People who make bad decisions often end up poor. Giving them money will not help them make better decisions, and may make them worse off.

How you think those two effects interact, and how much you value efficiency of donation vs. enabling people with poor decision making skills to waste probably determines where you stand on this issue.

If someone below the poverty line wins $10,0000 in the lottery they'll buy a few luxuries, spend a lot of money on short term things for a little while and then go right back to being poor. If you tell them they'll get $10,000 for the next 4 years no matter what they do, I'll bet their attitudes change. What people need to make rational decisions is to be able to develop confidence that tomorrow will not be another disaster - of course, that is a much more difficult thing.

As long as we continue this meme that people that are poor have poor character poverty will be allowed to continue and fester.

This is also known as "poor decision making skills". Granted, it's very understandable in many situations, but let's call a spade a spade

Poor people are making economic decisions not to come out ahead but to mitigate their losses. They aren't doing this because they want to, it is because it is the best decision they can make given their constraints. For example, they can either sell their time for minimum wage, far less than the value they create, or they can starve or go homeless. The person they are selling their time to knows that the alternative to taking the deal on the table is pain or death -- that the poor person cannot walk away from the bargaining table without making themselves worse off. So they are free to ignore the value those people create and, instead, offer the least amount possible for the poor person to avoid the fate they'd suffer if the walk away from the deal. In a word, exploitation.

So, the poor person makes a deal that looks terrible to people who have the luxury of being able to walk away from a potential trade with no loss. People that must be enticed, that must leave the table with more than they brought, people who are on an upward spiral, who do not generally have to make a deal or face loss. People who are used to all parties leaving the table with more value.

They are, as much as any human can, making the best decisions they can in their situation.

Are there people that are simply too dumb to figure out what is best for themselves? Yes, but that number isn't anywhere close to the 45 million people we have living below the poverty line in the US.

It's not just those below the poverty line, all of humanity does this... even the rich.

But where did I say they are dumb? I know some incredibly smart people that are horribly off financially. I also didn't say they were the only ones with poor decision making skills. Sometimes the situation is a product of their upbringing or environment, sometimes it is because of willful ignorance or willing risk.

Please don't think I'm denying that for the most part lower socio-economic classes are more liable to be exploited. I understand how class mobility has become increasingly difficult in recent times. I believe in a minimum wage.

But ignoring an important facet of the issue because it's uncomfortable isn't going to get you any closer to solving the causes of the problem. Besides, the good news is you can teach financial literacy and decision making.

No they don't. If that were true no net value would ever be created.

I mean, there are instances where it is true even for the rich (insurance, for example) but most decisions, especially the larger ones, are based on getting something of more value to them than what they are trading. And they are hardly ever bargaining for their life, the ultimate loss, as poor people do routinely.

If you assume (as do most Econ 101 models) that humans are pure rational actors in the sense of the rational choice model, which there is considerable empirical evidence that they are not. And also assume that the market for purchase of the kind of labor that the subject is selling is perfectly competitive on the buyer-of-labor side, rather than distorted by monopsony or oligopsony (which may be more frequently true than the former assumption -- though subtle collusion make it false even when it seems to be true superficially -- but certainly is not universally true.) [The second condition is necessary because if it fails, minimum price regulation will change the best price, since in the absence of competition, the purchaser of labor can do so at artificially depressed prices.]

Is it not worth asking why they would choose less for themselves? And, if so, doesn't the act of asking why suggest that we assume there must be an explanation that makes sense? Or do we assume that one out of eight human beings are simply not as rational as the rest of us?

I don't know. I wouldn't let the requirement for perfection completely override the reasonable. The alternative is that there is an underclass of irrational human beings. I think we'd be living in a much different world if that were the case.

Rationality is also subjective. What you'd do, with your safety net and well-off family and house with no mortgage, is entirely different from what someone one check from homelessness may choose to do. And it may look irrational.

Not necessarily. It can also mean that there are fates worse than dealing with usury. Car break down that you need for your job and you need $1200 bucks and you have $27 that's supposed to pay for your groceries for the next week? A payday loan starts to look like a very good option considering the consequences of not taking that deal.

>Rationality is also subjective. What you'd do, with your safety net and well-off family and house with no mortgage, is entirely different from what someone one check from homelessness may choose to do. And it may look irrational.

