December 29, 2002
From the desk of Jane Galt:Charity Begins at Home
I part company with libertarians who think we can get government out of the charity business. Advocates often seem so infatuated with the free market that they believe it applies everywhere, which is silly; there's no equilibriating mechanism I can see to ensure that the demand for charity equals the supply. So, given that most of us feel a genuine obligation to help the genuinely needy -- those whose physical or intellectual endowments are insufficient for them to earn a decent living -- the government will, at the very least, have to be the charity provider of last resort.
That view is not incompatible with the belief that private charity does a better job, on average, than government charity. Not always or in every case, of course. But government charity is, by its nature, one size fits all. It is also, by its nature, generally designed to eliminate false negatives, at the risk of creating false positives.
One of the central problems with charity is that Americans by and large wish to help the deserving -- those who are doing their best and just can't make it, for some reason -- but not the undeserving. The problem is that there is not now, nor ever will be, a perfect mechanism for separating the deserving from those looking to get a free ride. If you focus on excluding the undeserving, you will probably miss some deserving cases; if you focus on including every deserving case, you will include some who do not deserve your help. The larger and broader the program, the worse this problem becomes, because the criteria necessarily become very crude, and because government, by its structure and for some very good reasons, relies on rules over individual judgement for the awarding of charity.
If the number is small, this is not much of an issue. But the effects of welfare reform seem to indicate that the number was not small, and probably is still not small in states that are gutting work requirements or time limits. And giving money to people who don't need it is a violation of the wishes of the voters who pay for it. It also creates a great deal of social pathology.
In Europe, I gather from my friends, the idea is that it's all right to pay people to stay in their houses staring at the walls all day because they're just human cattle (I mean, they don't put it that way, but that's the gist), and they're not going to have any sort of a worthwhile life anyway, so who cares if they're stuck in a council flat with no hope of anything better. But Americans don't think that way. It's not just resentment at paying taxes. It's a recognition that most of us are not so motivated as to achieve without the impetus of need riding hard behind us, and that if benefits are sufficiently generous, there are a lot of people who could be working who won't.
Is public charity degrading? I don't know, is it degrading to expect to subsist without effort, as many of our clients did until someone kicked their ass for them? As most people do, until their parents throw them out into the world? It's not degrading to expect it, I suppose, but the yankee in me feels there's something degrading in living that way.
Don't get me wrong; I've worked for a public service provider. I am not under the impression, apparently common in some of our more callous suburbs, that welfare benefits are the key to a life of plenty and leisure. Welfare benefits leave damn little money for fun. But relative to the immediate choice of working at some crappy job for not so much money, it's not that bad. There are also interesting questions of the marginal tax rates imposed by benefit cuts, but that's another post. Anyway, the point is that welfare recipients, especially and the long term, pathological welfare recipients we worked with, are making a logical choice between staying home and getting crappy money, or going to work and getting nearly as crappy money. You'd stay home too, if you didn't have parents who made you get a job or get out of the house.
Personally, I needed my crappy jobs to teach me to show up on time every single time, to organize things, to be nice to customers who were nasty, to do stupid unnecessary things just because my boss wanted them, to budget my time, and all the other unlovely skills we must acquire in order to get a better job. And indeed, much of our experience with welfare recipients was that they were willing to work -- just not at the entry level jobs they needed to take in order to gain experience to get a better one.
[Yes, I know that not everyone gets a better job. But sure as hell no one's going to hire them until they get that first job stocking shelves or mopping floors].
Private charity is better at dealing with these things than we were. But they were better at it because they risked creating false negatives: they kicked out people who, in their judgement, weren't trying hard enough. Government programs, or programs that take Uncle Sam's money, can't do that. You can kick them out for using drugs or violating a number of very specific rules, but you can't kick them out because the social worker thinks they're deliberately spiking their job interviews, or starting fights with their boss so they can get fired and go back on the dole. Yes, people do do that, and don't send me the emails telling me I wouldn't say that if I'd ever been poor. Sanctifying the poor into a bunch of people who would never, ever do wrong is no more illuminating than deciding they're all a bunch of lazy good-for-nothings trying to leech off the body politic. And for reference, I have known a number of middle class children who pulled similar stunts as long as the parental dole was still paying out.
