Friday, October 31, 2008

Something Different For The Weekend, Part II

Just a brief experiment:

1. Do you support the system of social security as it currently functions?

2. Do you support the food stamp program as it currently functions?

If you answered yes to both questions, then you hate freedom and liberty, or at least, you hate freedom and liberty for poor people. What do I mean? Allow me to explain and in doing so, demonstrate the pernicious effects of the interaction of well-intentioned government programs.

As many leftists have often pointed out, payroll taxes (social security and medicare) tend to be regressive because their burden falls hardest on the poor and on minorities. For one, minorities and the poor are less likely to live to an age where they can collect benefits. And perhaps more importantly, the 6.2% of income that is taxed for social security is much more needed by those living on the margins. Someone working full time, making minimum wage in Connecticut ($7.65 an hour), will pay nearly $1,000 in social security taxes over the course of the year, money I'm assuming everyone in that situation could use.

Where do food stamps fit in? Well, if my hypothetical worker is single, he probably won't meet the food stamp eligibility requirements. But if my hypothetical worker has children, then they'd likely be eligible for food stamps. And here's my big problem. Taxes are taxes and social welfare is social welfare, whatever the names the government wants to use. How much sense does it make to tax the poor with hand, taking away their hard earned money, while giving them vouchers good only for food with the other hand. It's literally taking the subsistence income they need to live and doling it back to them with preconditions.

This isn't just about being a libertarian, it's about understanding the real world effect of government policies and understanding that those policies are not implemented in a vacuum. Personally, this is the sort of result that troubles me. That's not to say there should be no roll for the government in helping the poor and no roll for the government in retirement savings. I'm just saying this isn't the best way.


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