Yes, Welfare is for Poor People

The Department of Public Welfare announced its plan to impose an asset test for food stamp recipients. The proposal would limit food stamps to most households with under $5,500 in assets, or $9,000 in assets for anyone over age 60 or with a disability (see below for clarification of “assets”).  Elizabeth and Jay wrote on the merits of asset testing last week.

In a Capitolwire (subscription) piece, Rep. Mike Sturla lashes out at the administration’s policy saying,

“We’re going to take the concept of the safety net and flip it and tell people they have to impoverish themselves before they get the benefits.”

Just to make sure I wasn’t misunderstanding the outspoken representative, I Googled the definition of impoverish and came up with “To reduce to poverty; make poor.”

Indeed! Welfare programs like food stamps were designed to help poor people, and the administration’s policy will work to ensure it serves only poor people.

Here is another important bit of information in the Capitolwire piece, namely, what isn’t counted as “assets” under the standard:

  • Homes and surrounding land and buildings which are not separated by property that is owned by others;
  • A home temporarily unoccupied because of employment, training, casualty, illness or natural disaster if the household intends to return;
  • A second home if it is up for sale;
  • A lot on which a household which currently does not own a home intends to build a permanent home;
  • Personal effects and burial plots (clothing, jewelry, gift cards);
  • Household goods;
  • Life insurance and pension plans;
  • Income producing property and equipment;
  • One vehicle per household, vehicles under $4,550 in value and any vehicles used to generate income;
  • Government payments;
  • Inaccessible resources (e.g. frozen bank accounts);
  • Installment contracts;
  • Resources previously prorated as income;
  • Non-liquid resources with liens;
  • Disaster and emergency assistance payments;
  • Certain government resources such as tax refunds, federal child tax credits, earned income tax credit, WIC, and education assistance;
  • Indian funds and lands;
  • German reparation payments;
  • Education savings accounts;
  • Family savings accounts; and,
  • Seed accounts.