Home > Books and culture, Economic policy > To help poor people, give them money

To help poor people, give them money

August 1st, 2014

The Oz (no link) is touting a campaign by Andrew Forrest to introduce an Australian version of the US “food stamps” system, replacing cash payments with a card that can only be used to buy an approved list of items. This is yet another step in the abandonment of economic rationalism by the political right. I’d be surprised if Forrest could get the support of any economist for this (though the recent performances of the IPA crew give me some pause). Free market advocates, following Milton Friedman, have long sought the replacement of in-kind benefits with cash. To those on the left, even where enthusiasm for markets is more qualified, the conclusion is reinforced by the obvious class warfare involved here. At best, someone like Forrest can be seen as a paternalist, hoping to protect the poor from themselves. But it’s obvious that the Murdoch press, and its target audience, want to punish the poor, not protect them.

As it happens, my slowly-progressing book has a section on just this issue, presenting the standard arguments of Friedman and others as part of the case for why markets work so well (when they do)

To help poor people, give them money

The problem of poverty is huge, in rich and poor countries alike. Around the world, nearly a billion people live in extreme poverty, living on less than $US1.50 a day. Even in the US, on most measures the wealthiest country in the world, the Dept of Agriculture estimates that 14.5 per cent of the population experience food insecurity, defined as being ‘uncertain of having, or unable to acquire, enough food to meet the needs of all their members because they had insufficient money or other resources for food.’

Faced with images of the hunger and suffering caused by famines and extreme poverty, a natural and intuitive reaction is to send food. This reaction is often politically appealing in countries that happen to have large stockpiles of food, either because of unforeseen declines in market demand, or because of government policies such as price supports for farmers.

On the other hand, many advocates of development aid dismiss food aid as a short-term ‘band-aid’, and argue that the aim of aid should be to provide the ‘right’ kind of assistance, as measured by subsequent economic growth. Advocates of aid initially focused on economic infrastructure and industrial development, and have more recently turned their attention to health and education.

Which of these approaches is right? Much of the time, neither. While support for health and education has a better track record than food aid, there is a growing body of evidence to say that, in both poor countries and rich ones, the best way to help people is to give them money.

To see why this should be so, ask: What would a desperately poor family do with some extra money? They might use to stave off immediate disaster, buying urgently needed food or medical attention for sick children.

On they other hand, they could put the towards school fees for the children, or save up a piece of capital like a sewing machine or mobile phone that would increase the family’s earning power.

So, the poor family is faced with the reality of opportunity cost. Improved living standards in the future come at the cost of present suffering, perhaps even starvation and death. Whether or not their judgements are the same as we would make, they are surely in the best possible position to make them.

Experimental evidence supports this conclusion

Exactly the same points apply in rich countries. Giving poor people assistance in kind, such as food stamps and subsidised housing, has a lot of political appeal. Not only does it meet an apparent need, but it appears to reduce the chance that the recipients will waste their extra income on luxuries, or on alcohol and tobacco. In addition, as in the case of the US food stamps program, it may also be possible to form a political coalition with producer interests, in this case the farm lobby.

Thinking in terms of opportunity cost, however, we can see that aid in kind almost inevitably results in waste. The opportunity cost of subsidised housing is the low rent paid for the house, while the opportunity cost of moving usually includes going to the back of the line. So having secured subsidised housing, people will stay there even if the house no longer suits their needs, because it is too big, too small, or far away from a new job.

The same kinds of problems come up with food stamps. Families poor enough to get food stamps face all kinds of problems. They might, for example, be faced with eviction if they don’t make a rent payment, or with a need for urgent medical or dental care.

Most of the time food stamps cover only part of a family’s food budget, so they are really just like cash. Families can meet some of their food bills with stamps, then use the money they save to meet other needs. The opportunity cost of spending more on food is the alternative that can’t be afforded.

But it’s precisely when people need money most, to the point where they are prepared to live on a restricted diet, that the limits of food stamps start to bite. If poor families were given money, they could choose to pay the rent bill even if it meant living on rice and beans. That’s a hard choice, but it might be the best one available.

Unsurprisingly, then, poor people often try to change some of their food stamps for money. This is denounced as ‘fraud’ and used as a reason for cutting food stamps even further.

It is market prices that determine the opportunity costs of goods and services for individuals and families. So, when people choose how to spend additional money, the opportunity cost of one choice is the alternative that could be bought for the same amount.

The idea that poor people don’t understand this is patronising and wrong. The tighter are the constraints on your budget, the more important it is to pay attention to them. Poor people often have less access to markets of all kinds, including supermarkets basic financial markets such as bank accounts and face complex and variable prices as a result. Nevertheless, many of them manage to find highly creative ways of stretching a limited budget to meet their needs. Additional constraints, in the form of payments that can only be spent in particular places and on particular goods, are the last thing they need.

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  1. Uncle Milton
    August 1st, 2014 at 14:41 | #1

    What if poor people spend the cash on cigarettes, drugs or alcohol for themselves rather than vegetables for their children?

    Just asking.

  2. Uncle Milton
    August 1st, 2014 at 14:44 | #2

    Andrew Forrest, by the way, is noblesse oblige from central casting. You can’t fairly lump him in with the reptiles from the Murdoch press.

  3. August 1st, 2014 at 14:54 | #3

    Both sides of politics have their patronising moments with the poor.

    On issues such as borrowing money at high interest rates, the Left seems to assume that poor cannot make these calculations for themselves and need to be protected from their own choices.

    How much you exactly repay of these high interest rate shysters is on their website you toggle a box to tell yourself exactly how much you will repay of the different periods of time for different amounts of money. There is full disclosure.

    Likewise, the Left is very keen to make it illegal to offer poor people of job below a certain specified minimum – the minimum wage. Again, the poor people are soon not to be able to make choices for themselves about whether this offer is better than their alternatives.

    The nudge literature is rather condescending as well towards the poor in particular and most other people as well except themselves in person. You should read behavioural labour economics summary of the IZA a website co-written by Larry Katz

  4. GrueBleen
    August 1st, 2014 at 15:04 | #4

    @Uncle Milton

    Is it your belief that the majority should always be punished because of the failings of the few ?

    How do you apply this principle to your own life ?

  5. Brett
    August 1st, 2014 at 15:06 | #5

    @Uncle Milton

    What about it? If it turns out that it’s not alleviating poverty, you can adjust the cash payment program later. But everything we’ve seen in evidence suggests that people don’t just “blow the money” – they use it to meet their needs.

    And yes, some of that will be spending on cigarettes and alcohol. Poor people like pleasure same as everyone else, especially since their day jobs are usually so monotonous and dull.

