gap between the rich and you.


5 thoughts on “Evidence anti-poverty programs work. So why not?

  1. Social Security is NOT “welfare”

    For the elderly, Social Security benefits slash poverty by 75%.” Social Security’s overall effect on all poverty is also enormous, responsible for by far the largest poverty reduction among all these programs, the study said.

    Warren Chamberlain w1uir@aol.com

    Liked by 1 person

  2. Great article in the Chicago Tribune, today. Here are some excerpts:

    The myth of the ‘welfare queen’ endures
    By: Dahleen Glanton

    Republicans are expected to vote this week on a farm bill that once again takes aim at the infamous “welfare queen.” The problem is that she does not exist.

    Though no one has used the term outright in the current debate, this elusive scammer has been at the core of entitlement reform since Ronald Reagan conjured her up in 1976.

    Conservatives refuse to give up their quest to bring down this lazy, scheming, African-American woman who uses her food stamps and other government aid to support a lavish lifestyle with countless jobless men who drift in and out of her bed.

    They have heard about the piles of research and other documentation that prove she is — and always has been — nothing more than a myth. But the only proof they need of her existence is what they feel in their gut.

    Chances are they’ve never crossed paths with her in a grocery store, because they don’t shop in the same neighborhoods. But they’ve heard of someone who knows someone who has seen her in the checkout line paying for filet mignon and lobster with her government-issued debit card.

    Now, with the backing of Donald Trump, House Republicans are setting out to put an end to this conniving user once and for all. In order to continue receiving benefits under the Supplemental Nutrition Assistance Program, or SNAP, she would have to get off her shiftless butt and get a job.

    Never mind that work requirements for the long-term SNAP recipients who do not have children have been in place since 1996.

    The new farm bill imposing stricter work requirements on millions of low-income people receiving food stamps is the latest attempt by Republicans to cleanse the assistance rolls by forcing out people they believe are taking advantage of the system.

    In order to receive about $150 to $185 a month in benefits, SNAP participants between the ages of 18 and 59 would have to prove they are working least 20 hours a week or participating in an equivalent job training program. Those who are disabled or raising a child younger than 6 would be exempt.

    What’s wrong with that, you might ask? Nothing, if you assume that the only people who don’t have jobs are the ones who don’t want them.

    According to the nonpartisan Center on Budget and Policy Priorities, the proposed work requirements ignore important barriers to employment, such as very limited skills, mental health issues like depression, as well as housing, transportation, child care, and other medical and social barriers.

    While a portion of the financial savings would go back to the states to help pay for the job training programs, the new rules would force states to develop large new bureaucracies that do little to increase employment.

    The bottom line is that there’s no evidence such sweeping work requirements would be effective. They likely would serve only to increase hunger and poverty for some 1 million households — with more than 2 million people in them — that would be kicked off the rolls, the center found.

    The truth is that the typical food stamp recipient isn’t an urban black woman at all. She is a white woman.
    And the people who benefit most from food stamps paid for with our hard-earned tax dollars aren’t primarily black kids living in fatherless homes. They are little white kids who would starve to death if the government didn’t step in to help them.

    And that elusive “welfare queen”? She’s just a figment of those Republicans’ uninformed imaginations.
    dglanton@chicagotribune.com Twitter @dahleeng

    As I said, these are excerpts. To see more facts about anti-poverty programs, read the entire article.

    Also see: SNAP has helped millions of families

    Of course, if you are a conservative, facts about anti-poverty won’t matter to you, because your fisceral hatred of the poor has locked the door on facts.


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