Finance / Politics

Big Welfare Handouts Mean Folks Who Stay Home Are Living High on the Hog off Your Tax Dollars

United States of Dependence: For Millions, It Pays Not to Work

Kids love Santa. They don’t have to work for the stuff on their Christmas lists; he just gives it to them.

In many states, gratuitous welfare benefits have made that childhood fantasy an adult reality. Professor Casey Mulligan of the University of Chicago and I have found that some families can receive the annualized equivalent of a six-figure income with no one working—and you’re paying for it.

During the pandemic, idled workers received unemployment “bonuses” so high that many were pocketing more than twice what they had been making on the job. Even without these extra weekly payments, unemployment benefits can reach unexpected high levels in many states. In New Jersey, for instance, a family of four with no one working can receive unemployment benefits equivalent to a job paying over $96,000. That’s more than the median household earns in wages and benefits combined.

High unemployment benefits are not unique to the Garden State. In 13 states, a family can receive annualized unemployment benefits worth more than the median household income. The value of unemployment benefits comes not just from their sheer size, but their tax advantages as well. Unlike earned income, unemployment benefits are exempt from payroll taxes, and six states also exempt them from the respective state income tax.

And while the pandemic-related unemployment benefits have ended, the Affordable Care Act (“Obamacare”) subsidies have just kept expanding. A program that was sold to the American people as a hand up for the poor has quickly been transformed into a handout for upper income earners.

In some parts of the country, a family of four earning over half a million dollars still qualifies for Obamacare subsidies. Those with a quarter million-dollar income qualify in nearly the entire country.

The annualized value of these healthcare subsidies and unemployment benefits for a family of four can exceed a six-figure income. In Washington state, the amount is more than $122,000, substantially more than many blue-collar incomes.

In fact, it is 32 percent more than the wages and benefits of the median household; 51 percent more than the median secondary school teacher’s wages and benefits; 95 percent more the median machinist’s salary and benefits, and 220 percent more than the median retail associate’s salary and benefits.

But Washington state is not alone. In 29 states, unemployment benefits and Obamacare subsidies are worth more than the wages and benefits earned by the median firefighter or truckdriver. In 14 states, these two programs pay annualized benefits exceeding the wages and benefits of the median electrician.

While our study examined only two welfare programs that are not means-tested, there is an entire suite of means-tested programs for which many people are eligible, and which together provide a surprisingly high standard of living.

In Loudoun County, Virginia, just outside Washington, D.C., you can receive over $25,000 in annual rental assistance alone—and that is just one program. Add to that food stamps, which have just been expanded, and subsidies for everything from education to transportation, and you have not just a robust social safety net but a perverse incentive not to work because even a small amount of income disqualifies you from receiving these means-tested benefits.

Many economists have been scratching their heads, wondering why so many workers are sitting on the sidelines today, despite four-decade-high inflation and the resulting record-high number of unfilled job openings. The expansion of welfare benefits—both in terms of eligibility and size of benefits—has provided a substantial disincentive to working. Businesses must not only compete against one another for workers, but against the dole as well.

While Americans are preparing for the most expensive Christmas ever, they are justifiably frustrated that they are working hard to earn a living while being forced to support so many others who aren’t working. That’s what happens when liberals play Santa Claus with your tax dollars.

This piece originally appeared in Fox News


Reprinted with Permission from - The Heritage Foundation by – EJ Antoni

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Sara
18 days ago

I will do my best to keep this post as short as I can while still getting my point across that the system is BROKEN. In 1972, yes 51 years ago, I read an article in Boston newspaper and remember being very upset, A woman wrote that she had several children. Her husband worked 2 jobs and she worked as well- and they both were happy to do so to provide for their family.
Unfortunately, one of the children became ill, and the life saving medicine the child needed was extremely costly. The woman approached her local welfare office to attempt to get assistance with paying for her child’s medication. She only wanted help with the cost of the medicine. She was promptly told to become eligible for assistance with that, she must quit her FT job, and instructed her to tell her husband to quit his second job, then they would be able to get with utilities, Food Stamps, health insurance , and on and on and on. She argued that they did not want to do that, they just wanted to resolve her childs health issue- that is all she needed. Again, was told what she had to do to get assistance. She said although she did not want to, she may be forced , in order to save her child’s life, to do exactly what the State Welfare employee told her she had to do.

