In a classic example of Unibrow politics, Sen. Mitt Romney has teamed up with President Joe Biden to “reform” federal welfare programs. Romney’s proposal, known as the Family Security Act (FSA), is really Universal Basic Income in disguise.
Biden’s proposal is currently part of the $1.9 trillion COVID-19 relief bill the House is drawing up, and would send parents an annual total of $3,600 per child under age 6 and $3,000 per child aged 6-17. The payments phase out for single parents earning more than $75,000 annually and for couples who earn more than $150,000. Biden’s plan is a one-year program, but The New York Times reports that the goal is to eventually make the change permanent.
But in true “anything you can do, I can do
better worse” fashion, Romney’s Family Security Act leaves Biden in the dust.
Romney’s proposal offers larger benefits extended to include more parents, but it “abolishes” the welfare programs Biden wants to keep. Romney wants to pay parents an annual total of $4,200 for every child under the age of 6 and $3,000 per child aged 6-17, with the payments phasing out for individuals who earn more than $200,000 annually or couples earning more than $400,000. However, unlike Biden’s plan, Romney’s is designed to be permanent from the start.
A parent (or parents) who qualified for the full payments during all 17 years of a child’s eligibility would receive a total of $57,600 per child under Biden’s plan and $62,600 under Romney’s.
Regardless of Mitt Romney’s talking points about reforming welfare, he’s using Washington’s classic “for the children” excuse to spend more money and make government bigger. In essence, the Family Security Act is using children to lay the foundation for the eventual introduction of Universal Basic Income. According to Romney’s summary of his own plan, “The Family Security Act would provide a monthly cash benefit for families, amounting to $350 a month for each young child, and $250 a month for each school-aged child.”
The idea of Universal Basic Income (UBI), a program that would provide a government-guaranteed minimum income check for every citizen, was introduced during the Democrat primaries by Andrew Yang as part of his platform.
Though Universal Basic Income failed to save Yang’s candidacy, the idea was adopted by another failed Democrat candidate for president: Vice President Kamala Harris. When she was still in the Senate, Harris used coronavirus hysteria as an opportunity to promote this Marxist dream of the far-left when she co-sponsored the Monthly Economic Support Act (MESA), a plan that would give $2000/mo. to people until the COVID-19 “crisis” is over. Families with children would receive even more.
Supporters of the Universal Basic Income concept considered MESA the first step to making it a permanent entitlement.
By the way, before you assume that only Democrats favored MESA, Sen. Tom Cotton (R), who was running for re-election at the time, also used coronavirus hysteria to propose his own Universal Basic Income-lite version of Harris’ bill.
Mitt Romney’s Family Security Act provides Democratic Socialists and Nationalist Republicans — I apologize if that sounded redundant — the perfect “never let a crisis go to waste” opportunity to create a “redistribute the wealth” Universal Basic Income program. But as Veronique de Rugy, Ph.D. (contributing editor at Reason and senior research fellow at the Mercatus Center at George Mason University) points out, there are other liberty-killing consequences.
The the plan is advertised as “deficit neutral.” However, it would grow the size of government by increasing both spending and taxes. It increases spending by $66 billion and increases taxes by $46.4 billion, since most of the plan’s offsets are actually tax hikes. My objection isn’t with these specific tax hikes. It would be better to find additional welfare spending cuts.
Proponents rightfully argue that its universal feature, which pays child allowances regardless of employment status, would limit the high implicit marginal tax rates on work and hence some disincentives to work that exist in the current system. For instance, the EITC creates disincentives for workers who are in the phaseout part of the benefit, meaning that more income from work reduces the size of the benefit. Many welfare programs suffer from this issue.
However, this universality creates other work disincentives. For example, experiments with the universal basic income provide evidence that unconditional cash payments can be detrimental to beneficiaries’ employment. This undermines the importance of work as a pathway out of poverty for some low-income Americans and their children. In fact, Scott Winship at the American Enterprise Institute has made a powerful case that the work requirements included in welfare reform of the 1990s played an important role in reducing child poverty.
Some say that these disincentives are worth it, if it means that single moms can stay with their kids more. I believe it is a plus for these moms. It is also likely to remove the marriage penalty built in the current system. Yet these facts don’t mean that it’s necessarily worth it on net, once you include all of the present and future costs and distortions of the plan.
These distortions include the reduction of federalism resulting from a plan that gives an even bigger role to Washington. In addition to more federal spending added to many other and often duplicative welfare programs, one of the plan’s offsets, TANF, allowed variation and experimentation in the states, as opposed to the one-size-fits-all approach with federal spending. As fiscal policy expert Dan Mitchell notes: “The right approach is to get Washington out of the business of income redistribution. We’re far more likely to get good outcomes if we let states decide (and learn from each other on) how best to reduce poverty.” (emphasis mine)
Republicans and Democrats alike support the objectives of the Family Security Act because they believe in the concept of Universal Basic Income as a means to redistribute money toward families and subsidize children. But should government be creating a system, let alone be in charge of it, that favors one activity over another, such as having children as opposed to not having them?
And even if you support the concept of the Family Security Act and Universal Basic Income, based on the expansive growth of social welfare entitlements when the “war on poverty” was declared over 50 years ago by Pres. Lyndon B. Johnson, should the next big “anti-poverty” program provide government checks to families with mid-six figure incomes?
Romney’s cash-for-kids proposal is being touted by some in “conservative” media as a budget neutral bill that could also potentially reduce the deficit in the long run, but believing that requires us to ignore a few inconvenient truths:
- Trump and the GOP increased the national debt by $8.3 trillion in 4 years, despite promising to rein in spending
- The national debt has exploded despite varying degrees of GOP control of Congress and the White House since 2011
- Trump’s FY2020 budget projected a $9 trillion increase to the U.S. budget deficit by 2024
- Republicans are ready to open the coronavirus spending spigot again
It’s simply a fact that big-government spending has been standard operating procedure for far-left Democrats for decades, and Republicans have proven to be just as far-left in this department. So, pardon my skepticism when I hear Mitt Romney — a Gutless On Principles Hall of Shame enshrinee — promise that his new entitlement program won’t cost taxpayers more money.
When it comes to Romney’s Family Security Act and Universal Basic Income, allow me to paraphrase Ayn Rand, “Government help is just as disastrous as government persecution. … The only way a government can be of service to national prosperity is by keeping its hands off.”
Something tells me Mitt Romney has never read her work.
David Leach is the owner of the Strident Conservative. He holds people of every political stripe accountable for their failure to uphold conservative values, and he promotes those values instead of political parties.