A Framework for Thinking About Welfare Policies

Image credit: texaswic.org

If you’ve read much of this blog, you already know that my brain makes sense of the world via exhaustive, mutually exclusive categorizations. And here is that applied to welfare.

Speaking specifically of financial situations, there are three categories of people . . .

  1. Self-sufficient: They currently don’t need external financial support
  2. Temporarily dependent: They need some degree of financial support now, but they have the potential to shift into the self-sufficient category
  3. Permanently dependent: They need some degree of financial support for life

I believe people want to be in the self-sufficient category. Being self-sufficient is fulfilling; it’s an achievement obtained through effort that leads to growth, and humans obtain fulfillment from personal growth.

But humans also want to get the most for the least amount of effort. If it’s unquestionably proven and everyone knows that you can get equally great-looking and strong abs with the Seven-Minute Abs workout or the Eight-Minute Abs workout, nobody would choose the latter unless they get some ancillary benefit from working out for an extra minute.

Welfare efforts, either private or public, need to take into account those two features of humans as they seek to achieve the goals of (1) helping people who are in the self-sufficient category to stay there, (2) financially supporting the people in the temporarily dependent category in a way that promotes their movement into the self-sufficient category, and (3) providing sufficiently for the permanently dependent in a way that preserves their dignity.

But this is only half of the discussion. Remember, there are two groups of people involved in welfare efforts: those to whom the wealth is being provided (the recipients) AND those from whom the wealth is coming (the benefactors). My simple framework above only deals with considerations about the recipients.

And what of the benefactors? Talking specifically about government welfare programs (forced giving “at the point of a gun,” as libertarians would put it), there are several impacts on them that should not be ignored. Forced giving takes away the increased societal cohesion and shared empathy that comes when a benefactor gives to a needy neighbour. Beneficiaries may give more of themselves when they do it voluntarily and when they have more control over how their donation is used (because they are giving in a way that they feel is most efficient and best for the recipients). And when high taxation is instituted for the sake of wealth redistribution (especially if it’s progressive), beneficiaries’ incentives change–their marginal willingness to work and create more jobs and wealth (which will probably end up being used by others rather than themselves if they are already wealthy) is diminished, although the macroeconomic impacts of that are unclear.

There are many other considerations and values that come into play when deciding how best to provide welfare in a society, and I will not try to go through them exhaustively. But I do have a couple other points to make on this topic.

First, it’s ok for people to have different values that lead to different decisions about how best to support those in need. I don’t feel like people generally come to their preferences about this topic based on bad motivations, of which probably the most common accusations are greed and selfishness–“liberals want free stuff from the rich,” and “conservatives don’t care about the poor.” On the contrary, they all seem to be trying to figure out what the right thing to do is, but there are multiple values at play, and it just depends on how you prioritize those values.

Second, people forget that there is a difference between inequality and poverty. The is especially relevant to my post last week about socialism. Is the goal to eliminate wealth disparities, or is it to eliminate poverty? There’s a huge difference. That same question, put a different way, might help clarify the distinction: Is a society morally objectionable if it has eliminated poverty but still allows for significant wealth inequality (assuming the society’s policies are such that it also supports people’s freedom of opportunity to move between classes)? Your answer depends on your core values and beliefs about the goals of a society.

And now you know a little more about why I said I’m torn about where I sit on the welfare spectrum.

3 thoughts on “A Framework for Thinking About Welfare Policies”

  1. Important question, and thoughtful analysis from you, as always Dr. Christensen. Your key point: “Being self-sufficient is fulfilling.” In this regard you will no doubt agree with Viktor Frankl that even more important to folks than getting the most [economic] benefit for least effort is dignity and meaning. I invite you and your readers to check out my take on this issue, what you call “welfare” and I refer to as “free-riding.” Spoiler alert: I challenge the stereotype of the “welfare queen” and I sniff out the scent of structural racism and implicit racism, not to condemn them, but to expose them to the light of day and bring them explicitly into our policy debates. (BTW, I wrote this in Feb 2019 — more than a year before George Floyd!) FixUSHealthcare.blog post: http://fixushealthcare.blog/2019/02/19/healthcare-reform-what-about-free-riders/ I invite more discussion, Socratic dialog and policy debate!

    1. I really appreciate your points in the post you linked to! It is important for sure to take into account the legacy effects of prior discrimination and how they influenced the current culture and opportunities of those groups when making decisions about welfare. And I don’t have an answer for this, but it has to be balanced with the risk that welfare can have on entire groups of people (not just racial groups but socioeconomic groups in general). I saw first-hand growing up in Alberta how the Canadian government has created many problems within the indigenous populations of Canada by giving them all sorts of reparations, so the means of assistance is probably as important as the amount of it.

  2. Dr. Deane Waldman’s Free Articles and Books on Fixing Healthcare. Dr. Waldman exposes the travesty that is today’s American Healthcare System, where more money goes to administrators than to doctors for treatming patients.

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