Skip to content

Social safety net

Imagine A Central Income Distribution Institution

Many years ago, I learned that the Faroe Islands has a peculiar process for compensating workers. There, employers pay each worker’s entire paycheck to the tax authority, which removes any taxes owed and then remits the remainder to each worker’s linked bank account. As part of this process, the tax authority also rolls in any welfare payments an individual is owed when making its periodic payments. Beyond these practical advantages, the idea of a central income distribution institution (CIDI) — i.e. a government entity that all income payments are routed through, even factor income payments like wages, dividends, and interest — is useful for thinking through certain intractable philosophical, accounting, and conceptual debates that frequently pop up in the economic policy discourse.

‘Work Requirements’ Or Real Jobs?

When I heard the debt-ceiling deal would target people in their fifties for new work requirements to get food stamps, I thought about my brother. As a young man in the Navy, he was diagnosed with type 1 diabetes—that’s the one where your body attacks your pancreas, and you need insulin to stay alive. At the time, treatment options were limited, and the Navy discharged him. But thanks to the V.A. and medical advances, he was OK. He’s a talented mechanic, had steady work, and raised two wonderful kids. In his fifties, though, the toll of the disease meant a lot of sick days. Too many for his employers.

Did The Debt Ceiling Deal Really Save The US From Bankruptcy?

So as far as the debt ceiling is concerned, there has been a pattern which has become a classic of sorts, with just days to go before the day that the Treasury Secretary Janet Yellen said the US would run out of cash to meet its obligations, President Biden and House Majority Leader Kevin McCarthy reached a bipartisan deal which is going to permit the government to keep borrowing in return for certain cuts in spending, social spending in particular, that the Republicans insisted on. The catastrophic disaster predicted by Treasury Secretary Janet Yellen in the weeks leading up to the negotiations and the deadline was again narrowly averted.

England To Trial A Basic Income For The First Time

England is about to pilot a basic income scheme for the first time. Thirty people will receive £1600 a month for two years. The trial, which will take place in central Jarrow and East Finchley, seeks to find out what effects this will have on the lives of the participants. Will Stronge, director of research from thinktank Autonomy, said: All the evidence shows that it would directly alleviate poverty and boost millions of people’s wellbeing: the potential benefits are just too large to ignore. Indeed, this seems like an interesting and positive scheme to tackle the hardship millions of people face in this country. However, unsurprisingly, debates within the corporate media have included baseless criticism and personal attacks.

Debt Ceiling Agreement Improved, But Harmful Provisions Remain

While the debt ceiling agreement announced last night is a significant improvement over the radical House bill, it is not the deal the country deserves. There are a number of troubling elements, including the provision that will put at risk food assistance for very low-income older adults. This policy will increase hunger and poverty among that group, runs contrary to our nation’s values, and should be rejected. The nation must pay its bills — but that shouldn’t mean enacting legislation that leaves people who already struggle to afford the basics worse off. We should never have been in this situation. We are here only because House Republicans twisted the rules of democracy.

More Older Workers Are Trapped In Crummy Jobs, Unable To Retire

Over the past two decades, older workers have become an increasingly significant share of the labor force. In the economic recovery after the Great Recession of 2008–2009, four in 10 Americans ages 55 or older were in the labor force—the highest participation rate in half a century. As of 2020, these older workers made up 23.6% of the total U.S. workforce, the highest portion on record. Why are so many older Americans unable to retire and so many working into old age to survive? For many, the answer isn’t “because they want to.” Even before the COVID-19 pandemic, more than 50% of low-income older households ages 55–64 were financially fragile—up dramatically from the 35% at risk in 1992.

To Fight Inequality, Tax The Patriarchy And Invest In Care

While millions of households across the United States are scrambling to file — or extend — their taxes by the April 19th deadline, members of our billionaire class are doing a great deal more smiling than scrambling. Why? Because the U.S. tax code is built to reward wealth over work and serves big corporate interests over working families. Trillions of dollars goes untaxed each year, deftly squirreled away by tax professionals hired by the nation’s wealthy and powerful or left untouched because the federal government doesn’t tax wealth as it does income. Over one recent five-year period, a bombshell ProPublica investigation from 2022 revealed, the 25 richest Americans paid a true tax rate of roughly 3.4 percent.

Federal Budget: Moral Or Immoral?

April, the month tax filings are due, prompts us to ponder what our income taxes pay for. Are they used to provide all citizens sufficient resources and public goods for human security and well-being — the core of our national security? How much of our taxes pay for radically reducing climate change emissions and protection of nature; for equal quality education for all; for providing health care for all; for housing the poor and homeless and eliminating hunger; for safe bridges, roads and rail and adequate public transportation; for prioritizing diplomacy and peace in the world so as to avert war and reverse our decline of democracy? Aren’t these our deepest security guarantees?