    @Jim Rose

    Likewise, the Left is very keen to make it illegal to offer poor people of job below a certain specified minimum – the minimum wage. Again, the poor people are soon not to be able to make choices for themselves about whether this offer is better than their alternatives.

    It’s called setting socially acceptable conditions under which the market is allowed to operate, something that happens in all economies. I’m sure you could find some people who would willingly sell themselves into chattel slavery if that was legal, too, but should we allow it? After all, isn’t the person doing that “making a choice”? Isn’t it patronizing to tell them they can’t sell themselves into chattel slavery?

    That’s what the minimum wage is about. If you can’t pay a certain amount per hour for a task, then it’s not a job worth having – at least as how it’s set up.

  6. history in time
    August 1st, 2014 at 15:22 | #6

    >
    What if rich people spend their money on yachts and holidays rather than the kids.

  7. John Quiggin
    August 1st, 2014 at 15:23 | #7

    @Uncle Milton

    How does this differ from the proposition that we should install comprehensive video surveillance in all homes to prevent child abuse? Again, just asking.

  8. Uncle Milton
    August 1st, 2014 at 15:48 | #8

    @John Quiggin

    There’s never a simple answer to the question, “where do you draw the line”?

    The John Stuart Mill answer is to let people harm themselves but not others. In practice, we do stop people harming themselves, from seat belts to compulsory saving for retirement.

    While we don’t have video cameras in homes, if your kid turns up to school with a black eye, however innocently obtained, the school will report this to the authorities and a file will be opened on you. If it happens repeatedly, expect them to pay you a visit.

  9. MWS
    August 1st, 2014 at 15:53 | #9

    I would consider supporting income management for all working-age recipients IF the paid parental leave was also income-managed. After all, this money should only be spent on the children and basic living costs …

    As this proposal is to exclude age- and veterans-pensions from being income-managed, then how will somebody who has been income-managed for a number of years while of working age, suddenly acquire the necessary wisdom to be able to manage their money when they reach 65 (or 66, 67 or whatever the pension age is)? It smacks of trying to exclude conservative voters from any impacts of income management. Apparently they are forgetting that these pensioners also have family members who WILL suffer.

  10. Uncle Milton
    August 1st, 2014 at 15:59 | #10

    @GrueBleen

    In my own life I put up with petty annoyances that are designed to protect me from myself, provided they are not too obtrusive, which they rarely are.

  11. Don Arthur
    August 1st, 2014 at 16:04 | #11

    “Were Friedman alive today, it is almost certain he would oppose the Australian government’s income management policy.”
    http://www.australianreview.net/digest/2013/11/arthur.html

  12. Cranky Peanut
    August 1st, 2014 at 16:19 | #12

    I might support “Income Management” if the government could prove that poor people are poor only because they don’t know how to manage their affairs and their money.

    Otherwise, nope. Not a hope.

    Income Management isn’t a “petty annoyance”, and if people would be so kind as to not trivialise the negative impacts is has on those subjected to it.

    Trying to justify it with crocodile tears and hand wringing over spending on alcohol and tobacco isn’t going to wash.

  13. Fran Barlow
    August 1st, 2014 at 16:22 | #13

    I must admit to having mixed feelings on this matter. I should declare in advance that as a school teacher who has spent a good deal of my career teaching in Sydney’s south western suburbs, I have seen a fair bit of child neglect, and some poor choices with money — by no means restricted to recipients of community provision. That view may be skewed, because almost by definition, one notices the cases where people are apparently making what appear to be unwise choices about their money management, even if, for the most part, people who are poor are doing a fair job.

    My partner’s father was, sadly, an alcoholic, and his long suffering mother — an ex-WAC — performed heroically in raising three children on the pittance left over from her husban’d malfeasant conduct. My father’s family story was a common one. They got just enough, but not one thing more and his mother, as far as is told by him and his siblings, never once grimaced or cried or laughed or showed affection. She never felt she could share this burden outside the family, because that would have been shameful so her hell was private. The struggle used up all she had — which is something that is simply never accounted for in the economics of poverty. More money might have helped, assuming she rather than her husband had secured control of it.

    My own experience of stries like this are, I suppose, why I am inclined to favour a greater reliance on non-cash support structures. “Food stamps” are of course demeaning, and this is not something I’d ever want to see, but these days there are ways of providing people with stored value cards. Which could look for all the world like a standard transaction card and could be enabled to purchase just about anything outside of a few blacklisted items. One might fund community food and grocery coops, and allow concessional access to those for those qualifying.

    One could likewise increase the stock of quality public housing — and not merely in the areas where land was cheapest, and create a structure in which people of qquite modest means could live there, with some state support that would be invisible to most of the fellow occupants.

    The basic problem is that we humans aren’t all equally good at NPV-style calculus, and in any event some of us use a discount rate on benefit that is seriously weighted against future benefits. For those who think their life chances are poor, not considering seriously their life circumstances 12 months ahead isn’t entirely irrational — it just looks that way from the perspective of those of us who imagine that if we do the right things we will probably be better off than now a year from now. The rational choice of a homeless person, or someone who has few marketable skills is nearly always to salve the pain that attends that reality, because pain of one kind or another is with them every day. It is a wicked problem. It’s also why such folk are so much more likely to be exploited or swindled.

    So when we who want to empower the marginalised speak of a safety net we need, IMO, not to fall into the mistake of allowing our respect for their possibility in near ideal circumstances to alter our approach to their needs in the world as it is. Being respectful is a sham if the consequence of our “respect” are programs that set them up to fail. We should be cognisant that oppression really does oppress people, and diminish their ability to use the resources they have optimally. Their free choices are not as free in practice as those of us who have had the benefit of good education and worthy mentors.

    What public policy should do is to ensure that they get everything they need to be able to make adequately good decisions on their own behalf, even if that involves resort to measures that some might decry as “nanny statish”, because, IMO, that’s a lot better than policies that are FU statish.

    Let us increase the generosity of community provision (including through the supply of cash or non-repayable credit), but let this extra provision flow through well-conceived and implemented programs in which the beneficiaries themselves can be actively involved. Let’s ensure that everyone gets good access to quality health, housing, transport and education, starting from early childhood. Let’s ensure that there are places where people can purchase food and staples concessionally. Cash is a great thing because it allows choice, but meaningful choice comes from insight and that is not caused by money but by quality life experience.

  14. Ikonoclast
    August 1st, 2014 at 16:23 | #14

    Most poverty in our system (late stage capitalism) is caused by the highly inequitable nature of the system itself and the deliberate policy of using unemployment to discipline workers, limit wage demands and fight inflation. Another way of saying this is that most of the poverty in our system is caused by laws, rules and institutions designed to enable a few to become super rich while impoverishing many others. Poverty in our society is not an accident or an unintended consequence. It is very deliberately intended and designed into our system.

