It may be inadequate and it may only be temporary, but the sudden federal injection of cash that accompanied the coronavirus made a significant difference to millions of lives.
That’s according to new research on the impact of government aid by teams based at Columbia University, University of Chicago, and University of Notre Dame, whose findings offer strong evidence that federal aid has successfully protected many low-income families at risk amid surging unemployment and unprecedented economic turmoil.
In the wake of the coronavirus crisis, Congress approved a number of measures designed to blunt the impact of mass layoffs and provide cash relief to those thrown out of work. These included means-tested one-off payments of up to $1,200 for individuals and $2,400 to married couples with no dependents and a considerable expansion of eligibility for unemployment insurance. These measures are not without their fair share of problems, coming as they have with a built-in expiry date, delays in reaching the needy, and no provisions for helping undocumented migrants.
Nonetheless, it is abundantly clear from the research that the unprecedented expansion of federal aid has not only averted a catastrophic spike in poverty, but also given many workers a bigger income than they would have had if they’d remained in work. On this point, the authors of the Chicago/Notre Dame study are unequivocal:
Our results show that for low-income individuals and families, the government response to the pandemic more than offset the sharp decline in earnings . . . The entire decline in poverty for April and May can be accounted for by the one-time stimulus checks the federal government sent out during these months and the expansion of unemployment insurance eligibility and benefits.
Drawing on Census Bureau data, the study finds that poverty fell some 2.3 percentage points “from 10.9 percent in the months leading up to the COVID-19 pandemic (January and February) to 8.6 percent in the two most recent months (April and May).” Taken together with a May study which found that some two-thirds of unemployed workers are eligible to collect sums actually exceeding their usual earnings, the research offers ample evidence that the approach generally taken by America’s welfare system has less to do with alleviating poverty than it does with forcing people into degrading and badly paid work.
Which is to say, if you’re actually serious about reducing poverty the most obvious and effective course available is still the redistribution of wealth to the least well-off. America’s hegemonic attitude toward welfare, ridden through as it is with a neo-Dickensian logic of moral desert and personal responsibility, still insists that the best anti-poverty measures are those designed to inculcate a good work ethic and encourage individual self-improvement. Get a job, work hard, go to school, learn to code — or so the logic goes. While poverty may be a moral issue, it is hardly a moral failing, and welfare paternalism will never be a solution to the material deprivation that needlessly robs so many of a decent and dignified life.
Want to fight poverty? Give poor people more money. It really is as simple as that.