Is the Government Overfunding the Welfare System - Essay Example

Government Overfunding of the Welfare System Welfare is a term that is synonymous with income assistance or support and social assistance. Social welfare acts as a safety net of last resort to the extent that for an individual to qualify for social assistance, they must have exhausted all other avenues for getting assistance. Many countries across the world have social welfare systems that serve to help nationals overcome some challenges such as getting basic healthcare, food, and education. Different countries have unique or similar social welfare programs that vary in terms of their effectiveness with respect to their goals. While generally governments spend a lot in welfare programs, it is worth noting that these expenditures serve a noble course and have massive benefits in the long run. This paper will discuss how and the extents to which countries spend on social welfare focusing on Canada and the U.S. Canada is one of the countries that have a stable and highly performing welfare system. The Canadian government provides citizens with the assistance that they may not get from market players through its social programs. In Canada, many of the social safety programs are managed by the provincial governments (Westhues 45). For example, the provincial governments offer services that are deemed to be medically necessary to all citizens. The costs of some of these services are subsidized by the federal government of Canada. In as much as the Canadian government provides a lot of welfare services to its citizens, some services are beyond the scope of the government and, therefore, must be privately funded or purchased through private insurance (Westhues 53). The federal and provincial governments also subsidize the cost of secondary school education in addition to giving students bursaries and loans. Some of the people who benefit from social welfare in Canada include children from low income families, individuals who are disabled, those who earn low incomes and the youth. Poverty relates to the situation in which an individual does not have enough money to cater for their basic needs including food, shelter and clothing according to Raphael (13). Taking note of the fact that poverty is a complex problem whose root problems cannot all be addressed, the federal and provincial governments of Canada have opted to tackle it head on. The welfare system plays a great role in dealing with the problem of poverty in Canada as noted by Raphael (27). Thanks to the welfare system, Canada is one of the countries that have low poverty rates. In 2009, the Organization for Economic Co-operation and Development ranked Canada 18th (behind Belgium, Denmark and the Czech Republic) in terms of poverty prevalence, which hints to the fact that Canada is doing well in its efforts to contain the poverty menace. The Canadian government has managed to contain poverty and uplift the living standards of its nationals through its several social welfare programs. In this respect, the government spends billions of Canadian dollars in ensuring that dropouts are maintained low, encouraging and fostering good nutrition, and reducing substance abuse as noted by (57). Some of the cash is spent on subsidizing housing, supporting Children’s Aid, incentivize the working poor, funding education, and helping young individuals who are in trouble with the law among other uses. In as much as the Social safety net is supported by a huge number of people in Canada, many people believe that it has done little to change the situation of nationals (Harell, Soroka, & Mahon par. 1). The healthcare system evidently costs the tax payers the highest amount of money closely followed by programs that are dedicated to helping those in need. An analysis of the poverty rate revealed that the 1990s saw the rate decline marginally. The same was true for income inequality and unemployment. It is currently estimated that about 1.7 million people or 5%of the population rely on social welfare programs to overcome some of the challenges they face as noted by Harell, Soroka, & Mahon (par. 2). Statistics further indicate hat over 15% of Canadian families lived below the low income cut-off. An analysis of how the United States of America spends on social welfare reveals that its social welfare system is quite distinctive compared to those of many of its contemporaries as noted by Milbourne (15). Compared to many rich democracies, the U.S. charges its nationals less tax and spends less invests less on social programs. This, however, does not mean that the country has a social welfare system that is less complex or smaller than those of its contemporaries. The U.S. applies several strategies in respect to affording social welfare to needy citizens (Morgan par. 1). For example, it offers tax-based subsidies, government spending as well as private social spending programs. Like Canada and many other countries, the U.S. social welfare system offers child care, health insurance, house support, and pension according to (Morgan par. 5). Together, these offerings amount to massive investments which take up a significant portion of the country’s gross domestic product (GDP). In essence, the amount that the U.S. spends on social welfare and health is far much greater than that spent in many industrialized countries. Even with the full implementation of the Obama Care, the percentage of the American population that will have no health insurance will be higher than that in other countries. Furthermore, the U.S. system guarantees not sick and parental leaves which are a basic right in many countries. In the country private social benefits and services that come from the contribution of employers and as opposed to government sees to it that some people are covered while others are not. In the same way, while those who have high incomes enjoy good benefits, those who earn less income receive worse services. According to the Organization for Economic Cooperation and Development (OECD), the U.S. is ranked fifth highest spender in the world with regard to social fare. The OECD also notes that the U.S. is the country that gives the highest tax breaks dedicated to social purposes. While many think that the U.S. social welfare system is designed such that it takes from the rich to give to the poor, this may not be the case in reality. The reality is that the majority (roughly 96%) of U.S. citizens benefit in one way or another from social programs that have been sponsored by the government (Morgan par. 10). The U.S. system is so designed that a huge percentage of the money spent on social welfare is contributed by private parties as opposed to the government, which is the same case with many Commonwealth countries. Out of the amount dedicated to direct public spending in the U.S., roughly 7% are directed to benefit programs that are means-tested. It is beyond doubt that Canada and the U.S. spend a lot of resources in social welfare. While some people feel that the U.S. and Canadian governments overspend on social welfare, this may not be the case in the real sense especially considering the amounts vis-a vis the countries’ GDPs. Furthermore, the benefits associated with social welfare funding are numerous and massive when compared to the cost that the governments would spend on such things as healthcare without social welfare programs like Medicare and Medicaid. What this basically means is that government spending on social welfare is important for the country and should be maintained at a reasonable level. It is evident that when spending on social welfare is reduced, the nation suffers as more people tend to be exposed to poverty. Works Cited Harell, Allison, Soroka, Stuart & Mahon Adam. Policy Options, September 2008 Is welfare a dirty word? Canadian public opinion on social assistance policies. 2013. Web. http://www.irpp.org/en/po/canadas-working-poor/is-welfare-a-dirty-word-canadian-public-opinion-on-social-assistance-policies/ Morgan, Kimberly. Americas Misguided Approach to Social Welfare: How the Country Could Get More for Less. 2013. Web. http://www.foreignaffairs.com/articles/138483/kimberly-j-morgan/americas-misguided-approach-to-social-welfare Milbourne, Paul. Welfare Reform in Rural Places: Comparative Perspectives. Emerald. 2010. Print. Raphael, Dennis. Poverty and Policy in Canada: Implications for Health and Quality of Life, Canadian Scholars Press. 2007. Print. Westhues, Anne. Canadian social policy: issues and perspectives. Wilfrid Laurier University Press. 2006. Print. Read More