The taxpayers who are paying for the programs don't want to support the people who are able, but unwilling to work, just as they do want to support those who are willing, but unable. And supporting the former group has consequences for the rest of us. It takes people out of the workforce, for one thing. For example, one of my statistics professors averred that the most effective way to reduce repetitive stress injuries and back pain in the United States was to reduce the workmen's comp for them, since there is a nearly 1-to-1 relationship between changes in the level of compensation for those sorts of injuries, and the number of them reported by doctors.
[Other studies apparently suggest that the pain is psychosomatic, not faked. In which case, we really might be doing the recipients a favor. But I'm not a doctor, nor a statistician. I'm just repeating what I'm told.]
But that does not imply that private charity is perfect. Mark Kleiman points to a post by Jeanne D'Arc that points up all the problems with private charity, starting with the people who donate the stuff. Listen up: I too have given into the temptation to clean out my stock of unwanted canned goods at the annual Thanksgiving drive. But there is a difference between realizing that you're never going to eat those seventeen cans of Dole Peaches in Light Syrup you bought because you made the mistake of shopping when you were hungry and canned fruit was on special, and hauling out the ten-year old can of -- er, something -- with the dents and the label ripped off so you can give the very special gift of botulism to some needy family this holiday season. And the needy are not needy enough to require your old gym socks. IF you want to give underwear, for gosh sakes go down to Wal-Mart and pick up a shiny new six pack of Jockeys. Sheesh.
Nor is charity an excuse for parading how gosh darned good you are to all and sundry. I used to mentor a little boy at one of our facilities, and half the people there seemed to expect to be beatified for the incredible sacrifice of two hours every Thursday making crayon drawings and doing math homework. I'm sorry, but what with Tivo and all, I find it hard to imagine what's so gosh darned important that you can't spare a couple hours a week. Charity is about the people who need help, not about you. I mean, it is a bonus if you enjoy crayoning, but that's not the point of the thing. Just as with your own children, one must crayon and do math homework even when you have much more interesting possibilities.
Ultra-libertarians are on the wrong side of the question of whether a decent society lets the helpless fend for themselves. Conservatives in general may be too optimistic about the possibilities of private charity. Certainly volunteers on the right and left are prone to putting the focus on themselves, instead of the people they're supposed to be happening. But deciding that government charity is superior is not the answer either, not only because its sorting method is very poor, but also because what the poor lack now is generally not money, but the social network that helps out the rest of us in innumerable ways in times of trouble. There are far, far too many liberals of my acquaintance who are willing to pay tax dollars, but not to get in there and actually work with the poor. They don't have time, they don't want to be bothered, (my favorite) they "wouldn't be any good at it" . . . well, I'm sure there's something you're good at. Other than making excuses. The poor have reached the limits of what tax money can buy them. Their problems are more complicated than hunger or lack of shelter, and that means they need real live people helping them out. That means you, "but I voted for the Senator who wanted to increase the budget for food stamps!" It's time for people to realize that nothing is a panacea, and that while we all need a little safety net, it's a lot better to help people to walk the tightrope than to catch them when they fall.
Posted by Jane Galt at December 29, 2002 12:48 PM | TrackBack | Technorati inbound linksGreat post, as always. I had to comment on one thing since it's in my area of expertise.
"For example, one of my statistics professors averred that the most effective way to reduce repetitive stress injuries and back pain in the United States was to reduce the workmen's comp for them, since there is a nearly 1-to-1 relationship between changes in the level of compensation for those sorts of injuries, and the number of them reported by doctors.[Other studies apparently suggest that the pain is psychosomatic, not faked. In which case, we really might be doing the recipients a favor. But I'm not a doctor, nor a statistician. I'm just repeating what I'm told.]"
