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From Wikipedia, the free encyclopedia

Welfare is a type of government support for the citizens of that society. Welfare may be provided to people of any income level, as with social security (and is then often called a social safety net), but it is usually intended to ensure that people can meet their basic human needs such as food and shelter. Welfare attempts to provide a minimal level of well-being, usually either a free- or a subsidized-supply of certain goods and social services, such as healthcare, education, and vocational training.[1]

A welfare state is a political system wherein the State assumes responsibility for the health, education, and welfare of society. The system of social security in a welfare state provides social services, such as universal medical care, unemployment insurance for workers, financial aid, free post-secondary education for students, subsidized public housing, and pensions (sickness, incapacity, old-age), etc.[1] In 1952, with the Social Security (Minimum Standards) Convention (nr. 102), the International Labour Organization (ILO) formally defined the social contingencies covered by social security.

The first welfare state was Imperial Germany (1871–1918), where the Bismarck government introduced social security in the late 19th century. In the early 20th century, Great Britain introduced social security around 1913, and adopted the welfare state with the National Insurance Act 1946, during the Attlee government (1945–51).[1] In the countries of western Europe, Scandinavia, and Australasia, social welfare is mainly provided by the government out of the national tax revenues, and to a lesser extent by non-government organizations (NGOs), and charities (social and religious).[1]

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  • ✪ The Complete Moderate's Guide to Welfare
  • ✪ Welfare Queens about to get their wake up call
  • ✪ The origin of welfare and why it was created
  • ✪ Central Government Employees Earned Leave Rule to Change-- Ex-Servicemen Welfare


