governments role in welfare. With all of the improvements in the standard of living that have been brought about by changes in welfare, social security, and other government programs, it would seem ludicrous to suggest that government should completely back out of the welfare system and leave that to private institutions. Because the improvement of the poor persons lot producing positive externalities such as increased productivity and lower crime rates, the private sector would under-produce these services. Clearly, the government needs to have some role in administering welfare. Oddly enough, the solution to the problem of poverty may be found in our past. Government at the national level is unable to provide for the good of every poor person in an economically and practically efficient manor, but individual people and smaller local organizations can. If the government subsidizes groups who help the poor, it would be less costly than creating and administering its own programs, and also more effective. By creating awareness in the public consciousness about the problem of poverty, and offering economic incentives to individuals and groups who are willing to help out, the government can facilitate the improvement of the standard of living of poor people in an effective, efficient, and cheap way. The phenomenon of private replacement of government service has already been observed in some parts of the country as a result of the effects of the Welfare Reform Act of 1996. In Arlington, Texas the number of welfare cases decreased by almost 35,000 from 1994 to 1999, while the number of people served by Arlington-area charity groups increased almost 20,000 during the same time period. But what of the 15,000 unaccounted-for cases? It is not known whether these people are now employed or if they slipped through the cracks. At the current rate of increased reliance on private charity, Arlington food banks are finding it difficult to meet the n...
