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I think people spend WAY too much effort worrying about the "small subset of people" who misuse a social system. To the point that their fixation on this small subset causes more waste than just being okay with the fact that some people will misuse a system.

When Covid began, the Ontario Government just handed out cash. You could go to a website and 5 minutes later be set up for a $400 direct deposit into your bank account. You didn't need to prove anything. You just gave them your bank information and personal information and how many kids you have. People got anxious about the hypothetical kind of person who could abuse this. The response was basically: if we try to carefully scrutinize every person, it's going to cost us more, and we're not going to get the money out fast enough. This is for parents who suddenly have to buy Chromebooks and other school supplies for their kids.

If you ask me, I think it all stems from a deep feeling all humans have, but that some cultures greatly amplify: the anxiety that someone isn't rowing while you are.

There's so much of this thinking that misses the forest for the trees. When you're running a giant government program, fraud and misuse are to be expected. The question "will there be fraud?" is rarely the right one - rather it's "factoring in the cost of fraud, is this still a good program?"

There was a fair bit of PPP fraud, but that's okay! It was designed to be relatively easy for businesses to get that money, because getting money into the hands of small businesses was critical. Plenty of the fraud could have been prevented with additional paperwork/validations/etc., but amount saved from fraud by doing that would be completely outweighed by the cost of businesses failing that otherwise could have been saved because they couldn't get the money fast enough.

Especially in the United States, we’re so focused on catching fraud, we probably spend more money on the bureaucracy to stop the fraud than the cost the fraud would have, itself.

Worst, we spend so much time trying to prevent fraud, the programs don't reach their full potential to benefit the most amount of people that need it and are qualified to receive it.

Yeah, it's this bizarrely shortsighted focus on making it an absolute priority that nobody takes advantage of us as compared to just prioritizing our own well being.

We're not even good at being selfish :/

Accepting fraud encourages fraud and demoralizes people who are playing by the rules just to watch fraudsters pass them by in life.

"Accepting fraud encourages fraud" is a sensible argument if you live in a society that is breeding fraudsters. I don't think the existence of an opportunity for fraud creates fraudsters. I think it's more a consequence of a society that is failing to equip its people with the education, skills, safety nets, and opportunities necessary to live a moral life.

This line of thinking creates a feedback loop, bolstered by systemic racism and poverty bigotry: the riffraff will abuse these systems so we won't offer them, or we'll make them all but impossible to utilize. And then those individuals struggle and are left with little choice when they're drowning.

As a general rule I am somewhat of the camp of "part of what defines us as a society is how we treat the people who have it the worst."

I think even if you could somehow prove that there was a ridiculously huge amount of welfare fraud, I'd still be somewhat supportive of it; I think there's an inherent value of knowing that a safety net exists. If you lose your job, or get into a horrible accident, or have some condition that puts you at a disadvantage, we (as a society) should be looking out for you, particularly in the most wealthy economy on the planet.

I think even if you take a wildly more cynical approach, a substantial amount of welfare is still worthwhile. When people run out of money, society ends up paying for it, whether it's because those people steal and go to prison or end up in the hospital. If you spend $1B in welfare and half of it gets stolen, it's still a great investment if it take down the societal costs of dealing with poverty by $2B.

I really don't see how much my post disputes anything you're saying. I said I don't want people to replace current benefits with UBI, not that I'm against people getting no-questions-asked benefits.

I don't want to speak for them, but I think they were agreeing with you and elaborating on their perspective. I do too; UBI as a replacement worries me.

Upon rereading, I think you're right; I think I got in defensive mode way too quickly due to some sister threads.

Oh? https://www.usnews.com/news/best-states/california/articles/... "California has paid at least $20 billion in fraudulent unemployment benefits since the start of the pandemic."

> ... confirming a number smaller than originally feared but one that still accounts for more than 11% of all benefits paid since the start of the pandemic.

The overwhelming majority not being fraudulent. That's rather the point, isn't it?

So this would only be a problem if more than 50% is fraudulent? Or what number? 11%, or $20B is still a massive amount of fraud.

Of course fraud is a problem. But 11% fraud isn't a reason to scrub the program altogether, either.

Wasn't implying that this particular program should be scrapped (though it was clearly implemented in crisis mode, with predictable lack of protection), only arguing against the OP's claim that the amount of abuse of social programs is small.