Monopoly is a classic board game where families sit around to argue and play out their own little simulation of free market capitalism. There is no better system to teach kids about the joys of paying taxes and rent, really. But in Monopoly, unless you bend the rules to keep the game going, when someone loses and goes bankrupt they just… vanish. It doesn’t work like that in real life. If enough people go bankrupt and aren’t allowed back into the game, eventually, they get out their torches and pitchforks. So let’s examine how America has bent the rules in order to keep as many people as possible playing the game. This video is brought to you by Skillshare. The problem with wanting to discuss welfare in America is defining welfare. There is no official government definition of welfare and in fact, there is no program with the word welfare in its name. If you were to get seven different people into a room, you would have seven different interpretations of what counts as welfare. I know this… because I tried on Twitter. So for the purposes of this video, we’re going to go with the programs that most everyone agrees are welfare… Where the government is giving you monetary assistance based on your income or inability to work. This can either be direct, or through a subsidy, or through free or discounted services. So does using public roads and relying on the police for protection count? Not really, while it is a “free” government service, you’re not getting monetary assistance for that and you get it regardless of your income. Does having a federally-backed mortgage or student loan count? Well, that’s a little foggy, the government is financially insuring your loan, but not to you directly, it’s mostly just insurance for the banks. But when we start talking about tax credits, the fog starts to lift. A tax credit reduces the amount of taxes you owe after taking your deductions and brackets into account. Taxes in the United States are incredibly complex, and someone should definitely make a video explaining them. Would you like to know more? And there are two refundable tax credits you can claim based solely on your income level and family situation. Meaning that if you owe a negative amount of federal income tax at the end of the year, the government will give you extra money on top of getting back everything that was withheld. The Earned Income Tax Credit, or just EIC, was designed to encourage working because you can only get it by… earning income. Many analysts in both political parties believe that it helps lift people out of poverty. The credit increases with the more you make and eventually decreases with the even more you make, you only get it up to a certain income level. I wish I could tell you what that level is or what the average person gets, but it changes for literally everyone. What I can tell you is that this credit is claimed on 27 million tax returns and cost the government 65 billion dollars in 2017. Both in lost tax revenue and in having to pay out extra. The Earned Income Credit also increases with your family size, which likewise entitles you to claim the Child Tax Credit. One thousand dollars for every child you have, I guess the government thinks that’s enough to pay for childcare for a year. The Child Tax Credit is claimed by 35 million families and cost the government 52 billion dollars in lost revenue and payouts. These two tax credits combined are why almost half of Americans pay no federal income tax… Romney was actually right when he said that. But almost nobody who claims these credits would classify it as welfare – even though it fits our definition of direct monetary assistance based on income. Probably because there’s a weird stigma about having received welfare and nobody wants to admit that they might have. Take education for example, up through high school it’s free for everyone, regardless of income, so that’s not welfare. But higher education is a different story. We’ve already ruled out student loans, but if you filled out a FAFSA, you very likely received a Pell Grant. This is monetary assistance based on income. It’s not direct since it goes to the school rather than to you, but it is free education assistance that you never have to pay back. You can receive up to $5920 per academic year for up to six years. Seven million Americans received the Pell Grant last academic year, costing the federal government 28.2 billion dollars. But these are still gray forms of welfare that not everyone would agree counts as welfare. So let’s switch gears and talk about the more black and white forms of welfare… like the Obamaphone from the 2012 election, do you remember that? You got Obamaphone? Yes, everybody in Cleveland if you a minority got an Obamaphone, keep Obama in president, you know? He gave us a phone, he gonna do more. The program is actually called Lifeline, it’s administered by the FCC and provides discounted telephone service to low-income households. And it was actually started in 1985 by Ronald Reagan. It used to only provide landline phones but has since moved on to cell phones and recently started to offer internet service. Because c’mon, it’s 2019 and nobody uses a landline anymore – not even your grandma. It’s not a free phone though, it’s a discounted service where the FCC only pays $9.25 a month on your bill, you cover the rest. You actually help pay for it with that Universal Service Fund tax on your bill. 10.7 million households are part of the program and it costs the government 1.3 billion dollars a year… this is by far the smallest program I’m going to talk about today. She actually explains how you qualify in that clip… How’d he give you a phone? You sign up, if you on food stamps, you on social security, you got low income, you disability. Your income must be at or below 135% of the Federal Poverty Line or you have to participate in another federal financial assistance program. And most of those other federal financial assistance programs are what we would call “welfare.” Temporary Assistance for Needy Families, or TANF, is a cash assistance program that fits almost everyone’s definition of welfare. It’s also sometimes referred to as state-sponsored child support. Its main purpose is to serve as a financial safety net, provide job opportunities, promote family stability, and prevent out of wedlock pregnancies… that’s a weird one. It falls under the Department of Health and Human Services and distributes 17.3 billion dollars to 3.4 million families. Though, like many of these programs, it’s actually run by the individual states and each state sets their own requirements and payout levels. Under the program, you are supposed to accept a job within 24 months and be working or training for 30 hours a week, and you can only be on the program for a maximum of 60 months… the heck is that? That’s uh, that’s an asterisk. Yes, I know what an asterisk is thank you, I mean why is it there? Well, like you said, a lot of these programs are run by the several states, so eligibility, time limit, and benefit amounts are all over the place, you know, not to mention all of the exceptions. Ah, so every time that shows up it’s because there’s some fine print that I’m skipping over in order to keep this video from being an hour long? Yeah. Like how Georgia limits TANF to only 48 months. Georgia actually has some of the strictest TANF requirements. You must have a child under 18 years old - which makes sense, it’s called assistance for needy families, not individual people. You must be in a single parent home. Which doesn’t make sense since the program is supposed to promote two-parent family stability. And, again, you must be part of or applying for another federal financial assistance program. Perhaps the fact that many of these programs require you to be on other programs is why they call it a safety net… You can’t just be on one, you have to be on several. For a family of three, that is a single parent with two children, they must have an income under $784 a month and have less than $1000 in total assets. Once you’re on the program for ten months, your payout cannot be increased because of having more children. So the myth that some people intentionally have more kids in order to increase their welfare payments is… just that a myth… at least for TANF in Georgia. If you meet all of these requirements, the maximum payout regardless of how many children you have is $280 a month. Georgia hasn’t increased their TANF payout in 22 years, so taking inflation into account its value has dropped by 37%. New Hampshire is the highest at $1039, California is at $714, and Texas is at $290. You get these payments on an Electronic Benefit Transfer, or EBT card. EBT itself is not a welfare program, it’s just how welfare is received instead of on paper checks because it’s 2019. But TANF isn’t the only program that uses EBT, by far the most popular is the Supplemental Nutrition Assistance Program, otherwise known as SNAP or more commonly, Food Stamps. It’s federally run by the USDA, serves 44.2 million people at a cost of 70.9 billion dollars. You can only use SNAP for fruits and vegetables, bread and cereals, dairy, meats, and consumable plants and seeds. Basically the food pyramid, but, without the top, no candy. Yes, I know they don’t use the food pyramid anymore, I’m old. But you literally can’t use food stamps for booze and cigarettes, that’s another myth that needs to end. In fact, alcohol and tobacco are at the top of the list of things you can’t buy with SNAP, along with hygiene products, pet food, or hot and prepared food. Which means, no fast food either. A good rule of thumb is that if there is no sales tax on an item, you can probably buy it with SNAP. In order to receive SNAP, you must be at or below 130% of the Federal Poverty Line. For a family of three that’s $2252 a month, and for a single person it’s $1245 a month. If you work full-time for federal minimum wage, you qualify for SNAP, just let that sink in for a second. The maximum benefit for a family of three is $505 a month, while a single person will get $192 a month. Just for reference, I spend way more than that on groceries and you probably do too… that’s why it’s just called an assistance program. But I’m a single guy, I basically eat a trash-tier diet and I don’t have any special nutritional needs. It’s not like I’m pregnant… or an infant. Which is why we have the Special Supplemental Nutrition Program for Women, Infants, and Children, more commonly known as WIC, specifically