Comments on: First debate of 2016 CA election season tackles poverty, taxes

By: Ulysses Uhaul

Ulysses Uhaul — Tue, 15 Dec 2015 23:20:43 +0000

Is it fair that a server in a food place with two kids getting free health care, dental, eye care for her family while a two income young family pays $1400.00 per month with a 5-7 thousand dollar deductible with limited choice of medical providers.

The tension in California over inequality works many ways. Compounded by forced immigration, undocumented visitor issues, wink wink job and higher educational discrimination, who can be allowed in mortal combat, who is allowed to carry a ladder or fire hose, letting politicans or voters determine employee pay, gender this and that nightmares, who may be peeking in bedrooms or bathrooms, who wears a bulky backpack or has an odd looking midriff with wires here and there….tension…..unpredictability……insecurity….

No wonder doomers and the fair and balanced clash!

By: Richard Rider

Richard Rider — Tue, 15 Dec 2015 18:22:51 +0000

In reply to RT.

Indeed, poverty programs PAY people not to work. Stated differently, working more costs benefits, for little or no net gain.

This is not just theory:

http://riderrants.blogspot.com/2013/02/yes-100-tax-on-earned-income-for-single.html

“Yes, a 100% tax on earned income for many single parent families”
by Richard Rider
REVISED September, 2015

Here’s an eye-opening study by the Pennsylvania Department of Welfare — looking at the welfare benefits for a single parent with two kids.

BOTTOM LINE: If one is taking advantage of the welfare/subsidy options, then between about $9,000 and $69,000 of (reported) earned income, such a family faces what amounts to an average 100% tax.

Stated differently, such a family earning $9,000 and receiving the subsidies is as well off as the identical family earning $69,000 and paying their taxes. It’s an awesome disincentive to improve one’s lot in life. And there’s every reason to assume that similar disincentives of roughly the same magnitude can be found in ALL of our states.

I first found the story in the WALL ST JOURNAL — an op-ed by economist Arthur Laffer (see below). That article led me to the source material — a study and PowerPoint put together by the Pennsylvania Secretary of Welfare.
http://www.aei.org/files/2012/07/11/-alexander-presentation_10063532278.pdf

The loss of benefits is not a uniform sliding scale, as some benefits arbitrarily stop past a certain income point. The PowerPoint is worth reviewing, even if just for a quick overview.

Suggestions of reforms are made both in the Pennsylvania study and the WS JOURNAL article, but for now the fact remains — the government pays people to remain poor. Few will find their net income jumping between $9K to $70K in one increment, so for the years working between these two numbers, one is essentially working for free. And most such low skilled workers have little prospect of ever passing that $70K point where they start actually making money.

This 100% tax makes a strong economic (though hardly moral) case for working on the side in the underground economy for cash while collecting all the low income benefits. It would be a huge temptation to do so. Welfare (and that’s what all these “entitlements” are) is a drug, and we are addicting people to these subsidies.

Here’s the link to the excellent WALL ST JOURNAL article by Arthur Laffer:
http://online.wsj.com/article/SB10001424127887324235104578243373468081096.html?

By: RT

RT — Tue, 15 Dec 2015 17:50:56 +0000

CalWORKs (California’s Cash Aid TANF Program) has proven that state wide efforts to deal with poverty are simply ineffective. This bill seems to have accepted the false CalWORKs premise that those receiving enough outside support from a government program are not in poverty. The fact is that this idea (as well as the major flaw in CalWORKs) is that it ignores the fact that the only true way out of poverty involves gaining a job that pays enough to pull the family out of poverty.
Without a true focus on gaining employment, this program will fail just as CalWORKs has failed so many families by leaving them in poverty and subject to the whims of the state and local bureaucracies.

By: Richard Rider

Richard Rider — Tue, 15 Dec 2015 17:48:32 +0000

Divide and Conquer. That’s the core strategy for destroying Prop 13 safeguards. Given the “soak the rich” mentality of too many low information voters, it might work.

Once the rich and businesses (those who choose to stay in California) are getting the big tax bills, they won’t fund any opposition to raising the REST of the property owners’ bills.

As I said — Divide and Conquer.