    I really get sick of people buying into the fallacy that it’s all an unintended and lamentable consequence of some badly set part of the system. It is integral to the system itself; integral and fully intended.

    Paying adequate welfare using money will alleviate the ill effects of the system. But the fact that we keep needing to do this for able people (redistributing wealth with welfare) demonstrates irrefutably there is something fundamentally wrong with the system itself.

  15. Uncle Milton
    August 1st, 2014 at 16:23 | #15

    “I’d be surprised if Forrest could get the support of any economist for this”

    Behavioural economists are always pointing out that people suffer from cognitive biases, leading them to make bad choices, hence policies “nudge” them in the right direction. Now maybe what Forrest is proposing is a shove rather than a nudge, but then the debate is about how much paternalism is needed, which is different from saying that giving cash is always superior.

  16. August 1st, 2014 at 16:25 | #16

    Around the world, nearly a billion people live in extreme poverty, living on less than $US1.50 a day.

    This is a surprisingly widespread over-simplification that leads to serious misunderstanding. They do no such thing, apart from perhaps a very few who only do so briefly and transitionally, as it is physically impossible; those like that either better their lot or perish (of course, their numbers are continually replenished).

    Rather, what is mostly happening is that there are nearly a billion people living in extreme poverty, living with less than $U.S. 1.50 a day and using that as a very necessary top up to their remaining and otherwise inadequate non-cash subsistence resources. When those subsistence resources are adequate, people living like that did better on less cash. Think how things were in Haiti, in the days before the U.S.A. arranged to have the Creole Pig wiped out, and compare that with how things are there now: cash incomes have increased, and people are suffering even more.

    For this and related reasons, simply giving people more money is less effective than it might be. In an extreme case it would simply move food from mouth to mouth. Of course, the thrust of this article is about the other kinds of poverty constraint, that money can help with but food can’t, but it is important to have a clear understanding of just what is concealed by the veil of money when there are indeed non-cash subsistence resources around as well – and when there are not, and which sort of poverty we are looking at, whether that of the developed world or elsewhere.

  17. Ikonoclast
    August 1st, 2014 at 16:31 | #17

    @Fran Barlow

    Of course, wicked problems always have historical antecedents too. Many men and some women of your partner’s father’s generation were traumatised by war, suffering PTSD and so on. Alcoholism was a common response. And most, if not all wars, are fought at the pointy end by the lower classes so that the upper classes can pursue their own goals. That is, the lower classes pay the cost in blood and pain and ruined lives while the upper classes make off with the war profits.

  18. Midrash
    August 1st, 2014 at 16:43 | #18

    To make sense of these issues requires a rare combination of clear thinking (informed by but by no means identical with a good knowledge of economics), lots of worldly experience including, especially knowledge of and sympathetic imagination for the whole range of human beings, their capacities, cultures and prejudices. TTht ssid there is no use pretending that 40 per cent or more of people, even in Oz, are incapable of making decisions concerning money that wouldn’t regularly p*ss off the people who are big net taxpayers for most of their lives. OK, by good luck maybe not as big a proportion actually waste and squander….

    Consistent with that confident affirmation of reality as I have seen it to be I am not enthusiastic about UK Chancellor Osborn’s sllowing people to take their pension fund savings as lump sums. It is, for one thing, almost certain to add to the burden on the public purse… On the other hand who wants to keep people dependant on the jobsworths populating the world of private pension providers and financial advisers?

    A quibble over your using that figure of $1.50 a day for what so many people have to live on. It is just a tabloid headline figure so to speak, even if generated by NGOs. I asked my drivers in a couple of Third or Fourth World equatorial tropical countries a few years ago what it would to buy enough food to supplement nature’s almost free supplies and the average answer was 30 cents day. There were of course no heating costs and water was usually plentiful. Of course health care was minimal even if not very expensive. It prompted the thought that the money we spend setting up 13750 refugees each year as future voting citizens might be better spent – save for maybe 1000 special cases – on doing good things for millions in the countries of first refuge.

    And while I’m at it JQ: though many of my acquaintance on right and left deplore surveillance I note an inverse relation between objecting and advancing age. At least lets have a few lawyers and counsellors arranging for CCTV to be installed as both deterrent and protection from lies on all sides. IMO there ought to be much more surveillance combined eith serious and credible penalties (and damages) to deter abuse.

  19. Midrash
    August 1st, 2014 at 16:50 | #19

    @Ikonoclast
    How do you explain the devastation of the UK officer class, disproportionately, in WW1?
    Are you allowing for enough classes in your analysis. The great days of Britain’s rise from about 1500 to 1900 was marked by the high rate of growth of the commercially and professionally successful classes. In contrast the traditional nobility/aristocracy were military in origin and got themselves killed

  20. kevin1
    August 1st, 2014 at 16:56 | #20

    As I understand it, the Gates duo have Gus Nossal as chief strategist to drive their philanthropy. Forrest gives Marcia Langton top billing in his Acknowledgements. She’s a public figure and needs to join this debate. Does she sign up to these recommendations too or is she a consultant providing sectional input like the staff of PM and C, Access Economics, McKinsey and Deloittes who were also involved?

    How are the views of acknowledged experts and practitioners in the field considered? Is this a reward for Forrest pledging a large philanthropic donation last year? Is this the way to develop public policy?

  21. rog
    August 1st, 2014 at 17:11 | #21

    @Uncle Milton

    the Left seems to assume that poor cannot make these calculations for themselves and need to be protected from their own choices

    People from all walks of society make financial mistakes, Joe Hockey’s MIL got dudded by a smooth talking financial advisor from CBA. You assertion is based on your assumption that others have made an assumption…the reality is that there are some clever crims out there.

  22. Uncle Milton
    August 1st, 2014 at 17:17 | #22

    @rog

    It was Jim Rose that said that, not me.

  23. hc
    August 1st, 2014 at 17:35 | #23

    I assume the restrictions on purchases are designed to reflect the interests of taxpayers who probably don’t want to see their tax dollars spent on smokes and booze. These types of restrictions might even encourage greater acceptance of the transfers from those providing the income.

    Heavy drinking and smoking are concentrated among low income people and, as they are irrational patterns of behaviour, I see no difficulty with restricting purchases paternalistically.

    In indigenous communities money that could be used to pay for family food does get diverted into booze and smokes. Consumption of these items has a huge effect on health – I estimate that 20% of the gap between white and indigenous life expectancy is due to their cigarette smoking alone.

  24. Watkin Tench
    August 1st, 2014 at 17:36 | #24

    The left should be making more of the fact that approx 700,000 unemployed people can’t squeeze into 150,000 jobs no matter how much you take away the carrots and beat them with a stick.

