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Perverse incentives

Have you ever stopped to consider how the government rewards and encourages that which it allegedly wishes to prevent?

An investor who loses money gets a tax write-off. One who makes a wise investment and gains a profit gets penalized.
A CEO who runs a company into the ground gets a bailout. One who operates a company and earns huge profits, increases payroll, etc, gets penalized by paying higher taxes.

A Democrat politician in a very poor area knows that if his constituents improve their financial status, they will likely move out of his/her district and a vote will be lost. The wealthier they become, the more likely they are to vote for the opposition party. That politician has no incentive to help his constituents do well but has a great incentive to keep them poor.

There is no federal money for the parents of a student who makes honor roll every quarter. There is an abundance of money for the parents and school of students who are coded as having learning disabilites.

Most government agencies put in for next years' budget, asking for a percentage increase over the previous year. They have no incentive to save money or operate more efficiently because if don't use this year's funds, their next year's budget will likely be cut. They have an incentive to ask for more than they think they will need and then they either must figure out how to spend it all or have their future budget cut.

Promotions and salaries in many government jobs are based on the number of employees one supervises, therefore, there is really no incentive to reduce staffing and a very real motivation to grow one's own department, regardless of actual need.

Means-tested social programs naturally provide a disincentive for two parents to get or stay married because when both incomes are considered, they are less likely to receive assistance.

If someone receiving government assistance starts earning an income, the government's response is to penalize them by cutting their benefits.

I wonder how much things would change if we rewarded excellence, success, achievement, and personal responsibility instead of punishing them.

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