Seeing, but not understanding, the problem

The speaker of the Massachusetts State House is pushing legislation to prevent welfare recipients from sending money or goods overseas. The amount of money transferred by wire services is said to be roughly $2.4 billion across the whole United States, which isn't exactly peanuts but is hardly a pressing problem on the national budget. Nevertheless, he sees part of the problem, and wants to get ahead of voter angry by presenting a solution:
DeLeo is pushing legislation as part of the state’s new welfare reform bill that would prohibit Bay State recipients from using their EBT cards — and the cash assistance they carry — for international wire transfers.

The problem here is that money is fungible. Once you've given people money, they can trade it for other things. If you provide welfare benefits in any form other than "Here is a hot bowl of soup, sit down over there and eat it right now", then it can be transferred to others or traded. If you give them welfare benefits and say they can't transfer that money overseas, you are just creating a market for an underground business trading welfare benefits for goods or money that can be sent overseas.

And that's exactly what happens.
Also tucked in the comprehensive bill is another DeLeo-backed measure to keep groceries bought with welfare benefits stateside. By requiring that groceries be for “home consumption and use,” the legislation addresses an area of fraud highlighted by a series of New York Post reports in July that found Big Apple welfare recipients buying food in the U.S. and shipping it in large plastic barrels, mainly to Caribbean countries, where it opened a black market for the taxpayer-funded goods.

If the welfare benefits go to buy food in the US, and that food is then shipped overseas, how can you possibly tell the difference between food shipped overseas paid for with real money and food shipped overseas paid for with welfare money?

Obviously, you can't, at least not if you are going to pay welfare benefits in cash instead of in actual food

So what's the real solution?

Since the people receiving welfare are sending it overseas instead of using it themselves, clearly they don't need it. Therefore, stop paying it. At all.

This entry was published Tue Nov 05 12:25:00 CST 2013 by TriggerFinger and last updated 2013-11-05 12:25:00.0. [Tweet]

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