    I’m touched by Fran’s story (sounds a bit like my own, actually) but any system devised by bureaucrats to make the poor spend their money on food rather than grog is doomed to failure as people will always find ways to game the system. I think it is better to ensure that maltreated women and children have well funded support services to fall back on – including emergency food and accomodation. In poor areas, it may also be a good idea to provide students with breakfast.

  25. rog
    August 1st, 2014 at 17:36 | #25
  26. rog
    August 1st, 2014 at 17:44 | #26

    According to Twiggy the poor ie vulnerable are self identifying. You just need people to identify the self identifying.

    I think Twiggy is having a genuine go at addressing poverty but is limited by his expertise. The mistake was to put him in a position of leadership.

  27. chrisl
    August 1st, 2014 at 17:50 | #27

    Rog : Who does have the expertise?

  28. Ivor
    August 1st, 2014 at 17:57 | #28

    @Jim Rose

    Wrong.

    The Left assumes that capitalists “cannot make these calculations for themselves and need to be protected from their own choices. “.

    Hence the bailouts, the QE, the defaults, and the 25% unemployment.

    Without capitalism there would be no suggestion of food stamps.

  29. Ivor
    August 1st, 2014 at 18:17 | #29

    Maybe we could countenance food stamps if they were accompanied with superannuation stamps, fuel stamps, clothing stamps, dentist stamps, travel stamps, education stamps, and housing stamps.

    All funded from Twiggy’s missing taxes?

  30. Megan
    August 1st, 2014 at 18:56 | #30

    @hc

    Heavy drinking and smoking are…irrational patterns of behaviour, I see no difficulty with restricting purchases paternalistically.

    Unless that applies to everyone equally – regardless of whether they are rich or poor and wherever they got the money to make those purchases – it might lead to some friction.

    And if it did apply equally it might also lead to some very unhappy rich people.

  31. Pete Moran
    August 1st, 2014 at 19:27 | #31

    I wonder if the concept of micro-financing supports your thesis JQ?

  32. Megan
    August 1st, 2014 at 19:37 | #32

    The ALP’s shadow minister Shane Newman has given tacit approval to Forrest’s report saying on ‘NIRS’ that he “welcomes” some of its key ideas.

    He particularly mentioned alcohol foetal syndrome and home ownership (ie: the ability to mortgage off parcels of land to individuals rather than have group ownership).

  33. rog
    August 1st, 2014 at 20:33 | #33

    @chrisl Obviously, in Twiggys world, those with expertise are “self identifying”

  34. sunshine
    August 1st, 2014 at 20:46 | #34

    Forrest said ;- ‘I stand here as a servant of Aboriginal people’ . Well thanks ,but no thanks Twiggy. The intervention sucks ,it is rapid forced integration.

    Re: war ;- A bayonet is a weapon of war with a working class man at either end of it.

  35. Florence nee Fedup
    August 1st, 2014 at 21:10 | #35

    @Uncle Milton
    If that happens, it is the job of child protection. Happens cross society, not only those on benefits.

    How does Centrelink know what one spends their money on, Why should they know. That is not their job.

    How does Centrelink assess the situation, Not their role. L:eave it up to those who already have this responsibility.

  36. Florence nee Fedup
    August 1st, 2014 at 21:12 | #36

    Yes, but why should those on welfare be singled out for such treatment.

  37. August 1st, 2014 at 21:23 | #37

    Perhaps unemployment benefit should be divided into an amount for basis needs and another amount for discretionary spending. The money will be spent to the benefit of the economy. The money spent can be designated as investment in human and social capital. If there is a fiscal problem, albeit an emergency, raise taxes on the basis of relative wealth. The fundamental issue, aside from the ideology which has a long pedigree if the Poor Laws are remembered, is the need to everybody without exception to be engaged in socially productive work consistent with protecting the ecosystem, including what Gandhi described as “bread labor”, or body labor.

  38. August 1st, 2014 at 21:32 | #38

    Pr Q @ #7 said:


    How does this [judgmental paternalism] differ from the proposition that we should install comprehensive video surveillance in all homes to prevent child abuse? Again, just asking.

    Since you ask, I will tell. There is no moral equivalence between the right to be free from home invasion and the entitlement to welfare benefits. To even ask the question is to answer it.

    The legal rights of citizens to be free from invasion is based on ancient common law and cannot easily be over-turned, even by the most vigilant agents of the Crown. These rights are more or less unconditional and absolute, all the more so where there is no probable cause for authorities to forcibly enter or search.

    By contrast the entitlements of welfare dependents are specified by legislation which can be amended or repealed at the next election. The benefits are usually selectively dispensed and eligibility is subject to meeting various conditions. Thats as it should be given that the resources being doled out are the tax-payers and he is entitled to accountability in the expenditure of his hard-earned dollars.

    Installing CCTV in all homes to pre-emptively prevent child abuse would be a violation of the most cherished and long standing rights to privacy and property, summarised by the saying “a man’s home is his castle”. And this sweeping draconian practice would only constrain or catch a small minority of the total population, so it would be an absurd over-kill.

    By contrast a welfare dependent is, like any dependent such as child, lunatic or criminal, significantly subject to the authority of the agency that writes the cheques and is responsible for their welfare. There is plenty of evidence that welfare dependents are even more likely to indulge in vice than randomly selected citizens. Substance abuse is one of the main reasons why they are on welfare to begin with. Curtailing expenditure on vice is actually beneficial to the beneficiary.

    So the state has every right, nay a duty to the tax payer, to insist that welfare resources are spent on items for which they are intended, namely the means of subsistence. Whether the state chooses to exercise this right is matter that depends on the circumstances.

    IMHO, based on personal experience, the case for income management of indigenous welfare recipients and in kind welfare benefits in the Northern Territory was over whelming. Forty years of unconditional welfare from the federal government, a basket case NT government and a culturally sensitive administration by Baby Boom anthropology dupes had resulted in a systemic crisis. As one Arnhem land elder put it: “The missionaries were better”, and those kind souls took a hard line on such matters.


    Mr Yunupingu, a former Australian of the Year, called for the intervention taskforce to urgently build missionary-style dormitories in the communities where children could be fed, clothed and cleaned. He said he would not shy away from criticism the dormitories would be a return to the days last century when missionaries ran the communities.

    “The missionary days were good,” Mr Yunupingu said. “The missionaries looked after the kids much better than the Government does today.”

    Whether the same principle ought to be applied across the board to non-indigenous welfare recipients in the other states is a vexed question. For purposes of racial equity I tend to lean to the affirmative.

    More generally Howard’s assertion of the principle of “mutual obligation” to welfare recipients has struck a chord in the community. It affirms the principle that we must all contribute to the common weal.

