Mason's # 6: Work Incentives Don't Matter Much

Again, I am inclined to agree with Mason here, with the extremely strong caveat that they don't seem to make much difference for the poor.

He is right that the $600 extra unemployment benefit seems to have pushed few people to actually choose unemployment.

On the other hand, evidence from when Congress did this sort of thing in 2009 as part of the "Obama stimulus package" points strongly to the idea that people receiving unemployment benefits don't seem to find very many jobs ... until those benefits are about to run out.

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A lot of the motivation for means testing of welfare benefits (this is where he is referring back to Clinton's reforms) is that there had been too much carrot and not enough stick. So the shift back to sending out more checks is going back to the systems that bothered enough people to get them changed in the 90s. A lot of Democrats were in favor of that at the time, and those sort of Democrats seem to be a target of Mason.

On the other hand, the idea of just sending out checks instead of our huge system of overlapping welfare programs was originally a conservative or even Libertarian approach. The point here is that the problem is not the poor it is the bureaucrats being paid to help the poor. Most of them work for agencies who survival depends on the existence of poor that need to be helped, so they are unlikely to actually ever reduce the number of people needing aid. It's make-work for people with certain college degrees. The idea with sending out checks is that it actually helps the poor without helping the middle and upper class white collar workers of anti-poverty agencies.

On this point, Mason is silent. He asserts that incentives don't help the poor get into jobs, but he doesn't consider if incentives might keep others in their jobs.

A parallel idea is that sending checks would be cost efficient if we substituted this for all those agencies; it's a sad fact that most of the money allocated to fight poverty pays people who fight poverty rather than getting into the hands of the poor. Unfortunately, the sudden switch to issuing checks during the pandemic/lockdown has created parallel systems that cost more.

Keep in mind while thinking about what Mason wrote that, 1) the public perception is that the "Biden stimulus package" was mostly about sending checks to people, while 2) 80% of the funds were allocated to government agencies and politically connected institutions. This makes me thing the "bait and switch" worked, and the bureaucrats are laughing all the way to the bank. What is scary here is that people are forgetting how strongly the Washington D.C. metropolitan area has risen in the ranks of rich cities over the last 15 years. It didn't used to be a place you moved to to get rich.