The Poor Don’t Lie and Cheat Any More Than the Rest of Us

Those no-good, dirty, rotten poor people. They lie, and they steal, and they spend our money.

Or so I’ve been told by readers since my last op-ed column, where I did the math proving that government benefits aren’t generous enough to make people want to be poor.

But you’re just doing the legal math, said one reader. What about what goes on under the table? Surely all that welfare fraud is proof that poverty can be the good life, if only you have the gumption to bilk the taxpayer.

Food Stamp Error RateFirst of all, the government has conducted investigations of fraud in programs like welfare and food stamps, and they’ve found it to be shockingly low. Less than 2 percent of the programs’ budgets get ripped off. That’s lower than the private sector, where the average business loses 5 percent of its annual revenue to fraud.

Second, and perhaps more surprising, investigators have found that the majority of government fraud is committed by the middle class and the rich, not the poor!

After Hurricane Katrina, for example, the investigative reporter Eric Schnurer discovered that most of the $500 million lost to fraud did not go into the pockets of the poor people who lost their homes but rather to the “shifty contractors” who were supposed to be rebuilding the homes.

Similarly, reports Schnurer, “Medicare and Medicaid fraud is largely committed not by patients — very few people are trying to rip off taxpayers to obtain unneeded spinal taps or root canals — but by providers: unscrupulous (or sometimes just incompetent) doctors and hospitals billing for procedures the patient didn’t need or didn’t receive.”

Throw in another $100 billion a year in defense contractor fraud, and you quickly find that fraud is more likely to make the rich richer than it is to make the poor want to be poor. It’s redistribution alright, but the wealth is moving up, not down, the ladder.

Once upon a time, I might have been surprised by these findings, but in writing my new book Letter to the One Percent, I found a consistent pattern in the research literature. Psychologists have conducted many experiments on the rich and the poor, and they’ve found that the rich are less likely to have empathy for other human beings. They’re more likely to break the rules and feel that they’ve earned the right to do so. They’re less likely to think of the moral consequences of their actions, especially when money is involved, and they’re more likely to put their own needs ahead of others’.

The notion that the poor are uniquely morally deficient, it turns out, is completely backward. They’re actually more virtuous, on average, than the rich.

And yet, we have politicians who assume that the poor are less trustworthy and therefore less deserving of our help. On the 50th anniversary of the War on Poverty, they took to the floor of Congress and criticized “single mothers” and “deadbeat dads” for dropping out of school and having babies and cheating the system. Then they proposed a budget that would cut government benefits for tens of millions of Americans.

Meanwhile, in Florida, they’re fighting a recent court decision that struck down a law requiring drug testing of all welfare applicants. But they don’t seem concerned about corporate executives who apply for billion-dollar subsidies. They’re not clamoring for drug testing doctors who receive Medicare payments or retirees who receive Social Security checks or Congress members who receive six-figure salaries.

Why? Because they assume that the poor are more likely to waste taxpayers’ money on drugs. Well, I’ve got news for them: The rate of illicit drug use is no higher among the poor than it is among the rest of us, and the rate of alcohol addiction is actually lower.

Human nature is human nature. There are liars and cheaters in every walk of life. But the facts are irrefutable: The poor are not poor because they lie and cheat, nor are they responsible for high taxes and mounting debt. If anything, they have contributed less to fraud and waste than the rest of us. The next time you hear Senator Marco Rubio and his Republican colleagues say otherwise, remember: That’s a stereotype, and it’s wrong.

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This op-ed was published in today’s South Florida Sun-Sentinel and Huffington Post.

Obamacare Is Not a Reason to Give Up on Government Programs

Health Insurance Enrollment Under Obamacare

The biggest myth of the Obamacare debate goes like this: The failures of Obamacare prove that the government can’t be trusted to run our health care system.

This single myth is so powerful that it has become the rallying cry of every Republican who’s considering a run for the presidency in 2016. It has single-handedly brought the Tea Party back to the forefront of American politics. It has been uttered on every cable news channel everyday since HealthCare.gov launched on October 1.

And it is wrong on every possible level.

First of all, the premise is wrong. Obamacare cannot be a litmus test for government-run health care because Obamacare is not government-run health care.

Obamacare creates an online exchange where people can buy private insurance. The government merely sets basic standards that every plan has to meet and gives consumers a place where they can locate those plans. The rest is up to the free market.

This simple concept has been so twisted and misunderstood that many Americans actually believe that the government will have access to their medical records. This is completely false. Under Obamacare, the IRS only needs to verify that you have health insurance. It does not — and cannot — see any of your private health information.

The second problem with this myth is that it’s too soon to judge Obamacare. All new software goes through a trial period. It’s frustrating, but it’s inevitable — and temporary.

Back in 2005, the same thing happened when the Bush administration launched the website for Medicare Part D. First, they had to delay the launch. Then, when they finally rolled it out, it didn’t work at all. Then they got it working, but it was too slow and full of inaccuracies.

Every major news outlet carried stories about the failures of Medicare Part D. According to polling data, the program was actually less popular than Obamacare is today.

Within a few months, the glitches were fixed. Medicare Part D now has a 90 percent approval rating. No one remembers the initial bugs in the system.

The third problem is that many of the so-called “failures” of Obamacare aren’t actually Obamacare’s fault. Remember that Obamacare wasn’t supposed to create one big national insurance exchange. Each state was supposed to create its own insurance exchange, but the Republican governors in half of the states refused to follow the law.