It is quite true that back pain claims go up in an environment of more generous disability insurance but that doesn't mean the pain is at all fake. In Washington state (at least) it's been studied and there is a clear correlation. The pain can be very real but it also responds to incentives. If nothing else, people can opt to work with pain rather than go out sick if benefits are good enough. MANY people have some degree of back pain and if you set the bar for "disability" low enough, lots more of them can decide that they too are disabled by the pain.
There's also a less conscious angle that much chronic pain, especially back pain, is actually HELPED by activity and focusing on something other than the pain. Sitting around all day on disability tends to make the pain worse, not better. So if benefits get cut and a person with seemingly disabling back pain is forced to go back to work, their pain may actually get better in the face of increased activity. Strange, but true.
One final flaw in how we handle disability in many cases (though this is getting rather off the topic of the original post) is that often a disabled person's sole source of medical insurance is via the state disability system. If they get better they lose ALL their health coverage. It's a huge disincentive to get better.
The back pain issue reminds me of the World War 2 (or maybe it was WW1?) experience with shell shock (post traumatic stress).
A lot of men were getting shell shock, and so recieving discharges. It got to the point where it was affecting numbers. So a medical discharge of psychiatric grounds was banned. The number of cases plummeted. Then it was quietly reintroduced so that the doctors could secretly ship home the guys who were really sick. But it was kept secret and the number of shellshock cases stayed far, far lower than it had been.
Now shell shock it clearly "all in your head", which doesn't mean it is not very real, but certainly does mean that other mental conditions (such as incentives) will affect it.
I have a friend who was my high school civics teacher, and is now a real estate salesman, which he does quite well. He remarked that welfare is the bribery that we give to the poor in place of a job.
One of the problems with government funded charity is that it becomes a "right". That is, the person qualifying for it can compel the agency responsible to provide the mandated benefit. This can be an obstacle in developing the humility necessary to change and improve oneself.
This problem of the program being an obstacle to beneficial change exists without regard to who is running the program. As long as the program is rules based (which Jane points out it must be if it is funded by government), the people running the system cannot judge who is worthy of help. Which means the people wanting access to the program don't need to manifest an attitude adjustment.
All-in-all, this gives me little hope for Bush's faith based initiatives.
(I know that "attitude adjustment" seems pejorative. I just don't know how else to express it. It may not be fair, but most of us need a touch of humility in order to change and learn new skills. I accept that SOME of those needing help have great job skills and fine attitudes. It is about those who do not that I speak.)
Re faith based initiatives:
The U.S. spends millions yearly on Faith Based Initiatives, arguably to no great good - I refer, of course, to the grants, contracts and intervenor funding that goes to practitioneers of the Gaia religion, the "environmental" liars.
David: the interesting thing about unemployment is how little it has to do with education or the acquisition of new skills. Keynes was right on this one; unemployment really is a macro phenomenon, not a micro one. Case in point being the period 1994-1999, when probably more people than ever before found their skills in need of upgrading to cope with technological change. This happened without causing any increase in unemployment at all.
George Orwell noted it best in The Road To Wigan Pier, when he pointed out that the fact that two million are out of work is something that cannot possibly be Alf Smith's fault; but if two million men are out of work, then it is logically necessary for someone like Alf Smith to be out of work, and everyone, including the man himself, tends to regard that as the fault of Alf Smith.
Marx's analysis of the unemployed has become so orthodox these days that it's often fun to remind people of its provenance -- even Alan Greenspan agrees that the purpose of the unemployed is to act as a "reserve army of labour" and to keep wages down. In paying them a dole, as a poster above correctly notes, we are simply providing a bribe to keep them out of work. It's a morally repugnant system, with, as Jane notes, horrendous and psychologically corrosive effects on the people who are affected by it.
The only problem is that the "reserve army" method is the only way to keep inflation under control in the sort of free-market economy that some of us want for other reasons. If you aren't prepared to countenance an incomes policy, then your only policy weapon against inflation is the creation of periodic recessions and unemployment.
