I’ve talked about this before here but it bears repeating.
A year after the experiment had started, eleven out of thirteen had a roof above their heads. They accepted accommodation, enrolled in education, learnt how to cook, got treatment for drug use, visited their families and made plans for the future. ‘I loved the cold weather,’ one of them remembers. ‘Now I hate it.’ After decades of authorities’ fruitless pushing, pulling, fines and persecution, eleven notorious vagrants finally moved off the streets. The Joseph Rowntree Foundation did a study of this experiment.
Costs? 50,000 pounds a year, including the wages of the aid workers. In addition to giving eleven individuals another shot at life, the project had saved money by a factor of at least 7. Even The Economist concluded:
‘The most efficient way to spend money on the homeless might be to give it to them.’
We tend to presume that the poor are unable to handle money. If they had any, people reason, they would probably spend it on fast food and cheap beer, not on fruit or education. This kind of reasoning nourishes the myriad of social programs, administrative jungles, armies of program coordinators and legions of supervising staff that make up the modern welfare state. Since the start of the crisis, the number of initiatives battling fraud with benefits and subsidies has surged.
People have to ‘work for their money,’ we like to think. In recent decades, social welfare has become geared toward a labor market that does not create enough jobs. The trend from ‘welfare’ to ‘workfare’ is international, with obligatory job applications, reintegration trajectories, mandatory participation in ‘voluntary’ work. The underlying message: Free money makes people lazy.
Except that it doesn’t.
From “Why we should give free money to everyone” from de Correspondent. Thanks to Thom for the link.
This should pretty much be the first thing they teach you when you study Development Economics. If you like the sound of this then you might like economist, John Quiggin talking about the theory of the universal minimum wage and the secret to happiness for everyone.. stay at home parents, artists .. everyone.