Depression Soup Line
This morning I was reading a very poignant post from Money Reasons about what Christmas was Like During the Great Depression for his Grandma. You know that saying that where people say “what would happen if you got hit by a bus,” well poor money reason’s great grandpa literally got killed by a train while his grandma was only a wee one.
The part of the article that resonated with me was the one line where he said “back then, there wasn’t any government aid to help” with their problems and he was right. The first food stamps did not become available until 1964. WIC (Women, Infants and Children) didn’t come to be until the 70’s. Section 8 Housing was also a product of the 70s and it wasn’t until 1982 until all states participated in the medicaid program (medicare for low income or disabled people).
Babci Knows Bad, you Don’t
You know even in a recession, if you have the means to get your housing, food and health care expenses paid for, life’s pretty good compared to Grandma Money Reasons. When Babci was growing up in Poland, aside from being malnourished, she had at least a couple of siblings die from treatable illnesses. Back then, if you couldn’t afford a doctor and/or medicine and you were really sick, well, you died. She even has this famous story about how she and her twin sister couldn’t go to church at the same time because they only had 1 pair of shoes and 1 dress to split between the two of them. Since the priest didn’t know there were two of them, he refused to give my mom communion one day because he thought she had already gotten hers during the last mass. You see that boy in the photo at the front of the line . I’m pretty sure he’s not wearing shoes because he didn’t have any. My mom still complains about how messed up her feet are from not having shoes growing up.
I’m very fortunate to have never had to be hungry or cold my entire life and am super glad my mom clawed her way out of poverty. I wonder if she would have been as motivated to change if she always had everything provided for her?
Is Government Getting Too Big
I’m starting to question if our government safety net is getting too big these days especially with our exploding defecit. Does everybody really need to have everything paid for by Uncle Sam when times are tough? Is it not an option to move back in with family or friends when the going gets rough? Everyone needs to have a support system, but it’s a whole lot harder to ask for help from family and friends indefinitely vs collecting welfare from a big government organization forever.
I grew up in a neighborhood where many people were on some sort of welfare system. Most of the people referred to welfare and food stamps as “free money.” Some were even second generation welfare recipients. They also thought my mom was nuts for not taking “free money” that she was eligible to receive due to her income status. Aside from the crime, many of these folks enjoyed a life of liesure. The prospect of working 40 hours a week to maintain the same or lower standard of living to them was a life for chumps. These weren’t people with disabilities. These were able bodied individuals who didn’t want to work for the man because they didn’t want to eat into their quality time with friends and family. Um, would I like to spend more time with my family? Hell yeah. Do I feel it’s wrong to have someone else fund that for me? Yes again. (Thank you Babci for being such a great role model)
So if I fell on hard times, what would I do?
- I would collect unemployment until I found a job. Since I’ve worked full time for over 15 years and part time for another 8, I feel like I paid into those benefits enough to justify that.
- I would not collect section 8. I probably move Babci in with me (as cramped as it would be) and rent her house out or sell it.
- I probably wouldn’t need food stamps because of Babci’s garden and my emergency fund.
- I’d pay for my own health care for as long as I could but I would like a universal health care plan.
After going through this exercise, I realized that I’m all for helping children because they really can’t fend for themselves. I do think a certain population of adults needs a little more negative incentive to actually go out and work. I’m very lucky to have had a job during this recession, but in the last one in the 90’s I couldn’t get a single decent job. However I could get 3 crappy ones, so that’s what I did. I was only 18, so I had no skills at that time except the desire to work and I must have applied to 50 places before I found the jobs I did get.
What Could Be Done Differently
In our efforts to help the needy, are we also creating an entitled monster? Do we need to re-define what needy really is? Perhaps this is just coming from the spent part of me that just got over a stomach flu but still has to do the 100 things that work and family demand. Although life is sometimes exhausting, I’m perplexed that not everyone feels the same desire to support themselves.
I think the solution is smaller support systems and communities of people helping each other in way that’s not a faceless organization. I’ll happily buy a winter coat for a kid in my child’s school that needs one but I really hope that parent doesn’t think of it as “free money” but money that another parent took out of their own budget to help.
