All Commentary
Thursday, March 1, 2001

Relying on Relatives

Are Seniors Really Independent When They Rely on Taxpayers?

One of the highlights of the 2000 presidential campaign was Winifred Skinner. You may remember her—she was the can-collecting 79-year-old woman who used the money from her foraging for tin and aluminum to finance her prescription drugs. She was interviewed on Good Morning America about her plight, and Al Gore highlighted her story in his campaign speeches. Chosen by Gore to be one of his 13 “citizen advisers” before the first presidential debate in Boston, she even traveled there in a Winnebago to do her part in bringing about change.

At some point in the saga, it came out that Winnie had a son who was quite well off, perhaps even wealthy; he presumably could make up for the shortfall in income that might occur if she stopped walking the streets in search of a nickel’s worth of tin. But that revelation failed to derail the media’s love affair with Ms. Skinner, and it didn’t stop Al Gore either. He explained that we still need a prescription drug program for seniors because Winifred prized her independence. She didn’t want to depend on her son.

No. She wanted to depend on me. And you. Strangers. And Al Gore’s idea of compassion was to force us to support her.

Fast forward to the present, which for me as I write this column is late December 2000. George W. Bush is making cabinet choices for his administration in the abbreviated time available after the circus in Florida. As Bush assembles his cabinet and begins speaking about his policy agenda, we now hear from the equivalent of Winifred Skinner’s son. In this case, it’s Sarah Jessica Parker, the acclaimed star of the acclaimed HBO hit Sex and the City.

Sarah Jessica is concerned about a Bush presidency. Speaking to a Washington Post reporter, she said, “I’m worried about the kind of cuts he might make in domestic programs that mean something to a lot of people, including people in my family who depend on certain things from the government.” (I wish I had the same grounds for concern. I cannot remember Bush mentioning a cut in any domestic programs during the campaign.)

But the truly fascinating aspect of the remark is that I think Sarah Jessica Parker actually expected that her quote would make her appear compassionate. According to a story this past summer in the New York Times, she is worth about $4 million. Her annual income is certainly what most people would call a great deal of money. Apparently it does not occur to her that she might be an appropriate source of help for the less fortunate members of her family. In her mind, as in Gore’s and Winifred Skinner’s, struggling loved ones should be cared for by strangers. There is another possibility, suggested by the peculiar wording, “people in my family who depend on certain things from the government.” She did not say they were on welfare or food stamps or Medicaid. It is possible that they “depend on certain things from the government” such as agriculture price supports or cheap airwave frequencies to run radio stations or government-limited taxi medallions or export subsidies to favored companies and industries. Compensating relatives for these losses, should the government decide to cut back, might even challenge Sarah Jessica Parker’s monetary resources.

Without Social Security

I am reminded of those who pronounce that without Social Security, millions of elderly Americans would starve to death. This image, designed to enforce the policy status quo, ignores the way the world might work in the absence of government-enforced “compassion.” In the absence of Social Security, people would plan differently for their own retirement. (They are doing it now in a world where Social Security’s future is merely uncertain.) But the most important difference between a world with Social Security and a world without is that relatives would help one another instead of relying on welfare payments financed by payroll taxes. That is true private social security.

A world of true private social security has many challenges. Many siblings do not get along, and it might be difficult to coordinate assisting poor elderly relatives. Many would use the financial leverage to manipulate relatives in various ways. The cold, heartless public Social Security system avoids these problems, and it allows for the illusion of dignity. Winifred Skinner may prize her independence. By not relying on her son, she is free from his meddling in her life. But is she really independent when she relies on me and you?

The Sarah Jessica Parkers and the Winifred Skinners may believe that the illusion of independence is worth preserving. I generally prefer truth to illusion, but let’s assume that it is better to depend on strangers than loved ones. Maimonides, the great Jewish thinker of the thirteenth century, argued that the highest level of charity is when the donor, through a loan or gift, creates the opportunity for the recipient to get a job or start a business, thereby becoming truly independent. The next highest level is for the recipient to depend on the donor, and for both to be ignorant of the identity of the other. The government system does have that desirable outcome. But producing that outcome through public means comes at a tremendous cost.

It creates a world where people rarely if ever look to one another for help. It creates a world where true compassion is deadened, a world where gratitude is lost. It means a one-size-fits-all system where people with radically different circumstances are often treated identically.

Put yourself behind John Rawls’s veil of ignorance, not knowing your situation or that of your parents. Would you deliberately create a world where the situation of the elderly was determined by the political process rather than by individuals and families? Is the illusion of independence that precious?

  • Russell Roberts the host of the weekly podcast, EconTalk and co-creator of the Keynes-Hayek rap videos. His latest book is How Adam Smith Can Change Your Life. He is also a John and Jean De Nault Research Fellow at Stanford University"s Hoover institution.