Daniel Oliver (www.smart.net/~doliver/) is a Washington, D.C.-based editor and writer and a research associate at the Capital Research Center (www.capitalresearch.org).
Despite the good news that national welfare rolls have declined nearly 40 percent over the last five years and that recent federal and state reforms appear to be at least partly responsible for this decline, the debate over welfare reform is going nowhere.
Welfare-state liberals argue that if government programs are significantly cut (which to date has not happened, as measured by federal welfare appropriations), charity will not be able to make up the difference. Independent Sector, a Washington, D.C.-based coalition of government-funded social-service organizations, believes that “charities cannot come close to filling the gap for proposed cuts in the funding of social programs.” Conservatives, on the other hand, argue that charities, churches, neighborhood associations, and other voluntary institutions can assume most if not all responsibilities for the needy now carried out by government.
Yet both arguments overlook an important point: welfare and charity are both forms of dependency. Why would we want to “fill the gap” by replacing one form of dependency—welfare—with another—charity?
Henry Ford, one of the greatest entrepreneurs and philanthropists of this century, once remarked that “the recipients of charity are usually destroyed—for once you give a man something for nothing, you set him trying to get someone else to give him something for nothing.” Octavia Hill, a nineteenth-century British landlady and housing reformer who was famous in her day for her work with low-income tenants, similarly criticized what she called “foolish almsgiving”: “the lavish and sudden rush of ill-considered gifts . . . is deadly. It is the cause of a steady deterioration of character pitiable to watch.”
Both the welfare-state liberal and conservative arguments fail to recognize that in an ideal society, there would be no welfare or charity. Ideally, every adult would be able-bodied and self-supporting. No individual or family would suffer the misfortunes of a house fire or devastating natural disaster. No one would engage in self-destructive behavior such as excessive gambling or drinking.
Obviously, such a world will never exist, but it is the kind of world we should nonetheless strive to approximate, however imperfectly. The question, then, is not how to fill the gap but how to reduce dependency.
What Causes Dependency?
There are really only two reasons why people come to rely on welfare or charity—misfortune and foolishness: people are either victims of circumstances beyond their control, or they willingly engage in self-destructive behaviors. Each of these causes of dependency needs to be examined.
By definition, a misfortune is an event beyond one’s control. But in a free society where people are free to exercise their ingenuity, experiment with new technologies, and create better products to serve customers, many misfortunes that have long plagued mankind are lessened if not eliminated altogether.
Because of weather radar and satellite images, we can now track and predict the likely course of hurricanes, giving those in their paths time to board up their homes and businesses and move inland to safety. Ships no longer sail into storms and sink, as they did for centuries. Advances in construction have made homes and other buildings more hurricane-proof and earthquake-proof, saving both lives and property.
In this century alone, the life expectancy of Americans has risen nearly 30 years, thanks largely to biomedical research that has discovered cures for scores of diseases that are no longer part of our everyday vocabulary. These diseases once killed husbands and fathers, sometimes leaving their wives and children in poverty. Thus, one way to reduce misfortunes that result in dependency is to ensure that free markets, free inquiry, and entrepreneurship are allowed to work their magic.
The other cause of dependency is self-destructive behavior. When those whose problems are of their own making receive welfare and charity, they are insulated from the natural consequences of their behavior. Rather than suffering the effects of idleness, excessive drinking, and other forms of irresponsibility, recipients are handed a “crutch” (free food and shelter, help with paying utilities) that allows them to persist in their folly. Thus, the “learning experience” that would occur in the absence of welfare or charity—“I have to stop lounging around and find a job,” “I have to stop gambling”—is postponed and may never occur.
Generations ago, most charity workers understood this problem. They knew that “helping” those who were unwilling to help themselves simply allowed self-destructive behavior to continue, and that often the most compassionate course of action was to allow such persons to suffer, perhaps until their suffering became so great that they would be motivated to change. Octavia Hill sometimes had to evict alcoholics and other tenants who refused to work or pay rent, arguing that “the fact of having to move may be a lesson [and] if other landlords did the same, it would certainly stop much evil.”