If you’re one of those people struggling but wanting to work. Hang in there, keep at it and eventually you’ll find something. Things will get better and don’t be afraid to take a job that’s beneath you for a while. Something better will come around once the economy recovers.
What do you think. Is it impossible for government to cut spending by 10% or more like all private sector companies did during the downturn? Do you think we have too much support for people in need, do we need more or is it just right?
{ 31 comments… read them below or add one }
Cut defense spending. Our defense budget is more than the rest of the world put together! In my opinion, even a small cut back here would mean tremendous savings.
I teach literally an entire class on the purpose of government and the tradeoffs made. If you’re interested in these issues, I strongly recommend getting a copy of Public Finance by Jonathon Gruber (any edition). It is easily accessible and does a great job explaining the economic intuition behind when there is a role for government and what trade-offs are made whenever government gets involved. Then it provides empirical evidence about the size of these trade-offs for individual situations.
It is not easy to design government programs and it is not easy to make these decisions. Just relying on charitable giving is going to under-provide because of the free-rider problem. Additionally (and not from an economic standpoint) when charity is more face-to-face and individual scam artists are more likely to get it (see any complaint thread about giving money directly to panhandlers) and the proud but needy are less likely to feed/house their children (see: boxcar kids blog). Government provision isn’t perfect and theoretically cannot be perfect, but a system of churches and so on works well in addition to some government intervention and not as a replacement for it.
Nicole you really should do an article or two on this stuff. The topic fascinates me but as you can see, I’m no expert in the topic. I just write from my personal observations. I’d love to know the pros and cons. Weren’t you saying you were looking for topic ideas?
Ha, no, we’re not looking for topic ideas. We are looking for input on what challenges we should do for the month of February, but that’s just for fun.
I don’t like doing these posts because it’s really complicated and very difficult to explain in a short amount of time without diagrams and then people from one side or the other (usually both) push uninformed half baked arguments at a person. I can’t even explain why it’s ok to buy new cars in a post (see our post on that topic, and all the complainers from GRS saying I’m a crazy nutcase making excuses) and I do a great job of that one in person. After a point I feel like, I’m not getting paid to explain this stuff to these people… I’m basically giving it for free what my students pay 10K/year to get.
Government is very difficult and very subtle. If it were easy then hopefully we’d always be doing the right thing.
Jon Gruber is awesome though– check out his text book! Interlibrary loan it if you have to. He’s got a fantastic cspan video on the recent health care legislation back in March when he was at College of the Holy Cross, but it’s even better if you’ve got the public finance background.
I lived in poorer areas growing up too, so I know what you mean… The people that need it, get a bad rap because of the people that are taking advantage of the programs.
Wow, I got so into your story, that I forgot to say Thanks for the mention!!!
It’s not often that I get drawn so deeply into thought that I forget to do that 🙂
The article is definitely in my weekly lineup, love the timeline of government social programs listings too!
Yeah, who knew all this stuff didn’t exist until the 60’s and 70’s and even 80’s. How the heck did handicapped people survive before 1982 if they didn’t have parents with killer health benefits?
This is a good point. Those few who abuse, spoil it for the rest.
Of course there are people taking advantage of aid programs. The tricky thing is: how do you determine who “deserves” free aid? Without knowing a person’s circumstances intimately, it’s hard to understand exactly what is going on in their life. Perhaps it is logistically possible to move in with relatives, for example, but there may be behavioral reasons why that’s not something a person could or would do. Maybe there are untrustworthy family members, physically or emotionally abusive ones, or geographic barriers that would make such a move really unwise for the person needing aid.
It seems the larger our communities grow and the less we are in touch with each other the more difficult it is to figure these things out. Small communities can be brutal, too, since the tolerance for differences tends to be small. It seems there should be a “just right” size community that is small enough to care for each other, but not so small that diversity is challenged.
I think it’s possible for government to cut spending. Human services don’t necessarily need to be cut, though, since there is so much that can be cut in other areas.
You bring up some excellent points. I have a great mom, but if my dad were still alive, there is no way in hell I’d ever live with him.
Too many take advantage of it. But too many need it too. So I guess it is very hard to draw the line. I admire people like Babci though and I think there should be more like her out there. Proud people should sometimes accept more help but are also the ones who tend to stay in need the shortest.