for pregnant, post-partem, and breastfeeding women, infants under one, and children under five. It’s also run by the USDA and serves 7.3 million people, at a cost of $6.58 billion dollars. The financial requirement for WIC is quite a bit looser than SNAP at 185% of the Poverty Line, so 53% of all newborns in the country are part of the program. Which is good, because one of its primary goals is to increase the vaccination rate. Much like TANF, WIC exists to provide assistance to the country’s poor, while promoting some other background goal like family stability or preventing epidemics. In many states, over half of all newborns are also born under Medicaid. We don’t have universal healthcare here in the United States, for reasons that are not in the scope of this video, but we do provide varying degrees of socialized healthcare for certain groups. The first group is Medicaid, which is the single largest source of healthcare in the United States, for people living at or below 133% of the Federal Poverty Line. It’s administered by the Department of Health and Human Services along with a similar program known as the Children’s Health Insurance Program, or CHIP, for children of people who make slightly more than the Medicaid limit. For the purposes of this video, we’re going to combine them together since they’re basically the same program just for different age groups. Together, they cover 73.9 million Americans at a cost of 576.6 billion dollars (2017), though slightly under half of that comes from the states rather than the federal government. Because like many of these programs, it’s run through the individual states. You might even be on Medicaid and not realize it because your state calls it something else, like MediCal or BadgerCare or PeachCare. In fact, you might even be under ObamaCare and not realize it for the exact same reason. Although it’s actually called the Affordable Care Act and it didn’t really provide socialized healthcare for anyone. What it did do, among other things, was require health insurance companies to cover pre-existing conditions, increase the time you can be on your parents’ insurance, and require everyone to have insurance… at least for now. You’re still buying private insurance, there is no ObamaCare card. But the ACA did provide subsidies to help people get insurance that might not otherwise be able to afford it, which cost the taxpayers 42.6 billion dollars. It also expanded the eligibility for Medicaid. Remember when I said Medicaid covers people at or below 133% of the Federal Poverty Line? For people living at or below 133% of the Federal Poverty Line. That’s because of the ACA Medicaid Expansion… which was optional. So if you live in any of these states, which did not accept federal funding to expand medical coverage to poor people, the requirement is likely lower than 133%. Meaning you have to be in super-poverty to be eligible for Medicaid. Or super old if you want to be eligible for Medicare. Medicare is the second largest source of healthcare in the United States, serving 58 million people who are at least 65 years old at a cost of 591 billion dollars. And it’s also not a form of welfare. Medicare is not a free healthcare from the government like Medicaid, most people on Medicare pay premiums, copays, and out of pocket expenses just like everyone on private insurance. The only difference is that this run not-for-profit by the government. It’s partially funded through those premiums and partially from that 1.45% that comes out of every paycheck… and the matching payroll tax from your employer. Medicare is only free if you are dual-eligible for Medicare and Medicaid at the same time. 9 million people fall into this category, costing 200 billion dollars, meaning that this small fraction of people on Medicare account for almost a third of Medicare’s entire budget (2017). The VA, or Veteran’s Affairs, is also not a form of welfare. If we go by the definition we established earlier, you don’t get VA healthcare or disability benefits based on your income, it’s more akin to Worker’s Compensation… but for the military. Not every veteran gets VA benefits, you have to have a service-connected disability. That’s a physical or mental health injury that was directly caused by your military service. Depending on the level of injury, you might only receive care for that specific injury. Like a hearing aid if you have service-connected hearing loss. You might also receive disability payments, which is compensation for your decreased ability to find a job elsewhere as a result of your injury. It isn’t free money or welfare, it’s military worker’s compensation. Worker’s Compensation, or Workman’s Comp depending on your state, is an insurance program paid for by employers and run through the state. You only qualify for it if you have a workplace injury and even then… The idea is to pay for any healthcare costs related to that injury and maybe help cover the bills while you recover. So that you can get back to work. Unemployment, on the other hand, does fit our definition since it’s monetary assistance based on your inability to work. Or at least inability to find work, hopefully only temporarily. Unemployment Insurance is paid for by employers and again administered by the individual states, with some help from the federal government. It cost the government 31.5 billion dollars in 2016, which is the lowest it’s been in decades. You have to be unemployed through no fault of your own, so laid off or your employer goes out of business or something. Not if you quit or were fired for misconduct. Currently, you’re allowed to claim unemployment for 26 weeks – in most states – which is just over six months. During the Recession it was extended to 99 weeks, which is just shy of two years. The roughly 7 million people who relied on that extension are referred to as the 99ers. It’s nearly impossible to track how many people rely on unemployment, because some people are only on it for a few weeks, some people are on it for months, and some people can be on it multiple times per year. The payout amount depends on your previous income. It varies widely by state, with the highest maximum payout being $783 a week in Minnesota and the lowest being $235 a week in Mississippi. Meaning regardless of your prior income, that’s the most you can get. Some states require that you prove you’re looking for a job while claiming unemployment and a few require you to take any job that is offered to you. Even if it’s part-time, minimum wage, or way outside of your skillset. Studies have shown that in general, people who are on unemployment don’t spend any more time unemployed than people who live off of their savings. It’s just a way to help you pay the bills and keep a roof over your head while you look for a job. Speaking of keeping a roof over your head, I’m actually kind of surprised we haven’t talked about housing assistance yet. It’s actually kind of complicated and I’m going to need some visuals… actually, hold on, I have something for this. It’s a good thing I brought up Monopoly… F*** Alright so, this is a rich person’s house and this is a … wait. Okay, alright so, this is a rich person’s house and this is a… Hold on a second I got this one. So housing assistance today comes in a couple forms. We'll start with traditional public housing projects. So a "project" was usually a certain number of towers or low-rise housing blocks clustered in an area, all built at once. The most important thing to remember is the vast majority of public housing "projects" were built under the 1937 Wagner-Steagall Housing Act and its 1949 amendments. The legislation was drafted to "improve" the housing supply, rather than to add to it -- New public housing had to replace private housing "one-for-one.” This was so as to not "distort the housing market" with an excess of affordable public housing units. So whole neighborhoods were levelled to build public housing. Now, the low-rise blocks usually did quite well as they were cheap and easy to maintain, but the towers usually didn't fare as well. Once occupancy dropped below 100% there wasn't enough rent to keep all the complicated systems that make a housing tower work in a state of good repair, and stuff started to fall apart. Now, "HOPE VI" in the early 1990s was a program originally designed to demolish and replace the most "blighted" public housing towers with new, "mixed income" housing to reduce "concentrated poverty.” The idea being that if poor people live next to rich people they'll stop being poor, because, I dunno, money travels through walls by osmosis or something. Right. Originally this program worked as designed but in the late 1990s under the leadership of some guy named "Andrew Cuomo" the definition of "blighted" expanded to include "any project on valuable land we can make a buck off of by selling or leasing it to private developers." There is also a thing called "scattered sites.” where a public housing authority buys ordinary houses and rents them out to those who qualify for public housing. You might live next to one and not even know it. So you qualify for public housing if you are "low-income", defined by the department of housing and urban development as making 80% of median area income. Your rent is capped at 30% of your income, with a lower boundary of $25 a month. Now if you think this sounds appealing, you'll find that a lot of other folks also think so! My local housing authority, the Philadelphia Housing Authority, has a waitlist for its public housing projects which is 104,000 names long. The average wait time for a unit is ten years. This is of course compounded by the fact that demolition of housing projects are still underway under HOPE VI even as the waitlist expands. Now, luckily there's an alternative to government run public housing called Section 8. So a Section 8, or "housing choice voucher" works like this: You can rent a private residential unit in any building with a Section 8-friendly landlord. You are expected to pay 30% of your income in rent, with the remainder made up by the local housing authority. Section 8 landlords are required to charge no more than what the government calls "fair market rent" -- usually well below actual market rent. Since there are a lot of section 8 tenants to choose from and HUD is fairly prompt with the checks, it's easy and steady money for landlords. We spent about $32 billion on the Section 8 program in 2017 -- as compared to $6.3 billion on public