Dsquared - You're right that unemployment is more macro than micro. My brother is unemployed and I fully expect this is a temporary situation that has little to do with him. (Anyone need a good VAX programmer?) On the other hand, there are people who simply cannot seem to hold a job no matter how robust the job market. Government sponsored welfare too often insulates these people from the need to address their personal short comings that prevent them from succeeding in the workplace.
As an example, I had a good friend who simply could not understand that he had to show up for work. If a friend was getting married, if the weather was nice and he wanted to take his kids to the park,or if he felt a need to spend time with his wife, he'd simply skip work. Not surprisingly, he could not keep a job. Did this frustrate him? Yes, but government subsidized housing, food stamps, and other programs made it possible for the family to survive. There was no need for him understand that he HAD to show up to work even if he'd rather be doing something else. Would he have preferred to live in a nicer location, drive a reliable car, and have the other trappings of a middle class lifestyle? Of course. He just valued his freedom to set his own schedule more than these things. I don't think he ever sat down and made a conscious decision a long these lines. The government programs made it possible for him to avoid facing such difficult choices.
For people such as my friend, unemployment is a micro, not a macro, problem. They are not part of the "reserve army" of labor because they cannot hold a job even in a tight job market.
Unemployment is a matter of a surplus of workers (or shortage of jobs, depending on which end of the telescope you're looking through). Surplus and shortage are resolved by price, so if there is persistent unemployment, look to why prices are not moving to resolve it.
D^2 makes a good point about macro factors, but with welfare families it's more complicated than that. For one thing, empirically they tend to remain unemployed regardless of macro conditions. And for another, the qualitative experience of the social workers I talked to is that most of them were, in fact, quasi-unemployable. Their skills and attitudes about work made them unable to keep a job. For example, I mentored a boy whose aunt lost her home (I don't know why.) His mother quit her job to take in his young cousin, a toddler. (The aunt couldn't stay with her -- rules of the residence.)
A middle class parent whose job was the only family income would not have done this; she would have found some arrangement, like the sister coming over to care for the kid. But she'd lived her life seeing work as optional; something to take on if other things didn't interfere. The job she quit was a good job as janitor at a hospice, with room for advancement and good benefits. The next job she got was at KMart, which pays nothing and has no benefits.
She was a nice woman who cared deeply about her kids. But she'd lived her entire life moment-to-moment. The government not only enabled, but positively encouraged it. Her kids will break out of it, we hope, but it will take a hell of a lot of services, including middle class folks like me to help push them through school.
I don't think anyone thoughtful is going to claim that supply of welfare will, should, or can meet demand. Welfare is, by definition, not earned on the market. The supply of any good must be rationed. Free goods cannot be rationed by price, so they must be rationed by means other than price. Supply of any free good will always be less than demand.
The argument against welfare does not stand upon the question of whether or not "enough" welfare would be generated by a free society. Clearly human wants are unlimited; and so there is never enough free goods.
What we "ultralibertarians" don't like about welfare is not giving out money, per se. Any money or goods a government, or any other corporation has which it is entitled to, it surely has the right to dispense with however it may decide. That's private property, which essentially everyone agrees on. And although trying to do good via handouts is difficult, it is surely possible. What libertarians protest is the means of funding of said handouts - taxes. Involuntary taking. Theft, if done privately, or if performed without the intellectual rationalization of the elite. It's morally wrong.
Until you understand the moral argument against taxation, you will not be able to understand the moral argument against (public) welfare.
Letting the helpless fend for themselves is, agreed, morally problematic. However, it is not morally wrong; we can infer this from the fact that right now, someone else is starving to death who you might easily and at low cost save, by an small contribution to Oxfam or other such charity. Practically everyone reading this has plenty of ability to voluntarity donate more to charity. That you don't is either moral blight (if you truly believe a good person should), moral cowardice, or self-deception -- or else, quite clear evidence that you understand that inaction is, morally, categorically different than action.
Anyone living above the poverty line in the West reveals this morality, by his or her inaction.
Taxation is an action. Only by force, constantly threatened and applied, can a regime of forced wealth extraction persist.
Non-helping is inaction. It's the default state of humanity.
