Rice University's premier undergraduate journal of scholarship in domestic and international policy.
William Wang
Mar 2, 2023
Universalizing Assistance: Removing Access Barriers and Spurring Growth
The U.S. federal government currently spends $1.1 trillion USD funding 89 means-tested welfare programs that provide assistance in various areas, ranging from medical aid to housing assistance (Rector, 2018). However, the maze of trying to navigate these 89 programs and their varying eligibility requirements and applications has created immense difficulties for potential applicants.
The United States Federal Government should replace means-tested welfare programs with a Universal Basic Income (UBI); in doing so, it would reduce bureaucracy, increase accessibility to welfare programs, boost economic growth, and allow welfare to serve as an avenue to redress the historical racial inequities faced by minorities in America.
Means-tested programs require potential recipients to submit an application and demonstrate their eligibility before recipients can receive the benefits. Although these procedures mean that only approved applicants receive benefits and reduce fraud, it creates new challenges for citizens that seek assistance. With benefits being restricted to only those that apply, a potential beneficiary must be aware of the existence of such a program. Programs that provide essential support may go unnoticed to those that require assistance. Moreover, the need for review also means that applicants must be able to provide adequate documentation (Herd, 2015). This is challenging for some applicants that may not have the means to provide such documentation. Fortunately, the universality of a UBI circumvents these administrative obstacles, as it would provide direct cash assistance of $1000 USD to all US citizens each month and arrive without request. Indeed, Herd (2015) found that universal programs such as Social Security achieve nearly 100% participation rates, while means-tested programs such as SNAP achieve much lower participation rates of 40-70%. Consequently, Minton & Giannarelli (2019) finds that of the 46 million Americans in poverty, 13 million or 28% of those in poverty were not connected to any programs. This percentage also remained consistent for those in deep poverty, where 5.5 million of 12.7 million did not receive assistance from any programs (Minton & Giannarelli, 2019). This suggests that the lack of accessibility of current means-tested welfare programs stems from systemic flaws like program awareness and bureaucracy. Replacing current means-tested welfare programs with a UBI would directly deliver aid to all, solving the lack of accessibility within the current system.
The benefits of a UBI span beyond just well-being. Providing direct cash transfers to citizens also increases aggregate consumer demand within the economy, spurring growth both domestically and abroad. Providing each American with a monthly cash benefit increases the aggregate consumer demand inside the economy, as the daily citizen’s purchasing power is improved. This increased consumer purchasing power would allow more products to be purchased and demanded and more goods to be manufactured and supplied. A UBI of $1,000 per adult would grow the U.S. economy by 12.56% over the next 8 years (Nikiforos, 2017). Additional money in the hands of lower-income households leads to higher spending, which Anderson (2015) empirically corroborates that every extra dollar going into the pockets of low-wage workers adds $1.21 to the national economy.
Means-tested programs’ nature of conditionality perpetuates structural barriers that negatively impact and deter current and potential recipients. UBI circumvents these issues due to its unconditionality. The funding of welfare perpetuates its own discrimination. LaRochelle (2019) finds that welfare programs are increasingly operated at the state level with the aid of federal block grants, which are lump-sum payments for broad and general purposes. This delegation of power to states creates concerning outcomes. Specifically, LaRochelle (2019) discovers that states with more minority citizens are more likely to cap benefits, impose strict eligibility requirements, punitive sanctions, and shorter time limits. Overall, Semuels (2017) quantifies that a 5% increase in African American share of the state population results in a $25 dollar monthly decrease in cash assistance. These differences are most prominent between states with the most African Americans and states with the most white Americans. For example, a poor family in Vermont, where 94 percent of residents are white, and only 1 percent are black, is 20 times more likely to receive assistance compared with a similar family in Louisiana, where 61 percent are white and nearly a third of residents are black (Jan, 2017).
Welfare use also packages images of “laziness, promiscuity, and criminality” with blackness. This leads caseworkers, which are a requirement for bureaucratic systems like welfare, to have negative views of certain racial groups, resulting in minorities being more likely to be sanctioned and removed from programs (Hardy, 2018, p. 11). Consequently, stigmatization presents another barrier for those that require assistance. Social attitudes that associate welfare with laziness, dishonesty, and moral weakness, mean that applying for benefits may be a threat to a person’s self-image (Gershon, 2018). Empirically, a recipient living on welfare experiences a 19% increase in depressive symptoms and has 29% higher odds of major depression (Pak, 2020). Herd (2015) continues that the necessity of knowing programs’ existence and the time and effort required to satisfy procedural requirements hinder participation further. Specifically, complicated applications and documentation requirements contribute to lower participation in means-tested programs than in universal programs (Herd, 2015). A universal system solves these problems by design; a UBI is automatic. This means that those who require assistance do not need to go through the invasive process of applying for welfare with a caseworker, no longer having to stand up and identify as poor (Calnitsky, 2016). Another benefit of a UBI is that it treats typically separated groups in a similar manner, which destigmatizes the program itself (Calnitsky, 2016). The line between who deserves assistance and who doesn’t gets removed when low-wage workers, the disabled, the unemployed, or middle-class families are all receiving benefits regardless of their differences.
A UBI’s universality resolves current flaws of means-tested welfare such as administrative burden and structural barriers through its elimination of bureaucracy. At the same time, it increases economic growth and reduces poverty via the increased consumption driven by providing daily citizens with more purchasing power. Current means-tested welfare programs should be replaced with a UBI program to benefit recipients in the United States by eliminating administrative burdens, breaking down structural barriers, and increasing economic growth. The implementation of such a program would lay the foundation for the removal of the distinction between those that deserve assistance and those that do not, reduce the social stigma surrounding government assistance, and encourage those that require assistance to reach out for aid.
Herd, P. (2015). How administrative burdens are preventing access to critical income supports for older adults: The case of the supplemental nutrition assistance program. Public Policy & Aging Report, 25(2), 52–55. https://doi.org/10.1093/ppar/prv007
Pak T. Y. (2020). Welfare stigma as a risk factor for major depressive disorder: Evidence from the Supplemental Nutrition Assistance Program. Journal of affective disorders, 260, 53–60. https://doi.org/10.1016/j.jad.2019.08.079
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