Paul Ryan Study Critiques Federal Poverty Spending as Hurting Poor — Income/Wage News Roundup

The way means-testing works discourages the poor from trying to increase earnings, he argues.


The latest news on poverty and wages: A House Budget Committee study promoted by GOP Rep. Paul Ryan criticizes America's $799 billion anti-poverty program as actually working to keep poor people down. The study argues that the means-testing system puts poor people in a position where they are punished for trying to earn more money:

"For too long, we have measured compassion by how much we spend instead of how many people get out of poverty. We need to take a hard look at what the federal government is doing and ask, 'Is this working?'"

Previous news on poverty and wages: President Obama will make the case for raising the minimum wage from $7.25 an hour to $10.10 an hour in New Bristol, Connecticut on Wednesday, a day after presenting his fiscal year 2015 budget proposal. House Republicans have opposed raising the minimum wage, claiming that doing so would hurt employers.

The Congressional Budget Office (CBO) estimates that raising the minimum wage to $10.10 an hour would lift about 900,000 people out of poverty and would cost around 500,000 jobs. However, CBO Director Douglas Elmendorf said that "there was substantial uncertainty" about the estimated effects the proposed minimum wage hike would have on employment.

Related previous coverage from Reason:

David Harsanyi on the lack of economic consensus on Obama's policies.

Peter Suderman on how the recent minimum wage reminds us why we need the CBO.

Veronique de Rugy considers whether it is time to introduce a guaranteed income.

More from Reason on the minimum wage here.