Which is my point. Even though what that person that is one short paycheck from homeless does may look irrational, it likely is not considering the information they have and the choices available to them. When someone is making decisions with what amounts to a gun to their head, those decisions are going to look irrational to those that don't consider the gun.

Many people see the decisions the poor make and say "Oh, well I would have just negotiated based on my value to the business rather than settling for minimum wage." Which is a good response and perfectly valid if you can walk away from a deal with no negative repercussions. But the poor are negotiating with a gun to their head. They either have to take the deal or go hungry or homeless or not pay for their medication or what have you. Their decision is rational when all of the information is taken into account. It just looks irrational to people who generally don't have to deal with negative utility when they walk away from a given deal.

As a society I think we should strive to minimize how many of these life and death or pain on the line financial decisions people have to make. I'd like to see us strive for a nation where no one is negotiating for their life. I'd like everyone to have the freedom to walk away from a deal that doesn't create value for them. Simple as that. It will be better for everyone because it removes value destroying distortions.

I hold a gun to the head of someone you love. I tell you you will deliver something or I will kill them. You start to negotiate for how much you will be paid for your labor...do you think you will get the best value for your labor, overall? Or will you simply prevent the loss of life of your loved one?

You'd likely just be happy to prevent that grievous loss.

The poor are under the same terms except instead of a gun it is starvation or homelessness that is the threat to themselves or their loved ones.

This is just the simplest and most apropo example of misbehaved transactions. Not all voluntary transactions result in the best value for each party. You are correct that they would get more for their labor if they could but the deviant nature of the transaction keeps it from being a value trade and creates, instead, a struggle to lose the least amount they can -- a destruction of value for that party but, if mitigated, the best possible destruction of value from their point of view. It is not a healthy part of the system.

Think of a protection racket -- are those people getting the best value? Or simply getting the least amount of destruction of value given the circumstances? Those two things are not the same.

It’s a chronic crisis, a chronic stressor, and it affects the way people think. Short-term infusion of money will probably be blown on what you might consider to be frivolities because of this reason.

There are exceptions, to be sure, and plenty of ignorance about good decisions… but “poor decision making skills” is at best a crass, misleading oversimplification.

(Most dangerously it’s intentionally used to mislead.)

If you don't have money to spare, and then one month you get a windfall and do, it's absolutely rational to assume (and consequently base your decisions on) that you'll go back to the former state.

You seem to be caught in a circular argument... the poor can't help that they're poor because, well, they're poor!

It means "doesn't have much/enough money". Poor people usually make decisions that are perfectly rational given the day-to-day grind of being poor.

That is exactly what it is. Poor people are poor because we are poor.

We see rich people making money on the stock market, and wish we could, but we have no excess money to do that with.

We see rich people upgrading their homes and their cars and their whatevers to be more energy efficient, but when our car breaks down and can't be repaired, we buy whatever car we can afford, not whatever car would have the lowest TCO per mile.

Or hell, anything that has a calculable TCO, usually the most efficient TCO-wise has a very large initial investment... poor people can't afford that, thus we are punished, literally, because we are poor.

Like, a few days ago, I finally ran out of my strategic supply of incandescent bulbs. I can't have CFLs in my house because they tend to give me headaches, and they make everything look like shit anyways; but for the past decade, LED lighting has been absolutely too expensive.

I basically fought with myself for 3 days over finally spending $75 to upgrade sixteen 40 watt bulbs and seven 60 watt bulbs. Power efficiency wise, trying to estimate my average usage as best as possible, it is going to take 2.7 years for for those bulbs to pay for themselves (I use the lights very little, but our power prices are very high)... sometimes I wonder if I'm going to survive the month, let alone 2.7 years.

Hell, I'm trying to grow food in my backyard just to try to get better vegetables cheaper: the farmers market around here is pretty bad, and what little local vegetables we grow are sold out of state, while most of what is on store shelves is either from California or out of the country, and often half-rotten.

The people who eat pre-packaged frozen garbage all the time, or eat at McDs and KFC all the time, and become massively overweight and generally suffer from health problems (which also punishes us because we're poor, thus making us even poorer) eat that way because at least it isn't half rotten garbage being sold as fresh vegetables.

My fellow poor people around here think I'm insane for going Paleo, such as getting rid of cheap sources of carbs (such as breads and pastas and refined sugars), and eating more fresh vegetables (organic brands tend to actually not be rotten garbage; yet another punishment for being poor), and eating more healthy fat and protein sources (such as better cuts of real meat instead of eating chicken or really bad cuts of pork, or processed shit like hot dogs or whatever)...