If you believe in working towards a moral society, and you believe that theft is a worse moral evil than inaction in the face of suffering, and you believe that taxation is theft - then you will be compelled by logic to the libertarian position.
I also want to take issue with the idea that a free society will not generate "enough" welfare.
Even if it cannot, then that's still not a sufficent argument to say that we should not seek a free society. I believe the converse, as I argue above. But it does dim the attractiveness of a free society for a lot of people; apparently Ms Galt among them.
How much does America currently spend on welfare? Governments spend about a $400 billion per year. Americans also give on the order of $100b/year to private charity.
Would 1/5 of the current spending on charity be enough? I tend to think so, but then I am the sort of person that think the Great Society a fairly unmitigated failure. Others may believe that much more money is necessary for "adequate" charity.
(Of course, if we abolished public charity, there would be at least somewhat more money given privately simply because people's incomes would be higher. But people would hardly give the full $400b.)
We don't know how much money there would be in a free society for welfare. The data we have are from our current society, and from a much freer, but also much poorer historical America.
Recently Ted Turner gave a billion to the U.N.. Bill Gates gave $20B to his foundation, which does various things. Many other rich men have left foundations, organized to do various things. The total assets controlled by charitable foundations in America must be on the order of hundreds of billions; these should generate on the order of several percentage points in interest that could serve as an ongoing source of welfare.
Of course, currently those revenue streams do not serve as welfare. Rather they are channeled in other ways. But that is because the government already does welfare; there is no point in trying to compete monitarily with a government. When cash-transfer is monopolized by the deep pockets, charitable givers think of other things to do with their fortunes.
100 years ago, Carnegie's money was used to do something he viewed as directly helpful to the (deserving) poor: to endow libraries where you did not have to subscribe to rent books, but where anyone could check them out for free.
These days, Bill Gates' money is "dedicated to improving people's lives by sharing advances in health and learning with the global community". This does not directly help America's poor; I would argue that if there had been no welfare when Gates made the endowment, he might have considered making his foundation's mission something more directly helpful to the American poor. But there was welfare. Overmuch, I would say; but certainly well-covered, by the US federal and state governments. So Gates did something else with his money.
How much capital ownership do you think it would take, earning dividends and interest tax-free, to "adequately" endow enough organizations to provide all necessary charity for the poor, completely privately?
Do you think that America can generate enough money to do that?
If so, then you believe that America could handle welfare completely privately. Without taxation. Morally.
My son's SoCal granola high school decied that their class Christmas prohject would to buy a heifer for some third world family. My son announced that this was stupid and that the squee-gee man who works directly across the street from the school was a far more worthy recipent of their charity. His arguemnt was that the kids and staff saw this man every day and had more of any obligation to help him than someone they found on a web site. He said "How can we look at him ever day and not help him and yet send $500 dollars to some agency?"
The head teacher was pissed but the kids went for it and gave the guy gift certificates to the grocery store, cash, and a new jacket and took him to lunch with them.
Surplus and shortage are resolved by price, so if there is persistent unemployment, look to why prices are not moving to resolve it.
I think Keynes wrote a bit on this.....
Dear Miss Galt,
Though I style myself a libertarian, I doubt I speak for anyone else in this regard, but still...
At this time, I don't think the public disgust with welfare is about particular, quasi-technical aspects of public versus private charity, or even with the morality of coercing self-supporting persons to provide for non-self-supporting persons through taxation. For ordinary, non-politically-engaged people, I think it's more about the sense of having been abused by the system, with the primary beneficiaries being the operators of the system, and the system's nominal clients being mostly an excuse. For me, and perhaps for other unsure liberty-minded types if there are any, it's mostly about what works best with the fewest undesired side effects.
Henry Hazlitt's book The Conquest Of Poverty made a good case for the old English "workhouse" system. Those who designed it explicitly strove to avert as much human suffering as possible while taking care not to elevate its clients above the condition of the able-bodied self-supporting worker of the lowest stratum. I won't recap all the features of the system here, but I will mention that the "indoor" nature of workhouse relief -- adults were required to live and work in the workhouse for their bread and board; children were required to attend classes; no cash was given to the residents for use outside the premises -- appears to have quenched many of the undesirable side effects of cash welfare such as we practice today.
