Work and Welfare (University Center for Human Values Series) - Hardcover

Solow, Robert M.; Gutmann, Amy

Hardcover

ISBN 10: 0691058830 ISBN 13: 9780691058832

Verlag: Princeton University Press, 1998

Inhaltsangabe

The Nobel Prize-winning economist Robert Solow directs his attention here to one of today's most controversial social issues: how to get people off welfare and into jobs. With characteristic eloquence, wit, and rigor, Solow condemns the welfare reforms recently passed by Congress and President Clinton for confronting welfare recipients with an unworkable choice--finding work in the current labor market or losing benefits. He argues that the only practical and fair way to move recipients to work is, in contrast, through an ambitious plan to guarantee that every able-bodied citizen has access to a job.


Solow contends that the demand implicit in the 1996 Welfare Reform Act for welfare recipients to find work in the existing labor market has two crucial flaws. First, the labor market would not easily make room for a huge influx of unskilled, inexperienced workers. Second, the normal market adjustment to that influx would drive down earnings for those already in low-wage jobs. Solow concludes that it is legitimate to want welfare recipients to work, but not to want them to live at a miserable standard or to benefit at the expense of the working poor, especially since children are often the first to suffer. Instead, he writes, we should create new demand for unskilled labor through public-service employment and incentives to the private sector--in effect, fair "workfare." Solow presents widely ignored evidence that recipients themselves would welcome the chance to work. But he also points out that practical, morally defensible workfare would be extremely expensive--a problem that politicians who support the idea blithely fail to admit. Throughout, Solow places debate over welfare reform in the context of a struggle to balance competing social values, in particular self-reliance and altruism.


The book originated in Solow's 1997 Tanner Lectures on Human Values at Princeton University. It includes reactions from the distinguished scholars Gertrude Himmelfarb, Anthony Lewis, Glenn Loury, and John Roemer, who expand on and take issue with Solow's arguments. Work and Welfare is a powerful contribution to debate about welfare reform and a penetrating look at the values that shape its course.

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Über die Autorin bzw. den Autor

Robert M. Solow is Institute Professor of Economics, Emeritus, at the Massachusetts Institute of Technology. He won the Nobel Prize for economics in 1987. He is the author of numerous books and articles, mostly about the sources of economic growth, the nature of the labor market, and other topics in macroeconomics.

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"This book should be read by anyone interested in the philosophical underpinnings of welfare and the likely consequences of welfare as we shall come to know it. Solow presents a grim but accurate picture of the meager job prospects of most welfare recipients. It is a very readable book based on hard evidence."--Alan Krueger, Princeton University

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Work and Welfare

By Robert M. Solow

PRINCETON UNIVERSITY PRESS

Copyright © 1998 Princeton University Press
All right reserved.
ISBN: 978-0-691-05883-2

Contents

Introduction Amy Gutmann....................................................viiPreface to the Lectures Robert M. Solow.....................................xviiLecture I: Guess Who Likes Workfare Robert M. Solow.........................3Lecture II: Guess Who Pays for Workfare Robert M. Solow.....................23Comment Glenn C. Loury......................................................45Comment Anthony Lewis.......................................................55Comment John E. Roemer......................................................63Comment Gertrude Himmelfarb.................................................77Response to Comments Robert M. Solow........................................85CONTRIBUTORS.................................................................95INDEX........................................................................97

Chapter One

LECTURE I

Guess Who Likes Workfare

ROBERT M. SOLOW

* * *

I am sure that some of you are bemused by the almost oxymoronic character of the occasion. No doubt you recall Edmund Burke's gloomy thought that "the age of chivalry is gone, that of sophisters, economists and calculators has succeeded; and the glory of Europe is extinguished forever." You feel, wearily, that you know what he meant; it's that bad. A lecture—no, two lectures—on "human values" by an economist: one might as well invite a turkey buzzard to lecture on table manners. How would the poor beast know where to start?