This all or nothing requirement is ridiculous . Able bodied should be forced to work before getting any help, and monthly benefits should be reduced by what amount they can earn. Of course things have only gotten worse here in good old Taxachusetts and welfare states over the past 50 years.

Thanks for allowing me to vent…

Mike L
16 days ago
Reply to  Sara

That is one of the reasons my wife left Taxachusetts 30 years ago.

Letts Brandon
19 days ago

As you may know states used to be responsible for funding the Federal government. This ended when the fed was allowed to tax citizens directly. This was a mistake. To correct this I propose we make the states whose representatives vote to pass bills and budgets which exceed the feds income be held responsible for the overages. Since the president signs these bills and is the represents the entire country either all the states will be responsible or perhaps just the states he won the election in. Perhaps those states that elected the president and also has representatives that also voted for the bills would be charged a double portion of the overages. This could be written into a balanced budget bill. Let’s make this a part of the MAGA platform.

Mike L
16 days ago
Reply to  Letts Brandon

May be difficult fighting the 16th Amendment (Federal Income Tax). Like the idea though.

Why should tax payers in the other 49 states pay for high speed rail in California?

Robin Walter Boyd
20 days ago

Government shouldn’t be allowed to provide any type of welfare. No social issues should be under government control. This is how we have wound up heading toward becoming a Socialist nation. We need to set social programs back to 1911.

Smike
20 days ago

My generation and those following in our footsteps are believers of living for today and expecting uncle sam to take care of us in our old age. We lived from paycheck to paycheck, squandered it all on the good life, drugs and booze. Retirement was something your old man did. That’s how we lived. We learned you can buy anything new; cars, houses, motorhomes with $0 down and no payment for 24 months. So we traded cars, houses and motorhomes every two years and never paid a dime. Can’t do that with used stuff, only new. Max out your credit cards and use one to pay the other, it’s easy. And if that doesn’t work, just get another one. So, that’s what you’re dealing with, generations of slacker, takers, druggies and boozers; we’re the; it’s all about me generations. We’re not dumb or lazy- why work when you can get whatever you want free. See ya on the slopes chump, oh, sorry you have to work – well, somebody has to but not me….

Teton river
20 days ago

I am 72, retired and live quite well, that’s because I always put 10% of my earnings away for retirement. If you plan ahead and live within your means you can be self sufficient.

Deep Bass
20 days ago

Sooner or later, these commies are going to run out of other people’s money. Then the whole shebang will come crashing down. A huge population of welfare mothers and children will be starving and the commie politicos will have no means to feed them.

Robert Zuccaro
21 days ago

Not everyone on assistance scams the system but I knew plenty of people in my youth who collected disability or unemployment and used that money on drugs or booze.

don
21 days ago

As a grandchild of ‘legal’ immigrants after WW1, all they knew was work. They never had much, they gave to many in need…they were always thankful for God’s provision and to be American!

WTF
21 days ago

A six figure household income on unemployment would have to include probably 6 members on the system. I doubt anyone dressed as in this article’s picture is on welfare.
Gainful employment is more than just a paycheck and money in the bank. It is about achieving success with positive results. Today’s socialist give-me or I’ll take it movement is eroding some people’s desire to accomplish, to be proud and say ‘I built that’. We have to trust that the majority of people are good, honest, hardworking and believe that the American dream isn’t about winning the lottery.

