> Earn slightly too much, and vital support disappears
My reading of this is that the threshhold for the USA government to withdraw financial (and other?) support for disabled people is too low, is that right?
> My reading of this is that the threshhold for the USA government to withdraw financial (and other?) support for disabled people is too low, is that right?
In general, step functions (earn 200 get benefits, 201 no benefits) are really really bad from a public policy perspective. If you want to get people out of these dependency traps then you need to taper them more effectively.
Even tapering them is problematic as you end up with astronomically high effective marginal tax rates, but it's better than a hard cut off.
Perhaps too low. Definitely too much of a step function.
Not only is it too low, but it is the discontinuity in support. This leads to perverse incentives where for the wage you could make, you’d barely clear the threshold to lose benefits and make barely more money than on government support.
This isn’t an argument to remove support—it’s an argument to remove binary thresholds with smooth ramps to incentivize people to work.