    As the saying goes, “beggars can’t be choosers”. Or as the other saying goes, “You live under my roof, you live by my rules”.

  39. hc
    August 1st, 2014 at 21:33 | #39

    Megan, You are quite right. But the opportunity cost of flawed decisions by the rich are lower. They can still put food on the table and pay for school books. Its true that both rich and poor misrepresent the opportunity costs but it matters less for the rich.

  40. Donald Oats
    August 1st, 2014 at 21:49 | #40

    Should the aged poor on pensions be placed on 100% income management? What makes the aged poor any different to the working age unemployed poor? Or as one person pointed out above, PPL receivers? The whole logic of income management reeks, and quite frankly, I’m surprised at a Liberal (ie Australian Conservative) party even entertaining such ideas.

    In extreme cases, perhaps a case can be made for a particular person to be on some sort of income management of their welfare payments, but given the incredibly low income that the dole represents, perhaps a better idea is that people should have their dole augmented with free fresh meat and fruit and vegetables, that sort of thing. It might leave the recipient with a shred more dignity if they didn’t have to make harsh choices like fresh food vs rent this week, or food vs electricity. I know of working people who have that struggle of meeting all bills in a timely fashion, purely because of the lumpiness of earnings and bill arrival times; it is to be expected that people on the dole long term will find it very tough indeed, and to remove that last bit of flexibility they have with their financial matters will have nasty consequences I’m confident, sad to say. There are no easy answers though, so one solution is highly unlikely, a fantasy.

    If it is felt necessary for a whole category of people in a consumer society to be placed under severe restrictions as to what and when they may purchase any things, something does not compute!

  41. August 1st, 2014 at 23:14 | #41

    @jack strocchi

    Or as the other saying goes, “You live under my roof, you live by my rules”.

    I find it incredibly hard to believe that you have actually used this saying in these circumstances. I take it you are a white person? Do you know whose roof you – and Twiggy Forest, and all the rest of us white people – are actually living under? Learn some manners.

  42. bjb
    August 1st, 2014 at 23:33 | #42

    One way to limit the need for welfare “reforms” of any sort for the next generation would be to fully implement Gonski, and at least give each kid an equal leg up. Since the Tories appear to have no interest in that, I’d doubt the Governments intentions irrespective of what good intentions Forrest may have.

  43. BilB
    August 2nd, 2014 at 00:34 | #43

    I find the very notion of Twiggy Forrest’s “report” offensive. Conceptually I think of this a fat cat attemting to manipulate a people into a form that he can exploit, which in Forrest’s case would be to have such people working his mines on their land, for a pittance. The very gall to be telling indigenous people how to run their lives to meet our perceptions after we have pushed thdm into the far cofners of their land.

    Having said that education of the young so that they can cope with the mess of a world that could very well descend upon us all is a future proofing strategy that should be engaged. That education though must understand and make allowances for the vast gulf between cultures.

    Speaking of food stamps, I would prefer that a combination of food primary items supplied

  44. BilB
    August 2nd, 2014 at 00:44 | #44

    ….physically thereby saving the retail markup, and paying a cash amount to value of that retail markup plus some extra so that the recipient has some flexibility and choice. Tin and packet food would be supplied from manufacturers direct to depots operated by councils. This could be an option amoungst a parcel of solution strategies.

  45. Julie Thomas
    August 2nd, 2014 at 04:58 | #45

    @jack strocchi

    “As the saying goes, “beggars can’t be choosers”. Or as the other saying goes, “You live under my roof, you live by my rules”.”

    I suppose that is why so many blackfellas kill themselves; it is the only way to avoid the hell that comes from living under your roof.

    Living under your roof has become increasingly intolerable for some white people also or have you not noticed that rates of anxiety and depression and suicide and other health problems are increasing in poor people? Oh that’s right people only get these things because they get welfare or they just make it up to get welfare.

    But really you might want to consider an alternative scenario; that it just isn’t worth living if all there is to living is to work in the jobs you are offering.

    And what’s this weird stuff about your privacy being so sacrosanct?

    It seems to me that people like you – and this focus on being secretive is another feature of the crazy old man diagnosis – must want this privacy because you do shameful things that you don’t want others to know about.

    Can you explain, not how come you imagine you have this right, but why you want it so much? That would be interesting.

  46. J-D
    August 2nd, 2014 at 04:59 | #46

    A rich man gave a beggar a generous quantity of cash, and the beggar immediately ran into a delicatessen and bought smoked salmon sandwiches. The indignant rich man ran after him and said, ‘I gave you money because you’re starving, not so that you could indulge yourself with smoked salmon sandwiches!’ The beggar replied, ‘Listen: when I haven’t got any money, I can’t eat smoked salmon; you say that when I do have money, I can’t eat smoked salmon; so tell me, Mister Bigshot, when do I get to eat smoked salmon?’

  47. Midrash
    August 2nd, 2014 at 05:13 | #47

    @Florence nee Fedup
    Easy to agree that neither government, nor the church nor Centrelink specifically are likely to be much good at anything complex let alone assessing the behaviour of individuals – or families – but that’s not to say they shouldn’t at least try and apply some rules about what you call “their money” when that money comes from resentful – or even generous and undemanding taxpayers.

  48. Midrash
    August 2nd, 2014 at 05:16 | #48

    @J-D
    Nice story. Has it a point? Or is it a nicely ambiguous fable you could tell in Sunday school to get the kids thinking?

  49. Midrash
    August 2nd, 2014 at 05:24 | #49

    @Julie Thomas
    Your usual presumption about people. I am confident that Jack uses his real name and is quite young contrary to your insinuation or apparent assumption (or guess). And I don’t recall him treating privacy as sacrosanct so much as making a contrast between two different customary expectations to answer a conflation of them.

  50. Midrash
    August 2nd, 2014 at 05:31 | #50

    @P.M.Lawrence
    Well made point about that glibly quoted $1.50 a day. Better than I did.

  51. Midrash
    August 2nd, 2014 at 05:57 | #51

    “The rich are different from you and me”. That famous line might do at a dinner party to answer the rather obvious but humbugish suggestion that all sorts of government mediated benefactions from the taxpayer should be equally subject to control. Instead of going into a case by case detailed refutation of such proposals let ne just offer the suggestion that the rich and merely prosperous be allowed to buy their way out of supervision by a flat rate fee (cp. the UK’s non-dom tax) or a higher rate of tax? But isn’t that the way it works already? Not a bad rule of thumb really that those who have been paying the bill as taxpayers should be presumed not to need supervision and entitled not to be supervised? Obviously untrue of many OAPs but if they kill themselves with fags and booze it’s not likely to affect children and doesn’t damage GDP. (OK there are a couple of quibblers who might raise the case of the long term healthcare costs of some elderly people living unhealthy lifestyles but not dying quickly. Even in those cases it can be answered that the damage was probably done while they were still in the workforce paying income tax. That’s why we are justified in imposing a heavy excise on booze and cigarettes to top up what we get from the working smiking boozer’s income tax).

