Feeds:
Posts
Comments

Archive for the ‘Welfare’ Category

The Moocher Hall of Fame highlights people who have some special trait that sets them apart from normal welfare recipients. They may get on the list because they are undeservingly rich, malignantly evil, incredibly entitled, or downright weird.

I also have a terror wing in the Hall of Fame. Though I’ve had to become selective since it turns out that just about every nutcase terrorist in the western world mooches off taxpayers.

And now I’m thinking I need a new wing. I’m not sure what to call it, but it’s for the middlemen or wholesalers who engage in industrial-level fleecing of taxpayers.

To give you an idea of what I mean, here are some excerpts from a story in  Newsweek about some Chicago-based scamming.

…the grandmother was actually conducting a simple unemployment insurance scam, one that stole almost $7 million from the state of Illinois, attracted a federal investigation and on Monday earned Garcia a four-year prison sentence. Garcia would pass out business cards at gas stations and on some days 10 to 15 people would walk into her office and hire her to file unemployment insurance claims for them, according to court papers filed by federal prosecutors. Many of her clients were Mexican-born immigrants without lawful immigration status or work permits, which made them ineligible for unemployment benefits. …She also kept a list of U.S. cities near the Mexican border, handwritten and neatly organized, and selected from it when filling out a client’s application. …Garcia told the informant she had clients who used false Social Security numbers for five or six years without problems, and that nine out of 10 applications were approved.

I have a couple of thoughts about this story. First, why isn’t she in jail for longer? Second, why isn’t her daughter also in jail?

But most important, why is government so blindly incompetent that it makes us all have Social Security numbers, but then it doesn’t actually have some sort of system to match names and numbers on things like unemployment forms?!?

It’s almost as if government is a big incompetent blob.

Here’s another story about a welfare middleman, though this is also a case where it’s a woman who is ripping off taxpayers.

Convenience store owner Vida Ofori Causey out of Worcester, Mass. was charged in federal court Monday after pleading guilty to $3.6 million worth of food stamp fraud. …She was able to scam the program by buying food stamp benefits from receipts for half the actual value. …As a result, recipients had cash on hand to buy restricted items. The restricted items could include alcohol, cigarettes and even drugs.

Since there’s a long history of fraud in the food stamps program, I’m not surprised that this happened.

Though I’m impressed (in a bad way) about the magnitude. It takes a lot of dishonest recipients combining with one evil woman to produce $3.6 million in fraud.

Last but not least, here’s a really disturbing story about a moocher who very appropriately has been jailed for life.

For 10 years, the group targeted mentally disabled people, luring those who were vulnerable and estranged from their families and locking them inside cabinets, basements and attics, according to prosecutors. The group’s ringleader, Linda Weston, persuaded the victims to allow her to become their representative and began collecting their disability benefits. The victims, prosecutors said, lived in the dark and in isolation, and were fed food laced with drugs to keep them sedated; they were brutally punished if they tried to escape. On Thursday, a federal judge sentenced Weston, 55, to life in prison — plus 80 years — for her role in the scheme. …The case horrified Philadelphia, where in 2011 a landlord discovered four disabled adults locked inside a boiler room, NBC reported. …The group ran the operation in three other states, prosecutors said. …victims were forced to live in attics naked…were fed a diet of Ramen noodles, beans or stew just once a day. …Some were encouraged to have children in order to collect more benefits. …The group stole more than $200,000 in Social Security benefits from victims, some of whom were forced into prostitution.

By the way, all three stories today feature women, so America truly is a land of opportunity for reprehensible people of both sexes. So perhaps the bottom line is that I need a female wing in the Moocher Hall of Fame.

You’ve come a long way, baby!

P.S. Since today’s topic is about bad people who are financed by handouts, I’ll include some less-then-surprising news from the United Kingdom about another welfare-financed terrorist.

The ringleader of the London terror attack was bankrolled by the taxpayer, it has been revealed. Khuram Butt, 27, was claiming Jobseeker’s Allowance of around £300 a month, and was also paid housing benefit for his council-owned flat in Barking as well as child benefit. …Butt was a supporter of al-Muhajiroun and an associate of its leader Anjem Choudary, who encouraged his followers to exploit Britain’s welfare system. The jailed hate preacher even used the phrase ‘Jihad Seeker’s Allowance’.

Since the suicide bomber in Manchester also was leeching off taxpayers, we’ve reached the point where it will be more newsworthy if we find a self-sufficient terrorist.

P.P.S. I hope these are the virgins that greet Khuram in paradise.

