Tuesday, November 02, 2010

Who does government help really help?

I have a friend who likes to say that if you take all the world's wealth and divide it evenly with the world's population, it would be right back where it started after the next three day weekend.

So as we all vote at the beginning of the month today, I want to pose this question. Who does financial aid really help?

I have a client who got started renting Section 8 housing last year. Now the conventional wisdom is that without Section 8, millions of poor people would be homeless. The reality is that most of the Section 8 units my client rents are renting at above market rates. Who ends up with the money?

Not the poor person. It 's the person who bought an $11,000 house put $5,000 into it and now rents it for $799 a month. As he tells me, "I'll have my investment back in 2 years."

Now consider that this house is now off the market for a poor or moderately poor family to actually purchase. And consider that the true rent on a place worth $16,000 should be about $200.00, which is just about the amount the resident has to pay anyway. All the government money did was line the pockets of one of" the haves".

Or how about my convenience store owners, who do about half of their business the first week of every month. Who makes out when our government subsidizes the purchase of lottery tickets and beer? It's not the consumer, unless you count a nice buzz as part of the benefit.

Do you think that these convenience store owners drop their prices that first week of the month in order to chase those dollars? Hell no. In fact, watch a convenience stores signs in the window advertising "Beer at State Minimum". You'll notice that those signs conveniently disappear at the beginning of the month.

How about financial aid for college students? Is it the student who benefits from easier accessibility of Pell Grants and student loans? Actually, the out of pocket cost to the student and parent has grown exponentially. Who makes out? College professors, administrators and staff who have been getting 4-8% pay raises while most people's wages remain flat.

So if you would like to keep perpetuating this mess that does nothing but create more inequality in our country. The democratic ticket is your friend today.

If you believe in freedom and a "private option". Vote conservative.

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