Apparently, individual states have to do stuff, so it might be like the medicaid expansions where some states opt out of providing stuff for poor people to make a political point.
That's more money than the entire state budget for every state but California.
On the flip side, do you think looking at a single tax return for 10 seconds cost more than $840?
This isn't the real cost. The real cost is when people turn down promotions at work or new jobs because it puts them 2,000 above the poverty line, and they no longer qualify for subsidies. That means that in 10 years they cannot become comfortably middle class after another 3 promotions or new jobs.
I wholeheartedly agree that welfare cliffs are one of the most problematic elements of US subsidies. They punish people for bettering their situation and being more independent.
Any help should gradually Fade Out and provide an incentive for earning more.
Stop means-testing for things like this, and raise taxes at the higher brackets to cover it.
If you just passed the poverty threshold and get a 2k raise, that 2k is going to be "taxed" twice - once with regular taxes and once with losing out on your benefits. That's just not fair.
Whereas if I make 150k/year or 180k, depending which bracket you want to put it at (also idr where the brackets are exactly), as a single person, I can afford to have my taxes on everything over 120k/180k/whatever go up by a bit to make sure I'm reimbursing that 3k that I got from the government in various grants just to make sure I was doing ok.
And if you look at it real close, tax brackets are indeed a sort of means testing, so in the end it all works out.
Well designed subsidies for the poor don't have sharp monetary drop offs like these [1].
Ideally it would be something like for every extra dollar you earn, you get 10 cents less benefit. That way if you get up $1,000 raise, your subsidies go down by a hundred bucks, but you're still up $900 total. There should be no magic number where if you make $1 more you lose a huge benefit.
nobody should lose $500 of food stamps because they picked up a shift and earned and extra $100. that doesn't mean every single American needs food stamps. If you make $150k, you dont need food stamps, and the government shouldnt be giving them to you.
https://fee.org/media/17757/welfare_cliff.png?width=600&heig...
Make the subsidies universal. You make 500k a year and want food stamps? Sure thing. You're being taxed so much on every dollar above 180k that it hardly makes a difference.
That's no more a tragedy than everyone paying for then using the highway. We don't really means test the highway right? Why shouldn't the rich have to pay for their own roads? ;)
Wow, that's a fantastic analogy, thank you
Under the ACA Medicaid expansion the federal government covered 90% of the cost and the state covered 10% of the cost. I believe some of the states claimed that they could not afford that 10%.
With the energy efficiency rebates under the Inflation Reduction Act (IRA) and the Bipartisan Infrastructure Law (BIL) each state has to administer the rebates for that state's consumers, but the allows the states to use a portion of their gran for for the cost of that, including hiring staff.
So basically a state just has to apply, get the administrative money to cover setting up a program to distribute the rebates, then get their share of the IRA and BIL money and distribute it.
In Florida deSantis used his veto to block authorization for the state to get and use the $5 million portion of their grant that would be for administration and so Florida residents will not be getting the $174 million in energy efficiency improvement rebates, or the $173 million in appliance rebates, or the $7 million for a training program for electrification contracts, or other smaller grants from those laws. All in all, Florida is turning down $377 million.
deSantis has not given a reason, but it is likely part of his "Fight Back Against the Woke Agenda" theme he's basing his campaign on. Reducing emissions and increasing energy efficiency is "woke" in current far right circle.
Other recent actions taken in his fight against "woke"ness are tax breaks for purchasing gas stoves and killing a bill that would have directed state agencies to consider lifetime cost of ownership when purchasing cars.
I would certainly hope my state isn’t giving out tax-payer funded luxury stoves.
There is no such thing as “free” here.
[0] https://www.eldi.be/nl/aeg-ikb64301xb-inductie-kookplaat