Alleviating Poverty Without Increasing Deficits

by Stuart Shapiro

Many of us think that deficit spending to alleviate inequality is fine (within limits of course).  However, in this political climate it is clear that programs to deal with poverty are not in vogue, especially if they increase the deficit.  Kristin Seefeldt and John Graham have a new book with recommendations on policies that can help society’s least fortunate while keeping new spending to a minimum.

Conscious of these limitations, we have put together a set of proposals for reducing poverty in America while still protecting the federal budget and enhancing long-term financial security. These recommendations include indexing the federal minimum wage to inflation, restructuring Medicaid, targeting program recipients more precisely, allocating funds in concert with the business cycle, creating a systematic effort to provide subsidized employment and job training, and putting in place poverty impact analyses to identify new and low-cost avenues for poverty reduction.

The authors hope that these proposals will have bipartisan appeal.  I’m still not convinced that anything will have bipartisan appeal in this climate, but it is good to see proposals like this that try.

By: Stuart Shapiro

Stuart is a professor and the Director of the Public Policy
program at the Bloustein School of Planning and Public Policy at Rutgers
University. He teaches economics and cost-benefit analysis and studies
regulation in the United States at both the federal and state levels.
Prior to coming to Rutgers, Stuart worked for five years at the Office
of Management and Budget in Washington under Presidents Clinton and
George W. Bush.