Medicaid, Income Inequality and Work

by Carolyn Phippen

The Trump administration recently announced that states would be allowed to require Medicaid recipients to either engage in some sort of work or volunteering in the community as a condition of their benefits. I’m not sure why anybody would be resistant to the idea that a person receiving government (taxpayer) assistance should be doing all they can to build a better life for themselves, with the eventual aim of becoming self-reliant. This not only benefits society, but greatly benefits the individual as well.

The Democrats have preached the dangers of income inequality, but outside of redistributionist policies, haven’t offered any real solutions. That’s probably because those solutions are found in the free market. If we are truly concerned about income inequality in this country, we must be concerned about levels of, and commitment to, work.

The average household in the top income quintile in the U.S. has just over 2 workers, while those at the bottom have 0.43, or less than one-half.  Of those households at the bottom, only 18 percent had at least one adult working full-time in 2016. Both of these factors are significant, and have been getting worse over time. And they are similar to other information we have.

For instance, those with higher incomes tend to be older and those with lower incomes tend to be younger. This isn’t the case in every circumstance, but those are the trends. What does this tell us? On average, the more years a person has worked, the more that individual tends to make. For those who’ve spent many years out of the workforce, they may never catch up. Why would we wish that on anybody?

When we talk about social programs, it seems to me that the most important question we ought to be asking isn’t how we provide people with x, y or z and and then wash our hands of them but rather, how we give people the resources to overcome the obstacles currently in their way so they can flourish and build a successful, happy life. That’s called, according to economist Thomas Sowell, thinking beyond stage one. And I would say that’s also a part of understanding and celebrating the potential of every single individual in our great nation and around the world.

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