How Much Does the Safety Net Help the “Very Poor”?

Presidential candidate Mitt Romney, in attempting to highlight an emphasis on the middle class in his platform, said a politically foolish thing. “I’m not concerned about the very poor,” he said. “We have a safety net there. If it needs a repair, I’ll fix it.” In an apparent effort to soften the harshness of his remark, he added: “We have a very ample safety net and we can talk about whether it needs to be strengthened or whether there are holes in it. But we have food stamps, we have Medicaid, we have housing vouchers, we have programs to help the poor.”

The typical liberal spin on this gaffe is that it demonstrates this millionaire Republican’s heartlessness towards the most needy. Yet this is not what interests me so much. What I find far more interesting and telling is that Romney, like practically all conservatives, takes for granted a key premise of the progressives: The very poor are helped most by the welfare state, and the way to help them more is to “strengthen” the government’s safety net.

Conservatives almost always accept this premise with a certain slight variation to the liberal outlook. The right sees the poor as getting all and more than they deserve from big government, from the taxpayers, and so left-liberal complaints about the plight of the poor must be ignoring how much the government has already done to help those on the bottom rung. The left, on the other hand, has a different variation on the theme: The government must do more—much more—to help the poor (and middle class)—through more activity, more handouts, more regulations, more of a “safety net.”

Yet what’s most significant is what both sides have in common, the view that the government safety net does in fact help the very poor, that the poorest Americans have the most to gain from America’s welfare state, such as it is.

This has got to be the saddest misconception in all the talk about government poor programs. It is a mystery that it persists at all. If you consider the very poorest Americans—those without a place to live, for example—it seems odd to think the government has done so much to help them, when, as a matter of fact, they still do not have a place to live. It is a retreat from reality, and an obscene one at that, to speak of the “very poor” as the ones who have most benefited from America’s “social safety net” when, by definition, the very poor are the ones who have the least despite the decades and trillions spent on the war on poverty.

Indeed, the vast bulk of the welfare state—putting aside corporate welfare—is aimed not toward the “very poor” but the middle class. And why shouldn’t it? Those are the majority of Americans, the majority of voters, the ones whose votes Republicans and Democrats really care about buying.

When I think of Medicare, Social Security, public education, unemployment insurance, disability payments, and the rest of the lion’s share of the “safety net,” I don’t think of the “very poor,” I think of the middle class—from the lower middle class to the upper middle class—as the core recipients.

Yet people don’t think of this stuff when they think of the safety net. They think of food stamps—which cost about $80 billion a year at the federal level. This, a little more than 2% of the federal budget, is not a negligible amount of money, but it pales compared to the over $700 billion spent on Social Security every year, much of which ends up in the hands of a well-to-do demographic. Food stamps, moreover, are used by about 14% of Americans, which must therefore include a big chunk of the 95% Romney is referring to as neither very rich nor very poor. What’s more, well over half of the budgets of social welfare bureaus typically go to overhead costs, such as paying the salaries of well-paid upper middle class government workers.

The point here isn’t that the government should spend more to help the poor. The point is that government “safety net” programs are hardly directed toward nor sufficiently help the “very poor.” And this would be consistent with the entire history of the human experience, where the poorest were categorically those with the least access to the spoils of government taxing and spending.

Now, there is plenty the government can do to help the very poor, and it all involves getting out of the way. Government at all levels can and should: (1) stop taxing the poor—they are hit especially by sales taxes, payroll taxes, and sin taxes–and recognize that all taxes destroy wealth and that the poor ultimately suffer from them all, (2) stop regulating the poor out of work with business codes and fees that almost invariably protect established interests by erecting anti-competitve barriers to entry, (3) repeal minimum wage laws that prohibit those at the bottom of the economic ladder from being able to take that first important step, (4) repeal licensing laws on occupations like taxi-driving, construction, hair-dressing, and indeed every other industry that poor Americans are often quite qualified to be entrepreneurial in, but are only prevented from entering by the state’s absurd impositions that often amount to hundreds of thousands of dollars, (5) pursue fundamental criminal justice reform to bring safety and liberty back to the city streets, eliminating gang violence by ending the drug war, repealing all gun laws that disadvantage the poor, vastly reining in the police who are so often a threat to normal poor Americans, and completely revamping a correctional system that robs hundreds of thousands of peaceful poor Americans of their freedom and economic opportunities, (6) deregulate all industry—health care, especially; the poor have better access all the time to the very products whose producers are least regulated (computers, electronics, clothing) and are the most alienated from those with the most government involvement (medicine), (6) eliminate welfare programs that inculcate complacency and dependence rather than encourage independence and responsibility.

The government is by far much more an impediment and enemy of the very poor than it is any sort of friend or guardian to them. Romney’s recent flippant comment only echoes a grave misunderstanding permeating nearly the entire political spectrum on the true relationship between the state and the most vulnerable of Americans.