Ryan on poverty & dependency
Yesterday Paul Ryan gave a speech about poverty in Cleveland, Ohio. The title of the speech was “Restoring the Promise of Upward Mobility in America’s Economy.” As Jonathan Chait points out in his response, the biggest obstacle to upward mobility in this country is not welfare, regulation, high taxes, or any of the other things Ryan worries about; it’s income inequality. Countries that have less of that have more social mobility, even if they also have a more generous social safety net and higher taxes.
Fiscal hawks sometimes speak as if they regret having to cut federal spending for things like Medicaid and food stamps; such cuts are routinely described as painful but necessary. In his Cleveland speech, Ryan insists that what’s good for the budget is also good for the poor: by cutting programs that only encourage dependency, we’re actually doing the poor a favor. We’re like repentant codependents finally cutting off an addict’s supply. As Chait writes,
Ryan paints a picture in which we face an impending debt crisis but also have the good fortune of spending vast sums on poor people in a way that harms them, allowing us to reap large budgetary savings while giving the poor a helping hand. What an incredible stroke of good fortune!
But is it true that these programs foster dependency? Ryan avoids fleshing out this implication with any specifics, perhaps because to do so would quickly expose the vapidity of his claims. For one thing, welfare reform was undertaken during the nineties boom, when a red-hot employment market made it possible for people to transition from welfare to low-rung jobs. The notion that there are jobs today going unfilled but for the laziness of the poor has no relationship to reality.
Second, welfare was designed to replace the role of a male breadwinner and thus created a family model in which a single mother could expect to receive a basic income in lieu of work. That isn’t true of the programs Ryan wants to slash.
There is one ironic exception here, though: Medicaid. Medicaid offers health care for the very poor, along with nursing-home care and other special medical needs. It is possible that the availability of Medicaid could reduce a person’s incentive to earn more money, because at some point, they would earn enough to no longer qualify for Medicaid and then they’d lose their health insurance. But this would only hold true if we enact Ryan’s proposal to repeal the Affordable Care Act. Otherwise, people will have access to health insurance at every income level.