The biggest misconception about the libertarian position on poverty is that our opposition to the current welfare system necessitates an opposition to aiding the poor as such. The true question for libertarians is not whether social support for the poor should exist, but how society can best apply dispersed knowledge and properly align incentives to care, with dignity, for those who cannot care for themselves. The intellectual tradition of classical liberalism exalts human compassion and civil society as potent tools to promote harmony and neighborly goodwill: From Adam Smith’s discourse on beneficence and fellow-feeling, to Alexis de Tocqueville’s astonishment at the American phenomenon of voluntary philanthropic associations, to Charles Murray’s modern call to return to the human roots of our charitable spirits, libertarians have been thinking about alleviating poverty for about as long as we’ve been around.
That said, we have quite a few bones to pick with our current progressive poverty paradigm. Make no mistake: the US welfare system has utterly failed the poor. Since President Johnson first rattled imperial sabres at the scourge of poverty in 1964, federal and state governments have spent over $15 trillion on welfare programs with counterproductive results. Only slightly fluctuating over the past four decades, the projected 15.1 percent poverty rate for 2013 will reach a ten year high. Tragically, too many families have become dependent on state assistance to survive generation after generation. Rather than fighting poverty, the federal government appears to be rather handily financing it.
One problem is the system’s unwieldy piecemeal complexity. The Great Society spurred a new caste of professional social planners, eager to find a scientific solution to the social ill of poverty. The planners were to be the bold engineers of a grand social experiment, their wards unwittingly serving as lab rats. Poverty was sliced, diced, and line-itemized to be tackled by specialized departments, committees, and task forces, measured by their own criteria, and tinkered with until their (elusive) satisfaction. What began as a simple federal pension for single mothers gradually metastasized into a Borgesian maze of 126 separate anti-poverty programs managed by nested bureaucrats from afar. Lost in this labyrinth are the poor themselves; already harried and pressed for time, they are perhaps the least able to devote precious hours toward mastering the nuances of bureaucratic procedure.
A related problem is welfare paternalism. Conservative judgment and progressive condescension have armed social planners with a host of standard carrots and sticks to manipulate welfare recipients to “proper” behavior and stave off political unrest. Eligibility requirements and benefit generosity wax and wane with the changing objects of social anxiety du jour. The habits, diets, neighborhoods, parenting, and purchases of the impoverished are scrutinized while their souls are demoralized and democratized. By placing technocratic strings on the monopoly of public assistance, social planners ply the poor like marionettes. Since their incomes and budgets grow in tandem with a steady supply of puppets, these social planners have an incentive to ensure that the show never ends.
The fundamental problem that flummoxes the modern welfare state, however, is the simple knowledge problem. America’s inherited traditions of community-provided outdoor relief, poorhouses, and mutual aid societies were crowded out as higher governments intervened. Sadly lost in this corporate takeover were the cherished communal bonds that had ensured mutual respect and effective aid. Local civil aid providers had better knowledge of the unique challenges and aptitudes of the recently impoverished and were therefore in a good place to help them. Our hierarchical welfare system simply cannot consider the important nuances of each individual case. By necessity of structure, human beings are abstracted to a series of demographic details and numerical records that planners aim to maximize–poorly.
What can be done? The system cannot be saved but must be replaced. Libertarian thinkers like Milton Friedman, Michael Tanner, and Charles Murray have proposed welfare reforms that aim to better realign knowledge and incentives and tackle poverty from the bottom up. F.A. Hayek famously endorsed a “minimum income for every person in this country.” Reformers from the Left echo these libertarian proposals; in 1966, sociologists and activists Frances Fox Piven and Richard Cloward radically proposed to intentionally sabotage the existing welfare system in order that a guaranteed income could replace it. Early experimental evidence suggests that these thinkers’ theoretical contributions: a randomized control trial of Ugandan poverty programs reported that unconditional cash transfers to the poor yielded long-term benefits without disincentivizing work. Other studies likewise lend support. The poor enjoy better outcomes when they–and not planners–are in control of their own lives.
The changing winds of fashionable policy favor this approach: Switzerland’s recent basic income proposal has generated excited chatter in these united States. Wonks left and right can both agree that welfare isn’t working and that planners lack sufficient knowledge and incentives to truly aid the poor. So long as the guaranteed minimum income is means-tested and completely replaces all of our broken welfare system, this reform could address and decrease poverty at its roots while maintaining the autonomy of those who fall on hard times.
Political consensus will be harder to attain. Funding for the federal poverty racket edges nearer to $1 trillion in annual outlays with each fiscal year. The armies of administrators and activists who draw from this feedbox will not allow this wasted feast to end without a fight. Program enrollees, too, may mobilize against reform, preferring the certainty of the existing system to the uncertainty of political promises that too often fail to materialize. Should this proposal gain momentum, there will be a strong cry to compromise and enact a guaranteed minimum income as a supplement, rather than a replacement. Libertarians who promote this reform must remain steadfast to our principles and clearly communicate the benefits of reform to skeptical parties.
The recent discussion over a guaranteed minimum income provides libertarians with a rare opportunity to bridge ideological chasms and reform the welfare state in our favorite fashion–à la Hayek. If we cannot for now return to a truly community-based system of social aid, we can at least get less bad at emulating it on the federal level.