The Government Bailed Out The Banks; How About A People’s Bailout?

The March 10 collapse of Silicon Valley Bank sent shockwaves throughout the world economy. Since then, the US government moved quickly and decisively to bailout the bank’s depositors to the tune of USD 151 billion. The collapse of SVB, a bank utilized heavily by the tech industry and venture capitalists, is the second largest bank failure in US history. Signature Bank, based out of New York, also failed quickly afterwards as SVB’s crash triggered distrust in the banking system across the nation. The US government also bailed out Signature, spending USD 70 billion to ensure that the bank’s depositors had access to all of their money.

Poverty Is A Public Policy Choice

It should not have taken a pandemic to realize poverty is a public policy choice. Public investments in safety net programs continue to be extremely effective poverty reduction tools, as newly released Census income data show. Government social programs kept tens of millions of people out of poverty in 2021. Because of expansions to programs like unemployment insurance benefits and the child tax credit, poverty rates were actually lower in 2021 than they were prior to the Covid-19 pandemic. The poverty reduction achieved through expanded social insurance programs highlights how much policymakers’ choices can impact poverty.

Reflections On The Sri Lankan Economic Crisis

So much has been written on the Sri Lankan economic crisis that the facts are by now quite well-known (see for instance C P Chandrasekhar, Frontline April 22): the massive build-up of external debt; the huge Value Added Tax concessions that pushed up the fiscal deficit and made the government borrow abroad even to spend domestically; the decline in foreign exchange earnings because of the pandemic that particularly hit tourist inflows; the downward pressure on the exchange rate which made many Sri Lankan workers choose the unofficial route to send their earnings home rather than the official route; the precipitous decline in foreign exchange reserves; the directive of the government to cut down on the use of chemical fertilizers to save foreign exchange that actually hit foodgrain output; and so on.

May Day—Workers In India Feel Increasing Need For Unity

This year May Day is being observed at a time of increasing need for wider unity by workers in the wake of adverse government policies leading to increasing burden of unemployment and inflation at the same time. Policies relating to demonetization, poorly conceived tax reform in the form of GST, privatization, excessively stringent and poorly planned lock-downs have led to massive job losses and reduced income across vast areas of economic activity, while policies which favor big business interests contribute at least partly to rise of price of several essential commodities. At a time of adverse external factor including the Ukraine war policy distortions have made the situation for workers much more difficult than would have been the case of more protective policies had been followed.

The Gap Between What’s Offered By Our Social Safety Net And What’s Received

How much support do people actually receive from the social safety net? That’s the question that a recently released report from the University of Southern California’s Price Center for Social Innovation aimed to answer. The report, titled “Examining the Complex Social Safety Net for Low-Income Working Families,” explored what social programs are available to Los Angeles residents and how the support they receive from those programs varies as their wages increase. One key finding from the report was promising: If a mother with two children received all the benefits her family was eligible for, she would receive a living wage of $66,982 per year — enough to meet the basic needs of her family, based on the regional cost of living. In other words, the safety net would be operating in the way it should, ensuring those who fall on hard times have the support they need.

Scheer Intelligence: What Democrats Did To Welfare Haunts Them

A recent piece in the Washington Post titled “Welfare rolls decline during the pandemic despite economic upheaval” delves into one of the biggest domestic policy failures of Bill Clinton’s presidency: the Temporary Assistance for Needy Families (TANF) program, which provides financial assistance for the country’s poor. TANF, explains reporter Amy Goldstein, is the reason why when the coronavirus spread and shelter-in-place mandates were issued, causing millions of Americans to lose their jobs at rates comparable to the Great Depression, even less people were able to receive needs-based cash assistance than prior to the pandemic. Peter Edelman, a lawyer and former member of the Clinton administration, joins Robert Scheer on this week’s “Scheer Intelligence” to discuss the roots of this issue.

Reckoning With Labor Law’s Racist Roots

The maintenance of the racist Southern plantation system was the driving force behind the “compromise” struck by President Roosevelt and the Southern Democrats to exclude agricultural laborers from labor protections. In congressional debates this was clearly articulated. Representative Wilcox of Florida extolled, “You cannot put the Negro and the white man on the same basis and get away with it…” and Representative Cox of Georgia agreed, saying that it would be “dangerous beyond conception” to eliminate racial and social distinctions. Bargaining away racial equality, President Roosevelt and his coalition excluded agriculture from the FLSA.  There have been legal challenges to the agricultural exemption in the past but the exclusion has never been attacked squarely as unconstitutional because it was racially motivated. The Martinez-Cuevas case will be the first to squarely present this question before a court.
Sign Up To Our Daily Digest

Independent media outlets are being suppressed and dropped by corporations like Google, Facebook and Twitter. Sign up for our daily email digest before it’s too late so you don’t miss the latest movement news.