Ethics of ER

[LRS]

Great discussion, love this topic - thanks, Emilyngh.

For those folks who would decline these benefits or who, like MrsPete hvgotcodes, et al., believe it would be in some way morally reprehensible to do so - do you also intend never to claim social security benefits in retirement? If you do intend to do so, is there a principled distinction you can make between that and this?

I would decline free meals for my kid if I didn't need it.  I would accept if I did, but I would work my hardest to avoid it.  And I certainly wouldn't call myself FI if I were bilking the system like that.

Hey, appreciate the response. Love talking through this stuff.

I would agree that someone whose retired lifestyle would crumble but for subsidized meals for their children is not truly financially independent. But I don't think that's really the scenario we're contemplating here. I don't think many of us would choose to live on such a thin razor's edge in retirement that an extra $2 every school day would force us back to work for The Man. What we're talking about is being able to afford and sustain a retired lifestyle even without the subsidy, but choosing to take the subsidy anyway. Would you disagree that someone in those circumstances is "financially independent?"

The difference between SS and the school lunch thing is that SS is a system that has been in place for a long time, with the express purpose of providing retirement funds.  It is not supposed to be a welfare system; there is no means testing for SS (yet).  You get SS if you pay into the system, not if you need it or don't. 

I don't understand how the key underlying principle is any different. The law says that, under certain circumstances, you have to surrender a certain number of dollars to the federal government, and that under other circumstances, you can ask for a certain number of dollars from the federal government and the government will give them to you. The law create legal rights to benefits for citizens who meet certain criteria. Why does the morality of exercising a legal right under the law depend on how long the system has been in place, or whether there's a means test?

I understand what you're saying about the "express purpose" of the law - welfare isn't really FOR early retirees. Those weren't the people Congress had in mind when it passed the law. But do you think social security is really FOR financially independent people? Was Congress really thinking about people who had saved conscientiously and accumulated their own wealth when it enacted social security? I don't think so, and consequently I don't really see the difference in the two scenarios.

That said, I don't believe I will get what I pay in back, perhaps nothing at all, by the time I retire.  If I do get something, I would donate it to charity if I hit my retirement goal.

I'm also pretty pessimistic about social security. But actually, my original question was whether, given your apparent stance that taking government money you don't need is immoral (correct me if I'm misunderstanding or mischaracterizing), you would choose to make a claim at all. Unless I'm badly mistaken, you have the option of just never filing for social security benefits, even after you hit age 70. You could forget that you're even entitled to social security and let your 70th birthday whiz past without filing a claim. Will you do that?

The donate-to-charity option is really fascinating too. How would you feel about someone who's financially independent and doesn't need any more money, yet still claims the maximum welfare/SNAP/free lunch/EIC/Pell Grant benefits he can get...but then donates it to charity? Still immoral?

Thinking about this further and reading some of the responses from the other camp, I'm starting to see where they're coming from, and I'm teetering on the verge of changing my mind. I feel like poorly drafted laws and regulations that allow wealthy people to claim public assistance are essentially loopholes. I feel a sense of disgust and contempt when, for example, hugely profitable multinational corporations abuse analogous loopholes to avoid paying taxes or to collect corporate welfare. So maybe I really ought to feel the same disgust and contempt for individuals who do basically the same thing. But it's so much easier to condemn a faceless corporation than it is to condemn, say, a financially savvy mom who worked hard for her stash, sat down and read the law, figured out that there was more money, free for the taking, and jumped on it. I even hesitate to stick the "immoral" label on the hyperrich who engage in complex wealth-sheltering, because I feel like it's a "don't hate the player, hate the game"-type scenario where people are just responding to the incentives that the government is putting in front of them, for better or for worse. But maybe the hyperrich ARE bad people, and maybe that mom IS a bad person, for taking money that obviously wasn't MEANT for them.

Very thought-provoking topic!

[iris lily]

Great discussion, love this topic - thanks, Emilyngh.

