Further Thoughts on the Politics of Unconditional Cash Transfers and the Notion of the “Deserving” Poor

This morning I told you about my new Atlantic article about GiveDirectly, a charity that distributes cash to poor families in Kenya, and allows them to spend the money on whatever they want. The recipients are chosen not because they have demonstrated any kind of favored behavior, like enrolling their children in school, but simply because they are among the poorest people in their rural villages, living in homes made of mud or thatch and frequently going without enough food. They are generally spending their new income on worthwhile causes, like food and weatherproof roofs.

Yet conditional cash transfer programs are more politcally palatable across the world than unconditional ones like GiveDirectly, whether they are pursued by philanthropies or governments. Why? Because, as this beautiful Reuters piece demonstrates, much public policy rests on the assumption that there are two kinds of poor people: the deserving poor and the undeserving. Deserving poor people work, even if the wages they earn are less than the costs of child or health care. They endure cumbersome bureaucratic processes to seek child support from the absent fathers of their children, even if those fathers are in jail, drug addicted, or otherwise unable to provide for their kids. They open college savings accounts, even if they need 100 percent of their monthly income just to cover the costs of housing and food. They attend classes on why it's important to get married.

In the United States, government tells a small group of poor people — typically mothers of young children — that if they fulfill such requirements, they can receive, for a discrete period of time, a small amount of supplemental monthly income. Childless adults and the longterm non-working, non-disabled poor are almost completely excluded from social welfare efforts in many states. 

No matter how much economic research we cite showing that unconditional cash income and savings improve the lives of poor people and their children, it will remain politically difficult to tell taxpayers that we aren't going to require anything from the recipients of social welfare. That's because most of us assume poor people need to learn how to best help themselves. The radical premise of GiveDirectly is that poor people already know, much better than their governments or a charity director, what they need. 

Which assumption is true? Should governments and non-profits use the promise of cash to attempt to train or educate the poor out of poverty? Or should a basic income be understood as a matter of human dignity?

One thought on “Further Thoughts on the Politics of Unconditional Cash Transfers and the Notion of the “Deserving” Poor

  1. Brett

    I do think it’s probably the best way to give help to poor people, provided that

    1. You structure it so that they don’t face the equivalent of a 100% marginal tax if they get a modest pay raise and lose benefits (you need to gradually phase it out at higher incomes).

    2. You make sure that when the recipients have drug addiction or mental health issues, they get monitoring and treatment assistance to go with it. Mark Kleiman (a professor at UCLA) has written about how this can work.

    I’m not sure about the “basic income” argument, but I do think we ought to make sure nobody is going hungry, homeless, or sick because of money.

    I can understand some of the Indiana reforms, like making people do some volunteer work in response to getting welfare money. Done right, it could be like New Deal projects that put people to work doing all manner of stuff.

    Reply

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