these phaseouts, cliffs, and huge marginal tax rates aren’t failures of means-tested programs alone. Recipients are trapped in poverty also because of failings at the boundaries between social assistance, other social supports, and jobs. If jobs or other social programs reliably provided health insurance or child care, transitions out of social assistance wouldn’t impose such steep costs to the affected individuals. The problem is that on one side, we try diligently to minimize assistance programs by keeping their scope limited and clearly bounded. But this tight bounding means that people often exit means-tested programs—and do so abruptly—when they are still poor. On the other side, we have social programs and jobs that fail to provide the working poor with adequate wages or needed protections. If only one or the other existed, people would exit social assistance without the steep costs described here. But because both poor wages and meager protections exist together, leaving social assistance often means falling into a chasm.
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