Ryan C Briggs

I guess almost any article that takes aim at US policy toward the poor is a good thing, but I can’t get very excited about this article by Michael Blim. After criticizing the current ‘punishment’ based approach to dealing with poverty, he highlights a new method:

Another approach is on the rise. Providing the poor with incentives to change, it is proposed, could work better than punishment. Financial incentives are being proposed as the carrots whereby we can get the poor to fulfill their duties and help them earn back their rights. It works like this, for example: if we provide a poor mother with money for keeping her child in school, then the child is likely to stay in school. This way we can achieve two things: first, more schooling should improve a child’s life chances; and two, the mother receives additional monies to improve the life circumstances of her family.

This is being tried in NY, where 2500 poor families can gets $200 back when they get a medical check-up or $100 for seeing a dentist (among other incentives). The idea is that “through incentives, social planners hope to achieve what compulsion apparently is not.”

I have a few thoughts on this approach and its assumptions. First, on the very important medical front, it assumes that poor people need additional financial incentives to visit a doctor. This is not the right approach to take. Poor people already have strong incentives to see a doctor or visit the dentist: It improves their health. The problem is not incentives, the problem is that the cost of seeing a dentist is not worth it for many of the poor because it means they will have to forego necessities such as food. No one wants to starve to death with perfect teeth. The problem here is affordability, not incentives.

Second, on the issue of affordability, getting a few hundred dollars back will help only the richest of the poor, those who are only $100 short of seeing a dentist or $200 short of seeing a doctor. This will not make a difference for the poorest of the poor, those who need help most.

Some of the incentives, like $150 a month for holding a full-time job seem smarter. This will give the poor extra money to spend how they see fit. Altogether, this program does move away from ‘punishment’ thinking, but it really botches health. It incorrectly identifies a lack of incentives not affordability as the main problem and it tends to helps those who need it least. A lot can still be done.