Rich Get Richer, Reed Would Punish Poor

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.

 

 

 

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19 Responses to Rich Get Richer, Reed Would Punish Poor

  1. John Hunter says:

    Nice letter, Ray. But I still think that this forum is preaching to the choir. We need to expand our voice to the greater community,. Why not send a copy of this to the local papers to print? I know that most Republicans will vote for Reed even against their own best interests just because he is Republican, but their may be some independents whom we may sway with facts.

  2. Anne says:

    Agreed, John. This piece also makes me wonder what kind of assistance Reed’s own family must have relied upon as he grew up, given then circumstances surrounding his childhood. And yet by his actions, he seems to completely disavow the facts of his own life; I wonder what sort of weird self-loathing this denial is evidence of? Perhaps he could work through it with the help of a good therapist. Meanwhile, it is dangerous to have someone so anxious to disassociate with the problems of the poor in a position to legislate against them. It’s not the way for him to go about slaying those particular dragons.

  3. Just got a mailing from Tom Reed about “Medicare Advantage needs to be protected” He related that the White House will be making $300 million cuts to the program. This must have scared the Part C Medicare folks in Tioga County. I got a call right away about it. Can anyone explain what is going on exactly? I do remember thinking it was a good idea because the insurance companies were making enough money without our tax dollars.

    • whungerford says:

      That card, mailed at our expense, came to me too. Here is some information about the proposal: http://www.kaiserhealthnews.org/stories/2014/february/21/medicare-advantage-plans-federal-payment.aspx

      • Thank you, I had already read this one. These cuts were introduced early in the administration, as I recall, because the big insurance companies who provide them were doing quite well e.g. United Health, Humana etc. Check their stocks. The 15 million or so people who have these plans pay a much lower amount than regular Medicare beneficiaries with their own backup private plan. They get to go to the gym, get eyeglasses and more however,plans vary. The question was why should the taxpayers subsidize the plans? But in an important election year I can see why the Republicans will run with it. They can’t repeal the ACA now, too late. One would think that Republicans would support the cut, don’t they like cuts in taxes. What a farce.

        • whungerford says:

          I found Tom Reed’s postcard offensive. I believe hew is trying to fool us with one-sided information: a common practice with Tom. I am especially offended that this postcard, evidently campaign literature, was printed and mailed at public expense. Tom seeks to cut spending except when he is spending on himself.

          • BOB McGILL says:

            ya mean like this “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 ” is how the Democrats explain it. However the report I read said, ” a increase in minimum wage would make low income workers NO LONGER eligible for federal assistance.” A report on the ACA stated there are 47 million without health insurance and after everyone is done signing up there will still be about 30 million without insurance PLUS another 11 million illegal immigrants for a total of 41 million STILL WITHOUT HEALTH INSURENCE. BUT the report also said there is no way to know how many will be able to pay the premiums, perhaps as many as 20% won’t be able to afford it. 🙂 Then there was mention of a possible 24% increase in the cost because there is no way to know how many young people will even sign up.

    • BOB McGILL says:

      YOU WON’T GET THE TRUTH HERE, suggest you look else where 🙂

    • I meant with our tax dollars.

  4. It was 300 billion. Apparently many seniors in rural environments signed up for this plan. Still reading more about it.

  5. Anne says:

    Tom’s gotten into trouble before for his franking practices. If you look at his reported disbursements, he outspends most other congresscritters in this area–sometimes by as much as 10 to 1.

  6. BOB McGILL says:

    Truth is, SNAP was increased because of the recession and high unemployment. Now that the economy has improved, they are just lowering SNAP to the level it was before the recession, as needed. Why run a surplus when the money could be put to better use elsewhere. 🙂

  7. Picalibur says:

    Can someone please answer this question for me??? If you raise minimum wage, where does the money come from? Do the Big business take the loss? no, they will inflate prices. Does the small business take the loss, no they either cease to grow, raise prices, or close if they were already struggling. Will the RICH pay the difference? Not likely. So I will tell you, simple economics. You raise minimum wage, and the price of EVERYTHING else goes up to offset this new expense. It helps no one and hurts those that have been employed beyond minimum wage, have degrees making beyond minimum wage entry level positions to begin their careers while making student loan payments. It destroys the single mom who can barely afford what she has now. Oh and one last thing they fail to tell you. Even though the price of bread, milk, gas, and everything else just went up (more sales taxes) because of a minimum wage increase, now you make more money, so will pay more taxes and quite possible won’t qualify for WIC, or reduced school lunches, or other programs to help out those that are struggling.

    • John Hunter says:

      Yes, some of the increase will be passed on, but all businesses will have to face competition and competition will mitigate price increases. After all, that is what a free market place is all about not protecting the interests of business large and small at the expense of the poor.,

      • BOB McGILL says:

        Ever heard of CHINA ? MEXICO ?, BRAZIL ? Go to Wal-Mart and try to find a MADE IN AMERICA label ! Didn’t you read all the stuff on ConAgra,even Kentucky is taking business away from New York. 🙂
        ” free market place is all about ” making a profit and staying in business. Try telling your sob story to the poeple who just lost their jobs ! 🙂

        • John Hunter says:

          These are two separate issues. Off-shoring jobs is a large concern, but so is people working full-time who cannot support themselves or their families. The individuals you refer to will, at least in the short term, become part of the working poor or the permanently unemployed. We cannot solve one problem at the expense of the other problem.

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