Those are some big questions. As a part of overall government spending, assistance to the needy (food stamps, section 8, etc) are a minuscule part. Medicare, Social Security and Defense (of Empire) are the big chunks. Are they likely to get smaller anytime soon, and by the government’s own volition? Probably not, too many vested interests.
Hmm..I’d love to see a table with all the big budget line items in it. I wonder where I can find that.
I personally count medicare and social security as part of the aid that goes to the needy…because it helps the elderly and disabled.
It’d be a big table indeed… 🙂 I once had a in-depth look at our city budget, and boy, was I ever sorry I did. So much waste, so much redundancy. And that’s only at city level. Scale on up to state and federal, and it’s probably a whole new dimension of waste, greed, fraud and stupidity. I agree wholeheartedly with helping those in need, it’s something that we practice in person. It’s when powerful cartels and special interests that draw up their chairs to the table, and feed at the public trough with both hands that I have a bit of an issue. Maybe I’m talking old, like Squirrelers said below (although I’m not old).
Big questions indeed, as Andrew mentioned above.
My take, overall, is that generosity and giving to those in need is an essential part of our society. I would like to think that we are, as a nation, committed to these ideals.
That said, the real problem, in my view, is the lack of discipline and excess of entitlement that we have. Simply put, we have become lazy as a society in too many ways. I know I sound old, but I’m not that old and it’s how I see it:)
I think there are many folks who truly NEED help, and many others who are truly lazy. It would be great to ferret out the lazy, and train kids from a young age with the right values of hard work, self-reliance, dignity….and kindness for those who truly need it. Basically, I think it’s a matter of having a our nation go through a paradigm shift. If that happened, I would guess that we could easily cut 10% and still be able to help those in need.
Yup, it’s definitely the entitlement that’s the issue, not giving to the needy. I sure don’t want to see anyone starving or without basic medical care. I don’t see any good coming out of that.
Well I can speak from the perspective of someone who’s been on welfare. I was what was classified as ‘working poor’. I collected food stamps and health insurance and I was grateful for both. My options were to stay in an abusive marriage with a newborn and not be poor, get a divorce and work two jobs for min. wage and put my newborn in daycare, or get a divorce working one min. wage job (that allowed me to bring my baby to work) and collect welfare. I chose the latter. It bought me time to get back on my feet until I could make a better living.
Planet Money had a segment where they interviewed a few citizens of Denmark. They have incredibly high taxes to support a ‘socialist’ system of government but are considered one of the happiest countries. A journalist asked a woman how she felt when some people took advantage of the system. She said there are people like that and she doesn’t approve but she is still willing to support them and pay the high taxes because she loves the quality of her life.
I think that’s how I feel. There will always be people that take advantage of what is given to them but I’m willing to take that knowing that it’s raising the quality of life for most of our citizens.
Sandy- you always got something interesting to write about!
MoM – Thank you for your perspective. Your situation is exactly the type that the system should exist for and I’m so glad you were able to rebuild your life and are on your feet again. I was a little uncomfortable posting this article because I do want to help people who truly need aid and I certainly would like it available to me if poop hit the fan.
Unfortunately I know WAY more people who took advantage of the system and most of us could name at least one person who does. My neighborhood was filled with lifers loafing around and complaining that their life wasn’t better and they didn’t have money for all the latest gadgets. If someone had something they didn’t, they’d steal it. What a horrible way to live.
I think the concept of social welfare is under a microscope right now with unemployment so high. The debate if unemployment benefits should be extended is an interesting one where both sides have good points. Now if we can get our politicians to listen to each other we might get somewhere!
“My mom still complains about how messed up her feet are from not having shoes growing up.” <– You can always tell her that some recent research tells us that wearing shoes screw up our feet, and they would be better off if we went bare foot more often. 😛
My personal views is that while we create government to protect ourselves from each other, government does not protect ourselves from ourselves. Through the voting booth, we learn to steal from each other through thousands of programs, each of which has a net benefit for a small group, and a small cost for a large group. Add all of these up over time, and you get a large bureaucracy and the problems inherent with majoritarianism.
Is democracy as practiced really the best, absolute perfect form of government that there is? I highly doubt it.
I think there's plenty of room for experimentation and progress, and it's about time we start cutting back the most bloated excesses and allow more differentiation, specialization, and the free movement of people so that they can live under the systems which they prefer.