But Hill also understood that charity could promote independence if recipients had to give something in return. When her tenants suffered the misfortune of losing a job, she had them clean and repair her many properties in lieu of paying rent. This reinforced the value of work and allowed recipients to keep their dignity until their fortunes improved. Similarly, when Henry Ford in the early 1930s heard that the town of Inkster (a suburb of Detroit) had been particularly hard hit by the Great Depression, he hired its residents to work in his automobile plants and paid others to clean the streets, grow crops, and crush slabs of concrete from demolished buildings for use in paving streets and roads. As he explained, “I do not believe in giving folks things. I do believe in giving them a chance to make things for themselves.”
Unfortunately, too many charities today treat charity as a kind of free lunch. As one literal example, over the last 20 years soup kitchens and other food charities have distributed roughly 10 percent more food each year. Reliance on food charities has increased during both economic upturns and downturns—even though inflation-adjusted food prices have been falling for decades. The main reason for this growing dependency is simple: better-off Americans are donating increasing amounts of food to charities, and since all food has a limited shelf life, it must be quickly distributed.
A recent national study by Second Harvest, the nation’s largest network of food banks, found that while nearly 40 percent of food-charity clients are unemployed, only 22 percent of food charities offer employment training and only 9 percent offer actual jobs. Moreover, while 60 percent of clients say they would like information on how to better budget their money (poor budgeting appears to be a major reason for reliance on food charities), only one food charity in five offers budget and credit counseling.
The Task Ahead
Many charities must re-examine their methods to ensure that they are not promoting dependency. Individuals, foundations, and businesses that give to charity must also take a closer look at the organizations they support to ensure that they promote independence. And advocates of a free society must work to eliminate welfare programs. Welfare has promoted dependency in the same way that “bad” charity has and, more fundamentally, it is based on coercion. Welfare is the antithesis of charity and is incompatible with a free society.
Perhaps the most basic rule that could do wonders to improve charity today is, Don’t give away anything for free. Welfare rolls have dropped significantly in the last few years as states and the federal government have required recipients to work. It is likely that charity rolls would similarly decline if more charities made demands on recipients to find work, sober up, and the like.
Because misfortune and foolishness will always exist, there will always be a need for charity. But this need is without doubt far less than is commonly believed because bad charity has encouraged many people to become dependent. If all charities begin to follow the example of Henry Ford and Octavia Hill—and give nothing for free—many more Americans will be able to share in the American Dream.
- The seeming paradox of declining welfare caseloads and rising welfare expenditures is largely explained by the fact that federal and state governments are spending more per welfare recipient on job training and placement as well as on transportation, day care, and other “workfare” expenses. Heritage Foundation welfare analyst Robert Rector calculates that in 1992, 75 federal welfare programs cost $304 billion. But under recent budget agreements, they will cost $538 billion by 2002. Major reasons for the increase include expanded health-care coverage for low-income children, higher Supplemental Security Income, food stamp, and Medicaid benefits, and new workfare grants. “Welfare Fares Well in Budget,” Investor’s Business Daily, May 21, 1997.
- “Statement by Sara E. Melendez,” Independent Sector Web site, www.indepsec.org.
- Henry Ford with Samuel Crowther, Today and Tomorrow (Cambridge, Mass.: Productivity Press, 1930), p. 179.
- Quoted in Robert Whelan, ed., Octavia Hill and the Social Housing Debate: Essays and Lectures by Octavia Hill (London: Institute of Economic Affairs, 1998), pp. 93, 116.
- Americans for Medical Progress (Alexandria, Va.), 1991 annual report, pp. 1, 2, and American Council on Science and Health (New York, N.Y.), “America’s Health: A Century of Progress.”
- Quoted in Whelan, p. 118.
- See Martin Morse Wooster, The Great Philanthropists and the Problem of “Donor Intent” (Washington, D.C.: Capital Research Center, 1998), p. 20.
- Robert Lerner and Althea Nagai, “Feeding the Hungry: Should Food Charities Fear Welfare Reform,” Alternatives in Philanthropy (Washington, D.C.: Capital Research Center, January 1998).
- Second Harvest, Hunger 1997: The Faces & Facts (Chicago: VanAmburg Group, Inc., 1998).
- In Overcoming Welfare: Expecting More from the Poor and from Ourselves (New York: Basic Books, 1998), James L. Payne examines this rule at length. See also Marvin Olasky, The Tragedy of American Compassion (Washington, D.C.: Regnery, 1992), for an examination of this and other rules for effectively helping the needy.