“Charity may even hurt the poor more than it helps them. The long-term results of aid to Africa are so poor that experts such as Dambisa Moyo, one of Time’s “100 Most Influential People,” concludes that the “evidence overwhelmingly demonstrates that aid in Africa has made the poor poorer, and growth slower.” Similarly, expenditures to reduce U.S. poverty may have contributed to a greater number of children born out of wedlock, reduced hours of labor supplied by poor families, increased dropout rates, increased drug use, and elevated crime rates—perhaps a greater cost to society and the poor than the value of their increased consumption.
Teenage pregnancy in the United States, for example, exploded in the 1960s as we increased welfare for unwed mothers, and peaked in the early 1990s at sixty-two births per 1,000 teenagers prior to welfare reform in the 1990s, before falling to forty-one births per 1,000 teenagers prior to the Financial Crisis. That’s still three and a half times more than France, four times more than Germany, and seven times more than Japan. A poor girl in the United States with dismal economic prospects—a high-school dropout or the child of an illegal immigrant—might find welfare to be a viable alternative relative to a girl with more attractive economic prospects. It’s no surprise that teenage pregnancy rates remain shockingly high among U.S. minorities who have less-promising financial futures. The rates are double those of white teenage girls.
The cost of redistribution is likely higher still. We also know that lawmakers never actually distribute much of the income taken from rich investors to poor consumers. Instead, they use the money to curry favor with middle-class and even upper-middle-class voters. They use tax revenues to pay monopoly rent to municipal labor unions, to make social-security payments to richer-than-average senior citizens, and as tax breaks and subsidized financing to richer than average home owners and college graduates. Unfortunately, politicians demand their ransom.”
Excerpt From: Conard, Edward. “Unintended Consequences.” Penguin Group, USA, 2012-04-25. iBooks.
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