Sunday, September 18, 2011

The Transfer Payment Casino Society

Occasionally my wife and I go to one of the many casinos in our area. Myself, I'm not much of a gambler but my wife genuinely enjoys it so I go along for the ride and of course the wonderful buffet. I'll pluck $20 or $40 in a few slot machines and play until it's gone. I told my wife once that I might as well just visit the cashier on my way in and give him the money outright. The rest of the time I spend people watching while my wife plays her favorite slots with her own money (we keep separate finances).

What amazes me is that during this so-called Great Recession the casinos are brimming with customers - regular customers. I'm sure the casino operators we tell us that business is down, but if things are that bad shouldn't the casinos be nearly empty? Of course things are bad in general and yet the casinos are bustling with young and old alike with their money presumably experiencing the same fate as mine.

I would bet - pun intended - that a huge percentage of the money filling the casino's coffers are a direct result of government transfers. Social Security and various government employee pension money in the case of the older set. Not to mention the money the senior crowd is NOT spending on prescription drugs. There would also be unemployment benefits and SSI and other direct government payment money, not to mention food money made possible by food stamps, WIC and other benefits the younger set is not spending at the grocery store.

Tim Worstall's interesting article at made me think of my casino experiences of the last few years. How can there be so many people throwing their money away at the casinos when so many people are presumably so poor? Maybe it's not really their money.

In the article "The New US Poverty Numbers: Everyone, Just Everyone, Gets This Wrong" Worstall tells us that poverty numbers as reported in recent years are calculated before said poor people receive government benefits. It used to be that government benefits were calculated into the poverty figures.

We used to measure those who were poor after we’d helped them. Now, by and large, we’re measuring who would be poor if we didn’t help them. These just aren’t the same thing and so the numbers are not directly comparable.

This explanation will also aid you in understanding one of the great conundrums of modern America. How on earth can the US be spending hundreds of billions of dollars a year on beating poverty without actually beating poverty? Simple, we spend the money but don’t measure how much poverty we’ve beaten by spending it.

This is just one more way the government and mass media deceive us with calculated dishonesty. We as a society have spent trillions on "fighting poverty" and trillions more on corporate welfare (which is even more obscene) and yet poverty rates are unchanged if not higher. No one is advocating a society without a social safety net, but when will we have an honest policy direction that addresses the reason we are dumping good money after bad on transfer payments that literally do nothing to reduce poverty - except that is for the casino operators.

More power to the casinos, they obviously offer something beyond my comprehension, but it concerns me that people getting direct benefits from the government just take the money they don't spend on their own needs and give it to the casinos. Obviously this paints casino denizens with a broad brush, but do not deceive yourself into thinking that this is not happening.