Read Full Post »

There are a lot of positive things to be said about Norway.

In other words, Norway is a typical Nordic nation, with open markets, light regulation, free trade, and honest government. That’s the good news.

The bad news, at least from my perspective, is that Norway also is a typical Nordic nation in that it has a big welfare state.

But unlike the other Nordic nations, Norway also has a lot of oil. And, just like Alaska, it’s very easy to finance a big public sector when a government has access to a huge amount of petroleum-related revenue.

So does this make the country special? Is Norway a welfare-state Nirvana? In some sense, the answer is yes. As I’ve noted before, if a country wants a big welfare state, it makes a lot of sense to have very market-oriented policy in other areas to compensate. And if the country also happens to be rich with oil, that’s presumably not a bad combination.

But I would argue, of course, that Norway would be in better shape if the fiscal burden of government wasn’t so onerous.

And there’s growing evidence to validate my concerns. Bloomberg reports that falling oil prices are exposing problems with Norway’s extravagant welfare state.

More than a fifth of its working age population relied on unemployment or sick-leave benefits throughout 2016, according to a study by the Norwegian Labor and Welfare Administration, or NAV. With welfare payments up 3 percent in 2016, the growing dependence will likely make it harder for Norway to wean itself off oil and gas production. While the discovery of petroleum 50 years ago…helped make the world’s most generous welfare system possible — declining resources…means that the country will need to find other legs to stand on to keep up its standard of living.

Norway isn’t in any immediate danger, but I wonder whether it can still prosper when the oil runs out.

Simply stated, the welfare state may have eroded the country’s work ethic (something that’s also a problem in America).

That’s something that the stewards of the system readily admit. The agency’s acronym has even become a verb, to NAV, which means `being on benefits.’ “To uphold the Norwegian welfare system we need more people at work and not on passive benefits,” said Sigrun Vageng, the head of NAV, in an emailed answered to questions.

The problem of dependency has even spread to the richer parts of the country.

…dependency on state handouts now runs deeper. It also spread to the nation’s richest regions after the plunge in oil prices… Welfare payments in Rogaland, the regional center of the oil industry and home to Statoil ASA, rose a whopping 13 percent last year. Some 19 percent received benefits on average each month in Rogaland. In Oslo, it was 15 percent.

And once there are too many people riding in the wagon of government dependency, it’s not easy to rejuvenate a nation’s social capital.

…with an increasing share of its working age population on welfare benefits instead of paying taxes, the desired changes could prove a difficult task for whoever is in power. And many are also pulling out of the workforce altogether. The percentage of people of working age in employment fell to 70.6 percent in 2016, a 21-year low… “This comes as a big cost for the society, both through lost tax revenues and the direct expenses from social benefit payments,” said Jeanette Strom Fjaere, an economist at DNB.

On the bright side, Norway has set aside lots of oil money.

Norway…has over the past 20 years built up a sovereign wealth fund.

In other words, Norway is the opposite of Venezuela. It hasn’t squandered its oil wealth on bigger government.

On the dark side, it has reached the point where its sovereign wealth fund is shrinking rather than growing.

…the government last year started withdrawing cash for the first time.

Some people say this is similar to America’s Social Security system, which has a Trust Fund that is now being depleted. I reject that analogy for the simple reason that Norway’s fund is filled with real assets. The Social Security Trust Fund, by contrast, is nothing but a pile of IOUs (as even the Clinton Administration acknowledged).

But I’m digressing. Let’s close by observing that development economists sometimes write about a “resource curse” that exists when politicians feel they can impose lots of bad policy because it is easy to generate revenue by selling natural resources.

Some argue that Norway, with its commitment to the rule of law and markets, is the exception to the rule. Yes, its welfare state is excessive, but not because of oil. Indeed, there’s more welfare spending as a share of GDP in Denmark, Sweden, and Finland.

Though don’t forget that Norway’s GDP is boosted by all the oil wealth, so I’m guessing per-capita welfare outlays are higher than in neighboring countries (an important distinction, as illustrated by this data on government health spending).

So perhaps a version of the resource curse will hit Norway. But it won’t be because of a Venezuelan-style kleptocracy. Instead, it will be because the welfare state lures too many people into dependency. And when the oil money runs out, fixing that problem will be very difficult.

Read Full Post »

Whenever there’s a terrorist attack, I automatically feel a combination of anger, horror, and sadness. Like all normal people.

But it’s then just a matter of time before I also begin wonder whether we’ll learn that the dirtbag terrorist was financed by welfare.

