From the August 28 edition of Fox News' Special Report with Bret Baier:
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Conservative media figures have sharply criticized the recent push by Democratic politicians to alleviate poverty and reduce economic inequality. However, most of this criticism is grounded in a number of myths about the causes, effects, and importance of growing economic inequality in the United States.
Right-wing media are promoting a flawed study that claims it is more lucrative for low-income Americans to accept government benefits than take low-paying jobs, a notion that reveals the conservative sphere's ignorance on how anti-poverty programs work.
On August 19, the libertarian Cato Institute released a report titled "The Work Versus Welfare Trade-Off: 2013." The new study updates a much-maligned version by the same name released in 1995. Both reports claim to analyze welfare benefit levels nationwide and state-by-state and push the misleading notion that "[t]he current welfare system provides such a high level of benefits that it acts as a disincentive for work."
Breitbart.com was among the first right-wing outlets to promote the study, arguing that in New York state, a "mother of two is eligible for $38,004 in welfare benefits -- a sum more than the annual salary of a New York entry-level school teacher." The Washington Examiner joined in as well, with an uncritical review detailing the study's claims that a proverbial mother of two would be better off on government assistance than she would be working for as much as $15 per hour in some states.
On Fox News' Your World, host Neil Cavuto brought on the lead author of the study, Cato Institute senior fellow Michael Tanner, to discuss his findings in more depth. What followed was three minutes of self-promotion that forwarded the tired and debunked right-wing narrative against government assistance and the minimum wage. From Your World:
TANNER: There is no evidence to suggest that poor people are lazy, and every survey suggests that people on welfare say they would like to work, that they are not happy being on welfare. But just because they're not lazy doesn't mean they're stupid; if you pay people more not to work than to work, well, a lot of them are going to choose not to work.
Unfortunately, neither Cato's Tanner nor his counterparts in the right-wing media seem to have any clue how anti-poverty programs function.
The argument that government assistance and benefits are too generous and thus drive recipients out of work has been thoroughly debunked by experts, and Tanner's calculations have been the subject of scrutiny in the past. As the Center on Budget and Policy Priorities highlighted nearly two decades ago, Tanner is still basing his calculations on the assumption that recipients take full advantage of every single benefit program that is potentially available to them. From CBPP:
Cato's conclusions are striking. They also are inaccurate -- the Cato report is replete with analytic errors. For the nation in general and for California in particular, the report paints a misleading picture both of the amount of benefits most [Aid to Families with Dependent Children] families receive and of the supposed advantages from relying on welfare rather than working.
Both the 1995 and 2013 reports also fail to account for differing costs of living or the per capita income of the states surveyed.
Tanner is willing to accept that survey data suggests "that people on welfare say that they would like to work," but then attributes their continued reliance on benefits to the generosity of the system. This logic completely disregards the economic realities faced by low-wage job-seekers amidst a catastrophic recession and years of limited recovery.
Tanner is proud to report that welfare recipients can make more than the minimum wage in more than thirty states, but he ignores how the value of their benefits have eroded over time. According to the CBPP, "cash assistance benefits for the nation's poorest families with children fell again in purchasing power in 2012 and are now at least 20 percent below their 1996 levels in 37 states, after adjusting for inflation."
If, in fact, welfare recipients would rather work than receive benefits, the logical first step toward reducing reliance on government assistance should be to stimulate robust public and private sector job growth. Instead, Tanner and his right-wing allies argue that the only way to reduce reliance on government assistance is to cut programs and force people onto an ailing job market to survive.
Both Tanner and Cavuto agree that raising wages would be a bad anti-poverty policy and would increase unemployment. This conclusion, of course, flies in the face of all evidence to the contrary and simply furthers the conservative attacks against living wages.
On Glenn Beck, the Cato Institute's Michael Tanner falsely asserted that under Sen. Hillary Clinton's health care proposal, small business owners would have to provide health insurance to their employees, "or else pay an additional tax into a fund ... that the government will use to pay for that health insurance." In fact, Clinton's plan would provide tax credits to ensure that many small businesses offer health coverage to their employees.