... and that choice of mine? Sure, I'm not going to die of being overweight now. I had pre-Diabetus, it's gone. I used to weigh 340 pounds (I'm 6'0"), now I weigh 190ish. I went from that 340 to 214 in exactly a year. I did this with diet modification alone.

I lost all that weight? Punished by being forced to buy new clothes. Punished by being shunned by fatter people who basically hate me because I chose to become skinny and make better choices about my diet because somehow I'm better than them (as if that thought process even begins to make sense). Punished by having an even larger chunk of my budget eaten up my better diet.

Now, back to the garden? Sure, if I can put a little bit of work in, and get a fresh source of vegetables, that'd be great: the soil is apparently so bad that it may take years of adding nutrients and fertilizer and other organic material back to the soil to get it to grow a good crop.

What I've already put into the soil? Cost money. What I will put into the soil in the future? Costs money. When will I see a return on that investment? Never is still a possibility, I have not ruled it out yet.

So yes, being poor is a punishment for being poor, and the punishment for being guilty of the crime of being poor is being poor. Its a never ending loop of bullshit that is very hard to climb out of.

Want to fix society? Give everyone their basic needs so they can go focus on actually being productive members of society, and THEY BECOME PRODUCTIVE MEMBERS OF SOCIETY. Treat people like how you want them to behave, AND THEY BECOME THAT PERSON.

I have no clue why the hell so many people have problems with what is basically Psychology 101. None of this is new, but we keep rediscovering it every few years as if it is some magical new tablet handed down from Mount Sinai with brand new information on it.

Segregation and all the other ills of the day had nothing to do with the challenges faced by "colored" people. They just needed to be smarter and work harder.

Putting aside that there are various degrees of poverty, I will just congratulate you and your friends. But, studies show that economic mobility is far more difficult than in the past and more difficult in the U.S. than in many western European nations.

The severe and worsening income and wealth stratification of the past few decades is no accident. There are structural problems with our economy. That a relative few can overcome this to some degree neither disproves nor mitigates that fact.

It isn't a "lack of economic freedom" that makes the poor get screwed by shitty jobs and all the fees tacked onto poor-people services, it's the cottage industry that's sprung up around screwing the poor. The poor have little to no political power (and they wouldn't have time to exercise it, juggling their three part-time minimum wage jobs), so there's very few people actually looking out for them.

It's funny, when we do peel back regulations, and the poor get screwed further, these myth-of-overregulation people never reflect on that. They never stop to think that maybe, just maybe, the poor are getting screwed even further because it isn't regulations that are hurting them in the first place.

Whatever it is, you seem to suggest that the success of India and China has nothing to do with trade agrements. Nothing to do with currency manipulation. Nothing to do with technology. Nothing to do with the outsourcing of manufacturing and other jobs to these low wage countries. Just increase "economic freedom" (what does that even mean exactly) and voila!

And, why is it that even with regulation and suppressed "economic freedom", U.S. corporations realized record profits, while unemployment remained high, and wages low? Exactly whose "economic freedom" is being decreased here? How is it that we can pay CEOs so many times the average worker's salary even while that CEO is driving the company over a cliff? Meanwhile, full-time workers find themselves below the poverty line? No problems there, right? It's the workers' fault. Or perhaps it's the regulations, but which regulation(s)?

I'm just not following your argument. Are you saying there are no structural problems with our economy that cause the poor to be disenfranchised? And, what redistribution have I advocated, to which you are taking exception?

Exactly!

Food, shelter, access to medical care, these are the basics of human life, and no one should go without them.

exactly :-)

I'm saying, if you're living on $800 a month, and you get that sweet, sweet EITC money, you're going to use it to buy a new sofa, since your brother puked all over your sofa one night and you could never really get the smell out, and get all your bills current.

You might say that the stink of puke is worth putting up with, and the hypothetical poor person should pay for two credits of an associate's degree at the community college instead, which, ok, education is great, but the real reality is that for a lot of people, it's just not possible to work harder or earn your way out of poverty.

Not because of bad choices (e.g. living high on the hog from their magic $10,000 lottery ticket), but because low-end jobs in this country are unlivable and there's a whole cottage industry built up around screwing the poor with extra fees on every transaction they face throughout the day.

