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measures directed at the same end, the total administrative burden would surely be reduced. |
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A few brief calculations suggest also that this proposal could be far less costly in money, let alone in the degree of governmental intervention involved, than our present collection of welfare measures. Alternatively, these calculations can be regarded as showing how wasteful our present measures are, judged as measures for helping the poor. |
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In 1961, government amounted to something like $ 33 billion (federal, state, and local) on direct welfare payments and programs of all kinds: old age assistance, social security benefit payments, aid to dependent children, general assistance, farm price support programs, public housing, etc.1 I have excluded veterans' benefits in making this calculation. I have also made no allowance for the direct and indirect costs of such measures as minimum-wage laws, tariffs, licensing provisions, and so on, or for the costs of public health activities, state and local expenditures on hospitals, mental institutions, and the like. |
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There are approximately 57 million consumer units (unattached individuals and families) in the United States. The 1961 expenditures of $ 33 billion would have financed outright cash grants of nearly $ 6,000 per consumer unit to the 10 per cent with the lowest incomes. Such grants would have raised their incomes above the average for all units in the United States. Alternatively, these expenditures would have financed grants of nearly $ 3,000 per consumer unit to the 20 per cent with the lowest incomes. Even if one went so far as that one-third whom New Dealers were fond of calling ill-fed, ill-housed, and illclothed, 1961 expenditures would have financed grants of nearly $ 2,000 per consumer unit, roughly the sum which, after allowing for the change in the level of prices, was the income which separated the lower one-third in the middle 1930's from the |
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1 This figure is equal to government transfer payments ($ 31.1 billion) less veterans' benefits ($ 4.8 billion), both from the Department of Commerce national income accounts, plus federal expenditures on the agricultural program ($ 5.5 billion) plus federal expenditures on public housing and other aids to housing ($ 0.5 billion), both for year ending June 30, 1961 from Treasury accounts, plus a rough allowance of $ 0.7 billion to raise it to even billions and to allow for administrative costs ot federal programs, omitted state and local programs, and miscellaneous items. My guess is that this figure is a substantial underestimate. |
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