What do People do with Means-Tested Assistance ?
There is a ideological caricature of Americans who are aided by public assistance. There claims of fraud and waste are rampant, but the actual evidence is sorely lacking. It is not that there is no fraud or waste, but that it is grossly exaggerated. The caricature tends to be part of a political agenda that wants to reduce the assistance.
This Great Graphic was posted on Atlantic by Jordan Weissmann. It shows the consumption patterns of those receiving assistance (red) and those that do not (blue). The data comes from the Bureau of Labor Statistics.
Families receiving assistance spend about half as much as families drawing on assistance. They spend a third less on food, 50% less on housing and 60% less on entertainment. That said, the data does not capture the non-cash assistance that some households receive.
Some research (see Henry Farrell's review of a new study on the Washington Post's Monkey Cage blog) indicates that people tend to be more supportive of transfer payments and assistance if they believed the recipients are in genuine need and not gaming the system. We suspect, then, that if there was a greater understanding of what the assistance is being spent on, there may be less political resistance to it.
Of course, it is not simply a marketing challenge. It is ultimately a political question. How should the social product be divided ? What do social classes owe each other? In that debate, those receiving assistance are often demonized for political and ideological reasons that often bear little relation to the facts.
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