Essay on Government Spending

spill flair 12 Fall 12 Brigham Young University Brigham Young University 08 Fall 08 Fall Essay 3 Nguyen Bui A HTG 100, 103 Essay 3 Nguyen Bui A HTG 100, 103 People should be do by in incompatiblely regardless of their wealth and brotherly standings. Yet, in reality, societies have experienced economical in enoughities due to kick in scales, tax brackets, and education level. A research study on 23 developed countries and 50 states of the US has shown that countries with higher degree of inconsistency scat to have higher grade of health, social problems and lower rates of social welf be.To resolve such inequality, the U. S government has consistently intervened by alleviating poverty and redistri justing income in different forms of change payments such as welf be, Medicare, Social Security and employer-provided health indemnity. Despite the good intentions, these programs, which involved vainglorious outlay, havent been entirely effective in availing the low. Therefore , even though the poor energy suffer from an extensive economic inequality, the government great dealnot intervene by levying these transfer payments to focus on the equal outcome rather than personal freedom.Many studies have shown that transfer payments didnt help to redistribute income. According to Dwight R. Lee, unless 25% of $500 billion spent yearly on mankind assistance and social insurance programs were distributed through Medic attention, food stamps, Social Security, etc and 75% were allocated regardless of need. This suggests that a large portion of financial aid from the government went to those who were not in need. These programs were therefore proven ineffective since their means were to help the poor but the poor didnt very receive the exact benefits the taxpayers gave up.One of the reasons was that these transfer payments policy wasnt specific enough, so their main purpose of feeding yet the poor hasnt been accomplished. In addition, when taxpayers were taken funds outside to help the poor, their personal freedom was constrained because they couldnt do whatever they want on their remuneration completely, even in helping the poor themselves. more importantly, many poor people receive no more than the average income people and the transfers they lease are worth less to them.Out of the 25% payment transferred that were means-tested, notwithstanding about 30% was in money and the remaining 70% came in the form of in-kind transfers such as food stamps, housing, and medical care. These in-kind transfers are less preferable to the poor as cash provides more spending flexibility. For every dollar the government spends, only 25 cents are transferred to the poor. Out of those 25 cents, only 75% or 19 cents is the actual cash the poor can receive and use for whatever they need. veritable(a) though the poor hitherto receive a cash portion through these transfer payments, the cash amount is not enough to satisfy their daily need.Those progra ms put one overt help the poor as much as expected and as a result, the poor are still poor and the income inequality still remains unresolved. Also, it is disappointing to taxpayers because they can no longer use their own money to help the poor, and the money they give up doesnt maximize the poors utility either. Some of the basic supporting argumentations for transfer programs are that they help to reduce income inequality and social stratification. Particularly, the mathematical function explains this argument W= min (Y1, Y2, , Yn).This function states that societys utility (W) is dependent on the least of various(prenominal) utility, which is the poorest in terms of income. Thus, the poor have to be prioritized when income is distributed until all are equal. This is totally reasonable since a society would be fair only if the bottom individuals were also well taken care of. The advocates of these transfer payments also argue that transfer payments even though cant help to r edistribute income equally, at least they help the poor become better and thus, social welfare would increase as a whole.However, they probably never pay attention to the result. They probably havent asked themselves this question is the money actually transferred from the rich to the poor? Many studies have shown a striking fact that most government transfers are not from the rich to the poor. Instead, government takes from the relatively unorganized parties, like tax payers and consumers, and gives to elderly, sugar farmers, and steel producers, considered as the relatively organized parties.As mentioned above, only 25% of all the money spent yearly on public assistance and social insurance programs were distributed through Medicaid, food stamps, Social Security, and 75% were allocated regardless of need. People tend to believe that whatever tax amount they pay, either federal or state or social security tax, the money would be fully transferred to the poor. But they have failed t o recognize whether the transfer payments go to the poor or people who dont need it. They end up losing their spending flexibility to only help the poor a little.Would people still see the necessity of these programs if they realize that the poor dont get as much as they really need? Overall, the redistribution of income is important because inequality can only cause complex issues for society as a whole. But the most effective way of income redistribution remains controversial. While most people believe transfer programs are helpful because they help to symmetry income between the rich and the poor, I believe this is not an ultimate solution for such a long-standing issue.The statistics are self-explanatory these programs didnt result in a good outcome for the poor and the poor were still unsatisfied after all. Its the time for us to make changes, whether to alternate these programs or totally get rid of them so that taxpayers no longer have to pay a large sum of money to help onl y a little to those in need. 1 . Richard G. Wilkinson and Kate Pickett, The Spirit Level Why More Equal Societies Almost Always Do Better 2 . Dwight R. Lee, Redistribution of Income