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TheStreet Open House

Paul Ryan’s Entitlement Reforms Offer an Elixir for the Poor

Stock quotes in this article: WMT, TGT, MCD

Since President Bill Clinton left office, the U.S. economy has created only 6 million jobs. which is less than one-sixth the pace of the prior two decades, and according to a June study published by the Center for Immigration Studies, immigrants -- legal and illegal -- have captured virtually all of those jobs.

Many native-born Americans are working only part-time or opting out of work altogether to cash in on the plethora of payments the federal government offers for being poor.

And Democrats have been all too happy to encourage illegal immigration, through lax border enforcement, to fill the jobs their "anti-poverty" programs pay constituents not to take. Those tactics curry favor with Hispanic voters who want amnesty for undocumented immigrants or at least federal non-enforcement of immigration laws.

Once those immigrants have children, they are here to stay, and the children will eventually become reliable Democratic voters, too.

Congressman Ryan's plan would offer states the opportunity to create anti-poverty programs that include new work requirements and reduce regulatory barriers faced by low-income Americans who wish to establish small businesses.

That makes great sense, because for many without formal education, more-valuable marketable skills are acquired directly on the job or by starting a modest enterprise.

The legions of once minimum-wage workers who are now managers at Walmart (WMT) and Target (TGT), and even franchise owners in organizations such as McDonald's (MCD), bare strong witness to two fundamentals that should guide efforts to alleviate poverty: The best social program is a job, and the best way to get a good job is to be employed in the first place.

Ryan's proposals will face ridicule from liberal politicians and the media, because if implemented, his reforms would violate two of their most strongly held beliefs: The poor are the victims of capitalist greed and free market madness, and the best way to buy a vote is with a social program.

Sorry liberals, it is time to take your toys away.

Peter Morici is an economist and professor at the Smith School of Business, University of Maryland, and a national columnist.

At the time of publication, the author had no position in any of the stocks mentioned.

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

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