Mark Rice
21 days ago

How do people in my situation make a living after have a round of cancer that has taken 5 years to battle ! I am on SS now and because I was forced on it early , it doesn’t go very far ! My past employers will have nothing to do with me due to my age and cancer diagnosis ! I am an inch away from living under a bridge !

Colleen
21 days ago
Reply to  Mark Rice

I am in the same situation. I had cancer twice and was put on disability, but a soon as they could they said I made too much money for medicade and they took my medical card. Now I can’t afford all the tests the Dr still wants. It’s almost like they want you to die and be rid of you.

Sara
18 days ago
Reply to  Mark Rice

I am sorry Mark, it is certainly discouraging to see the trillions of dollars being doled to people capable of working, when in a situation such as yours with health issues.

Rik
23 days ago

I’m 75 and still have to work! Since I’m alone and mostly healthy, I really don’t mind working. I just resent that I REALLY HAVE TO WORK otherwise I would have to live in my car. That’s what happens when you previously worked as a straight commission independent contractor sales representative for small independent publishing companies. I wasn’t straight commission and independent by choice. They just couldn’t survive if they had to pay employee benefits. I never landed with a bigger company mostly because of Affirmative Action and being “white”! But I have an excellent job now and helping less fortunate friends and my struggling Church family and school. So, I feel really Blessed to have found this working opportunity.

SAW
22 days ago
Reply to  Rik

Yes, and the “Reparations” agenda still continues to hit the headlines now and then. Dems play all the games and angles, all of the time. Much tougher to hit moving targets.

A new age “Tea Party Revolt” is desperately needed but much cleansing of the real “Deplorables” is way overdue if the union is to survive.

John
23 days ago

There is nothing here about how many are getting these outrageous benefits. I can’t help but believe that it is very rare or the author would tell us.

Dennis
23 days ago

I can’t get $70 a week from NC DES, and I worked for 55 years? I have done all they asked and they have rejected me for little things. Clearly North Carolina isn’t one of the give it away, or maybe they are.

Bob Chase
23 days ago

Providing such high benefits spoils the system for helping folks during a rough spot. Imagine the moral decay for those taking advantage. There is certainly no benefit to society from this excessive handout.

Michael Lewis
24 days ago

Was I good patriot or a fool for living within my blue collar means for less than McDonald’s workers make today?

NewDay
24 days ago

democrats love people who are dependent on them. It’s a way to control people. They have to vote you back into office to keep the gravy train coming.

Henry Carney
24 days ago
Reply to  NewDay

New Day-
Excellent point and now they have all these hispanics
arriving hoping they’ll join up and give the Dems the
power to stay in office indefinitely. I don’t want to see that
thank God I’m in my 70’s.

Valerie
23 days ago
Reply to  Henry Carney

Deport them

Clark Kent
21 days ago
Reply to  Valerie

Never going to happen. That train left the station a LONG time ago. But thanks for playing.

Mike L
21 days ago
Reply to  NewDay

Very true on the democrats wanting the people to depend on them. Next, since people are dependent on democrats, they will vote for you. Makes it easier to convert to full socialistic or communistic form of government.

Paul W
24 days ago

To quote the late Rush Limbaugh, “It’s just very difficult to beat Santa Claus. It is practically impossible to beat Santa Claus.” Especially if you’re predisposed to being a leech.

Butch
21 days ago
Reply to  Paul W

Santa Claus was created by a democratic socialist!

Travs
24 days ago

The left is just buying votes. Democrats are the disease, Terminex is the cure!

Ali
24 days ago
Reply to  Travs

the site won’t allow me to give you a + so I have to write here that I am absolutely with you on this!!!

Stephen Russell
24 days ago

& costing business Huge time
Dems Got the Welfare State they wanted via Wuhan virus

teresa Ann d'alessandro
24 days ago

IT’S CALL BEING LAZY AND LOVING LIVING OFF THE SYSTEM. SOME PEOPLE DON’T CARE IF THEY ARE GETTING FREEBIES

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