Yup, I see a lot of waste. It would be truly nice to see some major change.
There are still a lot of people who truly need government’s help. It’s just so sad that there are quite a few who take advantage of the programs and who knows how to work the system.
Hopefully there’s Karma for that.
I come from a country where some of my family members are still in this situation. That means that shoes are reserved for school and/or church. My grandmother was also a twin and did the same thing as yours (are we related?!!) . They had one school uniform and shoes between the two of them so they alternated. They did what they had to do and my grandmother never, ever complained. My mom was of the same grit and ilk. When we moved to this country we moved to what we could afford which at the time as a crack/cocaine and welfare addled neighborhood. My mother did take WIC to make sure that we had breakfast on the weekends, and we had breakfast and lunch at school on weekdays. Otherwise, no other assistance. It’s taught me and my brother resilience.
Are people taking advantage? Hell yes. Just read my post today about my tenant. Are we creating a welfare state? Perhaps. The fact is that we can not afford to be like some European country. We are entirely different and it would not work. Will some people need temporary help occasionally? Absolutely. The problem is, how do you go about administrating these programs leaving the deserving ones in and booting out the ones that take advantage? A conundrum.
Sandy – yes, I think we are twins living in alternate PF universes. Yup, I can relate on the bad neighborhood too. Why is it that when people have fights with their boyfriends they had to be screaming out their apartment windows? I actually like having a portion of my tax dollars going to these types of organizations. What I hate is the waste and I hate the welfare lifers. There is a whole other subsection of immigrants who move here and never work and that makes the rest of us look bad. There will always be the sneaky ones who work the system but I hope that the vast majority are the truly needy.
Sandy, this is a wonderful post. I agree about cutting defense spending as well. $1 trillion down to $800 billion sounds reasonable doesn’t it?
I would max out my unemployment b/c I paid into it frankly. But, I would try my best to find a new job.
BTW, what is your Twitter handle? It doesn’t show up on your tweet button. Also, hope to have you voting on the Yakezie scholarship essays with a couple applicants who are first generations as well!
Cheers
@1stgenamerican. I am connected to you. I sure will vote. Are all the entries in already? I’ve been reading through them but was waiting until they were all in.
7 entries are up. A good enough amount to grade them relative to each other. Cheers
I’m always mixed on these issues.
On one hand, I think that people should work/earn a living if they’re able. That’s only fair. I don’t like that some people think of welfare as “free” money and live off the backs of others. My mom is a teacher in the city and a lot of the kids whose parents are on welfare get new Nikes every few months and other luxuries. That’s really irritating.
However, how can we expect those on welfare to know how to budget wisely when let’s face it, a large portion of the middle class can’t either?
Plus, there is a time limit for TANF (usually what people mean when they say welfare) – 60 months for cash benefits in most states. Some are lower. Of course, there are exceptions for certain people/families in certain situations.
Maybe I’m just too nice, but I have a hard time being angry at people to abuse welfare. Cash benefits do not provide any resemblance of a good life to me. I pity those people, who are so hopeless or lazy that they’re OK with living in relative poverty for their entire lives.
Ryan, Since I grew up in the thick of a neighborhood surrounded by welfare recipients, I have witnessed a lot of this first hand. Many of the kids in my neighborhood had parents on welfare. Some had very young parents, people who dropped out of high school because they got pregnant. But then instead of stopping at 1 kid, my neighbor had 6..I’m presuming so that she would get more and extended benefits. Then when I ran into the kids years later, they also had their own children in high school and became second gen welfare recipients. I have two role models posts that go into some of this..how drug dealer parent makes drug dealer kids and the need for having positive role models and education to show people a different way of life.
I also knew a disturbingly large population of people who were collecting assistance and working under the table to get extra cash for those luxury items. In my opinion I knew/know more people who took advantage than the ones who truly needed the aid temporarily to get back on their feet. There is an assumption that abusers are in the minority. I’m not so sure, really. Is someone who can’t hold down a job because they don’t show up to work someone who really “needs” welfare? To me that screams…they want to check the box and then get back on welfare asap. A lot of people don’t like going to work, but it’s weird that some people think of it as optional.
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