Policy Memo
Topline
Welfare should be for those in need. Working families should not have to give up part of their paychecks to support idleness among able-bodied, working-age adults without dependents.
Affordability 101 · Chapter 3: Freedom to Work and Enterprise
Plymouth Institute for Free Enterprise
Welfare should be for those in need. Working families should not have to give up part of their paychecks to support idleness among able-bodied, working-age adults without dependents.
Milton Friedman famously said, “If you start paying people to be poor, you're going to have a lot of poor people.” Similarly, when you give people welfare benefits for not working, you end up with a lot of able-bodied adults not working. This reduces economic output (which can contribute to rising costs), while simultaneously reducing government revenues and increasing government (taxpayer) costs. A single unemployed worker can cost the federal budget $4,200 per month, including costs of $2,800 in unemployment insurance, food stamps, and Medicaid benefits, plus $1,400 in lost federal income and payroll taxes. That’s money that instead has to come from the paychecks of current and future workers—making things less affordable for them.
H.R. 1 imposed new work requirements and expanded existing ones in Medicaid and food stamps—the two largest state-administered federal welfare programs. Beginning in 2027, individuals ages 19-64 who are able-bodied and do not have dependents under age 14 must spend at least 80 hours per month in community engagement—including work, job training, education, or community service. Those changes were estimated to save federal taxpayers roughly $400 billion over 10 years.
Workers could better afford to support themselves and their families if they didn’t also have to support able-bodied adults who choose not to work.
This memo is part of Affordability 101, Advancing American Freedom’s playbook of 101 policy solutions to make life more affordable.