Regarding the budget deficit, Yesterday I commented President Biden and the Need to Do Something, Just Not Now
McCarthy’s Key Demands
- Claw back unspent Covid-19 funds.
- Impose tougher work requirements for recipients of food stamps and other government aid.
- Halt Biden’s plans to forgive up to $20,000 in student loans.
- End many of the landmark renewable energy tax breaks Biden signed into law last year. It would tack on a sweeping Republican bill to boost oil, gas and coal production.
I stated “The first three points should not be the least bit controversial. Point 3 will happen via the Supreme Court, anyway. I have been arguing for tougher rules on government aid for a long time.”
This Tweet is in response.
Sure it is. Something like 63% of those of working age on Medicare are on SSDI. They are disabled. Enforcing a work requirement on the small number who could work under age 62, will cost the government more than simply sending the checks. It would create an entirely new dept.
— Tracey Ryniec (@TraceyRyniec) May 14, 2023
Understanding McCarthy’s Proposal
McCarthy’s proposal would require able-bodied adults without children to work, train or volunteer at least part time as a condition of receiving taxpayer support.
Generous exclusions include people with dependent children, those under age 19, those over the age of 56, individuals enrolled in an educational program.
And the Medicaid recipients only have to work 80 hours per month.
Apparently, this is too much for liberals to take.
The CBO Estimate
The CBO estimates it would save $120 billion. Some believe the change would cost money.
Based on actual experience in Arkansas, I suggest that the CBO’s savings estimate is too low.
Work Requirements for Welfare Aren’t ‘Wacko’
Nick Stehle, vice president of communications at the Foundation for Government Accountability, says Work Requirements for Welfare Aren’t ‘Wacko’
Are work requirements for welfare recipients “wacko”? That’s what President Biden said on April 19 in reaction to House Republicans’ debt-ceiling proposal, which included this policy for Medicaid and food stamps.
In 2018 Arkansas became the first state in America to implement a broad work requirement for Medicaid. It did so under a federal waiver, requiring that able-bodied, childless adults work at least part-time to keep receiving Medicaid benefits—very close to what’s contained in the bill passed by House Republicans.
The need for work requirements was obvious to anyone paying attention. In 2013, under Democratic Gov. Mike Beebe, Arkansas became the first Southern state to expand Medicaid. The number of new enrollees was 50% higher than predicted, costing taxpayers at least $1 billion more than expected, and by 2015 40% of state residents were on the program. The majority of new enrollees were able-bodied, childless adults, and half of them reported being out of the workforce entirely.
But the work requirement, which phased in starting in June 2018, turned things around. Medicaid rolls immediately began shrinking. Tens of thousands went back to work, and more than 14,000 boosted their incomes enough to leave Medicaid entirely. Moving people from dependence to independence as soon as possible should be the goal of safety-net programs.
Unfortunately, and as Stehle points out, Arkansas’s work-for-welfare experiment was cut short in April 2019 by an Obama-appointed federal judge, who paused Arkansas’s federal waiver on procedural grounds.
The case then made its way all the way to the Supreme Court which dismissed the case as moot because the Biden administration had already withdrawn the waiver.
The result is that once again welfare fraud is free to run rampant.
Liberals Protest
Health Affairs complains 18,000 adults lost coverage in Arkansas.
I wonder if the real problems are too few lost coverage, and SSDI benefits are too generous.
How to Fix Disability Insurance
A National Affairs article from 2015 on How to Fix Disability Insurance is a bit stale but covers the key points.
The article notes that demographics including the aging of baby boomers is responsible for some of the rise. But adjusting for demographic changes, there has been a roughly 50% increase in SSDI receipt since 1980 and a 60% to 70% increase since 1989.
Loosening standards for receiving disability is part of the problem: “In 2012, 58% of new beneficiaries qualified not on the basis of their medical condition alone, but because of additional consideration of their demographic characteristics and work experience.”
Factor in generous benefits: “The average monthly SSDI benefit today is almost exactly what a full-time worker making minimum wage earns before taxes. And that doesn’t include the value of Medicare benefits, which has grown as employer health coverage has declined and medical costs have risen.”
Importantly, “SSDI has thus gradually evolved into a long-term unemployment program, and it is particularly badly designed to play that role. Once awarded benefits, most enrollees remain on SSDI until death or retirement.”
Headed in the Wrong Direction
McCarthy proposes those who are able-bodied between the age of 19 and 56, who have no dependents, work 80 hours a month vs a normal 160 in a 4-week month.
McCarthy has the right idea but it’s only a start.
Food Stamp Program
There has never been a health crisis in this country that’s been 1/10th as devastating as this..this should be something that should be talked about everyday and have massive resources committed to it.. https://t.co/VNkCX82u6Z
— jim iuorio (@jimiuorio) May 13, 2023
I suggest changes to the food stamp program, now called SNAP.
Specifically, I would prohibit candy, potato chips, snacks, pizzas, ice cream, cakes, deserts, and soda. But I would allow soap, laundry detergent, cleaning supplies, and toothpaste.
We have more than a bit of an obesity problem, and SNAP is a part of the problem.
Those who want candy and snacks can get a job, at least part time.
We need to reduce dependency on government handouts. Changes to the disability and food stamp programs would be a welcome start.
The US Appears to Be Over the Debt Limit Already. What’s Going On?
For the debt ceiling background on this post, please see The US Appears to Be Over the Debt Limit Already. What’s Going On?
This post originated at MishTalk.Com
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Addendum
My original lead chart from the BLS was not the correct chart. I replaced it with a chart from the Kaiser Family Foundation.
Increases in enrollment may reflect changes in the economy, changes in policy (like recent adoption of the Medicaid expansion in the Affordable Care Act), and the temporary continuous enrollment provision created by the Families First Coronavirus Response Act (FFCRA).
There are about 42 million people on SNAP, about 92 million on Medicaid, and about 70,000 on SSDI.
Those on Medicaid jumped by about 21 million since February 2020.
Mish
those republicans aren’t mentioning reinstating all those tax cuts that mainly benefit corporations and the wealthy. You know the ones the bean counters in the basement said would add a trillion to the debt over ten years.
“A sworn fore of bureaucrats, Mr. Wriston often joked:
“Regulators sit by while snails go by like rockets.” He devoted much of his
career to diving through loopholes in bank holding-company legislation or
wriggling free of interest-rate restrictions. As Mr. Zweig shows, Mr. Wriston
presided over an encyclopedic range of innovations-among them negotiable CDs,
term loans, syndicated loans, floating-rate notes and currency swaps-that ended
forever the moribund bonking of the 1950s and ushered in our razzle-dazzle age
of finance. The old prudential banker’s ethic was eclipsed by the hedonistic
freedom of the consumer culture.”