Friday, January 11, 2013

EPI: War on Poverty: David Cooper: EITC and The Minimum Wage Go Hand in Hand in Fighting Public Dependence

Strengthening the EITC and raising the minimum wage should go hand-in-hand | Economic Policy Institute

If you want to have more low skilled people and people in poverty actually working jobs and getting paid to do so. Then they simply have to have incentive to work its that simple, otherwise why would someone who unless. They have some wanting to work and be productive in society, even if its in their best financial interest and in their families. Best interest for them not to work because they can collect more money and public assistance by not working. And collecting Welfare or Unemployment Insurance, why would someone in that position work if they can collect more money and benefits. From not working which is why I'm in favor of not only eliminating the minimum wage and replacing. It with a living wage starting at 10$ an hour and indexing it from inflation for full time workers 21 or over and not just keeping the. Earned Income Tax Credit or EITC but expanding it so these workers can have access to health insurance and. Even put money away in savings and for retirement, as well as educational opportunities so they can get education and job training. And be able to get themselves off of public assistance and into the middle class for good.

I would take public assistance to the point that it would encourage low skilled people to actually be working. Instead of being unemployed or unemployable because they would end up making more money and collecting more benefits. Then someone who doesn't work but collects public assistance. For example a low skilled worker just starting out. While they are also going through education or job training would make 10$ an hour over forty hours a week. As well as childcare benefits but someone not working and not going to school but collecting public assistance would make 7.25$ an hour. Over forty hours a week and someone working part time or not working at all but going through education. And job training would be collecting lets say 8.25$ and hour over forty hours and also eligible for childcare. Benefits as well where someone not working at all and not in school or job training wouldn't be. So I would incentivize work, education and job training over not doing those things.

As I've blogged before we should move towards having a public assistance system thats so effective that it becomes obsolete. That we would no longer need it, we'll never completely accomplish that but thats what we should be striving for. And you get by valuing work over dependence and self sufficiency over public assistance by making work, education and job training pay. More then dependency and you do this incentivizing people to work and better themselves.