Which is an understandable reaction since that’s now the normal pattern. Over and over and over and over and over again, we learn that taxpayers were supporting these murderous losers while they plotted and planned their mayhem.

And it’s not random. They’re actually told by hate-filled Imams to sign up for handouts. And European courts protect terrorist households that use welfare to finance death and destruction.

It’s gotten to the point where I even created a special terror wing in the Moocher Hall of Fame.

And it’s happened again. The piece of human filth who murdered 22 people at a concert in Manchester was able to finance his terrorism with handouts from the British government.

The Telegraph has some of the odious details about tax-financed death and destruction.

Salman Abedi is understood to have received thousands of pounds in state funding in the run up to Monday’s atrocity even while he was overseas receiving bomb-making training. Police are investigating Abedi’s finances, including how he paid for frequent trips to Libya where he is thought to have been taught to make bombs at a jihadist training camp. …Abedi’s finances are a major ‘theme’ of the police inquiry amid growing alarm over the ease with which jihadists are able to manipulate Britain’s welfare and student loans system to secure financing. One former detective said jihadists were enrolling on university courses to collect the student loans “often with no intention of turning up”.

But he probably accessed other types of benefits as well, particularly since he never worked and had plenty of cash.

…the Department for Work and Pensions refused to say if Abedi had received any benefits, including housing benefit and income support worth up to £250 a week, during 2015 and 2016. Abedi, 22, never held down a job, according to neighbours and friends, but was able to travel regularly between the UK and Libya. Abedi also had sufficient funds to buy materials for his sophisticated bomb while living in a rented house in south Manchester. Six weeks before the bombing Abedi rented a second property in a block of flats in Blackley eight miles from his home, paying £700 in cash. He had enough money to rent a third property in the centre of Manchester from where he set off with a backpack containing the bomb. Abedi also withdrew £250 in cash three days before the attack and transferred £2,500 to his younger brother Hashim in Libya

Time for another example. Remember the piece of human garbage in London who mowed down some innocent people with his car before murdering a policeman?

Well, he also was subsidized by taxpayers.

Khalid Masood, the radical ISIS terrorist responsible for London’s Westminster terror attack, did not have a job and was receiving government benefits before engaging in his attack. …Masood had a violent criminal history, including several knife attacks. …Terrorists receiving government welfare is a common theme discovered in many post-terror attack investigations.

Seems like Abedi and Masood should have had their own episode of “Benefits Street.”

There are also new reports on welfare-subsidized terror from continental Europe.

A story in USA Today offers a depressing summary.

Governments across Europe have accidentally paid taxpayer-funded welfare benefits such as unemployment funds, disability pensions and housing allowances to Islamic State militants who have used the money to wage war in Iraq and Syria, authorities and terrorism experts say. Danish officials said this week that 29 citizens were given $100,000 in public pension benefits because they were considered too ill or disabled to work, and they then fled to Syria to fight for the radical group. …Other countries that also have paid benefits to Islamic State fighters…It took eight months before welfare authorities cut off benefits paid to a Swedish national who had joined the terror group in its Syrian stronghold Raqqa. …Authorities concluded that several of the plotters in the Brussels and Paris terror attacks that killed 162 people in 2015 and 2016 were partly financed by Belgium’s social welfare system while they planned their atrocities. …radical Islamic cleric Anjem Choudary, who was jailed for terrorist activities, urged followers to claim “jihadiseeker’s allowance” — a reference to the nation’s welfare system. His phrase echoes a manual released by the militant group in 2015. How to Survive in the West: A Mujahid Guide advises that “if you can claim extra benefits from a government, then do so.”

By the way, I don’t know whether to laugh or cry about the Belgian government’s response.

Are they reducing the welfare state? Of course not.

But you’ll be happy to know that imprisoned radicals lose access to the government teat.

Philippe de Koster, director of Belgium’s agency that fights money laundering and terrorism financing, said steps have since been taken to prevent that from happening again. For example, those convicted of terrorism can no longer receive benefits while in jail.

I’ve already written about welfare-subsidized terrorism in the Nordic nations.

Here’s another story about developments in Scandinavia.

The report examined hundreds of individuals who left to join extremist groups such as Islamic State (IS, formerly ISIS/ISIL) between 2013 and 2016. Commissioned at the request of the Financial Supervisory Authority, it has found that the majority was still receiving living allowance, child benefit, maintenance support and parental benefits while abroad, having other people handle their mail to make it look like they were still at home.

The problem seems especially acute in Sweden.

