Tuesday, July 17, 2012

Jumping off a (welfare) cliff

H/T Doug Ross @ Journal

Mr. Ross writes;
I wrote last year about the way in which welfare programs lead to very high implicit marginal tax rates on low-income people. More specifically, they lose handouts when they earn income. As such, it is not very advantageous for them to climb the economic ladder because hard work is comparatively unrewarding... Thanks to the American Enterprise Institute, we now have a much more detailed picture showing the impact of redistribution programs on the incentive to earn more money.

Have seen this central thesis proven in my life.
I've witnessed people willingly drop out of job training because the job would pay them too much money and threaten their government subsidies.

It's the strategy, Stupid!

Words I learned today;
Middle Class Anarchy

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