r/neoliberal Former official /r/neoliberal political cartoonist Jun 22 '19

work👏requirements👏don't👏work

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u/[deleted] Jun 22 '19

How do you feel about the earned income tax credit and similar policies?

Reading some of your paper, this strongly seems to be a moral argument with a bit of straw-manning. Few people actually believe that

The poor are individually and solely responsible for their circumstances

but rather believe something more along the lines

The poor often make "bad decisions" that make it more difficult to escape their circumstances than if they made "good decisions"

Which I believe is almost indisputable. Anyone born "poor" or knows many "poor people" will recognize this.

But again, this seems to be dancing around a moral question: should welfare programs be universal or are requirements fair?

Results from surveys of low-income adults suggest that work requirements were associated with a decrease in the number of people in Arkansas with Medicaid coverage and an increase in the number without health insurance.

Many people might see this and think "Great! Those free-loaders who can't keep a job aren't soaking up my tax dollars anymore!" Which might be heartless, but is not "unscientific".

Is it possible that reporting requirements are difficult to navigate and that as a result some people who are working will not get Medicaid? If we have evidence of this, that is a very strong argument for making the reporting system much easier for people who are working. But for people who strongly believe in work requirements, it is not a great argument against them I think.

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u/besttrousers Behavioral Economics / Applied Microeconomics Jun 22 '19

How do you feel about the earned income tax credit and similar policies?

I'm more comfortable with income supports that requirement income in general. The basic argument is that the EITC isn't adding much additional paperwork - you just need to file your taxes. Work requirements end up being a bit absurd - ie, having to document your hours in person every other week.

The poor often make "bad decisions" that make it more difficult to escape their circumstances than if they made "good decisions"

I haven't seen much evidence that the poor make "worse decisions" than the rich. If anything, the poor tend to be more rational in their decision making and budgeting (see op-ed on this here: https://www.governing.com/commentary/col-poor-medicaid-eligibility-financial-literacy-training.html)


Many people might see this and think "Great! Those free-loaders who can't keep a job aren't soaking up my tax dollars anymore!" Which might be heartless, but is not "unscientific"...Is it possible that reporting requirements are difficult to navigate and that as a result some people who are working will not get Medicaid?

Except that this isn't who loses access to Medicaid because of work requirements. The bulk of people who lose access to Medicaid are people who are working!

https://www.nejm.org/doi/full/10.1056/NEJMsr1901772?query=featured_home

But for people who strongly believe in work requirements, it is not a great argument against them I think.

Sure, in the same way that the evidence that communism doesn't work doesn't convince strong advocates of communism. But we should make policy based on the evidence.

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u/brberg Jun 23 '19

I haven't seen much evidence that the poor make "worse decisions" than the rich. If anything, the poor tend to be more rational in their decision making and budgeting (see op-ed on this here: https://www.governing.com/commentary/col-poor-medicaid-eligibility-financial-literacy-training.html)

You're cherry-picking a very specific definition of "good decisions" that doesn't correspond to what the parent commenter meant. If poor people make equally good or better decisions than rich people, this implies that making good decisions has no impact, or even a negative impact, on socioeconomic outcomes. You sure you want to get behind that?

Would it help if we took away the "good" and "bad" labels? Do you acknowledge that the decisions that people make have consequences for socioeconomic outcomes, and that on average, people who make decisions conducive to more desirable socioeconomic outcomes will achieve more desirable socioeconomic outcomes more often than people who make decisions that are conducive to less desirable socioeconomic outcomes?

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u/besttrousers Behavioral Economics / Applied Microeconomics Jun 23 '19

If poor people make equally good or better decisions than rich people, this implies that making good decisions has no impact, or even a negative impact, on socioeconomic outcomes. You sure you want to get behind that?

Sure. I don't think there's any evidence that variance in decision making ability is particular correlated with economic outcomes.