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Tuesday, 09 February 2016 06:03

Right-Wing Think Tanks Are Factories of Cruel Ideas

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aaaaaaaaaaaaaaaaaaaaaahungerfoodWhy do right wing think tanks support government subsidizing corporations with taxpayer funds? (Photo: Propaganda Times)

Right-wing think tanks are often idea factories whose finished product is the peddling of cruel and soulless public policy papers and positions. 

Consider the upcoming implementation of a federal policy that - thanks to the "improving" economy - may cut off food stamps for as many as 1 million people, according to the Associated Press:

Advocates [for the provision of food stamps] say some adults trying to find work face a host of obstacles, including criminal records, disabilities or lack of a driver's license.

The work-for-food requirements were first enacted under the 1996 welfare reform law signed by President Bill Clinton and sponsored by then-Rep. John Kasich, who is now Ohio's governor and a Republican candidate for president.

The provision applies to able-bodied adults ages 18 through 49 who have no children or other dependents in their home. It requires them to work, volunteer or attend education or job-training courses at least 80 hours a month to receive food aid. If they don't, their benefits are cut off after three months.

Then consider the response of a right-wing think tank to this regulation, which is now kicking in, in many states, because of lower unemployment rates.

The Institute for Policy Innovation (IPI) not only praises the reduction in food stamps, but also endorses lowering the minimum wage for those who receive food stamps. Merrill Matthews, Ph.D., a resident scholar with the IPI, wrote a commentary on the website Rare - which the Institute for Policy Innovation promoted in a news release - that proposes:

Instead of doubling the minimum wage, how about letting low-skilled food stamp recipients work for half the minimum wage?

What if an employer who hired a low-skilled worker on food stamps were able to pay that individual, say, $4 an hour for a set period of time, say, six months. After that the employee would be bumped up to the company’s entry-level wage.

That option would allow the employee to get some on-the-job training, and the employer would have some time to see if the employee was a good fit.

Matthews does concede that after six months, the individual in need of food stamps should possibly receive the "company's entry-level" wage if permanently hired. However, this assumes that businesses wouldn't exploit the situation, hiring food stamp recipients for temporary employment and avoiding hiring many permanently. It also assumes lowering wages temporarily would create more permanent jobs, which doesn't happen much in a consumer-demand economy. (In fact, this suggestion seems paradoxical for a free-market think tank.) 

Moreover, the current federal minimum wage for full-time workers is $7.25 per hour. That amount yields a weekly take home pay of $267.80. As The Huffington Post adds, "That adds up to $13,926.38 per year, or just over $1,150 per month. The commonly cited minimum wage annual salary for a 40-hour-a-week worker is $15,080 -- before taxes."

Barry Ritholtz, a Bloomberg View columnist, wrote in 2013 that he investigated why Walmart and McDonald's - two examples of low-wage-paying businesses - rely on the government picking up the tab for benefits that they don't provide and the insufficient wages that they pay:

Both giants are the beneficiaries of a surprising amount of federal aid: Their employees receive an inordinate amount of Medicaid, food stamps and other public assistance. This allows them to maintain very low wages, and keep profits relatively robust....

More than half (52 percent) of the families of fast-food workers receive some form of public assistance. That's more than double the rate of the workforce as a whole. Most of it is through Medicaid and the Children's Health Insurance Program ($4 billion), while the Earned Income Tax Credit, food stamps, and Temporary Assistance for Needy Families program are the rest ($3 billion)....

I cannot fathom why my Libertarian friends are against raising the minimum wage, but OK with massive corporate subsidies.

Thus, by not only opposing raising the minimum wage, but also proposing short-term sub-minimum wages for those in need, the IPI proposal would increase taxpayer-funded corporate subsidies that allow for a larger business profit by increasing the supply of lower-cost labor.

The Institute for Policy Innovation describes itself as an organization that focuses on "limited government":

IPI's focus is on approaches to governing that harness the strengths of individual liberty, limited government, and free markets....

Though IPI is a non-partisan organization, we approach policy issues from a consistent philosophical viewpoint of individual liberty and responsibility, free markets, and limited government.

However, IPI is clearly just fine with a government that subsidizes the free market, while avoiding responsibility for providing for the basic survival needs of employees.

Not to be reposted without the permission of Truthout.