States have a lot of discretion over administering federal anti-poverty programs. Take Medicaid, for instance. As Chicago Fed economist Jacob Bermanpoints out,the eligibility cut-off for a single-parent household with three kids rangesfrom an annual income of $50,868 in Washington DC to $2,652 in Alabama. In a new study, Bermananalyzes which state have the most and least generous safety nets — supposedly accounting for living costs — including the following programs:
— Medicaid Children’s Health Insurance Program (CHIP);
— Earned income credits;
— Unemployment insurance Supplemental Security Income (SSI);
— Temporary Assistance for Needy Families (TANF);
— Supplemental Nutrition Assistance Program (SNAP);
— Special Supplemental Nutrition Program for Women, Infants, and Children (WIC);
— Worker’s compensation;
— Temporary disability insurance.
Berman’s key finding:
Vermont ranks as the most generous state with the average low-income person receiving about $26,000 in benefits. This is due largely to the fact that, using my measure, Vermont has the most generous Medicaid program and Medicaid accounts for about half of all of the programs I consider. Vermont also has its own refundable earned income credit and SSI program. Conversely, Georgia is at the bottom of the ranking since it has some of the most restrictive laws for Medicaid and TANF.
Now here is the part I find really interesting. As Berman concedes, government spending isn’t the only thing that affect living standards for low-income Americans: “Outside of the budget process, regulations influence the prices households pay for goods and services. For example, restrictive zoning laws tend toincreasehousing costs. Transfer payments are only part of the story.”
Here is the summary of the well-known paper that Berman links to:
Does America face an affordable housing crisis and, if so, why? This paper argues that in much of America the price of housing is quite close to the marginal, physical costs of new construction. The price of housing is significantly higher than construction costs only in a limited number of areas, such as California and some eastern cities. In those areas, we argue that high prices have little to do with conventional models with a free market for land. Instead, our evidence suggests that zoning and other land use controls, play the dominant role in making housing expensive.
Along these lines, a very nice blog post from my pal Ryan Avent on housing markets.
Follow James Pethokoukis on Twitter at@JimPethokoukis, and AEIdeas at@AEIdeas.
FAQs
Public Welfare State Expenditures Per Capita in 2021
| Rank | State | Per Capita Expenditures |
|---|
| 1 | New Mexico | 3,879 |
| 2 | Massachusetts | 3,873 |
| 3 | Alaska | 3,598 |
| 4 | New York | 3,542 |
46 more rowsWyoming has the lowest number of SNAP households, with only 13,000, followed by North Dakota with 24,000. Alaska, Vermont, and South Dakota complete the list of states with the least welfare recipients, with 39,000, 41,000, and 40,000 households benefiting from SNAP, respectively.
Who receives the most welfare in the US? ›
Non-Hispanic White people accounted for 44.6% of adult SNAP recipients and 31.5% of child recipients in 2020. About 27% of both adult and child recipients were Black. Hispanic people, who can be of any race, accounted for 21.9% of adult recipients and 35.8% of child recipients.
Which country has the most generous welfare system? ›
Public social spending
| Country | 2016 |
|---|
| 1 | France | 31.5 |
| 2 | Belgium | 29.0 |
| 3 | Finland | 30.8 |
| 4 | Italy | 28.9 |
32 more rows2021's Most & Least Federally Dependent States
| Rank (1 = Most Dependent) | State | Total Score |
|---|
| 1 | New Mexico | 86.57 |
| 2 | Alaska | 84.23 |
| 3 | Mississippi | 83.94 |
| 4 | Kentucky | 80.78 |
46 more rowsMar 23, 2021
Specifically, in his typology, Esping-Andersen identifies three types of welfare state regimes by which advanced capitalist democracies can be categorized: liberal, conserva- tive, and social democratic.
Which US state has the best welfare? ›
Vermont ranks as the most generous state with the average low-income person receiving about $26,000 in benefits. This is due largely to the fact that, using my measure, Vermont has the most generous Medicaid program and Medicaid accounts for about half of all of the programs I consider.
Which race receives the most food stamps? ›
SNAP recipients represent different races and/or ethnicities. White: about 37 percent; African American: 26 percent; Hispanic: 16 percent; Asian: 3 percent; and Native American: about 2 percent. (About 16 percent of participants are categorized as “race unknown.”) Many SNAP households have earned income.
What state pays the most in food stamps? ›
The state where SNAP benefits are the highest is Alaska, due to the high cost of living in the northern state. In Alaska, a family of four's maximum SNAP benefits is 1,819, dollars.
Who has the best benefit system? ›
The Top 5 were France, Finland, Belgium, Denmark and Italy. OECD countries spent an average of 20% of their GDP on social expenditure, on things such as public cash benefits, healthcare and pensions. The top 5 countries spent an average of 29.1%, while the UK spent 20.6% of its GDP on social provisions..
Over the past two decades, China has made great strides in expanding its version of a welfare state, which involves moving away from an out-of-pocket model to improve health insurance coverage and reduce out-of-pocket expenses.
Why is the US not a welfare state? ›
Across countries, racial fragmentation is a powerful predictor of redistribution. Within the United States, race is the single most important predictor of support for welfare. America's troubled race relations are clearly a major reason for the absence of an American welfare state.
Who has the best welfare system? ›
France remains the country most committed to social benefits, with almost a third of French GDP spent on social services by the government in 2019. Scandinavian countries appear high up on the ranking, with Denmark, Sweden and Norway all spending more than 25%. The OECD average was 20%.
Has been the most successful welfare program in the United States? ›
Studies also suggest that the EITC has been more successful than other welfare programs in reducing poverty. The Census Bureau claims that the poverty rate would be 2.5 percent higher in the absence of refundable tax credits.
What race is on food stamps the most? ›
SNAP recipients represent different races and/or ethnicities. White: about 37 percent; African American: 26 percent; Hispanic: 16 percent; Asian: 3 percent; and Native American: about 2 percent.
