Cato Institute: Welfare Benefits Exceed Minimum Wage in 35 States

Welfare benefits top the minimum wage in 35 states after taxes are factored in, according to a study by the Cato Institute.

Many welfare benefits are tax free.

“The current welfare system provides such a high level of benefits that it acts as a disincentive for work,” the report for the libertarian think tank says. “Welfare currently pays more than a minimum wage job in 35 states, even after accounting for the Earned Income Tax Credit.”

In 13 states, the total value of welfare benefits exceeds $15 per hour, according to the study.

By accident or design?

This is news?

The part about making more than $15 an hour was the only thing that caught me a little off guard.

Are they talking about corporate welfare or just picking on the “poor” guys again?

Wasn’t GM poor?

I am with you Sam, except that I am not surprised at the $15 mark. I will tell you why, medicaid. The article did not specify what type of welfare they are talking about, but medicaid benefits alone would push someone far above minimum wage. Factor in the fact that welfare (food stamps and regular welfare) increase with household size, it really isn’t that hard. Add in the fact that families making less than six figures (and even some that do) could not afford the coverage that medicaid provides on the open market.

Really minimum wage is not enough to support a family. Generally someone making minimum wage (with a family) will still qualify for food stamps and medicaid (at least the children will). In fact I don’t think you could get any medical insurance on wages under $18/hr. (And still pay for rent, utilities, car insurance, and food, not to mention the debt load so many people are under these days).

Is welfare designed to lift families to a point where they have a decent living?

If people earned a living wage would they need welfare?

I was also thinking Bear Stearns, AIG, Goldman Sachs, et al.

Corporate welfare helps the elites get more money to buy more power, and owning the poor causes the poor to vote them into more power, and the cycle grows, as people keep doing the same, and somehow expecting different results.

And all those poor bankers.:o

Thank God they were able to get their bonuses after your government bailed out their failed companies.

American Inconscionable Group
Written By Elizabeth MacDonald, Published March 17, 2009, FOXBusiness

AIG paid bonuses of $1 mn or more to 73 employees at its financial-products division, including 11 who no longer work for the company, New York Attorney General Andrew Cuomo said. The top 10 bonus recipients received a combined $42 mn, he said.

AIG’s financial products unit lost $40.5 bn last year.

“AIG made more than 73 millionaires in the unit which lost so much money that it brought the firm to its knees forcing a taxpayer bailout,” Mr. Cuomo wrote in the letter. “Something is deeply wrong with this outcome.”

Cuomo has launched an investigation into the bailed-out company, which received taxpayer funding of more than $170 bn, following revelations that it distributed $165 mn in executive bonuses. The bonus payouts for the Financial Products unit are expected to reach $450 mn, while bonuses for the entire company could be around $1.2 bn.
Eleven AIG personnel who received retention bonuses of $1 mn or more no longer work for the firm, including one who received $4.6 mn.

Read more:

That should tell all the really smart heads there is something very wrong with the very low minimum wage rates in our country. The rich get richer at the expense of the poor workers wage.

Its not the point. Welfare acts as a disincentive to work. It helps destabilize families and breads laziness. It doesn’t lift people up out of poverty, it keeps them poor by making them dependent on government handouts.

(for the record, I’m against “welfare to corporations” such as the massive transfer of funds to corporations that were “too big to fail” like GM. Isn’t that what Obama did to the delight of liberals?


Minimum wage is a starter wage. The higher it goes the less opportunities for the young to get jobs that teach them about the workplace.

Not sure if the argument is minimum wage is too low or welfare is too high.

That’s just it. Anyone who calls himself a bank gets Bernanke’s attention and support. And Bernanke doesn’t talk minimum wage either.

I think just the poor guys. If they counted corporate welfare (much higher than assistance to needy children etc.) The numbers would be much farther apart.:wink:

Welfare is like a drug. Once you get hooked on it you depend on the state for your livelihood.


Minimum wages cause chronic unemployment and further welfare dependency. But boy does it make politicians feel proud.

The rich get elected to keep the poor on welfare.

In order to save a few bucks the West has replaced skilled, industrial jobs with Mcjobs and Walmart greeter jobs…

and in doing so has exported those jobs to other countries who now out compete us.

That’s one of the reasons why there is so much welfare/low paying jobs.

Look at Reshoring Initiative

If businesses were forced to pay a living wage would they lay off workers, thus raising the unemployment rate?

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