The solution isn't to tell poor people to put up with the puke smell and work their way through a 20-year associate's degree two credits at a time, so they can make 30c more. The solution is to make the economy work for them, as well as it works for those of us posting here.

EDIT source http://lmgtfy.com/?q=deserving+and+the+undeserving+poor

I guess my question is, what do you mean by deserving/undeserving? Deserving of what?

So again, what do you mean by "deserving"? What do the poor deserve that (in your interpretation) ianferrel claims they do not?

It is one thing to say that some peoples' poverty is the result of their bad decision making skills. It is another to say that cash payments are not an effective form of assistance for such people. It is something else altogether to say that we should throw such people to the wolves. Do you acknowledge these distinctions, or do you think they are insignificant?

Cool

> again, what do you mean by "deserving"? What do the poor deserve that (in your interpretation) ianferrel claims they do not?

Actually nope not cool. You are clearly not familiar with the concept. This question does not make any sense in terms of the concept...

The concept of the deserving and undeserving poor has nothing to do with what the poor in general deserve or don't deserve. It implies that there are two type of poor people.

1. Deserving poor people (in ianferrel's mind those that make sensible decisions about money) 2. Undeserving poor people (in ianferrel's mind those that make poor decision about money)

I raised this issue because in Victorian England this concept was behind a lot of hand wringing and moralisation and very little actual social improvement. Those that forget history are doomed to repeat it - but those that don't know it can't help but forget it and people like ianferrel are clearly missing a huge swath of social history which would help them gain context for their opinions.

I live in a country (Colombia) where plenty of men waste their paychecks in beer. I see it every month. Less now than when I was younger, but still.

It has made the beer company very rich and profitable, but I can assure those were not good decisions made by the men, and it was not the fault of the government.

What happens when someone doesn't want to fit in to that mold? Their own friends call them cheap, not so close friends try to con them from their savings, and general people think of them of 'the bourgeois who we have to steal from'.

There are polls where people in Colombia are self-described as 'one of the happiest in the world'. It's actually 'we have to pretend to be happy' just to fit in society. And that involves wasting paychecks in booze with friends and/or family.

Think about people in NY pretending to be rich. It's the same here, but the pretension is: we-party-more-than-anyone.

I even remember when parties had to be until 6am or even 11am of the next day to be considered 'normal' and not a failure.

And all this has the consequence of most people having no savings at all.

Maybe at some point after we give poor people a bunch of money those who become poor again we can say are clearly making poor decisions. I believe most poor people are generally good people. We shouldn't leave a majority of people in the position they are in simply because some of them will waste it on bad decisions (drugs, etc.). This doesn't have to be a permanent thing, but the best charity at this point is probably to give people money.

The fact that bad decisions (again from a given point of view) are made has to do with the duration of the view. From my experience, people that spend their last money on drugs are looking for a relief, even if it lasts from a few minutes to a couple of hours of that high. This is the time that they don't have to face their situation. From that point of view, the decision is sound to them. Addiction is a very powerful thing, but it need not be chemical, it could very well be emotional.

The motivation is an extremely important item to consider. Proponents of the food stamps and other specific-use assistance programs point to the fact that they deter bad use. However, one can still buy fast-food with it and end-up more unhealthy and worse of.

Personally, I am of a very strong belief that as a society, we need to work to address root causes that together combine to contribute to the poverty rates. Some relatively straightforward ones - real universal healthcare (and mental health) and universal education to at least bachelors level.

If we really want to eliminate the notion of poverty, we need to figure out universal income question, but the economic consequences of this still need to be worked out. Universal healthcare and education are economic no-brainers when not completely bastardized by corporate interests... (in my own view at least.)

Empirically, giving people money helps them. This experiment with the homeless in London is a good place to start: http://www.washingtonpost.com/opinions/free-money-might-be-t...

The article you posted is great, thank you for sharing. It's clean, well-written, and backed by an experiment, which is fantastic. Do you have any more material like this? On the other hand, does anyone who disagrees have any material to the contrary?

But there are also many people who started poor and stayed poor, because they did not have the possibilities of the rich.

Or is your argument, that somebody whose parents where rich, will stay rich, because he made all the good decisions himself? There are so many rich, that make bad decisions and stay rich, because they have so much, they always will stay afloat.

But, obviously if you have significant amounts of capital, it's harder to lose it all.