    In short it’s not even a smart debating point to try and generalise income management to the rich and/or capable.

  52. John Quiggin
    August 2nd, 2014 at 06:03 | #52

    Midrash: 5 comments in a row is far too much. Until further notice, 1 comment per thread per day, except in sandpits.

  53. August 2nd, 2014 at 10:21 | #53

    Julie Thomas @ #15 ranted:

    “As the saying goes, “beggars can’t be choosers”. Or as the other saying goes, “You live under my roof, you live by my rules”.”

    I suppose that is why so many blackfellas kill themselves; it is the only way to avoid the hell that comes from living under your roof…Living under your roof has become increasingly intolerable for some white people also or have you not noticed that rates of anxiety and depression and suicide and other health problems are increasing in poor people?,,,But really you might want to consider an alternative scenario; that it just isn’t worth living if all there is to living is to work in the jobs you are offering.

    Oh puh-leese, try to dial the hysteria down to 11. Income management, sumptuary regulation and work-for-the-dole are not the cause of depression and suicide amongst indigenous people, the poor or any one else for that matter. If any thing self-harm is usually associated with too little intervention, rather than too much. Read Durkheim on anomie in his classic “Suicide”.

    I am arguing for democratic accountability and mutual obligation in the distribution of tax-payer funded benefits for all welfare dependents whether they be black, white or brindle. The people want to get value for money by ensuring that benefits are spent as they are intended, to provide the means of subsistence for dependent households. Conversely, paternalism is also better for the dependent households who are not, contra Quiggin, always the best judges of their own welfare.

    The principle of mutual obligation is fundamental and foundational to the welfare state, indeed to the state as a whole. That is the reason why TDT and Current Affair programs that focus on welfare fraud, waste and inefficiency are such regular high-raters. There is a yawning black hole in the middle of liberal utilitarian ethics and economics is no where near big enough to fill it.

  54. alfred venison
    August 2nd, 2014 at 11:00 | #54

    @jack strocchi
    “ranted”, eh? but that’s not my brief. you want to reach back to durkheim, i’ll reach back to huxley. why not just feed ‘em soma in their synth gin & let ‘em watch feelies all day? -a.v.

  55. 2 tanners
    August 2nd, 2014 at 11:36 | #55

    A few points. $1.50 a day – this is not $US, it is $US PPP. It is an appallingly low figure. Note that it is per person, so a household of 6 gets the princely sum of $9 US purchasing power parity per day. It is an income figure. So PW Lawrence’s story is irrelevant.

    Twiggy is, I believe, genuinely concerned. His Walk Free anti slavery campaign was founded out of a revulsion for slavery and not to gain access to mineral wealth. He consulted with government agencies on the best and most effective way to work.

    That said, I think his report starts from a poor assumption, that of a fixed level of benefits for the poor. To address poverty, give money. To better address it, give more money. And while you’re at it, don’t set up punitive poverty traps through the tax and benefits system.

  56. MWS
    August 2nd, 2014 at 11:45 | #56

    One further point about exempting age-pensioners from income management – there will be considerable scope for elder abuse in families where only those receiving age-pensions have access to cash, and everybody else is reliant on “welfare cards” which limit spending in certain areas. I understand that some (I have no idea how many) elderly people in remote areas were happy to be put on income management as it allowed them to refuse requests for cash from family and friends.

  57. Julie Thomas
    August 2nd, 2014 at 12:00 | #57

    lol puhlease! Me rant? Whatever.

    You are saying nothing that my grandfather used to say back in the ’70′s and it was patriarchal conservative nonsense back then.

    It is you who needs to get up to speed with your reading and being to realise how not stupid and quite capable of making reasonable choices poor ‘dependent’ people are, given a decent society in which reciprocity is the norm.

    You need to get out more and see how many of us are realising that conservatism has only ever offered a poor substitute for an egalitarian society and besides that it has never worked well.

    So offering us more domination by aggressive hierarchical men who force themselves and their wants – in many ways – on those less powerful is a bit stupid, no?

    And ….did you notice that you attributed things to me that I didn’t say? Is that one of the ways you dominate people and force things to be the way you want them to be?

    Of course it is not income management that is or will lead to increasing suicide rates.

    Are you denying that all these problems have increased? Do you have an explanation?

  58. August 2nd, 2014 at 13:40 | #58

    @Brett

    It’s called setting socially acceptable conditions under which the market is allowed to operate, something that happens in all economies.

    Wrong again. Germany, Denmark, Italy, Austria, Finland, Sweden, Iceland, Norway and Switzerland do not have a statutory minimum wage. Capitalist hell-holes all.

    Whether the low-paid and low-skilled get a fair consideration from unions in collective bargaining given these unions will be driven by majority rule – by the median voter/union member who is older, senior and of high job tenure – is a question worth exploring.

    The evidence is not good. In the Finnish depression in the early 1990s, the unions refused to agree to nominal wage cuts despite 20% unemployment – the worst since the 1930s. They protect those that still had a job.

    Most European labour markets are dual labour markets. Unions and employment protection laws ensure that they are made up of two-tier systems with ultra-secure permanent jobs with the rest on temporary contracts.

  59. August 2nd, 2014 at 13:48 | #59

    2 tanners :
    A few points. $1.50 a day – this is not $US, it is $US PPP. It is an appallingly low figure. Note that it is per person, so a household of 6 gets the princely sum of $9 US purchasing power parity per day. It is an income figure. So PW Lawrence’s story is irrelevant.

    How is it irrelevant? The figure cited was given in cash terms, and the whole point I was bringing out was that it doesn’t give a full picture and to show what was missing. Pointing out that it is only an income figure and that purchasing power parity is more informative is accurate, and it also highlights that cash figures aren’t enough information, which rather goes to show that it was worth my while bringing out that incompleteness. But even looking at purchasing power parity is still incomplete as it doesn’t bring out the fact that it is still not enough per person by itself, so the other resources do remain important and drawing people’s attention to that is still worth doing – which makes it all very relevant.

    By the way, you have got my name wrong.

  60. Florence nee Fedup
    August 2nd, 2014 at 15:19 | #60

    When has buying tobacco and Alcohol illegal. Agree both are not good for health, but what right has another to tell one what they can and not have, simply because they are unemployed. They are the ones that go without. If kids do, that is a matter not for Abbott, but state child protection agencies.

