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Thursday, September 15, 2005

Common sense vs. government programs

One thing I've wondered for most of my life is why government programs designed to help people in need aren't structured to help people leave them.

Take one example: Would a person accept a job that pays $100 more a month if it means their family would no longer receive health benefits worth $200 a month? In all likelihood, the answer is no.

However, that job may very well be a step to an even better job, one that provides better benefits than Medicaid and a chance to advance and leave poverty behind.

Two reasons for the current design are 1) because it treats everyone equally and 2) because it's easier to administer.

But a simple change could end the perverse incentives that keep people in jobs that otherwise wouldn't be dead-end jobs. Instead of cutting off benefits, require a $1 contribution per $2 that income now exceeds the cap for the benefits.

Although I don't like treating people differently, the goal of getting people off welfare is paramount.

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