But it is just a statistical fact, that moving up from being really poor today has become much more difficult than it was decades before, maybe with the exemption of being a computer scientists (but also there it is not so easy for a normally gifted person to finish studies and so on without help from the parents).

My post was an attempt to summarize and contrast the two major conflicting issues that relate to how aid to the poor is made, not to argue in favor of either.

It is a fact, that countries really flourished (USA, Germany, other countries) with a bigger part of the society in the middle class and having a better living and education, when those countries managed to bring better income also to working-class people.

Today's wealth in the US is for a big part because of the flourishing middle-class of the country shortly after the 2nd World-war. The same holds for Germany and other countries.

Today, all over the world, the income diverts and education already is going down for normal people in many countries. Middle classes are melting away.

Wealth of a society is not only to be measured by the wealthiest people in the society, but by the wealth of the middle class (and worker) people.

Today, we waste the wealth created after the war and give it away to the <1% of people.

Everybody should see this film: Inequality for All [1] that shows, the connections, that many are just ignoring today.

To my opinion, to help poor people, raise wages of workers in all the world (thus making an end with a Globalization that just helps the rich).

By raising the wages, you will not have people that just live on welfare, but that can be proud again for their work they do.

[1] http://www.imdb.com/title/tt2215151/

diverged.

(In the hope that it helps another non-native speaker.)

It's subtle:

The issue is not about eliminating poverty. It's about how to motivate rich people to part with their money. After all, aid to the poor comes from taxes, and the rich pay more taxes. So any kind of welfare has to give the donors of the money something in exchange for their donation. But the poor have nothing to trade for what they receive. Right?

Wrong.

The poor have their dignity. That's what they trade for donations. Every scheme for wealth distribution is informed by that fact. Rich people give money, and poor people abase themselves in exchange. That's why every welfare scheme always involves humiliation.

That's why government housing for the poor looks different from ordinary houses: so the poor will stand out, so they can be shamed.

That's why poor people have to endure long lineups at the welfare office: so they can be reminded that they are less worthy of decent consideration.

That's why poor people have to endure invasion of their most private aspects of their lives, through visits by social workers: so they can be reminded that they don't deserve privacy.

And that's why the rich don't like giving out cash: because cash is anonymous, and enables dignity, equality, and privacy.

As long as this implicit bargain (money in exchange for dignity) goes unexamined, the cruelty of the social welfare system will seem mysterious.

Time after time, when I've helped family members with cash, it winds up getting wasted horribly and helping them less than it hurt me to give it to them. When I help them with what they need, their situation improves.

And logically, if the poor as a group were good with money, they wouldn't be poor.

Yet the article asks me to abandon reason and experience because there's some "a growing body of evidence" somewhere out there which are not provided by the article.

Yeah, that's a good analogy to show my point. You don't throw someone on a wheelchair on their feet and hope it goes well. Just like you don't give a poor person a wad of money and hope it goes well.

This should be a solved problem.

Sorry, but that is not really logical. Many people are poor simply because they don't earn enough money. There is a difference.

Based on the relationship between poverty and ethnicity, I'd say it's related to much more than their choices.

Which, clearly, are a representative sample of the poor people in the society at large.

> are poor because of their choices or because of the place they live. Neither of which are fixed with cash.

Since changing the place you live often is generally not free of cost, I don't see how that follows for the "place they live" group.

To the extent that the "choices" group is past rather than current choices, I don't see how that works for that group, either. (Heck, even with current choices, choices are constrained by the available options, which cash does change.)

The problem with the "evidence" you're using is that it can be interpreted many ways. It's merely a correlation.

In circumstances closer to controlled experiments where I actually gave someone money, they usually wound up worse off in a couple months, not better, unless I made sure the money went towards fixing a real problem.

I am sorry, just this statement alone, disqualifies your whole argumentation. It is just a barroom cliche of the rich.

And who cares if you think my argument should automatically be "disqualified" because it doesn't match your politics.

And sometimes they are cliches, because they match into politics of some people. It is always much better to have an argument, why you do better than others, than to admit, that you are lucky.

But I guess, you are the one, who knows which ones are "accurate", because you know best.

> And who cares if you think my argument should automatically be "disqualified" because it doesn't match your politics.

Right. It is better, that your politics matches the politics of the rich and mighty.