You cited one program built quickly in an emergency. If you take something far more stable and longer running, say SNAP, only about 1.5% is established as fraud.

The fixation on "abuse" of social systems for the less wealthy is just a bias against the poor by relatively wealthy and powerful people. It's not just for food stamps and medicaid. Consider, for example, the utter fixation in the Bay Area with "fare jumping" on BART, where the compliance with the fare system is over 99%, compared with the complete silence among the public and the press on the topic of compliance with parking meters, which is known to stand at about 40%! People believe that armed police should be deployed to eek out the final 1% of BART fares, but nobody advocates for armed police to taser people who don't pay parking meters.

Exactly. "Public transit" should cost nothing and "Private transit" should pay for it.

Unless of course the system doesn't require the distinction of Public vs Private, which it seems inevitably leads to parasitism.

Another Canadian anecdote is that when the government decided that people have been given more than they should have, most people returned the money.

I have a great deal of anxiety that these folks aren't rowing: https://www.theguardian.com/commentisfree/2021/oct/27/climat...

... and I mean "these folks" in the GW Bush sense.

Why is it society's job to prevent poor people from vices, whereas rich people generally get to do whatever they want?

No one talks about CEO pay increases in terms of 'if we give them more money, they'll just spend it on drugs, emitting carbon, and other nefarious things'

The point is not protecting anyone from vices, the point is making sure basic needs are met.

When CEOs spend their money in frivolous ways, they generally have enough to not need to fall back on additional public assistance. If UBI were instituted in place of other benefits programs, some poor people would spend the money unwisely (or unluckily) and still be short on food, housing, etc. when the money ran out.

Of course this already happens in our current system, but theoretically it could happen more without some degree of government control of where money goes (like how section 8, SNAP, etc. work now).

>When CEOs spend their money in frivolous ways, they generally have enough to not need to fall back on additional public assistance

The wealthy receive the lion's share of the wealth created by public subsidies, whihc they then spend as they please.

1. Marillyn Hewson was paid $30mn as a retirement package last year, and 75%+ of her company's revenue comes from the US government.

2. Hugh Grant of Monsanto was paid $20mn and a significant share of his company's revenue is driven by the US's $20bn farm subsidy.

3. Peter Thiel has saved c.$1bn in taxes by using the Roth IRA structure.

I'm not trying to judge the morality of the above, but to act as though the wealthy don't receive government support tht they spend exactly as they please is a short-sighted position.

I'm not sure if you are mistakenly replying in the wrong place, but that doesn't seem related to the basic-needs argument I (and, in a slightly different way, the thread OP) are making.

I'm making the argument that sure, a CEO has $30mn, but if all that is derived from tax revenue, is it really that different than UBI?

Like sure, they don't need MORE than $30mn, but shouldn't we be asking why they got $30mn of public assistance in the first place? By your logic, shouldn't it be like 3 orders of magnitude smaller (Edit: since only the first $30k or so covers basic needs and the rest is allocated to non-essentials)?

Being paid to do a job isn't public assistance.

You can argue CEOs are overpaid, and you can argue government contracting companies engage in regulatory capture, but this scenario is so tangential that it has zero bearing on the question at hand.

>Being paid to do a job isn't public assistance.

It is when the government decided to outsource a core function (defense) to private industry, solely to enrich people like the CEO of Lockheed Martin.

The head of Medicare makes $450k, why does the head of a company who basically does a government function make 60x that, if not because the US has decided to offer MASSSIVE public assistance to a very small group of already wealthy people?

EDIT: And my point in all of this which you seem to be missing, is that why do you care SO MUCH about the tax revenue that goes to poor people, when you write off much larger amounts of tax revenue that go to rich people? Is it because you think that spending that money to reward people who enable wars in the Middle East is a less bad outcome than some dude doing smack?

> why do you care SO MUCH about the tax revenue that goes to poor people

I really think you might have made your way into the wrong thread. Both I and the thread OP are arguing against the idea that UBI can replace existing social spending. That is to say, we would still need to keep some of the existing social benefit programs if UBI were implemented.

No one here is saying we should take away benefits from the poor, and anger about gov't contractors is not even a tiny bit related to the actual discussion at hand.

I'm arguing that literally any limit on cash given to poor people is a paternalistic overstep because we do not do the same for the cash we give to rich people.

