What’s Still Wrong with Nixon’s Welfare Program

Mr. Nixon’s welfare program, which Congress is about to tackle, is a step in the right direction; perhaps as big a step as is politically feasible. In the short run, his proposals are likely to increase costs; in the longer run they bid fair to reduce it; and there are many advantages over the present system in equity and economy. Let me dwell just on three general virtues in these proposals.

1) The 100 per cent tax on earnings of welfare recipients is abolished—they will have some economic incentive to work and earn, and to decrease their dependence on welfare payments, by being allowed to retain the first $60 of their monthly earnings without losing any welfare benefits; only 50 per cent of additional earnings is deducted from welfare payments up to a maximum of about $5,000.

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Ernest van den Haag

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Mr. Nixon’s welfare program, which Congress is about to tackle, is a step in the right direction; perhaps as big a step as is politically feasible. In the short run, his proposals are likely to increase costs; in the longer run they bid fair to reduce it; and there are many advantages over the present system in equity and economy. Let me dwell just on three general virtues in these proposals.

1) The 100 per cent tax on earnings of welfare recipients is abolished—they will have some economic incentive to work and earn, and to decrease their dependence on welfare payments, by being allowed to retain the first $60 of their monthly earnings without losing any welfare benefits; only 50 per cent of additional earnings is deducted from welfare payments up to a maximum of about $5,000.