Forget Charity. Forget Fairness. Let's Talk Stability, Security, and Wellbeing
Much of our debate around social programs (Medicare, Medicaid, food assistance, student loan forgiveness, welfare, even immigration) typically goes like this -- liberals advocate for the program because they help the people who would receive the services, conservatives argue that the rest of the country shouldn't pay for services that not anybody needs.
This is a poorly constructed debate for several reasons:
People are inherently self-interested and
The real benefits of social programs often go far beyond the people who directly receive them.
During the pandemic, Congress expanded the Child Tax Credit (CTC), providing direct financial support to families with children, helping to alleviate child hunger and poverty. By offering monthly payments, it ensured that families had the resources to meet basic needs like food, clothing, and school supplies. The impact of this policy was dramatic and nearly immediate, as more than 3 million children were lifted out of poverty each month the expanded credit was in effect before it expired at the start of 2022.
Liberals would argue that fewer hungry children is a win. Some conservatives would argue that it's not the responsibility for the country to feed other peoples' children, though the latter would miss a core concept of a just society -- we shouldn't punish kids for the living situations of their parents. Fundamentally, we as a country have always believed that children should not suffer because of the economic challenges their parents face. The CTC embodies this principle, offering a way to ensure that all children have a fair start in life, regardless of their parents' income. It's a reflection of our societal values that prioritize the well-being and potential of every child, acknowledging that investing in children is investing in our future.
But both arguments miss the larger point -- everyone wins when kids aren't hungry.
It's Not Just About Morals, It's About Economic Stability
Implementing policies like Universal Basic Income (UBI), CTC, and other similar programs have benefits that go far beyond moral imperatives; they're strategic moves for economic stability. Significant bodies of evidence, time and time again in this country and others, prove that these programs create a safety net that:
Eliminates Macroeconomic Instability: By ensuring a basic level of income, we reduce the economic shocks that can lead to recessions.
Fuels Local Economic Spending: When people have money to spend, they buy goods and services, boosting local businesses and stimulating economic growth. Study after study shows that the poorer someone is, the larger percentage of their income they spend directly on their local economy.
Encourages Entrepreneurs: With a safety net in place, individuals are more likely to take entrepreneurial risks, leading to innovation and new business ventures.
Safeguards Against Layoffs from Automation and AI: As technology evolves, some jobs may be lost to automation. UBI provides a buffer that helps people transition to new opportunities without falling into poverty.
The Evidence Shows It Works and It Pays for Itself
Studies have consistently shown that the benefits of these programs far outweigh their costs. The CTC, for example, has not only reduced child poverty but also improved children's health, education, and future earnings. These benefits contribute to long-term economic gains that more than offset the initial costs of the program (Brookings) (Brookings). Additionally, research from the Roosevelt Institute and the Cleveland Fed indicates that UBI can increase economic activity, boost tax revenues, and reduce spending on other social services (Roosevelt Institute) (Cleveland Fed).
Since these programs often pay for themselves through increased tax revenues from higher economic activity and reduced spending on other social services, they're good policy, not just good morals. When people are financially stable, they contribute more to the economy, reducing the need for emergency assistance programs and boosting overall productivity.
The evidence is everywhere. During the pandemic, all families with children in the public schools in my home town, Worcester, Massachusetts, received food stamps, which provided a significant stimulus to the local economy. Studies show that food assistance programs, like SNAP, boost local economies by increasing consumer spending. Every dollar in SNAP benefits generates about $1.50 to $1.80 in economic activity, as families spend more on groceries and other essentials, supporting local businesses and creating a ripple effect throughout the community (Project Bread) (Cleveland Fed). Furthermore, since so many people had SNAP benefits it helped reduce the shame of using them. This seems to me to be a great way to directly help middle class families, not just lower class families - provide everyone with SNAP, pass the expenses directly to the families making enough money that they don't need it, and set up a donation program for anyone who really wants to refuse their benefits. Furthermore, if everyone gets such benefits it cuts down substantially on administrative costs since so much of these expenditures are about policing who qualifies and receives benefits and who does not.
Stop Thinking About Fairness, Start Thinking About Strategy -- and Wellbeing
Unemployment insurance is great for the broader economy because when there are either isolated layoffs, slowdowns in particular sectors or geographical localities, or even recessions, the larger economy is isolated, shielded, or at least provided with a parachute -- avoiding system shock. UBI, CTC, and other similar programs shield against both short-term problems and structural crises. If a tenant can't afford rent, the landlord also loses, and so does every store and service provider who was relying on business from both the tenant and the landlord.
Problems snowball. Anxiety mounts. Instability ripples. No one wins.
A strategically built social safety net also provides a buffer in case of natural disasters, terrorist attacks, sudden collapses of parts of the economy, or even terrorist attacks. Such a safety net can also take pressure off of Social Security and other programs that are failing to keep up with inflation. And all this security is great news for the strength of the American dollar.
So forget fairness, forget charity. It's about stability and security.
But it's also about our stress levels and our overall wellbeing. When discussing this idea earlier today with my friend Mike Ritz, former Executive Director of Leadership Rhode Island who now leads a government leadership institute at Gallup focused onstrengths-based development. Mike wrote that he wished we would move on from Bill Clinton's campaign slogan, "it's the economy, stupid," with "it’s our wellbeing, and who are you calling stupid?!" Imagine, then, if we lived in a society where your basic (and I do mean basic) needs for healthcare, shelter, and food were met, allowing you to focus on your education, your career, and your family. Now imagine that such a society might actually save everyone money.
Suddenly it doesn't sound so crazy, does it?
