Makers and takers and data fakers
I notice lots of people claiming that more Americans are on welfare than working. To say this data is misleading would be an understatement. Consider an imaginary country of 300 million. It is composed of 100 million families, each with 3 members. Of that total, 74 million families are headed by a worker and 26 million families are on welfare.
Does that seem like a country where most people are on welfare? Not to me. But it seems that way to lots of other people, who point out that 26 million times 3 is 78 million. So there are 78 million “people” getting benefits, and only 74 million “people” working.
Yes, and tell me again why I should care . . .
PS. Speaking of misleading data, how about this headline by Matt Yglesias’s substitute:
Less Than 1 Percent Growth Is Somehow Good News for the U.K., Sort Of
Nowhere in the post does Sean Vitka mention that growth was at an annual rate of 3.2%. Britain reports growth on a quarter-over-quarter basis.
Come back soon Matt.
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28. October 2013 at 05:12
“Nowhere in the post does Sean Vitka mention that growth was at an annual rate of 3.2%. Britain reports growth on a quarter-over-quarter basis.”
Indeed, and it’s been pointed out in the comments since Friday too: but as yet no correction.
28. October 2013 at 05:32
Scott,
Why should you care? If an ever increasing part of the population is able to satisfy their needs without having to work then what difference does monetary policy make to them or the economy as a whole?
The details of the welfare situation may be misrepresented but the true story is actually worse than any of us outside this culture can appreciate. Over the last decade tens of millions of new Americans have been introduced to the benefits of government welfare and they have embraced it. Record number of Americans are now dependent on the government and have no interest nor motivation in producing any real economic value. Oh sure, they are consumers but they are spending money that is taken from other people or borrowed on their behalf. Even if such activity boosts aggregate demand it provides NO lasting value. What is being consumed are necessities and entertainment. There is no increase in capital and in fact the human capital is simply wasting away.
Do you really think you can ignore this reality and still produce a workable model of the economy?
28. October 2013 at 06:00
Dan W’s point illustrates why CNS mislead (unlike Yglesias’ which is likely a “miss”, and if not an egregious mislead) could have some redeeming analytical/discussion value.
If one believed that the likelihood of being on welfare increases with having been on welfare, that household size is not evenly distributed, and that there is a positive correlation between being on welfare and larger household size (and not being on welfare and small household size), you would like to study this variable more and how it has evolved over time. And so would one who did not believe any of this.
28. October 2013 at 06:33
Scott this is why you ought to start pounding table on GI/CYB.
If you aren’t truly convinced, ask me the toughest Q’s you’ve got.
28. October 2013 at 07:24
Tim, That’s disappointing.
Dan, You misread my comment. I was asking why I should care about phony data. I certainly agree with you that I should care about the “real story.” I believe welfare should go to people who work, not those who don’t work.
MG, My sense is that poor families are not larger than affluent families, but perhaps I’m wrong. Does anyone have the data?
Morgan, I favored wage subsidies for low wage workers when you were still in elementary school. (Judging your age by your picture.)
28. October 2013 at 11:29
MG, My sense is that poor families are not larger than affluent families, but perhaps I’m wrong. Does anyone have the data?
I was curious too so I looked for some data. Here is some. I would like more detail but it is a start.
28. October 2013 at 17:01
Floccina, Interesting, but without adjustment for age differences it’s not clear. Younger people have more children, and lower incomes.
At the other extreme higher income families are larger on average, but also older. So that doesn’t work either.
29. October 2013 at 08:35
What is the meaning of “on welfare”? We don’t have a dole in the US.
The article doesn’t use the phrase “on welfare.” It says “means-tested benefit recipients.” Meaning:
Medicaid
Food stamps
SSI
WIC
Public/subsidized housing
TANF
The only one of these that is usually thought of as “welfare” is TANF – Temporary Assistance for Needy Families – which gives cash to poor people.
4.3 people got TANF in 2010, as opposed to over 10 million in 1997 (the year TANF replaced AFDC, which funded larger numbers.)
The number of people “on welfare” is way down since Clinton vowed to “end welfare as we know it.”
As for the other programs, notice something? YOU CAN BE WORKING and benefit from those programs. So there’s double counting going on – the woman who lives in Section 8 housing is cleaning your office, and the guy whose kid is on SSI is driving your airport shuttle.
30. October 2013 at 06:41
Bloix, You said;
“As for the other programs, notice something? YOU CAN BE WORKING and benefit from those programs. So there’s double counting going on – the woman who lives in Section 8 housing is cleaning your office, and the guy whose kid is on SSI is driving your airport shuttle.”
Good point, don’t know how I missed that.