I just recently found your SubStack and it is great! I had two thoughts from reading this piece.
(1) Comparing the US to Ireland is feasible but comparing it to the EU is perhaps a more correct way to assess American poverty. Whether we like it or not, the civic structure of America is very federal, with semi/quasi sovereign states. America is like a more united EU-a continent spanning superstate with very different regions and sub-interests. Ireland just does not compare. It is structured differently. Perhaps we should ask why Ireland has better poverty stats relative to the state of Hawaii or Mississippi.
(2) Also, when we look at many of the Top 1% they often make great wealth through investments. We need to find a way as a nation to leverage investing to benefit those in poverty. That is where huge fortunes are made.
Great post as always. One small correction: "But it’s a step toward the holy grain of universal, cash-based programs" --> "holy grail", or maybe you're trying to sell farmers on the idea ;)
In Israel such a plan was considered a disaster in 2000 since it encouraged muslims and orthodox Jews to have a huge number of children. But it is like the FDA's hesitancy with the Pfizer booster. Why learn from Israeli experience instead of doing your own mistakes.
It is interesting to consider that our New Deal legacy is based on work (or the unavailability of it, or inability to do it). I hadn't thought of it that way before. I guess that's not surprising, since the triggering event was the Depression, where the problem seemed to be lack of jobs for all who wanted them.
It makes sense, though, that this is true -- the focus on work -- when you consider the gaping holes in our social programs. Paid time off for new parents? Nah, get back to work! You dropped that kid way back on Tuesday; you can be back to work by Thursday. Health care for all? Nooo, you can look for a better job if you want health care. Generous vacation time? No, you don't need that. You're lucky to have a JOB. Etc.
I support cash benefits to people, in place of all other (complicated, administration-heavy) social programs. If we replace all the other programs, though, I'd like to see a lot more than $10,000 a year go to...everyone, not just people with kids. If I didn't have to earn a living, I'd be spending my time very differently -- my work would still be (I like to think) productive and beneficial to society, but it would not be my current paid gig.
I wonder (rather idly, not having much knowledge in this area) whether centering this current plan on a child-credit is not just because there's sympathy for families but also a weak attempt to get people to have more kids. One hears that people aren't having enough kids to support all the aging people. I know little-to-nothing about that.
On the other hand, kids are so expensive -- if you're living in utter poverty, $8,000-10,000 a year would no doubt make a lot of difference in your life. But I can't really imagine someone deciding to have more kids on that basis. Kids are a lot of work and expense.
There's a hypothesis that cash transfers create dependency traps only in generations that grow up with them. The first generation to get welfare uses it to better their situation, but their children grow up to be lazy bums. (What percentage of the children of "self-made" extremely rich people grow up to be "idle rich"?)
All of these projected benefits of giving cash to people veer pretty close to a claim that cash transfers can pay for themselves. If cash has such a miraculous ability to pull people out of poverty, why not consider programs that give impoverished people generous loans instead? By generous I mean fairly easy to default (significantly easier than student loans), and no obligation to start repayment until the recipient is no longer impoverished. You'd get the same benefits as the cash transfers and greatly diminish the need to raise anyone's taxes.
I think it's time to cop to reality and cut it, though. Manchin fucked it so hard, it's not coming back until we have a solid D Senate majority, and THAT's not happening if we don't recover this clusterfuck and pass SOMETHING.
Look, the topline dollar amounts that have been negotiated are enough that the Overton window has been shifted. Failing a miraculous filibuster repeal, the next 5-10 major public policy debates are GOING to be discussed in the trillions of dollars just like this one. At this point, taking a partial victory will do FAR less damage than a total loss will.
But what I have read is that Manchin is against the expanded CTC while he does support universal pre-K (a bureaucratic nightmare). Drop the pre-K and expand the CTC.
The link about child poverty refers to *relative* poverty. You could make that clearer. The US is much richer than Ireland, so the median income is higher, so American children need to be much richer to be not counted as "living in poverty".
Noah,
I just recently found your SubStack and it is great! I had two thoughts from reading this piece.
