Poor Policy: How Government Harms the Poor by D. Eric Schansberg

A Collection of Neatly Organized Data and Arguments Against Government Remedies for Poverty

Westview Press • 1996 • 244 pages • $25.00

George C. Leef is book review editor of The Freeman.

As Thomas Sowell correctly observes, before one can be a partisan of the poor, he must first be a partisan of the truth. Unless we understand the truth about the causes of poverty and the truth about the effects of what are called “anti-poverty programs,” we are not going to be able to do anything to help the poor. Indeed, in trying to aid the poor without an accurate analysis of the causes and the effects of the proposed cures, we are apt to make their condition worse. In medieval times, doctors used to bleed people suffering from diseases on the assumption that bad blood was causing their distress; this was almost never beneficial and fatal in many cases. Could it be that government policy today toward poverty is on a par with bleeding?

In Poor Policy, D. Eric Schansberg argues that, like bleeding, government policy to help the poor actually is harmful. Welfare programs aren’t just ineffective. They are harmful. Furthermore, the author, who is assistant professor of economics at Indiana University-Southeast, makes a strong case that many of the poor are poor (or at least poorer than they would otherwise be) due to the effects of laws and policies designed to benefit various groups of non-poor people. In short, Schansberg is arguing the classic laissez-faire position against interventionism by demonstrating that it creates and exacerbates poverty.

Virtually everything government does outside of its Jeffersonian core of protecting individual rights to life, liberty, and property creates wealth transfers that make the society poorer on the whole, and have their worst impact on those who can least afford it. Schansberg devotes several chapters to the familiar list of laws that especially hurt the poor—the minimum wage, occupational licensing, rent control, and so on. In doing so, he introduces the reader to public-choice economic theory. Once people understand the logic of public choice, they are less apt to be taken in by the claims that laws like those are “well-intentioned.”

I particularly commend the author for attacking sacred cows. Social Security? Sorry. It harms the poor. Drug prohibition? It harms the poor also. Public education? A cataclysm for the poor. Given that so many Americans have been conditioned to ask of any proposed public-policy change, “How will it impact the poor?” we should use Schansberg’s book (as well as the works of Charles Murray, Marvin Olasky, and others) to bludgeon Social Security and so on with the argument, “They hurt the poor!”

The book also takes some well-aimed shots at the pernicious idea that Christianity demands that we have a governmental welfare system. Big-government advocates shamelessly resort to this form of moral blackmail, but the author replies, “The bottom line is that there is no relation between the biblical call to Christians and the use of government to help the poor. In fact, they are diametrically opposed. The use of government to reach certain ends is based on coercion. The change in behavior designed to accompany the Christian’s Spirit-filled life is completely voluntary.” The use of coercion to accomplish anything, whether it is feeding the hungry or exploring Mars, is simply wrong. Schansberg has here hit upon what I believe must be the foremost goal of defenders of liberty, namely, to get people to pay attention to the morality of the means and not just the desirability of the ends.

Poor Policy is a useful, nontechnical book that neatly organizes a lot of data and arguments against the ideas that government can, does, and should assist the poor. Bravo.

Further Reading