I have to admit that many of my professional brothers and sisters do exhibit what Veblen would have called a trained incapacity to deal with human values in an unembarrassed way. But a concern for human values cannot do without economics. J. M. Keynes remarked that economists are not the guardians of civilization, but they are the guardians of the possibility of civilization. His Cambridge contemporary, Dennis Robertson, once gave a lecture entitled "What Do Economists Economize?" His answer was: love. He had in mind that altruism is scarce; there is never enough to go around. The function of economics is to devise social institutions that make it possible to economize on altruism and still live tolerably. Competitive markets, when they function well, are such an institution, with the remarkable capacity to transform individual actions motivated by simple greed into "efficient" and thus in some ways socially desirable outcomes. Then the limited supply of altruism can be saved up for those occasions when markets do not work well, or for those others when markets do their job but still leave us with outcomes that 51 percent of us—61 percent in the U.S. Senate—would like to improve, even at some personal cost to ourselves.

Robertson did not say, perhaps because he was not a middle-classAmerican, that even if there is some left-over altruism available, its use may be unhealthy. In a society that places a high value on self-reliance, being the regular beneficiary of altruism may be dangerous to one's moral health. It can lead to unresisted dependency. That is no doubt one of the reasons why it is said to be better to give than to receive. (There is some moral danger in the other side of altruism too. Noblesse oblige is not always an attractive attitude in a seriously plebeian society.)

The general topic of these lectures—welfare and work—falls naturally into this category of questions. Unadulterated market outcomes leave some fraction of citizens, often including numbers of children, deeply impoverished; the question is what to do about that collectively, if indeed anything should be done. For some purposes it is important to know whether extreme poverty arises from a failure of the market mechanism or whether the system is working well but with unpromising raw materials. In one case the best long-run course might be to fix the market mechanism; in the other, the choice is between altruism and nothing. A lot of economics is about that large question, but I will enter on it only when it is directly relevant to the particular issues I want to discuss.

My aim in these two lectures is to locate the workwelfare alternative at the intersection of two social norms or virtues or "human values": self-reliance and altruism. My main point today is going to be that the total or partial replacement of unearned welfare benefits by earned wages is the right solution to the problem of accommodating those virtues in the kind of economy that we have. Welfare recipients will feel better because they are exhibiting self-reliance. Taxpayers will feel better not merely because less is demanded of their limited altruism but also because they can see that their altruism is not being exploited. The statement about taxpayers hardly needs arguing, so I shall take it for granted. But I shall spend a lot of time today making the statement about welfare recipients plausible by describing the words and the behavior of welfare recipients themselves.

Tomorrow I want to argue that carrying out the transformation of welfare into work will be much harder and more costly (in the budgetary sense) than anyone who sees its virtues has yet admitted. The standard discussion rests on the tacit belief that all the problems lie on the supply side of the labor market; kennel dogs need merely act like bird dogs, and birds will come. But that is a Panglossian error. The number of jobs is not a constant, but neither is it likely to respond one-for-one to the number of offers to work. To the extent that it responds at all, it will be as a result of forcing already low wages even lower; and that is precisely why the social norm of altruism leads to the creation of welfare benefits in the first place. A contradiction or paradox seems to arise. There is a possible reconciliation, but it is not what current legislation envisions. So today my subject is welfare; tomorrow it will be work.

The United States has, like other rich countries, a complicated patchwork of devices for transferring tax revenues to poor people. The part of the system that is most often discussed pays cash benefits—welfare checks—mostly to single mothers and their children. There are other parts of the system—food stamps, Medicaid, housing allowances, and so on—but I will speak in a loose way only of welfare benefits, because I am interested only in one or two issues of principle, and not in the details. Everyone is aware that reform of the welfare system has been and may again be a hot, partisan, political issue. The recently passed legislation was bitterly fought over, and neither logic nor fact-based analysis featured strongly in the debate. No one can say with confidence what will happen in practice. The outcome matters intensely to the people involved. When you get very close to the limits of subsistence, little differences bulk large. Nevertheless, these lectures are not intended as a comment on current legislation. The small number of arguments I want to pursue should be equally significant whether you were born a little liberal or else a little conservative, or so I hope.

The particular form now taken by efforts to reform the welfare system is to eliminate as far as possible the passive receipt of transfer payments and replace it by a requirement to work, either as a condition for receiving...

Details zur Ausgabe

• Verlag: Princeton University Press
• Erscheinungsdatum: 1998
• Sprache: Englisch
• ISBN 10: 0691058830
• ISBN 13: 9780691058832
• Einband: Gebundene Ausgabe
• Anzahl der Seiten: 100
• Kontakt zum Hersteller: Nicht verfügbar
• Verantwortliche Person: Nicht verfügbar