Six of the ten richest people in America make the list because of inherited wealth. They are the Koch brothers, David and Charles, and four members of the Walton family, heirs to the Walmart fortune. The Kochs, the Waltons, and other rich Americans (whose children will inherit fortunes) spend freely to influence politics, pushing our country ever farther down the road to oligarchy. Meanwhile, hedge fund managers are doing very nicely, thank you, because their income, under the “carried interest” loophole, is taxed at a rate of just 20 per cent rather than the top rate of 39.6 per cent that high-income earners are supposed to pay. Many of our largest corporations use accounting tricks to park their profits overseas and avoid paying U.S. taxes, costing the government an estimated $50 billion per year in revenues.
But our congressman, Rep. Tom Reed, is worried that the poor may be getting away with something. Testifying before the House Budget Committee on March 25, Reed deplored “the current attitude that working more doesn’t pay” and called for imposing work requirements on those in poverty who receive government help.
Does Reed’s position make sense? Let’s consider the Supplemental Nutrition Assistance Program (SNAP), that the congressman has voted to cut. Perhaps he is not aware that a large proportion of SNAP recipients are in the program not because they don’t want to work but because they have lost their jobs. That’s why the SNAP program expanded by 70 per cent from 2007 to 2011 as the number of unemployed people increased by 94 per cent.
Another large proportion of SNAP recipients, and recipients of other benefits, are in fact employed, but in low wage jobs that leave them in poverty. NPR reported last October that “A new analysis finds that 52 percent of fast-food workers are enrolled in, or have their families enrolled in, one or more public assistance programs such as SNAP (food stamps) Medicaid or the Children’s Health Insurance Program (CHIP).”
“That’s right: With a median wage of $8.69 per hour for front-line fast-food jobs — cooks, cashiers and crew — workers are taking home a paycheck, but it’s not enough to cover the basics, …”
According to the analysis NPR cited, government help for low wage workers costs taxpayers $7 billion per year.
Of course, human nature is what it is and some will always cheat; but the rate of cheating in federal assistance programs is low. In SNAP, the rate of trafficking — that is trading benefits intended for the purchase of food for cash — is estimated at just over 1 per cent. Overpayments run below 4 per cent, and losses are partially offset by mistaken underpayments at .8 per cent. By contrast, improper payments to medical service providers under Medicare are estimated at 8.5 per cent of total payments.
Here in New York’s 23rd, we need a Member of Congress who will vote for programs that will expand the number of jobs — and for an increase in the minimum wage so that workers do not have to rely on federal assistance. Tom Reed will never be that member. Martha Robertson will.