Close to every person who left Sweden to fight for terror groups in the Middle East received welfare to support themselves abroad, according to a new government report. A study of 300 Swedish citizens who fought in Syria and Iraq between 2013 and 2016 shows jihadis are getting increasingly good at getting away with welfare fraud. The individuals often use a person in Sweden to handle paperwork and create the illusion that they’re still in the country. …The most attractive option are government loans to study abroad. The loans are easy to get and thousands of dollars are paid out at once. …The Danish Security and Intelligence Service (PET) recently identified several cases of Danish citizens receiving early pension because they were deemed too sick or disabled to work. They later left the country to fight for Islamic State while the payments continue to get deposited into their accounts. …PET has tried to cut off the benefits since 2014, but current legislation doesn’t allow the payment agency to cut early pensions simply because the recipient is believed to be a terrorist.

Let’s close with something that it either astounding or depressing, or actually both. All of the examples cited above are nations with bloated welfare states. Governments in all those countries consume more than 40 percent of economic output, and more than 50 percent of GDP in some cases.

Belgium is in that latter category, yet one official actually said that it was very difficult to fight terrorism “due to the small size of the Belgian government.”

To me, this is a reminder that the natural incompetence of government becomes worse the bigger it gets.

P.S. Today’s column mocks European government for welfare-subsidized terrorism, but American readers should be careful about throwing stones in glass houses.

The dirtbags who bombed the Boston Marathon were mooching off taxpayers.

And the U.S. refugee program includes automatic eligibility for handouts, making it, in part, a “terrorist-funding welfare scam.”

P.P.S. I suppose a concluding caveat would be appropriate. I’m not making an argument that welfare causes terrorism. That almost would be as silly as the leftists who claim that terrorism is caused by inequality or climate change. Though I do wonder whether people who get government handouts feel a sense of self-loathing that leaves them vulnerable to jihadist ideology.

Read Full Post »

Certain redistribution programs are called “entitlements” because anybody who meets various criteria is “entitled” to automatically get money or other benefits.

Economists worry that such programs (particularly the “means-tested” entitlements) create perverse incentives since some people will choose to work less and earn less in order to maximize the amount of handouts they receive. Such behavior is immoral, but understandable. People learn that if they make sacrifices and work more, the reward is taxation, whereas if they work less (or not at all), the reward is freebies from the government.

And the problem presumably is worse in places where there is a greater amount of redistribution (if you’re curious, here’s the data on which states and countries have the most profligate package of benefits).

But the problem goes beyond simply luring people into idleness with bad incentives. When politicians create programs that give away money, they also create opportunities for outright fraud. Which is a pervasive problem, as illustrated by these examples.

Let’s travel to Minnesota to get a sense of the magnitude of the problem.

Minnesota’s Pioneer Press reports on a government audit that found one-third of welfare recipients improperly received handouts.

A review by Minnesota’s legislative auditor has found that some of Minnesota’s welfare programs do a poor job of ensuring benefits don’t go to ineligible people… It found significant error rates in the Temporary Assistance For Needy Families program, which provides cash and other benefits to low-income families with children. …the audit found eight of 24 families it reviewed weren’t eligible for benefits they received.

That’s not a large sample size, so we don’t know if the actual overall error rate is higher or lower than 33 percent, but the audit certainly suggests that there is a major problem.

It’s also not clear how much of the problem is caused by accident and how much is caused by fraud. Presumably the latter, but it’s quite possible that some people aren’t knowingly bilking the system.

But in some cases, there’s no ambiguity. The Sun has a horror story about a stunning case of welfare fraud.

Fozia Dualeh, 39, was charged with felony theft in Anoka County District Court, as prosecutors say she received $118,000 in government aid over roughly an 18 month period. According to the complaint, Dualeh exploited three public benefit programs from January 2015 to August 2015 which included $24,176 in food support, $85,582 in child care assistance and $8,996 in medical assistance overpayments.

Wow, almost $120K over 1-1/2 years. That’s an impressive haul, though perhaps not too surprising given the dozens of handout programs that – when combined – make idleness relatively lucrative.

In any event, Ms. Dualeh claimed she was eligible for that huge package of handouts because her husband was no longer part of the family.

But that wasn’t true.

A search of the home by authorities in late October 2015 led to the discovery of Dualeh’s husband, who is also the children’s father, Abdikhadar Ismail, hiding under a blanket in the master bedroom, charges said. Several articles of mens clothing were found in a chest, as well as numerous documents and mail throughout the home belonging to Ismail. Ismail also listed the family’s address on two vehicles and with his employer, a residential health care business.

Given the large sums of money involved, the Center of the American Experiment probably deserves an award for most-understated headline on this issue.