The metaphor is 'Why do we tell poor people that this $1 can only be spent on certain types of food' when we don't say ' This $1 of pork barrel spending can't be used on CEO bonuses unless that CEO submits to regular drug testing.'

I don't know why this is such a hard concept? Maybe you & I just give up?

I see a lot of I think statements in your post, and no empirical data.

What specific issues are you suggesting result from giving cash over food stamps?

Are you familiar with the absolutely byzantine rules imposed by many states on food stamp recipients on what they can purchase?

It was recently discussed in an article here I believe. It goes down to specifying which specific types of cheddar cheese are permissible.

Just removing the mental burden of that alone would be an improvement.

> I see a lot of I think statements in your post, and no empirical data.

That's totally fair; this is observational anecdata.

Something a bit more objective would be to look at lottery winners [1], a case where someone gets literally millions of dollars injected into their bank account. Despite this a majority of lottery winners end up broke relatively quickly.

Of course, this is going to be a selection bias; typically financially responsible people are not playing the lottery since it's generally regarded as a bad financial investment, but the fact that the lottery exists proves that there's a large enough audience to justify its existence.

> What specific issues are you suggesting result from giving cash over food stamps?

I think there's a risk of an increase in the aforementioned lottery tickets,

> Are you familiar with the absolutely byzantine rules imposed by many states on food stamp recipients on what they can purchase? > It was recently discussed in an article here I believe. It goes down to specifying which specific types of cheddar cheese are permissible.

Yep! I actually looked into the process of applying for them when I was really broke in 2016 [2], and you will get zero arguments from me that it's a draconian system that needs revision. There are a bunch of arbitrary rules about how they can be redeemed and I am somewhat against those, but that doesn't mean that we get rid of food stamps entirely.

[1] https://www.lovemoney.com/gallerylist/64958/lottery-winners-... [2] I actually didn't end up getting them due to an extreme bit of good luck finding a job just in time.

I think it's pretty unlikely UBI will ever replace other welfare programs. At least in the US, the Rs and Ds are currently locked in a battle to drastically increase welfare. Even though the Ds nominally control congress, they aren't able to just ram it through. While I can see things moving further toward the D / increase welfare side in the future I can't see the Rs ever getting a strong enough majority that they would be able to eliminate other welfare programs in favor of UBI. (Which would be consistent with their platform, in the sense that a true UBI -- send $N per month to literally everyone -- would be able to eliminate a huge amount of government bureaucracy that is currently dedicated to administering all these programs.)

In practice, none of the "UBI trials" I've heard about are anything close to UBI, even for a small community. In fact, UBI seems to be getting rebranded as "guaranteed basic income" (GBI), meaning not universal, but "guaranteed for the people we feel like giving it to". All these trials I have heard of still have an income means test, and some are even limited to particular racial groups.

I think that was confirmed in the Ontario UBI study. There was a small but significant minority of people whose lives worsened on UBI. Although a majority reported being better off a significant percentage of people were the same or worse.

The study also showed that it basically did not change people's employment status or job training. That was a benefit touted for UBI. If people had income coming in that didn't depend on working they would seek job training and improve their careers. However, that did not appear to be the case generally.

It took a lot of effort to find this. It was buried beneath news spam in search results where things were cherry picked out of it.

Study is here: https://labourstudies.mcmaster.ca/documents/southern-ontario...

Ontario's basic program was a minimum income guarantee. Not UBI. Earned income reduced benefits. And within 10 months a party opposed to the program took over and announced an early end.

What do you think confirmed frivolous spending? What ruled out chronic health issues or other factors?

Your source said 26.2% started education or training. Where did you see this basically did not change?

71.8% who didn't work during the program cited health issues.

> t I do think there is a small subset of poor people who will be "perpetually poor." They have little/no financial literacy, they'll spend the money in a fairly frivolous way, and I think giving them raw cash instead of something more or less boxed-in like food stamps can lead to a lot of issues.

So what? You realize the top 1% have stolen >$10T from us overdecades of tax evasion, and you want to punish a few mentally ill people who don't spend money in the "right way" that you've personally determined to gatekeep?

This is the problem I have when people say: "the problem I have with UBI is that people won't spend it the way I think they should." It is such a small amount compared to the larger problems, and it would help so many people.

Engineers have a term for this: rounding error.

You're worried about rounding error.