As I wrote back in May, “These Republican governors, who say the states are better at governing than the feds, ceded enormous power to the federal government, violating a core principle of their party’s ideology. And then they crowed that Obamacare was a failure because it required a massive federal bureaucracy — the very bureaucracy that they chose to create!”

What’s worse, these governors didn’t announce their decisions until 2013, so it’s completely false to assert that the federal government had three years to build a national online exchange. They really only had a matter of months.

The fourth problem with this myth is that Obamacare is not a failure. This week, the government announced that more than 500,000 Americans signed up for health insurance through Obamacare in its first month of operation.

Think about that. Obamacare, with all its kinks and snafus, has already improved the lives of over half a million people.

You’ve probably heard that 106,185 people have signed up for health insurance through the new online exchange, but even more impressive is the 396,261 people who got their insurance through Medicaid or CHIP.

In all the hubbub about HealthCare.gov, we seem to have forgotten the Medicaid expansion under Obamacare, and the media hasn’t bothered to remind us because…well, it’s going so smoothly.

And that brings us to the fifth and most fatal flaw in this myth: The biggest success story from Obamacare has been Medicaid, the one part of the law that actually is government-run insurance. To say that the government can’t be trusted is to say that the millions of Americans who benefit from Medicare and Medicaid and CHIP don’t count and don’t matter.

That’s an ugly thing to say, but if you listen closely, you can hear it all around you. Every time the government tries to help the less fortunate, there is always a contingent of Americans who oppose it. But that doesn’t mean we shouldn’t help them. And it certainly doesn’t mean we can’t.

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An abbreviated version of this op-ed was published in today’s South Florida Sun-Sentinel and Huffington Post.

The Republican Riddle: What the States Know That the Feds Don’t

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I’m going to tell you a riddle. It’s a paradox of sorts, and it’s confounding some of the brightest political minds of our time. Here it is…

The Republican Party has lost the last two presidential elections. In the House of Representatives, they lost the majority of the nation’s votes. In the Senate, they’re outnumbered 55 to 45.

The future looks even dimmer. The youngest generation is more liberal than its immediate predecessors, and they’ve been turning out in record numbers. The electorate is becoming more educated and more diverse — two liberal trends that don’t show signs of stopping anytime soon.

And yet, at the state level, the story is completely reversed. Republican governors outnumber Democrats 30 to 20, and they control a majority of state legislatures.

How can that be? What are Republican politicians doing right at the state level that they aren’t doing at the federal level?

I’ll give you a hint: They aren’t who they say they are.

The answer to this riddle is the greatest act of hypocrisy in modern politics. It’s a magic act, really. An illusion. Don’t be fooled by appearances. Look at what they do, not what they say.

Republican politicians say they want smaller government. They say the states are better at governing than the feds. They say we can afford tax cuts. They say we need tax cuts.

But their actions tell a different story.

Take Obamacare for example. The Affordable Care Act instructed the states to set up exchanges where people could purchase affordable health insurance that they weren’t getting from their employers. Twenty-six governors declined, choosing to let the federal government do it for them. Of these twenty-six, twenty-four were Republican.

These Republican governors, who say the states are better at governing than the feds, ceded enormous power to the federal government, violating a core principle of their party’s ideology. And then they crowed that Obamacare was a failure because it required a massive federal bureaucracy — the very bureaucracy that they chose to create!

The dirty little secret of Republican politicians at the state level is that they love the federal government. They need it. They depend on it.

In fact, Republican states receive far more federal spending, relative to the taxes they pay, than Democratic states. For every dollar they put in, Republican states get $1.46 back. Democratic states get $1.16. Of the 22 states that voted for John McCain in 2008, 86 percent received more federal funding than they paid in taxes, compared to only 55 percent of the states that voted for Barack Obama.

Then the Republican politicians have the temerity to brag that their states have lower taxes. Well, of course they can afford lower taxes: The feds are picking up the tab!

What they don’t tell you is that they’re spending just as much money. They’re just being subsidized by the Democratic states!

It’s no surprise, then, that Republican state governments are more popular than Democratic ones. They have lower taxes and more federal funding — both of which are very popular.

Thus the riddle is solved: At the state level, Republicans are cynically and diabolically riding to victory on the wings of a big federal government while claiming to be doing the exact opposite.

At the national level, meanwhile, they’re just starting to learn how to play this game. In Washington, Republicans really have been trying to shrink the federal government, so much so that they threatened to default on the nation’s debt and blow up the global economy if the President didn’t agree to cut spending on everything, including retirement programs.

It wasn’t until they realized that the spending cuts were extremely unpopular — because, you see, the public actually needs the services that the government provides — that they backtracked and claimed that they never supported them in the first place. And when the President finally proposed cuts to retirement programs, they attacked him for even considering such an idea…even though they basically forced him to do it.

But the award for worst hypocrisy surely belongs to Oklahoma Senators Jim Inhofe and Tom Coburn, who went all-out to prevent sending federal aid to Hurricane Sandy victims and then demanded that the federal government send aid to their home state in the wake of the recent tornado disaster.

Maybe they’re finally starting to figure out what state-level Republicans have already discovered: The government is an essential part of our social fabric. It does important things, and someone has to pay for those important things. You can’t cut spending without hurting people, and you can’t cut taxes without cutting spending or blowing up the deficit.

There’s no such thing as real magic. Anyone who says differently is trying to trick you.

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An abbreviated version of this op-ed was published in today’s South Florida Sun-Sentinel.