Red ink & welfare's failure
A slideshow presented by Pennsylvania's secretary of Public Welfare, Gary Alexander, “Welfare's Failure and the Solution,” graphically illustrates the cost and unsustainability of the state's anti-poverty programs.
Starting with the big picture, a “Pennsylvania Growth Trends” graph shows 10-year expansions, 2001 to 2011, adjusted for inflation, in four categories.
First, the economy in Pennsylvania expanded by a total of 7.4 percent in that 10-year period, while general fund revenues to the state increased by 1.3 percent.
Next are two big jumps in growth in Pennsylvania during that same decade. Poverty was up by 29.9 percent and the Pennsylvania welfare budget ballooned by 36.5 percent.
Note that the welfare budget was up significantly more than the percentage increase in poverty. Additionally, remove the adjustment for inflation and the Pennsylvania welfare budget expanded during those 10 years by 80 percent.
Another slide shows the “Example Household Receiving Welfare Benefits” — “Single mom, two children, lives in Pennsylvania, no disabilities, children are 1 and 4 years old and placed in a Star 4 childcare center.”
The “Star 4” refers to the Keystone Star ranking system in which prekindergarten programs earn a Star 1 to a Star 4.
To get the Star 4 designation, “at least half of lead teachers have a Bachelor's degree in early childhood education, and all have at least an Associate's degree.”
Additionally, Star 4 teachers follow the “PA Early Learning Standards to development curriculum and assessment” and provide “daily updates” on a child's progress and have demonstrated a willingness to jump through a prescribed sequence of centrally designed hoops.
To obtain and maintain the Star 4 stamp of approval, the staff has to “complete continuing education each year” and “receive at least four employee benefits, such as health insurance, which helps to reduce staff turnover” — and helps to reduce the take-home pay of taxpayers who are picking up the tab.
Pennsylvania has two free prekindergarten programs: “Pre-K Counts” for households earning up to 300 percent of the federal poverty level, and Head Start for the “most at risk” who earn 100 percent of the federal poverty level or less.
A “Welfare Cliff” slide illustrates how subsidies for energy, food, day care, tax reimbursements, medical assistance, housing, etc., are cut as earnings increase, thereby delivering a strong and obvious disincentive for upward mobility and work.
A specific example from Pennsylvania's secretary of Public Welfare shows how the state's assistance programs have become a powerful deterrent to work: “The single mom is better off earning gross income of $29,000 with $57,327 in net income and benefits than to earn gross income of $69,000 with net income and benefits of $57,045.”
So why go to school or work harder when the net result is less money? And less leisure.
It was stated often during the recent tax debates in Washington that “the rich” will work less and create fewer jobs if the top marginal tax rate on income is increased from 35 percent to 39.6 percent. If that's true, how can any of us be surprised if people at the other end of the income range “work less” when the government imposes an effective tax of 100 percent on increased earnings?
The result, nationally, as reported by Pennsylvania's secretary of Public Welfare: “For every 1.65 employed persons in the private sector, 1 person receives welfare assistance.”
Ralph R. Reiland is an associate professor of economics at Robert Morris University and a local restaurateur (email@example.com).
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- Starkey: What are Penguins, Pirates up to?
- Capitals dominate overmatched Penguins in win at Verizon Center
- Pennsylvania Gov. Wolf to sign order barring drilling of new oil, gas wells in state forests, parks
- Police stop car in Beltzhoover, find body in back seat
- Lapierre eager to make mark with Penguins
- UPMC, Highmark disagree over payment of medical claims for children
- Coal truck, another hauling beer crash on Route 22
- Dixon vows to fix Pitt’s long-distance dilemma
- IRS scam snares another Westmoreland County resident
- For Penguins coach Johnston, it’s a matter of substance over style
- Penguins notebook: Johnston pleased with Downie’s all-around play