> So what? You realize the top 1% have stolen >$10T from us overdecades of tax evasion, and you want to punish a few mentally ill people who don't spend money in the "right way" that you've personally determined to gatekeep?

That's actually not what I said at all, did you finish reading my post? I made it clear that I want continued welfare programs, I just don't want UBI to replace them. I would be much happier if UBI were added.

Your exact words:

"They have little/no financial literacy, they'll spend the money in a fairly frivolous way, and ... can lead to a lot of issues."

What issues?

I was typing out a bunch of potential issues but I realized after a few sentences that I would actually like to know what you actually disagree with me on this?

If we had a UBI in addition to all the current levels welfare/safety-nets, is this something you actually disagree with? Why?

I disagree with picking on the financially illiterate as a negative to UBI.

Your post took great care to state how much you support welfare/safety-nets, but then oddly decided to take issue with a corner case.

Yes, everything has issues, but why point out the financially illiterate as causing issues? It seems like such a small nit compared to the much larger problems with how existing welfare programs are more at risk for becoming extinct; there is a constant onslaught from Republican politicians to dismantle anything related to welfare. In terms of numbers, that is far more an issue.

Perhaps I over-reacted because I am so used to conservatives looking for a handful of people who spent money on big-screen TVs instead of food as proof that the system is broken.

Perhaps you meant you were truly concerned that the financially illiterate would cause issues because they will need help to use the money correctly. And you weren't actually using that as an objection to UBI?

Did I misunderstand you?

I didn’t “take issue” with UBI, I took issue with using UBI to wholly replace other benefits, which is often proposed. I think that would disproportionately hurt people who have a hard time managing money.

I didn’t say whatsoever that they “cause” issues, it’s not a moral or intellectual failing to be bad with money, it’s hard for a lot of people, but I don’t think most deny that there are people who have a lot of trouble managing money.

What do you propose we do with these people? I personally don’t think we should just throw them to the sharks and tell them to figure it out.

> I think that would disproportionately hurt people who have a hard time managing money.

Ohhh. Dammit. My apologies, I thoroughly misunderstood you and was arguing from a faulty premise, and kept digging in because I'm doing 10 other things and wasn't giving this thread proper attention. That explains why I thought it was "odd" that you said that, because what I internalized wasn't what you meant.

Thanks for sticking with it and explaining to me.

Yes, we're on the same page.

Some proposals for helping people who are temporarily homeless are to provide an address (public housing) and help them get a job long enough to be able to pay a down payment on an apartment.

However, that's for people who aren't mentally impaired and just need a temporary leg up to get back into the system.

Some benefits do need to be tangibles like you said: e.g. an apartment (public housing, vouchers) or food (meal kitchens, SNAP) and not money because just giving someone money who can't cook isn't going to suddenly teach them how to shop and cook, assuming they can even be taught.

I don't know if there IS any solution today. I know long ago there were institutions but those were largely underfunded and abusive. However, there is public housing where I live that is for people with a certain degree if disability, but they have to be able to remember how to find their house and do simple things like bathe and eat.

If they are beyond that, that's where society has a big hole right now. Do you know of any efforts in this space?

> Ohhh. Dammit. My apologies, I thoroughly misunderstood you and was arguing from a faulty premise

No worries at all; judging by the other comments on my post it appears I didn’t explain myself terribly well.

————

I sadly don’t know many solutions to this either; I think making mental healthcare more accessible to people would be a good place to start( e.g. publicly funded psychiatrists) but I don’t think that financial illiteracy is really a “mental illness” in the classical sense.

> You realize the top 1% have stolen >$10T from us overdecades of tax evasion

You're gonna have to provide a citation for that kind of claim.

> but I do think there is a small subset of poor people who will be "perpetually poor." They have little/no financial literacy, they'll spend the money in a fairly frivolous way, and I think giving them raw cash instead of something more or less boxed-in like food stamps can lead to a lot of issues.

I think this phenomena cuts across class lines. There are lots of middle class households that live way beyond their means and basically just use expansive lines of credit - of which poor people don't have access to - to keep themselves afloat. Likewise, there's tons of "Richs to rags" stories of wealthy people who slowly fritter away their wealth with either foolish investing or extravagant purchases.

I doubt that it's a 'small subset' seeing that 54% of Americans, across all income levels, live paycheck to paycheck.

