During the Senate confirmation hearings for Congressman Tom Price yesterday, Price asserted the US was a compassionate country. Then, everyone’s favorite socialist, Bernie Sanders, accused the people of the United States aren’t actually all that compassionate. He said:
>>>“No, we’re not a compassionate society! …I don’t think, compared to other countries, we are particularly compassionate.”<<<
Well Bernie, the Gallup organization has consistently found that the US is the most charitable of the developed nations in the world, both internationally and domestically. A Heritage Foundation study found that our poor have more than the middle class in Europe. There is no absolute poverty left in America, only relative poverty built on envy of what others have.
For millennia, how to show compassion toward the less fortunate is a real question, one societies have struggled to answer. For most of the last century in the Western world, the answer has been the creation of a burgeoning welfare state, complete with guaranteed entitlements. However; since there is no such thing as a free lunch, for every entitlement created there are also a moral hazard created.
A moral hazard can be defined as any situation in which a party insulated from risk behaves differently from how it would behave if it were fully exposed to the risk - and yet we hear no recognition of the creation of moral hazards as we are told we are not compassionate. The danger of moral hazard is so great, people as diverse in thought as de Tocqueville, Nietzsche, Burke, John Stuart Mill, and Ayn Rand have all warned against creating them.
Do the “less fortunate” behave differently than if they were entirely responsible for their financial health?
Many people have witnessed others shopping with food stamps while talking on a mobile phone, then taking that food to their car. Many people have overheard those same people talking about what they watched on cable TV or a game they played on X-Box. People have seen others paying for groceries with and EBT card and then paying cash for cigarettes and beer. If you haven’t, you likely haven’t been in a middle market grocery store anywhere in America. Coincidentally, these are also the people most likely to be obese, have health issues due obesity and are least likely to be able to afford health care.
None of this is an indictment of the poor – they are only living within a poorly designed system – one that often prevents them from rising out of poverty on their own. Sometimes being poor is a function of bad choices, poor education, downturns in the economy or sometimes just pure bad luck – but sometimes it is a choice.
If we are going to support a welfare state, we must ask if the role of government is to create a minimum standard of living rather than assisting those who are temporarily in need. Does the “safety net” provide survival or “stuff” to assure a certain standard of living? Should the system be designed so that the “poor” have TV, mobile phones, cars and X-boxes and yet need support for food, clothing and shelter?
It is no secret that poverty rates were trending down until the Great Society programs of Lyndon Johnson started to bite. Per the Department of Health and Human Services, the 2016 US poverty line is $11,880 for an individual – according to the World Bank, 80% of the world’s population gets by on less than $10 a day – $3,650 a year, 90% less than $20 a day – $7,300 a year.
I’ll bet most don’t know that America’s “poor” rank in the top 10% of global incomes - not in the top 10% of the incomes of the world’s poor – the top 10% of ALL incomes.
There is no way we can look at the record level of food stamp participants or the trillions of dollars spent during the 50-year “War on Poverty” and call it a success. In our attempts at relief, what we have done is create moral hazard, making it far more difficult to solve the eternal riddle of helping the less fortunate.
If we truly want to be compassionate, we should be against the perpetuation of a permanent underclass dependent on handouts.