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A Warped Measure of Success in the War on Poverty

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Proponents of the federal government’s war on poverty say that even though the war has not defeated poverty after 50 years of fierce warfare, it has been somewhat successful in alleviating poverty. What is the principal measure of success that welfare-statists point to? They point to the large number of people who have been put on the federal dole since the inception of the program.

What a warped measure of “success.” The federal dole destroys self-reliance, independence, and can-do within the recipients. All too often, it makes them hopelessly dependent on the government, sometimes for their entire lives. It convinces them that they could never survive without the dole. It drives them into depression. It suppresses their spirits. The dole is really no different from heroin.

Thus, while welfare statists point to all the people who have been put on the dole during the past 50 years as evidence of success in the war on poverty, we libertarians point to that same measure as one of manifest failure.

What would libertarians consider a good measure of success in defeating poverty? The number of poor people who have become wealthy in the marketplace! When poor people are working for a living, saving their money, and enter the ranks of the middle class or even the wealthy. Or when poor people are starting businesses, out-competing established firms by providing better goods and services to consumers and becoming wealthy in the process.

So, which is a better solution to poverty: Putting people on the federal dole or having the poor participate in economic enterprise that enables them to live better, more independent, and more prosperous lives? It seems like a no-brainer to me.

Of course, welfare-statists would exclaim, “Jacob, that sounds great but there just aren’t enough economic  opportunities for the poor and, therefore, it’s necessary to put them on the dole.”

But guess why that’s the case. You guessed it: the statists’ very own policies! It’s their statist policies that lock the poor out of the marketplace, thereby producing the necessity for putting them on the dole.

Consider, for example, minimum-wage laws. For decades, they have locked out of the labor market poor black teenagers, especially in the inner cities. Suppose a poor black teenager approaches a white-owned company and says, “I’ll do what that rich white kid is doing at half the wage rate. I just want to learn the business.” No matter how much the employer wants to do it, the law makes it illegal for him to do it. The poor black teenager is locked out because the white-owned company chooses to hire the rich white kid over the poor black teenager at the higher, government-mandated wage rate.

So, what happens to those poor black teenagers. Many of them are sucked into another favorite federal program of the welfare statists—the drug war. It enables those poor black teenagers to learn a business and score big. It also oftentimes ends up landing them in a penitentiary for the next 10-20 years of their lives.

But even if they’re able to resist the siren’s song of the drug war, they still haven’t learned business skills, a work ethic, entrepreneurship, how to treat customers, and all the other things that come with economic enterprise. So, they turn to the dole to survive, just living out the one life they were given watching television in their public housing unit and waiting for their next welfare check. And knowing that they’ll never become wealthy unless they happen to hit with the lottery tickets that they buy every week.

There are also licensure laws that welfare statists say are necessary to keep us safe and secure. Actually, they are nothing more than a throwback to the guild era during the era of Mercantilism. Licensure is a protection racket designed to limit the entry of people into privileged occupations in order to keep their income up. That protection racket prevents the poor from entering those occupations.

There are also all the expensive regulations that the government imposes on businesses. The big, well-established firms love the regulations because they know that they prevent the poor from starting up businesses to compete against the well-established firms. When you consider minimum-wage laws, which prevent the poor from starting new businesses with low-paid labor, burdensome regulations, which the poor lack the money to pay for, complex permit requirements, and high taxes to fund the welfare state, what better way to prevent the poor from engaging in economic enterprise than all that?

Finally, let’s not forget how the dole is funded. It’s funded by seizing the wealth and income of people in the private sector — wealth and income that is key to the formation of capital, which increases standards of living by making workers more productive. The more that the federal government sucks out of the private sector with its ever-growing taxes to fund the dole, regulations, and other needless and destructive things (e.g., the warfare state), the worse off that makes the poor.

The libertarian answer: Abolish the income tax and the welfare state (and the warfare state). Leave people free to keep everything they earn and decide for themselves what to do with it. Separate economy and the state. Repeal every single welfare-state law and regulatory law (and dismantle the warfare-state empire). And then behold the poor becoming prosperous, wealthy, and independent.

Wouldn’t that be a better measure of success in a war on poverty? Wouldn’t the poor think so?

This post was written by:

Jacob G. Hornberger is founder and president of The Future of Freedom Foundation. He was born and raised in Laredo, Texas, and received his B.A. in economics from Virginia Military Institute and his law degree from the University of Texas. He was a trial attorney for twelve years in Texas. He also was an adjunct professor at the University of Dallas, where he taught law and economics. In 1987, Mr. Hornberger left the practice of law to become director of programs at the Foundation for Economic Education. He has advanced freedom and free markets on talk-radio stations all across the country as well as on Fox News’ Neil Cavuto and Greta van Susteren shows and he appeared as a regular commentator on Judge Andrew Napolitano’s show Freedom Watch. View these interviews at LewRockwell.com and from Full Context. Send him email.