  61. Florence nee Fedup
    August 2nd, 2014 at 16:10 | #61

    “Easy to agree that neither government, nor the church nor Centrelink specifically are likely to be much good at anything complex let alone assessing the behaviour of individuals – or families – but that’s not to say they shouldn’t at least try and apply some rules about what you call “their money” when that money comes from resentful – or even generous and undemanding taxpayers.

    Why should they try? Replicating what already occurs. If they have concerns, all that needs to be done, is make referrals to appropriate agency. In fact, they should be doing that now.

  62. Florence nee Fedup
    August 2nd, 2014 at 16:12 | #62

    What percentage of unemployed or those on welfare, do many here think abuse the system, abuse and neglect their families? Does the number you believe, justify all being treated as low life.

  63. Megan
    August 2nd, 2014 at 17:34 | #63

    @Jim Rose

    “Germany” might not be on your list shortly according to BBC:

    The German parliament has approved the country’s first minimum wage, in a vote in the Bundestag on Thursday.

    The wage will be set at 8.50 euros (£6.80) per hour, which is higher than the equivalent in the US and UK.

    Angela Merkel’s Christian Democrats approved the new policy as part of a power-sharing deal with the Social Democratic Party (SPD).

    Germany has previously relied on trade unions and business groups to fix minimum pay instead.

    At the moment, the country is one of seven in the 28-nation EU without a minimum wage level.

    Although… “the wage does not cover minors, interns, trainees or long-term unemployed people for their first six months at work.”

  64. sunshine
    August 2nd, 2014 at 18:34 | #64

    I think dole bludgers should be thanked for consistently allowing those who are more needy to have the few jobs as they become available .A new type of Australia day award could be created to recognise the best of the best in this field.

    On The Drum Twiggy said the problem is we have given them (Aboriginals) too much money ,and that we should now spend that $ on infrastructure instead. His view doesnt account for dispossession and cultural differences – massive omissions.

  65. bjb
    August 2nd, 2014 at 18:59 | #65

    sunshine :
    On The Drum Twiggy said the problem is we have given them (Aboriginals) too much money ,.

    Too much money ? From Adele Furguson’s “Gina Rinehart”, pg 416:

    Simon Hawkins, the chief executive of the Yamatji Mrlpa Aboriginal Corporation, argues that when Hancock (Lang) negotiated the deal with Rio he did not own the land: “He had no title property right, he had no tenement and [Gina] is now printing money, the traditional owners get 0.05%. There is a big disparity between that and the 2.5% royalty she gets”

    The Aboriginal people have been severely ripped off ever since white settlement.

  66. August 3rd, 2014 at 00:34 | #66

    Take cigarettes. I have a mentally ill relative who, like most mentally ill people, smokes. If her pension was delivered as food stamps, she would swap them for cigarettes. She lives in supported accommodation with plenty of other people with varying degrees of mental illness. They don’t pester each other for food, but those who’ve run out of cigarettes pester those who have still have some.

    The manager of the facility actually takes about $70 per week from their pensions, and uses it to buy cigarettes for them, which he dispenses daily – 15 of them. It really is a bit like “cigarette stamps”, isn’t it? Without this daily allowance, the conflict over lack of cigarettes would be much worse.

    I don’t know why I bring this up, except to illustrate a different reality to that most of us experience.

  67. August 3rd, 2014 at 00:41 | #67

    And I will add one more thing about welfare. In my ideal world, everybody would get a basic subsistence payment every week, regardless of our income or other circumstances. It would be about the size of the pension. Taxes would increase to cover the extra cost.

    Then if you became unemployed, you would make your own decisions about how long you wanted to be poor for, and what steps you wanted to take to increase your income.

    Because I loathe the welfare system. The jumping through hoops to survive. The penalties for failing to cope adequately. The welfare mentality where instead of considering your future, you are bound up in your interaction with the bureaucracy of welfare.

  68. jungney
    August 3rd, 2014 at 11:14 | #68

    You lot are disgraceful. Where’s the humility and gratitude to Twiggy Forrest? Do you understand the opportunity cost to him of taking time off from wealth creation to address the problem of what to do with the whining and indigent, the impecunious and downright shiftless? Personally, I’m with the good Reverend Malthus. The poor are surplus to requirements and should be left to their own fates and graves. The poor are a visual blight in their exhausted tracky dacks and thongs; they block up the entrances to Bi-Lo, smoking and hacking away like extras from a Dickens mini-series. So what if they spend all of their money in the very local economy just scrabbling by? Who needs em? Twiggy is too soft by half. He actually wants to feed them and keep them healthy which will only extend their lives and sense of entitlement. We need Hockey to have a real crack at them.

  69. BilB
    August 3rd, 2014 at 13:49 | #69

    Good on you, bjb, my sentiments entirely.

  70. Debbieanne
    August 3rd, 2014 at 14:58 | #70

    Is it just me, or have others noted that some of ‘our’ attitude to ‘leaners’ has changed along with the wording/naming, from social security to welfare?

  71. Florence nee Fedup
    August 3rd, 2014 at 15:26 | #71

    I wonder it the landlord and others will take food stamps. Bills do not disappear, when the job does.

  72. zoot
    August 3rd, 2014 at 17:32 | #72

    @jungney
    I agree. We’ve been tiptoeing around the subject for way too long. Time to take some meaningful action.
    My modest proposal is that poverty be made a capital crime. Probably best to set the mark at those whose taxable income is beneath that required to pay the Medicare levy. On this basis we’d have to execute most age pensioners and probably a few billionaires, but to make an omelet you have to break a few eggs. Am I right, or am I right?

  73. BilB
    August 3rd, 2014 at 18:59 | #73

    Here’s an off the wall idea, zoot. Following your thinking, it occurred to me that if excessive wealth were to be made a capital crime, culprits would be disposed of and their assets redistributed eliminating the poor, raising the overall level of contentment, spreading airline seats further apart, reducing resource consumption, reducing energy consumption, and reducing CO2 emission levels, all while eliminating far fewer individuals.

  74. BilB
    August 3rd, 2014 at 20:31 | #74

    Thinking about this some more, Zoot, both of these approaches have been tried in the past, and, again even today. I wonder which has been the most successful overall?

  75. rog
    August 3rd, 2014 at 20:38 | #75

    It seems that the report recommends a Gonski level of education reform

    http://indigenousjobsandtrainingreview.dpmc.gov.au/recommendation-3-improving-educational-outcomes

    This won’t please the govt.

  76. zoot
    August 3rd, 2014 at 20:40 | #76

    @BilB
    BilB, I believe your idea has much more merit than mine, simply because it involves the disposal of a lot fewer drains on the economy. Efficiency should always be our priority.

  77. Mark
    August 6th, 2014 at 04:18 | #77

    According to the ABS, there are about 146,000 jobs vacant[1], and about 740,000 unemployed people[2]. Assuming all those jobs will be filled from the pool of unemployed, that leaves about 594,000 people who can’t get a job, even if they want one.