Both welfare and UBI skirt the fundamental underlying issues of access to capital, voice/control in the workplace, equality of opportunity, concentration of wealth, concentration of power, etc. All of that would just still go on, but people would just probably-not starve.

In fact I wonder if UBI were implemented if many of these things could worsen as political pressure from the working classes in the form of unions and political parties and the like would weaken. If you're able to feed yourself via UBI, why vote for a "left wing" party, or go on strike, or go to a demonstration etc in order to push for more workplace rights, etc.? Hence why I think actually there's plenty of support for UBI from people who would not normally be advocates of extensive social programs.

Many old school Marxists saw welfare programmes as nothing more than an "escape valve" for the excesses of capitalism. Good as a "transitional demand" but harmful in the long run.

This is a complete misunderstanding about what it is to be poor. Poor people including "perpetually poor" aka most poor people are poor because they are lacking not in financial literacy but rather the necessary skills to make sufficient money to graduate from being poor. It's not that they fritter their money away its that they don't have any.

They do jobs that pay them barely enough to afford their shitty lives and invest between commuting and working 50-65 hours doing so in between being parents and spouses and doing not only all the things you do save take time off but doing the paperwork, phone calls, meetings, and leg work to convince people that they are in fact still poor and still need benefits.

If were to sit down and spend time optimizing these people's financial lives you would find that the amount "frittered" away is so tiny compared to child care, food, rent, medical costs that it wouldn't make a difference. Taking someone that for example makes and spends 20,800 and helping them not "fritter" away the 800 will not provide them with a means to climb out of poverty. There never was in that scenario enough resources no matter how they are budgeted.

The most canonical example of this absurdity used to be complaining about poor people buying TVs with tax return checks as if someone who is $40,000 below a middle class household income would SOMEHOW be doing OK if they hadn't spent that $500. My other favorite example is people complaining about poor people pulling out an EBT card and a smartphone wherein the EBT card signifies that the government has decided that your income is $5000 short of what is required to eat and live and the phone costs $200 once + $20 a month while providing vital utility.

Ultimately the benefits you describe as being targeted are pretty much targeted at keeping people from climbing out of poverty. Look at health insurance you can get medicine and care for nothing up until about $2000 a month income and then you have to buy your own insurance. Subsidies are great but they apply only if your employer doesn't offer an "affordable" plan the definition of affordable being if I recall correctly about 12% of your gross salary for the individual plan. There being tax benefits this inspires your employer to offer an "affordable plan" for individuals while jacking up the cost of covering your family. For example with my employers plan the employee + spouse costs 4x as much.

Ultimately moving up from substantial poverty to ordinary poor is actually a net loss. You could if you don't ever want to move up or believe you will be able to be better off staying a little poorer working part time and collecting benefits. Think about that! Would you like to work 60 hours to be as well off as you were working 24? How do you think people respond to that sort of incentive structure?

> Poor people including "perpetually poor" aka most poor people are poor because they are lacking not in financial literacy but rather the necessary skills to make sufficient money to graduate from being poor.

Ok, but why is it that lottery winners tend to end up broke pretty quickly [1]? The use of the word "perpetual" wasn't meant to imply the duration of poverty, but more of propensity towards it. I think there is a subset of poorer people who do not know how to manage money terribly well.

I agree that a very large percentage of poor people might be perfectly fiscally responsible but socioeconomic reasons prevent them from breaking out.

[1] https://www.washingtonpost.com/news/get-there/wp/2016/01/08/...

You can't reason about poor people receiving modest sums from lottery winners response to huge windfalls because it's 2 different populations reacting to 2 different scenarios.

People budget poorly in response to an instant massive change in wealth because much of America not just the poor are living financial lives with very short horizons. They make decisions based on gut feelings of can I afford that not mathematical projections. Having a balance of millions feels perceptively like unlimited money so many find the limits of their funds.

Likewise because say a tax refund is too little money to change their lives and not needed to pay bills poor people "fritter" them away on things that they want. This might be unwise compared to saving for a rainy day but it's not a cause of poverty it's a gut decision. Giving people money in a savings account over time with incentive for delaying withdrawal would be likely to produce a different gut decision.

It is deeply ironic that anyone who gets a 6 dollar coffee or 5000 on a vacation probably wastes more than Jane poor did on the TV while declaring the virtues of austerity.