housing in the same year. However, much like public housing units, the demand for Section 8 vouchers far outstrips the supply. In 2011, for instance, the Oakland California PHA received 100,000 Section 8 applications in its 5-day application period. Through a lottery, 10,000 of them actually made it on the waiting list, which was 6 years long at that point. Most Section 8 waiting lists are outright closed. And there are a dozen or so smaller programs like the low-income heating assistance program or LIHEAP, which helps folks pay for gas and electric in the winter, and some programs that subsidize private low-income housing developments, often in the form of tax credits. A lot of these are administered by municipalities so it's hard to track how much they cost us on a national level. So there is housing assistance for the poor, but it's not easy to get. Do you get anything if you're middle-class or rich? Yes it’s called a 30-year mortgage and is one of the most durable facets of the New Deal which has had the largest impact on American life. But you’ll have to go to my channel to learn more. I'm donoteat, but my channel is called "donoteat01" because someone already took "donoteat.” I have an hour on this subject of public housing over there, soon to be 2 hours, and that second hour is where you’ll learn about mortgages, so go over there and watch that if you wanna know more about public housing and housing assistance in America. Ok, the commercial's over, back to the studio. Wait, sorry, hold on! Alright, so there’s one last program that we need to talk about here – Social Security – and before you freak out and say it’s a benefit you’ve earned. You’re right, Social Security itself isn’t welfare by our definition. But there are three parts to Social Security and two of them definitely are. Social Security Disability Insurance, or SSDI, is a cash assistance program for people who have a physical or mental condition that prevents them from engaging in a “substantial gainful activity.” It’s not Worker’s Comp, you don’t get it because of a workplace accident. It has to be a disability that prevents you from getting a job for at least twelve months, or less than twelve months but will eventually result in death, and be under 65 years old. You also have to have contributed to Social Security for at least half of your working life. 10.7 million people are on the program, costing the government 142.9 billion dollars, with the average person receiving 1166 dollars a month. SSDI comes from the Social Security Trust Fund, which is separate from general taxes. Supplemental Security Income, on the other hand, does come from general taxes and the regular federal budget. SSI is a supplement to Social Security or SSDI for people with low incomes. You have to be drawing from Social Security or SSDI already, but that amount is low enough that you’re still not able to make ends meet. The maximum payout is 733 dollars for a single person and 1100 for a couple. It’s still run by the Social Security Administration, 8.3 million people are part of this program and it costs the government 63.4 billion dollars. So alright, the elephant in the room. Social Security is a mandatory socialized retirement program in the United States, and like Medicare, is subsidized through that 6.2% FICA Tax on your paycheck and is not run for profit. Unlike the retirement program that you may or may not have through your employer. It’s not a Ponzi scheme, it’s not going to run out, that’s just something politicians used to say because they wanted to lower taxes and privatize it. Isn’t weird that they stopped talking about that when the Baby Boomers started retiring? That fear came from the idea that each generation would be bigger than the last, which isn’t the case, Social Security isn’t going anywhere. It probably won’t be enough for you to retire on, but it will be there. You can retire early at 62 for a reduced amount, but for most of the people watching this video, the full benefit doesn’t start until you’re 67. You also have to contribute to it for at least 10 years. This is why undocumented immigrants aren’t a drain on Social Security, because they probably didn’t contribute to it at all. Can we stop with that stupid myth please? Once you’ve contributed enough, you’ll start getting a statement in the mail detailing how many credits you’ve earned and how much you would get if you retired or were injured today. Or, you can also check it online. 49.5 million people are part of the general Social Security program, which costs the Social Security Trust Fund 762.1 billion dollars. The average person receives 1345 a month, but it varies widely depending on how much you contributed. Social Security is not welfare under the definition that we established, it’s a general retirement fund that you contribute to during your working life and draw from later in life. You’re not getting it because of your income or inability to work, aside from SSI and SSDI. I only bring it up because it was one of the most mentioned programs when I asked on Twitter – but also because it could serve as a decent scaffold for what we could turn welfare into. Many people in both major parties want to reform our welfare system. Our system is extremely complicated, we only talked about fifteen programs in this video and that barely scratches the surface. And many of them overlap and require you to be in multiple programs. We could simplify this system by introducing a Universal Basic Income, that is a flat check to everyone in the country, regardless of income, age, disability, or anything else. It’s also known by other names like “Mincome” and the Negative Income Tax, which was first proposed by Nixon of all people. You’ve probably already heard about UBI from politicians or… a certain German Youtube channel whose name I would butcher if I even tried… For this video, we’ll talk mostly about the Minimum Basic Income, enough money to be above the poverty line. In the US, this means about 1000 dollars a month, or 12,000 dollars a year. Before you go thinking that that is an excessively large amount, if we were to combine every program we talked about in this video and disperse it evenly among every man, woman, and child in the United States, each person would get 635 dollars a month. So without making any other changes whatsoever, we’re already about two-thirds of the way there. We could combine all of these programs and eliminate all of the bureaucracy that we already have in the budget and shift it to one program that covers everyone. And we already have an agency that collects from and tracks everyone – Social Security. One of the common arguments against a universal basic income is that people would get lazy, stop working, and just live off of the government. As if $12,000 a year is enough to live on, there’s a reason they call it the Poverty Line. But while studies are currently starting in the United States and wrapping up in Finland, they were done 40 years ago in Canada. And almost nobody quit working. Really, the only people to work less were women who took a longer maternity leaves and teenage boys who chose not to drop out of school because the family wasn’t desperate for another source of income. Oh man, what a socialist dystopia. Imagine that, not having to drop out of school to go slave away in the mines so your family has enough to eat. But there are other benefits to a Universal Basic Income. Since automation is likely going to reduce the amount of jobs available, people will be laid off through no fault of their own. UBI could keep them afloat, rather than unemployment. Likewise, if work becomes optional, employers will have to improve conditions or offer extra incentives in order to keep people working there. We could also accomplish that Libertarian dream of abolishing the minimum wage. If all of your basic needs are already met and you don’t need your job in order to keep your apartment or go to the doctor, you wouldn’t need to be paid a livable wage. Because you already have a “livable” wage. Work just becomes extra money, they could pay you whatever the market decides is fair, because no one needs it to survive. And what would you do with all of that extra time on your hands? Learn a new hobby from Skillshare by going to Skillshare is an online learning community where you can learn new life skills from experts in their field. If all of your basic needs are met, you can finally learn how to basket weave, it’s not underwater but you have to start somewhere right? Or, like me, you can try to up your video editing skills by taking this course in Adobe Premiere. You may have noticed a few style changes here and there on my channel recently and learning Premiere is part of that transition. I would be completely lost without this series. So head on over to and get 2 months of unlimited access to all of Skillshare’s courses for free, you’ll also be supporting the channel when you do. A Universal Basic Income would require us to fundamentally change the way we think about money. Which is actually a lot harder than you might think, people get very set in their ways, especially when it comes to money. If we introduced UBI and got rid of minimum wage, many people would have a hard time adjusting taking a job that only pays 2 dollars an hour. We’d also probably have to restructure the way we do taxes. But not changing because – ugh, it’s just too hard – isn’t a good enough reason. This is America, I thought we took pride in accomplishing difficult things. It would also stop people from complaining about how certain people are takers and should work just as hard as them. If everyone is getting the same amount, everything is fair. As the world changes, technology gets better, and jobs disappear we’re going to have to adapt with the times, just like we have in the past. Remember when we got off the Gold Standard in the US or when Europe adopted the Euro? So now that you have a better understanding of the systems we already have in place, you can start thinking about how we can change them in the future, because now you… know better. I’ll be streaming the State of the Union much like I did last year, so be on the lookout for that announcement. Big thanks to DoNotEat for helping me with the housing segment, be sure to check out his channel in the links below. If you’d like to help support the channel, head on over to, don’t forget to subsidize that subscribe button, follow me on twitter and facebook, and join us on the subreddit.