    Given that there are no actual jobs to be filled by the 594,000 people, this raises the difficult question of what proportion of those people are actually dole bludgers. It’s difficult to quantify because there are no jobs for them to avoid. But let’s set the figure at say 1 in 10 people – 10% (which I think is very high).

    NewStart expenditure for 2014 is estimated at around $9.5 billion[3]. Assuming the unemployment and vacancy rate stays steady then that’s about $12,000 per unemployed person per year, bringing the total cost of the “dole bludger” component of unemployment benefits to about $762 million – a per-capita rate of about $35 per year[4].

    Commonwealth per-capita tax is about $15,000[5], making the magnitude of dole bludgers in the order of 0.2% of total commonwealth taxation per capita, .

    In fact, you have to get up to almost 45% of people being dole bludgers before the tax burden reaches even 1%.

    I know that these numbers are fast and loose – but the point is that the burden of the people being explicitly targeted is ridiculously small. The cost of these bad actors to employed people is far less than the cost of the proposed policies to active job seekers. I suspect that the cost of paying unemployment benefits to bad actors may actually be less than the increased cost of property insurance due to crime and other flow-on effects of these proposed policies.

    For my part, for the cost of one good cup of coffee PER MONTH, I’d rather put up with the dole bludgers and give everyone else a bit of dignity and respect.

    As an aside, as a small business owner I would also like to be able to fire people without the burden that I’m about to send them bankrupt. There is no aspect of this policy that makes sense. If anything, it’s probably just going to make me avoid hiring young people.

    Cheers
    Mark

    [1] http://www.abs.gov.au/ausstats/abs@.nsf/mf/6354.0
    [2] http://www.abs.gov.au/ausstats/abs@.nsf/Latestproducts/6202.0Main%20Features1Jun%202014?opendocument&tabname=Summary&prodno=6202.0&issue=Jun%202014&num=&view=
    [3] http://www.ncoa.gov.au/report/appendix-vol-1/9-11-unemployment-benefits-minimum-wage.html
    [4] Anecdotally, the number of taxpayers in Australia is about 11,000,000, or 50% of the total population. But if you double the numbers, they’re still very small. And, of course, they are even smaller for the majority of taxpayers.
    [5] http://www.abs.gov.au/ausstats/abs@.nsf/Latestproducts/5506.0Main%20Features62012-13?opendocument&tabname=Summary&prodno=5506.0&issue=2012-13&num=&view=

  78. Chris Lloyd
    August 7th, 2014 at 19:07 | #78

    Twiggy Forest’s card would not mandate specific expenditures. It is basically a debit card that cannot be used to pay for alcohol or gambling. Do you really have a problem with that John?

  79. J-D
    August 8th, 2014 at 07:05 | #79

    @Chris Lloyd

    Do you have an argument in favour of it? If somebody suggested replacing all money with debit cards that couldn’t be used to pay for alcohol or gambling, would you be in favour of that, and if not, why not?

  80. Florence nee Fedup
    August 8th, 2014 at 18:04 | #80

    I have an argument with any governments, that directs how I spend my money.

  81. Chris Lloyd
    August 9th, 2014 at 14:02 | #81

    @Florence nee Fedup YOUR money? We are talking about the money government gives to you.

  82. Chris Lloyd
    August 9th, 2014 at 14:08 | #82

    @J-D I do not accept the onus of proof. The government gives money to those who have insufficient income to support themselves. They (i.e. we) believe that spending it on drink or gambling will not improve their long term prospects. Your question about replacing all money with restricted debit cards is somehow equates spending MY OWN money with spending TAXPAYER money.

    Quiggin and others have made the point that people might subvert the alcohol restrictions, for instance by buying allowed goods for someone else and getting cash in return. I guess if the card owner had to pay a commission on this transaction, that would be an reason against. That is at least an economic argument. It depends on how much this would happen, which is an empirical question.

  83. Julie Thomas
    August 9th, 2014 at 15:03 | #83

    @Chris Lloyd

    Yep, the gubbmint gives this money to us because they cannot make an economy or a society that works for us.

  84. Chris Lloyd
    August 9th, 2014 at 16:50 | #84

    What has been missed in ALL the commentary is the pernicious effects of alcohol and gambling. I have first hand knowledge of the effects of alcohol having lost two family members. They manifestly did NOT know what was good for them, and I hope all readers would accept that I was not remiss (and was in fact proudly paternalistic) in trying to stop them from drinking. Now consider a remote dysfunctional community where there is no real economy, and a history of alcohol abuse. The meta-being of the community is an alcoholic, if you will. How does giving them money to buy booze help anybody?

    Part of the problem here is that Twiggy talks about rolling out the system to everyone, just to not look racists. But not all unemployed are the same. A depressed middle aged aboriginal former stockman in Wadeye is not the same as a recent law graduate in the city who is waiting for the right offer. Restriction might help the former, or at least a lack of restrictions might hurt him. The law graduate just needs money to tide her over.

  85. Florence nee Fedup
    August 9th, 2014 at 23:28 | #85

    Money I am entitled to, after paying taxes all my life. Money that is given out, to create a civil society. Money I spend, that keeps others in work. In fact I even pay taxes out of that money.

  86. Florence nee Fedup
    August 9th, 2014 at 23:34 | #86

    If I spend it on grog, it is I that goes without other things. Grog is still legal. Still helps to keep people in jobs.,Has a high tax built into it.

    Howe does that hurt anyone else.

    PS Do not spend mine on grog. I like a roof over my head and food more. That is my choice
    I wish people would get off their high horse, taking their moral outrage elsewhere,

    Now if I have children that are going without, one does not punish all. No that is picked up by the agencies, charged with protecting kids. If I am a drug addict, or alcoholic out of control, that is a health matter.

    The money I receive is not yours, never has been. You have no idea of the taxes I have paid over a lifetime.

  87. Ikonoclast
    August 10th, 2014 at 08:44 | #87

    I agree that alcohol and gambling do have very pernicious effects. My attitude is so strong many would call me a wowser. However, I do not agree with prohibition nor do I agree with food stamps or in-kind benefits. If we want to educate and assist people to look after themselves, paternalism is a step in the wrong direction.

    Chris Loyd’s argument is “A depressed middle aged aboriginal former stockman in Wadeye is not the same as a recent law graduate in the city who is waiting for the right offer.” I would suggest you can’t generalise like that. I can recall a few high profile cases over the years where high-paid lawyers became addicted to heroin or cocaine. Some also buy high powered cars which they then go and kill themselves in. Perhaps we should only pay lawyers in kind since they can’t be trusted to know how to spend their money.

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