When there is a monthly stipend that someone knows they can rely on no matter what happens (getting sick, losing their job, family emergency), they are suddenly capable of thinking beyond immediate needs.

Many people caught in the poverty trap know full well that they're making short term decisions that will do more harm than good in the long run, but often the better decision is beyond your means, either financially, or time-wise (because you're working 3 jobs and still falling behind on your bills and coming home completely drained and exhausted).

Give poor people a reward/goal within reach and then see how they do.

I know working on long projects can be very draining because weeks can pass by and I'm still very far away from the goal of project completion.

Poor people's lives are like that. They have to jump through more hoops and exert much more discipline for their life to get better.

One of the things I love about basic income is that if it's set high enough it really removes moral culpability from the rest of society.

So even if your relatives can't make good decisions, you've established a moral high ground and can safely refuse and blame them going forward, whereas if you'd never given them money, it'd all be your fault still.

The real problem with it is that's it's likely a massive labor subsidy, since basic income likely kills the minimum wage.

Joking aside, the concentration of wealth is a different issue than poverty. They're only distantly related.

Also, I'm for progressive taxation schemes.

Helping desperately poor people is a surely virtuous thing to do and helping them efficiently by giving them money via GiveDirectly, as suggested in this article and the linked 2003 NYT article, is all the better.

But, right now there are worse things to be than desperately poor: like being a kid in Africa who dies of malaria for want of a malaria net.

Given the poor state of medicine and public health in places where people are dying for want of a few thousand dollars, optimizing poverty relief programs seems premature.

And for what it's worth the people you'll save are also desperately poor.

[1] http://www.givewell.org/international/top-charities/AMF#Cost...

I know people who have had malaria (family that lives in a tropical 3rd world country). All survived.

Giving out mosquito nets to conquer malaria makes as much sense as giving out medical masks to conquer the flu. The answer of course is to be in good health, and to have access to medicine.

But we don't live with malaria, so feel-good gestures are as far as we go.

The point isn't to say they're not, but rather to say the nations that have been most successful at preventing malaria deaths are those that are most developed, or have access to anti-malarial drugs (which are dirt cheap).

The flu kills thousands every year and used to kill many more (the 1918 flu epidemic killed an estimated 50 to 100 million people around the world), but we don't even consider it to be fatal anymore due to our level of nutrition and medical care - which comes from development.

Also keep in mind the US used to have malaria-spreading mosquitoes and a fair amount of malaria-deaths, but now it's considered eliminated as a public health concern. Maybe some of the techniques it used could be applied to Africa, and not just band-aids that keep Africa hooked on western 'aid'.

This is absolutely nothing to do with human development.

Good health can compound problems with flu because it leads to a cytokine storm - flu epidemics tend to kill healthy young people disproportionately.

The scientific community has been extremely concerned about another influenza epidemic because there is no guarantee that we can do anything about it, medically speaking.

If there was an epidemic on that scale again, the best practice is to close schools and workplaces, to restrict travel. In other words: to temporarily stop the benefits of human development.

77% of maleria deaths are kids under 5 according to the WHO [1]. They're giving out mosquito nets to prevent children from dying of malaria.

But we don't live with malaria, so feel-good gestures are as far as we go.

For every 322 children under 5 protected by nets, one survives who would otherwise die [2]. This isn't the right thing to be cynical about.

[1] http://www.who.int/gho/malaria/epidemic/deaths/en/ [2] http://www.givewell.org/files/DWDA%202009/Interventions/Nets...

If you get it as a child, you will most likely end up with a lower IQ, though, which certainly is a lifetime affliction.

How much malaria costs when it is dormant is something I don't know. My intuition is that there is a cost (for example in a heightened inflammation response which is hard on the body) but I simply don't know.

Yes it does.

> just had it a few mild times as a kid.

Nope you have it. When you are in poor general health it will probably resurface. Good luck.

Or, phrased differently: Give a man a fish and he eats for a day. Teach a man to fish and he feeds himself and his family while selling the excess for discretionary income :)

1. https://en.wikipedia.org/wiki/Transfer_payment

A large and healthy middle class not only precludes unhealthy amounts of poverty (please keep in mind there will always be a "bottom 16%" [aka falling below < -1σ] no matter the level of wealth) but also precludes large concentrations of wealth by the upper class.

EDIT: replied before you finished your edit, I see we're actually in agreement. Carry on...

