The proliferation of welfare programs and the decline of the labor force have crushed America's post-2009 economic recovery. When it's more beneficial not to work, people won't work. Quoting within quoting:
So what accounts for America's anemic economy? Hall has about 50 pages of analysis, but since brevity is a virtue, let's look at some of what he wrote in his final paragraph.Labor-force participation fell substantially after the crisis, contributing 2.5 percentage points to the shortfall in output. The decline showed no sign of reverting as of 2013. ...an important part may be related to the large growth in beneficiaries of disability and food-stamp programs. Bulges in their enrollments appear to be highly persistent. Both programs place high taxes on earnings and so discourage labor-force participation among beneficiaries. The bulge in program dependence...may impede output and employment growth for some years into the future.In other words, he pointed out that a large number of people have left the labor force, which obviously isn't good since our economy's ability to generate output (and boost living standards) is a function of the degree to which labor and capital are being productively utilized.
And his work suggests that redistribution programs are a big reason for this drop in labor-force participation.
