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Repeal the Welfare System

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The presumptive Republican presidential candidate, Robert Dole, and his party are distressed that President Clinton may have preempted them on the issue of welfare reform. The GOP favors shifting welfare responsibility to the states. Just before Dole was to give a major speech on the subject, Clinton endorsed a reform program devised by Wisconsin’s Republican governor Tommy Thompson. The Clinton move is widely interpreted as coup, depriving Dole of an important issue. Praising the Wisconsin plan also allows Clinton to minimize his veto of two welfare bills. To date, he’s allowed 38 states to depart from federal welfare rules, though he has not formally approved Wisconsin’s request yet.

If the Republicans were smart, they would see that they have lots of room to outflank Clinton on welfare. Instead of small-scale tinkering with the welfare monstrosity, they could call for outright repeal and leave the President speechless.

Wisconsin’s plan is regarded as the most drastic departure yet from the federal system. But a closer examination shows that it only makes minor adjustments. Welfare recipients could stay on the rolls for five years. While on welfare, a person would have to take a job. However, under the program the state would subsidize jobs or create “community service” jobs. The program would even offer “job access loans” for job-related expenses. None of that will save money, at least in the short run. The state expects a 13 percent increase in spending ($40 million a year) because of such expenses as heath care and day care for children, which would be provided to all “working poor” even if they are not formally on welfare.

In other words, dependency on the state will continue, and even increase, under the Wisconsin plan. Instead of depending on the state for outright cash grants, welfare recipients will depend on it for jobs and care for their children. There’s less here than meets the eye.

As Thomas Sowell has pointed out, the Great Society welfare programs of the 1960s had the stated objective of ending the dependency of the people whom the government defines as poor. Judged by its own standard, the system has been a complete flop. The welfare system has created a large underclass that is defined by its dependent status and lack of prospects. That, despite the spending of more money than you would need to buy the Fortune 500 and America’s farmland.

Despite that bleak history, the long-suffering taxpayer is now asked to pay more, while being told that welfare “as we know it” will end. If the public is skeptical, who could be surprised?

If we are to think clearly about welfare we must start with the basics. Welfare is based on the premise that a person’s need is an entitlement to the earnings of others. Nothing could be more out of spirit with the American heritage of individual rights and limited government. When this country broke with the past and established itself as a revolutionary society, it affirmed the principles that the individual had a right to the fruits of his labor and physical force was an improper method of dealing with others. The welfare state was a conterrevolution that established precisely the opposite principles.

The first victims, then, of the welfare state are the people forced to finance it, who are then subjected to the social pathologies of the resulting underclass.

The second victims are the recipients themselves, who are corrupted by the dependence that the system fosters. Poverty is not merely a lack of money. Lots of young doctors fresh out of medical school have little money. But we don’t think of them as poor. Rather, poverty is a state of mind implying dependency, irresponsibility, and the lack of a future. The biggest creator of poverty is the welfare state.

By the material standards of the 1950s, the poor today are not bad off. But by the spiritual standards of the recent past, the are in dire straits. That’s where the welfare state has delivered them. Their only hope for a real future lies in the abolition of the welfare state and the unleashing of the only creator of wealth, free people in a free market.

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    Sheldon Richman is vice president of The Future of Freedom Foundation and editor of FFF's monthly journal, Future of Freedom. For 15 years he was editor of The Freeman, published by the Foundation for Economic Education in Irvington, New York. He is the author of FFF's award-winning book Separating School & State: How to Liberate America's Families; Your Money or Your Life: Why We Must Abolish the Income Tax; and Tethered Citizens: Time to Repeal the Welfare State. Calling for the abolition, not the reform, of public schooling. Separating School & State has become a landmark book in both libertarian and educational circles. In his column in the Financial Times, Michael Prowse wrote: "I recommend a subversive tract, Separating School & State by Sheldon Richman of the Cato Institute, a Washington think tank... . I also think that Mr. Richman is right to fear that state education undermines personal responsibility..." Sheldon's articles on economic policy, education, civil liberties, American history, foreign policy, and the Middle East have appeared in the Washington Post, Wall Street Journal, American Scholar, Chicago Tribune, USA Today, Washington Times, The American Conservative, Insight, Cato Policy Report, Journal of Economic Development, The Freeman, The World & I, Reason, Washington Report on Middle East Affairs, Middle East Policy, Liberty magazine, and other publications. He is a contributor to the The Concise Encyclopedia of Economics. A former newspaper reporter and senior editor at the Cato Institute and the Institute for Humane Studies, Sheldon is a graduate of Temple University in Philadelphia. He blogs at Free Association. Send him e-mail.