This is not an unqualified endorsement of workhouses. Apparently they were susceptible to certain abuses, and were weak on mechanisms for transferring clients to a condition of self-sufficiency. Yet they were an example of an approach that had been thought out to avoid the worst features of cash welfare: the degradation of honest labor, the creation of a self-perpetuating parasite class, and the avoidance of a bureaucracy that could buy votes for its favored politicians by handing out welfare benefits, in exchange for ever-expanding authority.
The whole subject needs more thought, and more experimentation. Probably best would be the complete defederalization of the subject, so that the states could try many approaches and learn from one another. Not that that's likely, but one can hope.
Happy New Year,
Fran Porretto
GOOD DAY,
I AM DR WILLIAMS THOMAS FROM THE UNITED STATE OF AMERICA. I AM THE MANAGING DIRECTOR OF THE OIL NEK COMPANY IN AFRICA AND DECIDED TO DONATE A SUM OF THE UNITED STATE $500,000 TO THE CHARIY HOME .I WENT THROUGH YOUR WEBSITE AND PROFILES AND FELT I SHOULD HELP OUT DONATING TO THE CHARITY HOME. GET BACK TO ME AND LET ME KNOW YOUR METHOD OF RECEIVED MONEY FOR THE OPHARNAGE.
THANKS
DR WILLIAMS THOMAS
I just received a note from you regarding a gift to Rancho Santa Marta home for children. Please respond with specific contact info. Thank you
i am an iraqi lady who lost all her family in the war .now i am a refugee in united arab emirates with two kids.we are starving and nobody is helping us.i applied to red crescent and they told me to open an account in any bank so they will help me monthly.now its my fourth month but nobody deposit a penny in my account.my account no. 020/159851/050 HSBC bank middle east dubai united arab emirates.please help me.my kids are dying from hunger.i donot have e mail or computer .i am writing from sombody who allowed me to use her computer and e mail to beg world wide for charity.adress c/o p.o.box 52853 abudhabi united arab emirates.please help.i am appealing to your consciece.god bless all
i am an iraqi lady who lost all her family in the war .now i am a refugee in united arab emirates with two kids.we are starving and nobody is helping us.i applied to red crescent and they told me to open an account in any bank so they will help me monthly.now its my fourth month but nobody deposit a penny in my account.my account no. 020/159851/050 HSBC bank middle east dubai united arab emirates.please help me.my kids are dying from hunger.i donot have e mail or computer .i am writing from sombody who allowed me to use her computer and e mail to beg world wide for charity.adress c/o p.o.box 52853 abudhabi united arab emirates.please help.i am appealing to your consciece.god bless all
i am an iraqi lady who lost all her family in the war .now i am a refugee in united arab emirates with two kids.we are starving and nobody is helping us.i applied to red crescent and they told me to open an account in any bank so they will help me monthly.now its my fourth month but nobody deposit a penny in my account.my account no. 020/159851/050 HSBC bank middle east dubai united arab emirates.please help me.my kids are dying from hunger.i donot have e mail or computer .i am writing from sombody who allowed me to use her computer and e mail to beg world wide for charity.adress c/o p.o.box 52853 abudhabi united arab emirates.please help.i am appealing to your consciece.god bless all
i am an iraqi lady who lost all her family in the war .now i am a refugee in united arab emirates with two kids.we are starving and nobody is helping us.i applied to red crescent and they told me to open an account in any bank so they will help me monthly.now its my fourth month but nobody deposit a penny in my account.my account no. 020/159851/050 HSBC bank middle east dubai united arab emirates.please help me.my kids are dying from hunger.i donot have e mail or computer .i am writing from sombody who allowed me to use her computer and e mail to beg world wide for charity.adress c/o p.o.box 52853 abudhabi united arab emirates.please help.i am appealing to your consciece.god bless all
Comments are Closed.