Warfare Freeloaders

Warfare Freeloaders

While discussing the failure of government at helping the poor, my interlocutor implied that I was focused on the welfare queen and perhaps did not realize (or did not care) that “conservative” reforms would wreck the lives of those in need. Quite the opposite. The welfare queens are not the recipients of transfer payments in the form of food stamps and section 8 housing allowances, but the government itself.

If a pharmaceutical company makes a 7 million dollars in profits on 100 million in revenue, the political leftward leaning lose their mind and denounce these companies for profiteering on people in need, even though on average most large companies have to live on 7% profit margins.

So, a for-profit industry is able to benefit millions of people in need and they put 93% of revenue into providing services and products.

By contrast, the government, according to this Forbes article is many orders of magnitude less efficient:

The Census Bureau estimates that our current welfare spending totals four times what would be necessary just to give all of the poor the cash to bring them up to the poverty line, eliminating all poverty in America.

So, if a family of a mom and two kids had $100 per week from a part-time job ( $5200/year) this family would need $14,890 to be brought up to the poverty line of $20,090/year. By contrast, the government spends $59,560 for that family.

If this were a private sector company providing a pill to eliminate poverty, the company would be making a 400% profit (in contrast to the drug company’s profit margin of 7%).

In another article listing the top charities in the US , Forbes details how charities typically provide 90 cents worth of aid to people in need for every 10 cents they take in.

I do not necessarily think it would be a good idea to just cut a check for $14,890 and hand it to someone in poverty. Most people who are poor, and excepting those who are disabled, remain in their condition because they lack...

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