(1) Comparing the US to Ireland is feasible but comparing it to the EU is perhaps a more correct way to assess American poverty. Whether we like it or not, the civic structure of America is very federal, with semi/quasi sovereign states. America is like a more united EU-a continent spanning superstate with very different regions and sub-interests. Ireland just does not compare. It is structured differently. Perhaps we should ask why Ireland has better poverty stats relative to the state of Hawaii or Mississippi.
(2) Also, when we look at many of the Top 1% they often make great wealth through investments. We need to find a way as a nation to leverage investing to benefit those in poverty. That is where huge fortunes are made.
Great post as always. One small correction: "But it’s a step toward the holy grain of universal, cash-based programs" --> "holy grail", or maybe you're trying to sell farmers on the idea ;)
In Israel such a plan was considered a disaster in 2000 since it encouraged muslims and orthodox Jews to have a huge number of children. But it is like the FDA's hesitancy with the Pfizer booster. Why learn from Israeli experience instead of doing your own mistakes.
It is interesting to consider that our New Deal legacy is based on work (or the unavailability of it, or inability to do it). I hadn't thought of it that way before. I guess that's not surprising, since the triggering event was the Depression, where the problem seemed to be lack of jobs for all who wanted them.
It makes sense, though, that this is true -- the focus on work -- when you consider the gaping holes in our social programs. Paid time off for new parents? Nah, get back to work! You dropped that kid way back on Tuesday; you can be back to work by Thursday. Health care for all? Nooo, you can look for a better job if you want health care. Generous vacation time? No, you don't need that. You're lucky to have a JOB. Etc.
I support cash benefits to people, in place of all other (complicated, administration-heavy) social programs. If we replace all the other programs, though, I'd like to see a lot more than $10,000 a year go to...everyone, not just people with kids. If I didn't have to earn a living, I'd be spending my time very differently -- my work would still be (I like to think) productive and beneficial to society, but it would not be my current paid gig.
I wonder (rather idly, not having much knowledge in this area) whether centering this current plan on a child-credit is not just because there's sympathy for families but also a weak attempt to get people to have more kids. One hears that people aren't having enough kids to support all the aging people. I know little-to-nothing about that.
On the other hand, kids are so expensive -- if you're living in utter poverty, $8,000-10,000 a year would no doubt make a lot of difference in your life. But I can't really imagine someone deciding to have more kids on that basis. Kids are a lot of work and expense.
So are they getting rid of the "care work" subsidies in this new version? (If so, thank God)
There's a hypothesis that cash transfers create dependency traps only in generations that grow up with them. The first generation to get welfare uses it to better their situation, but their children grow up to be lazy bums. (What percentage of the children of "self-made" extremely rich people grow up to be "idle rich"?)
All of these projected benefits of giving cash to people veer pretty close to a claim that cash transfers can pay for themselves. If cash has such a miraculous ability to pull people out of poverty, why not consider programs that give impoverished people generous loans instead? By generous I mean fairly easy to default (significantly easier than student loans), and no obligation to start repayment until the recipient is no longer impoverished. You'd get the same benefits as the cash transfers and greatly diminish the need to raise anyone's taxes.
.
I think it's time to cop to reality and cut it, though. Manchin fucked it so hard, it's not coming back until we have a solid D Senate majority, and THAT's not happening if we don't recover this clusterfuck and pass SOMETHING.
Look, the topline dollar amounts that have been negotiated are enough that the Overton window has been shifted. Failing a miraculous filibuster repeal, the next 5-10 major public policy debates are GOING to be discussed in the trillions of dollars just like this one. At this point, taking a partial victory will do FAR less damage than a total loss will.
But what I have read is that Manchin is against the expanded CTC while he does support universal pre-K (a bureaucratic nightmare). Drop the pre-K and expand the CTC.
The link about child poverty refers to *relative* poverty. You could make that clearer. The US is much richer than Ireland, so the median income is higher, so American children need to be much richer to be not counted as "living in poverty".