Though at the risk of being a pedantic libertarian, I would prefer if the headline said “Lucrative” instead of “Profitable.” After all, as Walter Williams has explained that profit is a meritorious reward for serving others.

But we can all probably agree that Ms. Dualeh deserves membership in the Moocher Hall of Fame.

P.S. I wouldn’t be surprised if Ms. Dualeh was introduced to the welfare system thanks to America’s poorly designed refugee program.

P.P.S. On the broader issue of redistribution and economics, this Wizard-of-Id parody contains a lot of insight about labor supply and incentives. As does this Chuck Asay cartoon and this Robert Gorrell cartoon.

Read Full Post »

Whenever mass shootings occur, some people quickly jump to conclusions before there’s any evidence.

Folks on the right are occasionally guilty of immediately assuming Islamic terrorism, which is somewhat understandable. Folks on the left, meanwhile, are sometimes guilty of instinctively assuming Tea Party-inspired violence (I’m not joking).

I confess that I’m prone to do something similar. Whenever there is a terrorist attack, I automatically wonder if we’ll find out welfare payments and other goodies from the government helped subsidize the evil actions.

In my defense, there’s a reason I think this way. Whether we’re talking about Jihadi John or the Tsarnaev brothers, there are lots of examples of dirtbag terrorists getting handouts from taxpayers.

It happens a lot in other nations. And it’s now happening with disturbing frequency in the United States.

It’s even gotten to the point where I’ve created a special terror wing in the Moocher Hall of Fame. And, as more evidence accumulates, the medieval savage who drove a truck through a Christmas market in Germany may be eligible for membership.

Here’s some of what we know, as reported by the Daily Caller.

Berlin truck attack terrorist Anis Amri used several different identities to claim multiple welfare checks simultaneously in different cities around Germany. Amri, the Tunisian refugee who killed 12 and injured 48 at a Christmas market in Berlin Dec. 19… The investigation was closed in November because Amri’s whereabouts were unknown. …Welfare is a common way for terrorists to fund their activities in Europe.

The U.K.-based Express reveals that the terrorist was very proficient at ripping off taxpayers before deciding to kill them.

Despite being shot dead in Italy just days after the attack, the Tunisian refugee is now under investigation for fraud after conning German authorities into handing over cash to fund his terror exploits. After travelling from Tunisia to Europe in 2011, he used up to eight different aliases and several different nationalities – at times even claiming to be from Egypt or Lebanon. Reports claim Amri carried several different false identity documents and used aliases to collect welfare in cities across Germany.

The story also has details on how welfare payments subsidized previous terrorist actions.

Welfare fraud was key to funding terror attacks in Brussels in March and in Paris last year. Terrorists collected around £45,000 in benefits which they used to pay for the brutal attacks in the major European cities. …Meanwhile, Danish authorities came under fire recently after it emerged 36 Islamic State fighters continued to receive benefits for months after leaving the country to join other members of the brutal regime in Syria and Iraq.

And while I’m not sure RT is a legitimate news source, it says Amri used 14 identities for mooching.

Anis Amri, the Tunisian man accused of driving a truck into a crowd of Christmas market shoppers in Berlin, used at least 14 different identities, a German police chief said. …Among other things, this allowed the man to receive social benefits under different names in different municipalities, the police chief said.

A close associate (and suspected co-conspirator) of Amri also was mooching off the system according to news reports.

A spokeswoman for the office of Germany’s chief prosecutor on Wednesday said authorities have taken a second Tunisian suspect into custody following raids in Berlin on Tuesday. …However, she added that there was insufficient evidence to charge the suspect. In a separate statement, the federal prosecutor’s office announced the man had been charged with committing social welfare fraud and would remain in custody. …the suspect had previously been detained on suspicion of supplying explosives intended for a prospective attack in Dusseldorf. …The 26-year-old suspect allegedly had dinner with Amri at a restaurant the night before the attack, according to Köhler. The suspect allegedly met Amri in late 2015. “Süddeutsche Zeitung” reported that the two men traveled together from Italy to Germany that year.

Gee, sounds like a model citizen. Merkel must be proud of her caring and sharing welfare state.

Last but not least, a story in the U.K.-based Telegraph has some added details on the sordid history of welfare-funded terrorism in Europe.

