Myth: Welfare traps people in poverty.

Fact: Welfare helps people get back on their feet more quickly.


Statistics show that nations that pay the most generous welfare benefits have the least persistent poverty and the greatest escape rates from poverty.


No study has ever proven that welfare traps people in poverty. However, studies do exist that show that nations with more generous welfare benefits allow their poor greater escape rates from poverty. Here's a chart showing how much various rich countries pay in social transfers:

Social security and other transfers as a percentage of the Gross
Domestic Product (1990) (1)

Country           % of GDP
France              23.5
Sweden              21.2
West Germany        19.3
Italy               18.9
United Kingdom      13.7
Canada              12.8
United States       11.5
Japan               11.2

And the following chart shows how much the poor in various countries escape their poverty:

Poverty rates (1994) (2)

                   Single-year   Persistent   Poverty
                   poverty       poverty      escape
Country            rate          rate         rate
Finland             3%            n/a          47%
Sweden              3             n/a          45
France (Lorraine)   4               2%         32
Luxembourg          4               1          29
West Germany        8               2          24
Canada             17              12          23
Netherlands         3               1          23
Ireland            11             n/a          22
United States      20              14          22
U.S. blacks        49              42          15

n/a = not available.

The general correlation is clear: those nations which help their poor the most have the least persistent poor. For those who blame the United States' problems on blacks, the correlation remains even after eliminating the United States completely.

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1. Howard Oxley and John Martin, "Controlling Government Spending and Deficits: Trends in the 1980s and Prospects for the 1990s," OECD Economic Studies 17 (Autumn, 1991), pp. 158-60. Social Security and other transfers include government outlays on public pensions, health insurance and other income maintenance.

2. Greg J. Duncan of the University of Michigan Institute for Social Research, 1994.