35 states that pay more in welfare than minimum wage (35 items)

By , Deseret News

Aug. 26, 2013

Does welfare rob Americans of their incentive to work?

That seems to be the conclusion some are drawing from a study published earlier this month by the Cato Institute, A libertarian think tank based out of Washington, D.C.

According to the study, 34 states and the District of Columbia provide more in welfare than a minimum wage job in that same state would.

According to a post on Foxnews.com, such a revelation shows that many American welfare programs are “creating little incentive for Americans to take entry-level work and likely increasing their long-term dependency on government help.”

When writing about the study for the Los Angeles Times, senior fellow at the Cato Institute Michael Tanner expressed outrage at the fact that less than 42 percent of adult welfare recipients participate in work activities.

“Perhaps it's because, while poor people are not lazy, they are not stupid either.” Tanner wrote last week. “If you pay people more not to work than they can earn at a job, many won't work.”

But not everyone believes the study is truly representative of how the welfare system works.

The most prominent criticism of the study is that it assumes, for the purposes of the research, that the sample families in each state receive the benefits of eight different welfare programs, namely: Temporary Assistance for Needy Families (TANF), Medicaid, Supplemental Nutrition Assistance, Housing Assistance, Utilities Assistance, Women, Infants and Children (WIC) and The Emergency Food Assistance Program.

“Very few people actually qualify for all eight of the programs Cato looks at,” writes Josh Barro at Business Insider. “So, the typical welfare benefit is much lower than Cato makes out, making staying on welfare less appealing.”

Barro also takes issue with the fact that the study doesn’t factor in the lower welfare benefits for single adults, which he says are much less generous than those for women with children.

“That said, poverty traps are real.” Barro concludes. “This is the phenomenon of people losing benefits as they earn more income of their own. It's a problem that welfare programs need to be designed around.”

Either way, the Cato Institute’s report has opened up a whole new discussion on the role of welfare, and the minimum wage, in the country.

1 of 35. Alabama

Minimum wage: No state minimum wage law

Total value of welfare benefits: $26,638

Known for having one of the longest navigable inland waterways in the country, Alabama became the 22nd state on December 10, 1817.

2 of 35. Alaska

Minimum wage: $7.75

Total value of welfare benefits: $29,275

Purchased from Russia for for $7.2 million on March 30, 1867, Alaska became the 49th state of the U.S. on January 3, 1959.

3 of 35. Arizona

Minimum wage: $7.80

Total value of welfare benefits: $21,364

The last of the contiguous states (or states located among the main land states of North America that are south of Canada and North of Mexico) Arizona was admitted as the 48th state on February 14, 1912.

4 of 35. California

Minimum wage: $8.00

Total value of welfare benefits: $35,287

The most populous state in the country, California was admitted as the 31st U.S. state on September 9, 1850.

5 of 35. Connecticut

Minimum wage: $8.25

Total value of welfare benefits: $38,761

Known as "The Land of Steady Habits," Connecticut was admitted as the fifth state in the American union on January 9, 1788.
1. OlderGreg
Aug. 26, 2013

Woulda been nice to have the list included in the main article, instead of yet- another *click*-next thing.

2. Kings Court
Alpine, UT,
Aug. 26, 2013

In other words, business that aren't paying a living wage are being subsidized by the state. What looks like welfare for poor people is really welfare for businesses, many of which turn massive profits but take advantage of government welfare laws to pay their employees dirt cheap wages knowing that the state will step in to provide health care, food stamps, and housing assistance.

3. What in Tucket?
Provo, UT,
Aug. 27, 2013

It is too bad KC that business has to make a profit. It is such an awful thing. Welfare takes money away from private enterprise. Under Mr. Obama we have had a 1% growth for 4 years and the lame stream media plays it off as a successful economy. The current policies are not working very well. We need less regulation, lower taxes with a simpler structure, fewer govt workers and the ones remaining at lower wages more comparable to the private sector and same for their pensions. We need a legal system that is more efficient and less expensive.

4. Pipes
Salt Lake City, UT,
Aug. 31, 2013

That's list could easily have been titled, "35 States that vote democrat." We need a better incentive for work. One like in the old days when our country was being built. One like, "If you don't work, you don't eat." Our forefathers would be ashamed of the mess we have made of this great land.

5. oldschooler
Sept. 18, 2013

Totally agree with Pipes, have those people work and receive assistance only it they work at least 30 hrs. a week. Also limit the amount of assistance and mandate them to pay taxes instead of working for cash and not reporting anything. Assitance for the hard working people and denied assitance for the lazy and the irresponsible ones that keep having children eventhough do not have means to provide for them.