The jihadists suspected of carrying out the bomb and gun attacks in Paris and Brussels used British benefits payments to fund international terrorism, a court has heard. …Zakaria Bouffassil, 26, from Birmingham is accused of handing over the cash which had been withdrawn from the bank account of Anouar Haddouchi, a Belgian national, who had been claiming benefits while living in the West Midlands with his wife. Kingston Crown Court heard how thousands of pounds of taxpayers’ money continued to be paid into Haddouchi’s bank account, even after he had left Britain for Syria and had begun fighting for Islamic State in Iraq and Levant (Isil). …On the opening day of their trial, jurors heard how some of the most notorious and wanted terrorists in Europe had used British taxpayers’ money to fund their activities in Syria and elsewhere.

Though I suppose I shouldn’t say “sordid history.” This is more like societal suicide.

After all, we’re not talking about welfare payments for a tiny fraction of terrorists. It really is a theme.

I linked to some examples above, and if you want more evidence, click here, here, here, here, and here.

By the way, I’m not claiming that welfare causes terrorism. Though I do wonder if Mickey Kaus has a point when he does make that link.

…extreme anti-social terrorist ideologies (radical Islam, in particular) seem to breed in “oppositional” cultures supported by various government welfare benefits. …The social logic is simple: Ethnic differences make it easy for those outside of, for example, French Arab neighborhoods to discriminate against those inside, and easy for those inside to resent the mainstream culture around them. Meanwhile, relatively generous welfare benefits enable those in the ethnic ghetto to stay there, stay unemployed, and seethe. Without government subsidies, they would have to overcome the prejudice against them and integrate into the mainstream working culture. Work, in this sense, is anti-terrorist medicine.

I don’t particularly like government-provided welfare of any kind, but I definitely think there should be strict rules against handouts for immigrants. And if that makes them less susceptible to terrorist ideologies, that’s a big fringe benefit.

P.S. It goes without saying that politicians aren’t trying to subsidize terrorism. It’s just a byproduct of bad policy. They do, however, explicitly and deliberately subsidize terrorism insurance for big companies. A rather unique example of corporate welfare.

Read Full Post »

Learning from the tremendous success of welfare reform during the Clinton Administration, the entire Washington-based welfare state should be junked.

It’s a complicated and costly mess that traps poor people in dependency while ripping off taxpayers and creating very comfortable lives for “poverty pimps.”

It would be much simpler (and more effective) to simply take all the money that’s now being spent on these programs and send it to the states as part of a “block grant” and let them figure out how best to help poor people without some of the negative consequences caused by the current plethora of programs.

I’ve previously written about how this would be a very desirable reform of Medicaid. Today, let’s build upon some previous analysis and explain why it would be good to get Washington out of the business of Food Stamps.

Let’s start with the fact that the program subsidizes purchases that have nothing to do with avoiding genuine hunger and deprivation. Indeed, as documented in a story in The Federalist, Food Stamps subsidize a considerable amount of unhealthy food.

New data from the U.S. Department of Agriculture reveals food stamp recipients spent more money on sweetened beverages than they did on fruits, vegetables, bread, cereal, or milk. The USDA analyzed transactional data from a leading grocery store in 2011 and found that Supplemental Nutritional Assistance Program (SNAP) households spent a greater percentage of money on unhealthier foods than those who didn’t use taxpayer funds to pay for their groceries. …The recent USDA study only looked at data from one grocery store retailer. It did not examine how SNAP funds were spent at convenience stores, which presumably would have significantly increased the amount of unhealthy foods purchased with taxpayer dollars.

Here are some of the details.

…The second largest expenditure for SNAP households was sweetened beverages, whereas the second largest expenditure for non-SNAP households was vegetables. …SNAP households spent 7.2 percent of their money on vegetables, while non-SNAP households spent 9.1 percent of their grocery money on this category of food. When comparing fruit purchases, the gap widens slightly: SNAP households spent 4.7 percent on fruits, and non-SNAP households spent an averages of 7.2 percent in the same category.

Here’s the comparison of purchases from those with food stamps and those using their own money.

As one might suspect, the problem has gotten worse during the profligate Bush-Obama era.

During President Obama’s tenure, the numbers and percentages of Americans using taxpayer’s money to buy their groceries has drastically increased. SNAP participation has increased 78 percent in the past ten years and remains near its all-time high… Food stamp usage also dramatically increased during President George W. Bush’s tenure… That’s because Bush signed a dramatic expansion of food welfare inside a farm bill. This expansion, among other things, made it easier to sign up and made non-citizens eligible to use U.S. taxpayers’ funds to fund grocery excursions.

By the way, I think poor people (indeed, all people) should be able to eat anything they want. That being said, there’s something perverse about subsidizing and encouraging unhealthy patterns.

