Saturday, March 15, 2014

Ending Poverty

Paul Ryan’s worst nightmare: Here’s the real way to cut poverty in America -

...The difference is entirely the result of government social spending on the poor — mostly in the form of transfer payments, like public pensions, unemployment insurance, child subsidies and/or wage subsidies. Many other developed democracies start out with lots of poor people, just like the U.S. But the countries with big welfare states remove most of them from poverty. The American welfare state does lower the poverty rate — but not enough. The American welfare state is way too small to be effective in doing its job of lowering poverty.
We know, then, how to slash poverty in the U.S. It’s very easy. All we have to do is expand the American welfare state, not necessarily to Swedish levels, but at least to Canadian or British levels. If we restrain public and private health cost inflation, by adopting medical price controls (“all-payer regulation”) of the kind used in most other democracies to prevent price-gouging by pharma companies, hospitals and doctors, we can pretty much end poverty in America very quickly...

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