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They have been induced to give up their opportunity to “develop and use their capacities,”
Today public assistance continues to grow faster than the earned income of taxpayers, with the average nonretired household in the bottom quintile receiving more than $41,000 in government transfer payments, while employers cannot fi...
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Unfortunately, the reform did not apply to other welfare programs, and the benefits of those other programs, such as food stamps and unemployment insurance, continued to increase, creating additional incentives not to work.
The bottom 20 percent of households with one or more prime work-age earners and no Social Security retirement benefits received on average more than $41,000 in government transfer payments, which enabled them to consume at middle-income levels.
At these high subsidy levels, most beneficiaries have little or no incentive to take a job since they are receiving about as much for not working as they could earn working.
We do not know whether Americans would have knowingly provided more than $41,000 worth of transfer payments to the average low-income household with adults of working age. But we do know the consequences of providing that level of support without any work requirement.
After transfer payments to households jumped 30 percent from the first quarter of 2019 to the third quarter of 2021,18 no one should have been surprised that over the same period 1.5 percent of the civilian labor force, or about 2.5 million people, simply dropped out of the labor force.19 With 11 million job openings and a booming economy, these 2.5 million people did not come back to work.
long-standing excuse for the deficiencies in public education is that we do not spend enough money. But that narrative is false. Figure 10.2 shows that from 1952 to 2018, the real average expenditure per pupil rose by 343.9 percent. Since these are in inflation-adjusted dollars, that means that on average every elementary and secondary student in 2018 had 4.5 times as many resources
Performance on the Scholastic Aptitude Test (SAT) was essentially unchanged for a dozen years beginning in 1952, but then it dropped by 8.0 percent from 1963 to 1980. Inflation-adjusted expenditures per pupil rose 83.8 percent during the seventeen years. Has there ever been a more tragic waste of money, spending almost twice as much per pupil and getting 8.0 percent less education in return?
Minority and low-income students attending charter schools or private schools on scholarships do not merely equal the performance of students in higher-income school districts; they often surpass them.
In what may be the most telling evaluation of all, a paper in the Journal of Policy Analysis and Management reported that charter school pupils are not only more likely to graduate from high school and attend college but also more successful in their college studies and after graduation make higher salaries than their peers who remained in traditional public schools.
Education reform is difficult politically because the public school system is the largest employer in many American counties. School boards, superintendents, and teachers’ unions are well organized, well funded, highly centralized, and powerful not just in local government but also in the nation’s state legislatures and in Washington, DC. Education policy has become a typical political power play.
If high-income individuals were clustered around Silicon Valley or Wall Street, it would be because those were the locations where market forces generate vast amounts of economic value. The richest counties are now clustered around the center of government power, suggesting that government power is a leading source of income. Eliminating cronyism will not just benefit citizens, consumers, and taxpayers; it will also open the gateway for merit, competition, and equality of opportunity.