In the U.S., welfare program is the general term for government support of the well-being of poor people, and the term social security refers to the US social insurance program for retired and disabled people. In other countries, the term social security has a broader definition, which refers to the economic security that a society offers when people are sick, disabled, and unemployed. In the U.K., government use of the term welfare includes help for poor people and benefits, including specific social services such as help in finding employment.[2]


Distributing alms to the poor, abbey of Port-Royal des Champs c. 1710.
Distributing alms to the poor, abbey of Port-Royal des Champs c. 1710.

In the Roman Empire, the first emperor Augustus provided the Cura Annonae or grain dole for citizens who could not afford to buy food every month. Social welfare was enlarged by the Emperor Trajan.[3] Trajan's program brought acclaim from many, including Pliny the Younger.[4] The Song dynasty government (c.1000AD in China) supported multiple programs which could be classified as social welfare, including the establishment of retirement homes, public clinics, and paupers' graveyards. According to economist Robert Henry Nelson, "The medieval Roman Catholic Church operated a far-reaching and comprehensive welfare system for the poor..."[5][6]

Early welfare programs in Europe included the English Poor Law of 1601, which gave parishes the responsibility for providing welfare payments to the poor.[7] This system was substantially modified by the 19th-century Poor Law Amendment Act, which introduced the system of workhouses.

Public assistance programs were not called welfare until the early 20th century when the term was quickly adopted to avoid the negative connotations that had become associated with older terms such as charity.[8]

It was predominantly in the late 19th and early 20th centuries that an organized system of state welfare provision was introduced in many countries. Otto von Bismarck, Chancellor of Germany, introduced one of the first welfare systems for the working classes. In Great Britain the Liberal government of Henry Campbell-Bannerman and David Lloyd George introduced the National Insurance system in 1911,[9] a system later expanded by Clement Attlee. The United States inherited England's poor house laws and has had a form of welfare since before it won its independence[citation needed]. During the Great Depression, when emergency relief measures were introduced under President Franklin D. Roosevelt, Roosevelt's New Deal focused predominantly on a program of providing work and stimulating the economy through public spending on projects, rather than on cash payment.