Particularly when obesity is one of the biggest health problems in low-income communities.

The program also has always had major problems with fraud, as illustrated by a recent scandal in Florida.

The U.S. Attorney for the Southern District of Florida announced the largest food stamp fraud bust in U.S. history Wednesday afternoon. …500 people had their identities stolen in Palm Beach County to be used to get fake Electronic Benefit Transfer cards which were then exchanged for cash… Federal charges were filed against 22 retail store owners or operators in connection with schemes to illegally redeem food stamp benefits for cash, the Justice Department said. Indictments allege the retailers received more than $13 million in federal payments.

Even millionaires bilk the system.

A Geauga County millionaire—who comes from royalty—has been indicted on charges he illegally received food stamps and medicaid assistance. Ali Pascal Mahvi is facing four felony counts which could put him behind bars for more than four years if convicted. …Meyer informed Mahvi of the indictment at Mahvi’s 8,000 square foot home. …Prosecutors say Mahvi defrauded Medicaid out of $45,000 and about $8,400 in food stamps. Mahvi, who is the son of an Iranian prince, estimates his worth at about $120 million. His $800,000 home features five bedrooms and five bathrooms, an in-ground swimming pool, and stable with horses. Mahvi, who says he owns 70 percent of a resort in St. Lucia, says he’s played by the rules.

And some scammers become millionaires from the other end of the system.

Convenience store owner Vida Ofori Causey out of Worcester, Mass. was charged in federal court Monday after pleading guilty to $3.6 million worth of food stamp fraud. …“Causey purchased the benefits at a discounted value of approximately fifty cents for every SNAP dollar,” a press release from Department of Justice stated. “By so doing, Causey caused the USDA to electronically deposit into a bank account controlled by her the full face value of the SNAP benefits fraudulently obtained.” As a result, recipients had cash on hand to buy restricted items. The restricted items could include alcohol, cigarettes and even drugs.

Stories like this reinforce the argument that states should be in charge of the program, if for no other reason than there will be fiscal pressure not to waste so much money.

Moreover, there’s considerable evidence that states are more sensible in their approach. I’ve already written about good reforms in Maine and Wisconsin. Well, the Daily Caller has encouraging news that the good news in those states is part of a national trend.

The number of people receiving food stamps has declined sharply due in part to the reinstatement of work requirements earlier this year, according to a report Wednesday. …“Caseloads fell sharply in April, especially in states reinstating a three-month time limit for unemployed childless adults without disabilities, new Agriculture Department data show,” CBPP detailed in its report. “The data, covering the first month in which most of the roughly 20 states that imposed the time limit in January began cutting people off.” The USDA has required food stamp work requirements since an overhaul of the program in 1996. Able-bodied adults without children are required to work at least 20 hours a week or else lose their benefits after three months. …Work requirements have now been restored in a total of 40 states compared to 44 states this past June that had either a waiver or a partial waiver.

And let’s look specifically at some positive developments in Kansas.

…before Kansas instituted a work requirement, 93 percent of food stamp recipients were in poverty, with 84 percent in severe poverty. Few of the food stamp recipients claimed any income. Only 21 percent were working at all, and two-fifths of those working were working fewer than 20 hours per week. Once work requirements were established, thousands of food stamp recipients moved into the workforce, promoting income gains and a decrease in poverty. Forty percent of the individuals who left the food stamp ranks found employment within three months, and about 60 percent found employment within a year. They saw an average income increase of 127 percent. Half of those who left the rolls and are working have earnings above the poverty level. Even many of those who stayed on food stamps saw their income increase significantly. …Furthermore, with the implementation of the work requirement in Kansas, the caseload dropped by 75 percent. Previously, Kansas was spending $5.5 million per month on food stamp benefits for able-bodied adults; it now spends $1.2 million.

P.S. In the long run, the block grant should be phased out so the federal government isn’t involved at all in the business of income redistribution. If we care about the limits on federal power in Article 1, Section 8, then states should be responsible for choosing how much to raise in addition to choosing how to spend.

P.P.S. Just in case you think fraud and waste is a rare problem in the program, here are some other examples.

With stories like this, I’m surprised my head didn’t explode during this debate I did on Larry Kudlow’s show.

P.P.P.S. While I periodically mock California, folks in the Golden State deserve praise for being the least likely to use Food Stamps. Their neighbors in Oregon, by contrast, are very proficient at mooching.

Read Full Post »

Because of my disdain for the two statists that were nominated by the Republicans and Democrats, I’m trying to ignore the election. But every so often, something gets said or written that cries out for analysis.

