One Nation Tries To Tackle Its Welfare Problem

Every developed nation on Earth, at least so called Western Nations, has something in common and that something is what to do about the poor.

Brent Smith

Countries wrestle with the social and economic impact – we/they struggle with the ever-increasing cost of caring for our/their poor. Those on the left insist it is our duty as a grand collective to redistribute the wealth from the haves to the have-nots.

Those on the right agree that some care should be provided to the working poor, the homeless and truly indigent. This debate has been raging for multiple decades with no end in sight – the left advocating for ever more entitlements and the right insisting on some accountability.

Instead of just endlessly debating the issue the Island nation of New Zealand years ago decided to try something new. In 2013 they overhauled their welfare system to make those who receive payments somewhat more accountable.

Some of the changes included discouraging families on welfare from having more children, requiring recipients to reapply for benefits at set intervals, cutting benefits if certain obligations are not met and guiding recipients into work. They also instituted a penalty for abusers of the system where a spouse must repay any benefit his or her spouse received under false pretences. Try that in America.

Although the system has helped, the government of New Zealand is still not satisfied. So, it’s on to something new and even more radical. They call it a “Universal Basic Income” (UBI) and it “involves a basic, unconditional, fixed payment made to every person in the country by the state in lieu of benefits.”

In other words, instead of poor citizens receiving a rash of benefits from various authorities, they would instead receive, in effect, a welfare salary. They would scrap the entire welfare system and replace it with this UBI.

New Zealand’s opposition leader, Andrew Little justified the “salary” saying: “The question is whether you have an income support system that means every time you stop work you have to go through the palaver of stand-down periods, more bureaucracy, more form filling at the same time as you’re trying to get into your next job.”

Being that welfare is basically here to stay, this actually doesn’t sound half bad. I’m not keen on the idea of paying someone a salary not to work, but is that not what we are essentially doing now? Yet with a system like this, think of all the government bureaucracy that could be cut. Think of all the hundreds of departments that could be closed by simply making direct payments to recipients, not to mention the waste, fraud and abuse that would vanish by doing away with layer upon layer of said bureaucracy.

Many might say, wow – considering our sad reality, this does sound better. Why has no one suggested this before? Actually, both Finland and the Netherlands are due to launch similar programs sometime this year.

But this has been suggested before, right here in the good old U.S. of A., 47 years ago, by President Richard Nixon. In 1969, Nixon made a speech suggesting the scrapping and replacement of the “Aid to Families with Dependent Children” (AFDC – 1935-1996).

Nixon said his proposal would benefit “the working poor, as well as the nonworking; to families with dependent children headed by a father, as well as those headed by a mother. What I am proposing is that the Federal Government build a foundation under the income of every American family with dependent children that cannot care for itself — and wherever in America that family may live.”

It was coined it as a “Guaranteed Annual Income,” (GAI) and it was the centerpiece of Nixon’s proposed “Family Assistance Plan” (FAP). Yet Nixon bristled over the term GAI and stated that “a guaranteed income establishes a right [income] without any responsibilities [work] …There is no reason why one person should be taxed so another can choose to live idly.” Conservatives in his party disagreed by stating that is exactly what Nixon’s proposal set up. The proposal did pass the House by a comfortable margin of 243-155, but the Senate killed it.

Of course the welfare system then wasn’t anything like the hammock we have today, so all things considered, maybe the New Zealand direct payment model would be preferable to our hopelessly broken, purposely complex and corrupt system.

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