Modern welfare states include Germany, France, the Netherlands,[10] as well as the Nordic countries, such as Iceland, Sweden, Norway, Denmark, and Finland[11] which employ a system known as the Nordic model. Esping-Andersen classified the most developed welfare state systems into three categories; Social Democratic, Conservative, and Liberal.[12]

In the Islamic world, Zakat (charity), one of the Five Pillars of Islam, has been collected by the government since the time of the Rashidun caliph Umar in the 7th century. The taxes were used to provide income for the needy, including the poor, elderly, orphans, widows, and the disabled. According to the Islamic jurist Al-Ghazali (Algazel, 1058–111), the government was also expected to store up food supplies in every region in case a disaster or famine occurred.[13][14] (See Bayt al-mal for further information.)

The World Bank's 2019 World Development Report on The Changing Nature of Work[15] considers whether traditional social assistance models continue to be appropriate given that, in 2018, 8 in 10 people in developing countries still receive no social assistance while 6 in 10 work informally beyond the government's reach.


Welfare can take a variety of forms, such as monetary payments, subsidies and vouchers, or housing assistance. Welfare systems differ from country to country, but welfare is commonly provided to individuals who are unemployed, those with illness or disability, the elderly, those with dependent children, and veterans. A person's eligibility for welfare may also be constrained by means testing or other conditions.

Provision and funding

Welfare is provided by governments or their agencies, by private organizations, or a combination of both. Funding for welfare usually comes from general government revenue, but when dealing with charities or NGOs, donations may be used. Some countries run conditional cash transfer welfare programs where payment is conditional on behavior of the recipients.[16][17][18][19]

Welfare systems


Prior to 1900 in Australia, charitable assistance from benevolent societies, sometimes with financial contributions from the authorities, was the primary means of relief for people not able to support themselves.[20] The 1890s economic depression and the rise of the trade unions and the Labor parties during this period led to a movement for welfare reform.[21]

In 1900, the states of New South Wales and Victoria enacted legislation introducing non-contributory pensions for those aged 65 and over. Queensland legislated a similar system in 1907 before the Australian labor Commonwealth government led by Andrew Fisher introduced a national aged pension under the Invalid and Old-Aged Pensions Act 1908. A national invalid disability pension was started in 1910, and a national maternity allowance was introduced in 1912.[20][22]

During the Second World War, Australia under a labor government created a welfare state by enacting national schemes for: child endowment in 1941 (superseding the 1927 New South Wales scheme); a widows’ pension in 1942 (superseding the New South Wales 1926 scheme); a wife's allowance in 1943; additional allowances for the children of pensioners in 1943; and unemployment, sickness, and special benefits in 1945 (superseding the Queensland 1923 scheme).[20][22]


Canada has a welfare state in the European tradition; however, it is not referred to as "welfare", but rather as "social programs". In Canada, "welfare" usually refers specifically to direct payments to poor individuals (as in the American usage) and not to healthcare and education spending (as in the European usage).[23]

The Canadian social safety net covers a broad spectrum of programs, and because Canada is a federation, many are run by the provinces. Canada has a wide range of government transfer payments to individuals, which totaled $145 billion in 2006.[24] Only social programs that direct funds to individuals are included in that cost; programs such as medicare and public education are additional costs.

Generally speaking, before the Great Depression, most social services were provided by religious charities and other private groups. Changing government policy between the 1930s and 1960s saw the emergence of a welfare state, similar to many Western European countries. Most programs from that era are still in use, although many were scaled back during the 1990s as government priorities shifted towards reducing debt and deficits.


Danish welfare is handled by the state through a series of policies (and the like) that seeks to provide welfare services to citizens, hence the term welfare state. This refers not only to social benefits, but also tax-funded education, public child care, medical care, etc. A number of these services are not provided by the state directly, but administered by municipalities, regions or private providers through outsourcing. This sometimes gives a source of tension between the state and municipalities, as there is not always consistency between the promises of welfare provided by the state (i.e. parliament) and local perception of what it would cost to fulfill these promises.


Solidarity is a strong value of the French Social Protection system. The first article of the French Code of Social Security describes the principle of solidarity. Solidarity is commonly comprehended in relations of similar work, shared responsibility and common risks. Existing solidarities in France caused the expansion of health and social security.[25][26][27]


The welfare state has a long tradition in Germany dating back to the industrial revolution. Due to the pressure of the workers' movement in the late 19th century, Reichskanzler Otto von Bismarck introduced the first rudimentary state social insurance scheme. Under Adolf Hitler, the National Socialist Program stated "We demand an expansion on a large scale of old age welfare". Today, the social protection of all its citizens is considered a central pillar of German national policy. 27.6 percent of Germany's GDP is channeled into an all-embracing system of health, pension, accident, longterm care and unemployment insurance, compared to 16.2 percent in the US. In addition, there are tax-financed services such as child benefits (Kindergeld, beginning at 192 per month for the first and second child, €198 for the third and €223 for each child thereafter, until they attain 25 years or receive their first professional qualification),[28] and basic provisions for those unable to work or anyone with an income below the poverty line.[29]

Since 2005, reception of full unemployment pay (60–67% of the previous net salary) has been restricted to 12 months in general and 18 months for those over 55. This is now followed by (usually much lower) Arbeitslosengeld II (ALG II) or Sozialhilfe, which is independent of previous employment (Hartz IV concept).

