This article deals with an issue which has taken center stage in the American people’s thoughts since the Great Recession of 2008: Poverty, and Government stimulus. Casey B. Mulligan presents the reader with the curious fact that the poverty level in the U.S. did not rise between 2007 and 2011. The reason he gives for this anomaly is an overzealous stimulus package by the U.S. government. By being too generous with government assistance for people who have found themselves out of work, the incentive for people to go back to work has effectively been removed. The generosity of the stimulus packages also means that many people, who, by losing their income, would normally slip below the poverty line, continue to find themselves securely above that line. The inevitable outcome in the long run is that of greater economic decline.
I found an article closely related to this one. It does not per se address giving money to people, but it does address “Obama Economics”. Your article explains that too much government spending has made people feel rather secure and in return slowed economic progress. Mine looks at taxes and how it will continue to pay for these government programs to help the poor or make people feel secure. It explains that the methods that are being projected will further slow the growth of the economy. The author further states that there will be a long time effect and long term slow growth if things do not change.
The article brings an important issue to notice by describing the poverty levels in the recent depression. Although, it is logical to assume that recession results in increased poverty, the article says otherwise. Poverty level did not rise between the period 2007 and 2011.
My intuition is that if people lose jobs, then they do not have a means to earn income and provide for themselves and their families. Therefore, food stamps would be a better indicator of poverty. I came across an article (http://www.independent.co.uk/news/world/americas/usa-2008-the-great-depression-803095.html) where it mentioned that food stamps are a symbol of poverty and a record 28 million Americans are relying on them to survive. This article was published in April 2008 and projected for an increase in further job losses. Therefore, it is clear that poverty level has risen due to a record increase in food stamp.