What is poverty? According to the Federal government, it is less than $12,000 a year for a single person, less than $13,000 a year for a single person in Hawaii, or less than $15,000 a year for a single person in Alaska. Aside from the fact that real research suggests these numbers are low by about half, I think the government completely misunderstands poverty.
Poverty is less about income and more about living conditions. Income certainly affects living conditions, but it is not just about income. Poverty is also about things like human dignity and financial security. In fact, poverty is more about human dignity and financial security than it is about income. These are two things that our current welfare system actually makes worse.
Poverty is very close to slavery, in that it undermines dignity, and it makes financial security depend heavily on factors beyond one's control. It is even more like slavery in the fact that those who are in poverty often get stuck doing work they hate, because the risk involved in quitting to find a better job is too high. People in poverty tend to make bad decisions for a variety of reasons. One is that when human dignity has already been undermined, there is little incentive to consider decisions more carefully, and when you have nothing to begin with, there is little risk associated with making unwise decisions. Lack of human dignity is also associated with depression and other mental illnesses.
Financial security is actually closely related to health, as well as decision making. Those who lack financial security tend to make a lot more important decisions that those who have it. People who have financial security can make mistakes without dramatic consequences that would devastate someone without financial security if the wrong choice was made. Research has shown that the human brain has a limited capacity for making high stress decisions like this. Once that limit is reached, a person becomes far more likely to make bad choices. Further, lack of financial security creates an enormous amount of stress, and the type of stress created is associated with significantly shortened life span as well as a number of chronic illnesses.
Human dignity and financial security are so important it would not be unreasonable to place them above rights like freedom of speech, personal property, and such, if it is possible to guarantee them in the first place. At least in first world nations, it is possible to guarantee these rights.
How the Federal government deals with poverty should take these things into account. Requiring people to confess that they are poor and to share all of their financial details with another person to get government welfare assistance infringes on human dignity. Requiring poor people to use a food stamp card that tells everyone watching that they are poor (including the cashier) infringes on human dignity as well. A welfare system that provides only medical care and food for most poor people denies them financial security, and restrictions on food stamps in particular makes them especially ineffective at providing financial security, because they cannot be used where they are really needed. Income restrictions on welfare that leave gaping holes also prevent welfare from providing financial security. Financial security is so important to people that they will deliberately limit how much they earn, so that they can stay on welfare, because welfare is more stable than employment, and earning too much will reduce welfare by enough to reduce total income. This is especially pronounced with the Medicaid system, where standard health insurance generally costs more than $80 a month for one person (through an employer), which is almost a $1,000 a year drop and often occurs with a raise that only increases yearly income by less than half that. Further, since most poor people don't have employer provided healthcare plans, the cost of insurance is as much as 2 to 4 time that, making Medicaid a better option than even a fairly large raise.
The only system that deals with all of this effectively is a universal basic income. Universal means everyone gets it, rich or poor. This is essential to the human dignity part. If everyone gets it, then there is no indignity for a poor person when someone discovers they are getting. Basic income means enough money to survive on, without any amount of earned income. This provides financial security. In fact, it provides financial security to everyone, rich or poor. Occasionally a rich person makes a major investment that does not pan out, and when that happens that person can go from rich to poor very quickly. Everyone needs a safety net. Basic income also provides a safety net for businesses, because normally an economic downturn or natural disaster means that no one in an area can afford to buy anything, and this causes businesses to collapse. A basic income guarantees that people will have the money that they need to spend, and in turn that means that they will have the money necessary to support the businesses that need it to survive. A universal basic income not only provides an economic safety net for individuals, it provides one for businesses and for the entire U.S. economy. A universal basic income would make recessions and depressions extremely difficult to even occur, because it interrupts the feedback loop that allows them in the first place.
The fact is, a universal basic income is the only reasonable way to actually alleviate poverty. Even the most robust welfare system cannot guarantee human dignity, and any need based welfare system will fail to fully provide financial security. A universal basic income can provide both of these things to everyone, at a lower cost than any other option.
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