If "the system" is giving people money to raise them out of poverty, how can it simultaneously be a "system that creates poverty?"

Your logic implies that there is enough work to go around, and that's increasingly seeming to be not the case - if there's not enough good paying work, that's not anyone's fault.

We also need to consider micro and macro-economics. Folks with less money have a high marginal propensity to consume or likelihood of spending most or all of the extra funds they receive. Also, consumer spending is a factor of economic output or GDP. Increasing consumer spending increases economic output. Q.E.D. Give people with no money enough money to not fall through the cracks.

It's generally considered that you either want to expand the current, highly convoluted system, or that you loathe welfare entirely as a matter of principle.

Some of us would prefer to replace the entire welfare system with simple automated scripts.

  if( 0 != ImmNatSvc.GetStatus( person ) & ( CITIZEN|PERM_RES|ASYLUM|REFUGEE|NONIMM_WORK ))
  {
      Treasury.DistributeBasicIncome( person );
  }

EITC is like what a person who once heard of negative income tax but wanted to make a Rube Goldberg parody of it would create.

A negative income tax would, in its simplest form, instead of limiting AGI to a minimum of zero after deductions, let it go negative, and treat the (negative) calculated liability on that income as a negative total tax liability.

(Now, EITC helps a wider range of people -- with qualifying children, it hits about the same point for people without children -- than NIT would with the current deductions available for US taxes, but, that could be addressed by adding greater child deductions than the existing standard deduction.)

When some people ask money and you give them some money - they are quite often disappointed because you are not giving them enough.

I'm tired of this stereotypical judgement that poor people are so bad with money that we'd be better off generously making purchasing decisions for them.

When you give money to all poor people, the net result is simply inflation[1]. If transfer payments were made to taper up from max(wealth) (receives $0) to min(wealth) (receives $average(wealth)), disparity would be brought to 0, which would naturally lead to everybody doing what they wanted rather than what earned them income. This would be a lot of fun, but it would unfortunately reduce the developmental value of humans to zero[2], and machines would evolve to replace us all (could be gray goo, could be the borg, etc.).

The true path to freedom from work is to work collaboratively on a humanoid robot with some basic rules for human interaction: 1) A robot may not injure a human being or, through inaction, allow a human being to come to harm. 2) A robot must obey orders given it by human beings except where such orders would conflict with the First Law. 3) A robot must protect its own existence as long as such protection does not conflict with the First or Second Law. Those should suffice for a while, but I know not what will come of them down the line.

That's all for now :) Have a great weekend, everyone!

1. http://www.physicsclassroom.com/class/newtlaws/Lesson-4/Newt...

2. http://econlog.econlib.org/archives/2011/05/robots_of_the_f....

Obviously, redistributive tax + BI schemes that result in some group having more money than previously increases demand and market clearing prices for goods disproportionately demanded by that group (and does the reverse for goods disproportionately demanded by the people who are net payers.)

So, clearly, the increase in effective buying power won't be as much as the increase in income compared to the pre-policy price levels would indicate.

But that isn't sufficient to make the case that BI won't mitigate poverty, however. Just that the degree of mitigation will be less than the most naïve analysis conceivable might suggest.

(Also, the link to Newton's third law to support this position was amusing.)

I feel what you're saying, but in 2015, one needs a phone to get (and usually to hold) a job. Especially low-wage jobs. E.g. a temp agency might start calling at 7h30 because they're looking for someone to fill in. Don't pick up your phone? We'll just give the job to someone else, oh and we won't call tomorrow, because you don't pick up anyway.

One of the other musicians said, in all seriousness: "Hey, my cell phone is my lifeline when I'm homeless." Another guy chipped in: "Me too."

It used to be cited that lack of a mailing address was a real impediment to the homeless getting back into a normal economic life, and the cell phone may play a similar role today.

One of the major motivations cited by many proponents of Basic Income is that a lot of the cost of existing poverty aid programs -- which they see BI replacing -- is tied up in administrative overhead verifying that aid is "used as intended", which does a lot to support a bunch of administrative government (and government-contracting) professional jobs -- which I guess is a kind of anti-poverty program for the college educated -- but really reduces the efficiency of actually getting the money where it is intended, as well as paternalistically assuming that the government knows how people should spend money to improve their situation better than they do.

PS: If you look a little deeper your advocating for a communist style demand economy which as we have seen just does not work long term.