Under ALG II, a single person receives €391 per month plus the cost of 'adequate' housing and health insurance. ALG II can also be paid partially to supplement a low work income.


The Italian welfare state's foundations were laid along the lines of the corporatist-conservative model, or of its Mediterranean variant.[citation needed] Later, in the 1960s and 1970s, increases in public spending and a major focus on universality brought it on the same path as social-democratic systems. In 1978, a universalistic welfare model was introduced in Italy, offering a number of universal and free services such as a National Health Fund.[30]


Social welfare, assistance for the ill or otherwise disabled and for the old, has long been provided in Japan by both the government and private companies. Beginning in the 1920s, the government enacted a series of welfare programs, based mainly on European models, to provide medical care and financial support. During the postwar period, a comprehensive system of social security was gradually established.[31][32]

Latin America


The 1980s marked a change in the structure of Latin American social protection programs. Social protection embraces three major areas: social insurance, financed by workers and employers; social assistance to the population's poorest, financed by the state; and labor market regulations to protect worker rights.[33] Although diverse, recent Latin American social policy has tended to concentrate on social assistance.

The 1980s had a significant effect on social protection policies. Prior to the 1980s, most Latin American countries focused on social insurance policies involving formal sector workers, assuming that the informal sector would disappear with economic development. The economic crisis of the 1980s and the liberalization of the labor market led to a growing informal sector and a rapid increase in poverty and inequality. Latin American countries did not have the institutions and funds to properly handle such a crisis, both due to the structure of the social security system, and to the previously implemented structural adjustment policies (SAPs) that had decreased the size of the state.

New Welfare programs have integrated the multidimensional, social risk management, and capabilities approaches into poverty alleviation. They focus on income transfers and service provisions while aiming to alleviate both long- and short-term poverty through, among other things, education, health, security, and housing. Unlike previous programs that targeted the working class, new programs have successfully focused on locating and targeting the very poorest.

The impacts of social assistance programs vary between countries, and many programs have yet to be fully evaluated. According to Barrientos and Santibanez, the programs have been more successful in increasing investment in human capital than in bringing households above the poverty line. Challenges still exist, including the extreme inequality levels and the mass scale of poverty; locating a financial basis for programs; and deciding on exit strategies or on the long-term establishment of programs.[33]

1980s impacts

The economic crisis of the 1980s led to a shift in social policies, as understandings of poverty and social programs evolved (24). New, mostly short-term programs emerged. These include:[34]

Major aspects of current social assistance programs

  • Conditional cash transfer (CCT) combined with service provisions. Transfer cash directly to households, most often through the women of the household, if certain conditions are met (e.g. children's school attendance or doctor visits) (10). Providing free schooling or healthcare is often not sufficient, because there is an opportunity cost for the parents in, for example, sending children to school (lost labor power), or in paying for the transportation costs of getting to a health clinic.
  • Household. The household has been the focal point of social assistance programs.
  • Target the poorest. Recent programs have been more successful than past ones in targeting the poorest. Previous programs often targeted the working class.
  • Multidimensional. Programs have attempted to address many dimensions of poverty at once. Chile Solidario is the best example.

New Zealand

New Zealand is often regarded as having one of the first comprehensive welfare systems in the world. During the 1890s a Liberal government adopted many social programmes to help the poor who had suffered from a long economic depression in the 1880s. One of the most far reaching was the passing of tax legislation that made it difficult for wealthy sheep farmers to hold onto their large land holdings. This and the invention of refrigeration led to a farming revolution where many sheep farms were broken up and sold to become smaller dairy farms. This enabled thousands of new farmers to buy land and develop a new and vigorous industry that has become the backbone of New Zealand's economy to this day. This liberal tradition flourished with increased enfranchisement for indigenous Maori in the 1880s and women. Pensions for the elderly, the poor and war casualties followed, with State-run schools, hospitals and subsidized medical and dental care. By 1960 New Zealand was able to afford one of the best-developed and most comprehensive welfare systems in the world, supported by a well-developed and stable economy.


Social welfare in Sweden is made up of several organizations and systems dealing with welfare. It is mostly funded by taxes, and executed by the public sector on all levels of government as well as private organizations. It can be separated into three parts falling under three different ministries; social welfare, falling under the responsibility of Ministry of Health and Social Affairs; education, under the responsibility of the Ministry of Education and Research and labor market, under the responsibility of Ministry of Employment.[35]

Government pension payments are financed through an 18.5% pension tax on all taxed incomes in the country, which comes partly from a tax category called a public pension fee (7% on gross income), and 30% of a tax category called employer fees on salaries (which is 33% on a netted income). Since January 2001 the 18.5% is divided in two parts: 16% goes to current payments, and 2.5% goes into individual retirement accounts, which were introduced in 2001. Money saved and invested in government funds, and IRAs for future pension costs, are roughly 5 times annual government pension expenses (725/150).

United Kingdom

UK Government welfare expenditure 2011–12

The United Kingdom has a long history of welfare, notably including the English Poor laws which date back to 1536. After various reforms to the program, which involved workhouses, it was eventually abolished and replaced with a modern system by laws such as National Assistance Act 1948.

