Poverty

Did you know that the Federal Government has 79 different means tested programs that cumulatively represent $927 billion in expenditures annually? Means tested programs are anti-poverty programs that help the poor. These programs differ from Social Security, Medicare, unemployment insurance and worker’s compensation insurance, because disbursements are based on a person’s income relative to official poverty guidelines and do not require prior contributions by the beneficiary. Robert Rector of the Heritage Foundation presented testimony to the House Budget Committee on April 17, 2012 concerning these programs, which can be accessed by clicking on 79MeansTestedPrograms.

Most Americans would agree that safety net programs are vital to society, especially one with so much wealth like ours. Our safety net programs fall into 2 categories: temporary assistance, which helps individuals and families in transition; and permanent assistance, which benefits the disabled and elderly whose financial circumstances are unlikely to improve due to physical or mental impairments.

What makes Mr. Rector’s testimony interesting is that it reveals the myriad programs and sheer magnitude of government anti-poverty expenditures. Some key points concerning means tested programs that are made in his testimony include the following:

* Federal expenditures for means tested programs were $719 billion in FY 2011. State contributions into federal programs were $201 billion, while independent state programs contributed an additional $9 billion. Together, means tested programs cost $927 billion in 2011.

* The government runs 79 different anti-poverty programs across multiple government agencies.

* Close to 50% of all means tested benefits are for medical care, presumably through Medicaid. 40% of benefits pay for housing, cash and food assistance, and about 10-12% of benefits pay for programs to enable beneficiaries to become more self-sufficient.

* The $927 billion spent on means tested programs in 2011 exceeded expenditures for Defense ($678 billion) and Social Security ($731 billion).

* Expenditures for all anti-poverty measures is more than double the amount required to lift all Americans out of poverty.

* Means tested program expenditures increased from $658 billion in 2007 to $927 billion in 2011, yet even though the recession has long since ended, Obama has sought and achieved significant, permanent increases in our behemoth ‘Welfare State.’

We need anti-poverty programs, because helping people who cannot help themselves, whether temporary or permanent, is absolutely the right thing to do. We have to do it. However, we do not have to do it like it appears it’s being done today. The true picture of our government’s anti poverty measures reveals a bloated and inefficient approach, but is that a surprise to anyone?

Means tested programs, like the Defense Department, Social Security, Medicare, and every other government program and department, are ripe for major reform. Is there anyone in Washington with the power and the guts to do anything about it? With the exception of defense, government reform appears to be at least 4 years away.

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