Even though we are surrounded by scores of information sources, the sheer number is enough to make one go numb. Factoids will be posted periodically to bring you bits of news which may or may not catch your fancy. Most of the Factoids will be posted to bring you counter-intuitive information which may not be covered by traditional news sources; Question: why aren’t they covered? Possibly they may go against the grain of political or cultural “acceptable” thought.  Or perhaps because they cannot fit into the thirty-second sound bites without raising more questions than they answer. Hopefully, you will find some of them of interest!

Who profits from fictitious poverty numbers?

We often hear about the crisis with the Social Security and Medicare programs, but we never seem to hear about any problems with funding for welfare programs. In 2023, means-tested welfare spending totaled $1.6 trillion, and it takes up “72.6% of unobligated general revenue (total revenue net of Social Security and Medicare payroll taxes and premiums and mandatory interest on public debt)”.

What do we get for this huge expenditure? While the official poverty rate has remained stable at about 11.5%, the Supplemental Poverty Rate (SAP) is actually increasing (This indicates that while the official measure stayed the same, the broader measure that includes additional factors like government assistance programs saw a significant rise). How can this be?

One interesting fact about the government’s numbers is that the Census Bureau does not count 88% of transfer payments made to “poor” households. This means that programs such as food-stamp debit cards, free medical care through Medicaid, refundable tax credits (checks from the Treasury) or benefits from about one hundred other Federal transfer payments are not counted as income. If all these transfers of money, services and goods were counted, the total value would have been $64,700 in 2020! Compared to when the War on Poverty began in 1967, this is an increase of 780% in inflation-adjusted dollars. How long do you have to work to net after taxes, $64,700?

So, who does profit from this amazing bit of government math, aside from the recipients? One obvious answer is the Federal government, or to be accurate, the vast bureaucracy which administers these programs. Add to that vast number are the other bureaucrats at the State, County, City, etc. levels of local government. Hundreds of thousands of individuals have a personal stake in creating erroneous numbers and openly report that the trillions of dollars spent on these programs are wasted.

What exactly is the purpose of these programs? Not counting those individuals who have a real need due to physical or mental problems, but looking only at the healthy, is it to help lift them off of welfare and into a productive life, or is it to maintain them at their current level so that hundreds of thousands of bureaucrats lead a middle and upper middle-class lifestyle? That, as people used to say, is the $64,000 question. How long can we spend approximately twice on means-tested welfare than we do on our national defense?

Thanks to Welfare is What’s Eating the Budget, WSJ, 9/12/2024, ppA15, written by Phil Gramm and Jodey Arrington.