Today is one of those days. Hillary Clinton has an editorial in the New York Times entitled “My Plan for Helping America’s Poor” and it is so filled with errors and mistakes that it requires a full fisking (i.e., a “point-by-point debunking of lies and/or idiocies”).

We’ll start with her very first sentence.

The true measure of any society is how we take care of our children.

I realize she (or the staffers who actually wrote the column) were probably trying to launch the piece with a fuzzy, feel-good line, but let’s think about what’s implied by “how we take care of our children.” It echoes one of the messages in her vapid 1996 book, It Takes a Village, in that it implies that child rearing somehow is a collective responsibility.

Hardly. This is one of those areas where social conservatives and libertarians are fully in sync. Children are raised by parents, as part of families.

To be fair, Hillary’s column then immediately refers to poor children who go to bed hungry, so presumably she is referring to the thorny challenge of how best to respond when parents (or, in these cases, there’s almost always just a mother involved) don’t do a good job of providing for kids.

…no child should ever have to grow up in poverty.

A laudable sentiment, for sure, but it’s important at this point to ask what is meant by “poverty.” If we’re talking about wretched material deprivation, what’s known as “absolute poverty,” then we have good news. Virtually nobody in the United States is in that tragic category (indeed, one of great success stories in recent decades is that fewer and fewer people around the world endure this status).

But if we’re talking about the left’s new definition of poverty (promoted by the statists at the OECD), which is measured relative to a nation’s median level of income, then you can have “poverty” even if nobody is poor.

For the sake of argument, though, let’s assume we’re using the conventional definition of poverty. Let’s look at how Mrs. Clinton intends to address this issue.

She starts by sharing some good news.

…we’re making progress, thanks to the hard work of the American people and President Obama. The global poverty rate has been cut in half in recent decades.

So far, so good. This is a cheerful development, though it has nothing to do with the American people or President Obama. Global poverty has fallen because nations such as China and India have abandoned collectivist autarky and joined the global economy.

And what about poverty in the United States?

In the United States, a new report from the Census Bureau found that there were 3.5 million fewer people living in poverty in 2015 than just a year before. Median incomes rose by 5.2 percent, the fastest growth on record. Households at all income levels saw gains, with the largest going to those struggling the most.

This is accurate, but a grossly selective use of statistics.

If Obama gets credit for the good numbers of 2015, then shouldn’t he be blamed for the bad numbers between 2009-2014? Shouldn’t it matter that there are still more people in poverty in 2015 than there were in 2008? And is it really good news that it’s taken Obama so long to finally get median income above the 2008 level, particularly when you see how fast income grew during the Reagan boom?

We then get a sentence in Hillary’s column that actually debunks her message.

Nearly 40 percent of Americans between the ages of 25 and 60 will experience a year in poverty at some point.

I don’t know if her specific numbers are accurate, but it is true that that there is a lot of mobility in the United States and that poverty doesn’t have to be a way of life.

Hillary then embraces economic growth as the best way of fighting poverty, which is clearly a true statement based on hundreds of years of evidence and experience.

…one of my top priorities will be increasing economic growth.

But then she goes off the rails by asserting that you get growth by spending (oops, I mean “investing”) lots of other people’s money.

I will…make a historic investment in good-paying jobs — jobs in infrastructure and manufacturing, technology and innovation, small businesses and clean energy.

Great, more Solyndras and cronyism.

And fewer jobs for low-skilled workers, if she gets here way, along with less opportunity for women (even according to the New York Times).

And we need to…rais[e] the minimum wage and finally guarantee… equal pay for women.

The comment about equal pay sounds noble, though I strongly suspect it is based on dodgy data and that she really favors the very dangerous idea of “comparable worth” legislation, which would lead to bureaucrats deciding the value of jobs.

Then Hillary embraces a big expansion of the worst government department.

…we also need a national commitment to create more affordable housing.

And she echoes Donald Trump’s idea of more subsidies and intervention in family life.

We need to expand access to high-quality child care and guarantee paid leave.

And, last but not least, she wants to throw good money after bad into the failed Head Start program.

…we will work to double investments in Early Head Start and make preschool available to every 4-year-old.

Wow, what a list. Now perhaps you’ll understand why I felt the need to provide a translation of her big economic speech last month.

The moral of the story, based on loads of evidence, is that making America more like Europe is not a way to help reduce poverty.

P.S. The only other time I’ve felt the need to fisk an entire article occurred in 2012 when I responded to a direct attack to my defense of low-tax jurisdictions.

Read Full Post »

Older Posts »

%d bloggers like this: