It’s Hard for People to Believe it When Government Gets it Right

November 30th, 2012 at 1:20 pm

I’ll have more to say about this broader theme in coming days, but I’ve been talking to tons of people from all walks of life in recent weeks about the fiscal cliff and, more generally, the stuff the federal government is doing for better or worse.  And while this is a “convenience sample” and not a scientific poll, the strong consensus I’ve found is that regardless of their political stripes, there is virtually no recognition of a lot of positive stuff that’s actually occurred (and by “positive,” I mean stuff they like—not necessary stuff that I like).

For this post, I’ll focus on the safety net, but many of the people I talked to want the government to spend less.  Putting aside the whole austerity-in-recession problem, when you point out to them that, in fact, we have very significantly cut spending—$1.7 trillion over ten years (including interest savings)—they refuse to believe it.

When you tell them that health care costs are actually growing more slowly in recent years, and that this may be an early sign that cost controls of the type in the Affordable Care Act will actually work, they are incredulous (though at this point, to be fair, it’s hard to separate out recessionary effects).

The fact that the President’s budget—which is basically what he’s working from on the cliff negotiations—will stabilize the debt as a share of GDP, as scored by the CBO, is simply unacceptable to people.

As is the fact that the safety net worked.  The figure below is an update of one I’ve used before showing the trend in poverty rates as officially measured and as correctly measured.  The Census Bureau has an alternative series of poverty measures that captures the economic impact of the benefits that flow to the poor.  So, for example, it includes the cash value of food stamps and the impact of tax credits like the Earned Income Credit.  It also adjusts for geographical price differences and out-of-pocket health care spending.

While official poverty rates—which exclude much of the value of the safety net—increased from 12.5% to 15%, 2007-11, the alternative measure, though higher at a point in time (accurately measured, there are more poor people than the official measure reveals), was essentially unchanged.  That’s right—the deepest recession since the Great Depression and poverty didn’t go up, at least not when you measure it correctly.

That is a real accomplishment and a sign of a far more civilized society here in the good, old USA then you might get from watching reality TV.  And before you get all wound up about the government bestowing gifts on the lazy, remember—this occurred during a massive market failure when work disappeared, particularly for folk in disadvantaged settings.  As the economy comes back, the extent of assistance from many of these programs will also fade (e.g., food stamps).

I’m not saying we don’t have work to do when it comes to a functional, efficient government sector…there’s a whole lot to improve.  But folks really need to look at these issues with open eyes, minds, and non-jerking knees.  You might be pleasantly surprised.

Source: Census Bureau (note: I used definition MSI-GA-CE as I believe it is closest to the National Academy’s recommendations.)

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6 comments in reply to "It’s Hard for People to Believe it When Government Gets it Right"

  1. rjs says:

    think you need a mantra with as few words as possible, that you can repeat over and over everytime you talk to people…

    obviously, people have heard “tax and spend” from the talkers so often they believe they’re inseperable & that’s all government does…

    • urban legend says:

      Here’s a start:

      “The safety net we have has kept millions out of poverty during the Great Recession, including millions of children.”

      Extension when elaboration is possible: “. . . millions, that is, who were not lazy until the Great Recession threw millions of workers out of their jobs within a few months. Then according to right-wing Republican economists who should know better but refuse to change their discredited theories, these millions — a big part of Mitt Romney’s 47% of “takers” — who were dutifully showing up and doing their jobs suddenly didn’t have a job — and just as suddenly got lazy and decided to take a vacation because they say the safety net is “too generous.” Do you think $1000 a month is “too generous”? Is it possible to have less respect for ordinary Americans than that? Is it possible to be more obnoxious to Americans who were playing by the rules and got thrown out of work for their efforts?”

  2. Fred Donaldson says:

    If conservatives and property protectors want to reduce food stamps and other subsidies to the poor, then they can simply radically raise the minimum wage to $15 an hour (like France, Australia, etc.) and make many more folks fall above the social net qualification line.

    Programs to help the working poor require the workers to make less than the poverty level. We can either lower benefits or raise the general level of wages so that anyone who works full time should be able to support their family without begging the government for help. Kind of an Ayn Rand concept, wouldn’t you say?

    The conclusion is that if we pay workers too little, they need help in order to live until the next day of work – a business subsidy, not a personal one.

    History recalls that the Southerners in slavery times often maintained that the slaves were better off than the “wage slaves” of the North, who often made so little they could not afford decent food and shelter for their family, unlike the slave. As usual, the elite (slaveholders) left something out – the part about rape, murder and imprisonment of slaves. But they were correct that the government didn’t have to provide food stamps etc., because sustenance to keep slaves alive and working was the duty of the owner, not society.

  3. fausto412 says:

    Ummm… It is tough to penetrate the bubble. I told someone Obama’s deficit was down and they would not believe me…googled the graph and data and they still looked at me like I was doing magic!