Another excellent article from Bill Freeza at CEI.
Boy, is he right. As we document all the time here there is a lot of money to be made in “anti-poverty” programs. From JP Morgan’s administration of the EBT program in various states (in Florida alone the contract is over $100 million) to Big Ag which is impacted greatly by what is put on the “food stamp list,” there are a lot of revenue streams for giant businesses in the welfare state.
It is fair to say that the economy is not the only reason that many anti-poverty programs are expanding.
What impact does this have on the economy? If you listen to Keynesian economists, giving away money is the easiest way to make an economy grow! That’s because when that money is spent on goods and services it fuels aggregate demand, which pumps up the Gross Domestic Product (GDP). Just like the cleanup from hurricane Sandy, expanding welfare programs creates economic vitality, never mind that both hurricanes and welfare drain money from other parts of the economy. So don’t even think about asking all those people who make a living giving away chunks of your paycheck to do something productive instead. Keynesians will warn you that such reckless austerity will drive us into a depression, just like firing all those government workers did in Greece.