In more recent times, comparing the Cameron–Clegg coalition's austerity measures with the Opposition's, the respected Financial Times commentator Martin Wolf commented that the "big shift from Labour ... is the cuts in welfare benefits."[37] The government's austerity programme, which involves reduction in government policy, has been linked to a rise in food banks. A study published in the British Medical Journal in 2015 found that each 1 percentage point increase in the rate of Jobseeker's Allowance claimants sanctioned was associated with a 0.09 percentage point rise in food bank use.[38] The austerity programme has faced opposition from disability rights groups for disproportionately affecting disabled people. The "bedroom tax" is an austerity measure that has attracted particular criticism, with activists arguing that two thirds of council houses affected by the policy are occupied with a person with a disability.[39]

United States

President Roosevelt signs the Social Security Act, August 14, 1935.
President Roosevelt signs the Social Security Act, August 14, 1935.

In the United States, depending on the context, the term “welfare” can be used to refer to means-tested cash benefits, especially the Aid to Families with Dependent Children (AFDC) program and its successor, the Temporary Assistance for Needy Families Block Grant, or it can be used to refer to all means-tested programs that help individuals or families meet basic needs, including, for example, health care through Medicaid, Supplemental Security Income (SSI) benefits and food and nutrition programs (SNAP). It can also include Social Insurance programs such as Unemployment Insurance, Social Security, and Medicare.

AFDC (originally called Aid to Dependent Children) was created during the Great Depression to alleviate the burden of poverty for families with children and allow widowed mothers to maintain their households. The New Deal employment program such as the Works Progress Administration primarily served men. Prior to the New Deal, anti-poverty programs were primarily operated by private charities or state or local governments; however, these programs were overwhelmed by the depth of need during the Depression.[40] The United States has no national program of cash assistance for non-disabled poor individuals who are not raising children.

Until early in the year of 1965, the news media was conveying only whites as living in poverty however that perception had changed to blacks.[41] Some of the influences in this shift could have been the civil rights movement and urban riots from the mid 60s. Welfare had then shifted from being a White issue to a Black issue and during this time frame the war on poverty had already begun.[41] Subsequently, news media portrayed stereotypes of Blacks as lazy, undeserving and welfare queens. These shifts in media don't necessarily establish the population living in poverty decreasing.[41]

A chart showing the overall decline of average monthly welfare benefits (AFDC then TANF) per recipient 1962–2006 (in 2006 dollars).[42]
A chart showing the overall decline of average monthly welfare benefits (AFDC then TANF) per recipient 1962–2006 (in 2006 dollars).[42]

In 1996, the Personal Responsibility and Work Opportunity Reconciliation Act changed the structure of Welfare payments and added new criteria to states that received Welfare funding. After reforms, which President Clinton said would "end Welfare as we know it",[43] amounts from the federal government were given out in a flat rate per state based on population.[44] Each state must meet certain criteria to ensure recipients are being encouraged to work themselves out of Welfare. The new program is called Temporary Assistance for Needy Families (TANF).[45][46] It encourages states to require some sort of employment search in exchange for providing funds to individuals, and imposes a five-year lifetime limit on cash assistance.[43][45][47] In FY 2010, 31.8% of TANF families were white, 31.9% were African-American, and 30.0% were Hispanic.[46]

According to the U.S. Census Bureau data released September 13, 2011, the nation's poverty rate rose to 15.1% (46.2 million) in 2010,[48] up from 14.3% (approximately 43.6 million) in 2009 and to its highest level since 1993. In 2008, 13.2% (39.8 million) Americans lived in relative poverty.[49]

In a 2011 op-ed in Forbes, Peter Ferrara stated that, "The best estimate of the cost of the 185 federal means tested Welfare programs for 2010 for the federal government alone is nearly $700 billion, up a third since 2008, according to the Heritage Foundation. Counting state spending, total Welfare spending for 2010 reached nearly $900 billion, up nearly one-fourth since 2008 (24.3%)".[50] California, with 12% of the U.S. population, has one-third of the nation's welfare recipients.[51]

In FY 2011, federal spending on means-tested welfare, plus state contributions to federal programs, reached $927 billion per year. Roughly half of this welfare assistance, or $462 billion went to families with children, most of which are headed by single parents.[52]

The United States has also typically relied on charitable giving through non-profit agencies and fundraising instead of direct monetary assistance from the government itself. According to Giving USA, Americans gave $358.38 billion to charity in 2014. This is rewarded by the United States government through tax incentives for individuals and companies that are not typically seen in other countries.


Income transfers can be either conditional or unconditional. Conditionalities are sometimes criticized as being paternalistic and unnecessary.

Current programs have been built as short-term rather than as permanent institutions, and many of them have rather short time spans (around five years). Some programs have time frames that reflect available funding. One example of this is Bolivia's Bonosol, which is financed by proceeds from the privatization of utilities—an unsustainable funding source. Some see Latin America's social assistance programs as a way to patch up high levels of poverty and inequalities, partly brought on by the current economic system.

Some opponents of welfare argue that it affects work incentives. They also argue that the taxes levied can also affect work incentives. A good example of this would be the reform of the Aid to Families with Dependent Children (AFDC) program. Per AFDC, some amount per recipient is guaranteed. However, for every dollar the recipient earns the monthly stipend is decreased by an equivalent amount. For most persons, this reduces their incentive to work. This program was replaced by Temporary Aid to Needy Families (TANF). Under TANF, people were required to actively seek employment while receiving aid and they could only receive aid for a limited amount of time. However, states can choose the amount of resources they will devote to the program.

See also


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"social insurance" by Stefania Albanesi. Abstract.
"social insurance and public policy" by Jonathan Gruber Abstract.
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Further reading

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