For those folks who would decline these benefits or who, like MrsPete hvgotcodes, et al., believe it would be in some way morally reprehensible to do so - do you also intend never to claim social security benefits in retirement? If you do intend to do so, is there a principled distinction you can make between that and this?

My income was taken from against my will to fund Social Security. Give me a choice 35 years ago, in or out, and I would opt out. But I had no choice, so now sure I'll be taking that which you took from me, Nanny G.

But that said, SS should be means tested as well and I will gripe and moan when it happens because likely I'll test out, but still--it should happen.

[beltim]

The retirement benefits under Social Security are not and have never been intended to be only for those who "need it."  The retirement portion of Social Security is simply a mandatory pension.  That's why the benefit depends on how long you work and how much money you made, and why there is a cap on the amount of wages subject to the tax.
http://en.wikipedia.org/wiki/Retirement_Insurance_Benefits

Subsidies like food stamps, pell grants, etc. are and are intended to be for those who need it.  That's why those programs have income limits. 

[Free_at_50]

Right or wrong the way I see it is that the more the government sticks there nose into our lives and pockets the more anyone of its citizens have a right to take advantage of government programs if they qualify.  Here's a scenario for you.  Two identical families making same money.  One forgoes our commercialism and saves enough to be FI.  The other one spends like there is no tomorrow.  Should the family that saved not have the same rights as the family that didn't care?  It is sad to say but more and more we dont live in a society of accountability.  For some reason our government feels like they know better.  That being the case I will agree with them and take any benefit for which I am entitled.

[Villanelle]

SSI is not in any way a needs-based program.  It is intended for everyone of retirement age, which makes it far different than something like SNAP, which is intended to help those who are struggling and is very specifically-needs based.  This is a huge difference. 

I would take SSI even if I won the lottery and had a zillion dollars in the bank. 

[starguru]

I would agree that someone whose retired lifestyle would crumble but for subsidized meals for their children is not truly financially independent. But I don't think that's really the scenario we're contemplating here. I don't think many of us would choose to live on such a thin razor's edge in retirement that an extra $2 every school day would force us back to work for The Man. What we're talking about is being able to afford and sustain a retired lifestyle even without the subsidy, but choosing to take the subsidy anyway. Would you disagree that someone in those circumstances is "financially independent?"

Yes.  FI means *independent*.  If you need or even use a government handout thats not independence according to my understanding of the term.

I don't understand how the key underlying principle is any different. The law says that, under certain circumstances, you have to surrender a certain number of dollars to the federal government, and that under other circumstances, you can ask for a certain number of dollars from the federal government and the government will give them to you. The law create legal rights to benefits for citizens who meet certain criteria. Why does the morality of exercising a legal right under the law depend on how long the system has been in place, or whether there's a means test?

I understand what you're saying about the "express purpose" of the law - welfare isn't really FOR early retirees. Those weren't the people Congress had in mind when it passed the law. But do you think social security is really FOR financially independent people? Was Congress really thinking about people who had saved conscientiously and accumulated their own wealth when it enacted social security? I don't think so, and consequently I don't really see the difference in the two scenarios.

The difference is the philosophy of SS is "you pay into the system now, to take care of current retirees, and in the future, workers will pay into the system to take care of you".  It's not a welfare system where only those who qualify based on need get a benefit.  That said, that's where I think we are heading, which is a shame.

I'm also pretty pessimistic about social security. But actually, my original question was whether, given your apparent stance that taking government money you don't need is immoral (correct me if I'm misunderstanding or mischaracterizing), you would choose to make a claim at all. Unless I'm badly mistaken, you have the option of just never filing for social security benefits, even after you hit age 70. You could forget that you're even entitled to social security and let your 70th birthday whiz past without filing a claim. Will you do that?

I am not against taking money from the government.  I am against bilking a system; i.e. I would not FIRE, then claim I'm so poor I need welfare/foodstamps/free school lunches.  Those programs are for truly poor people.  Not people who by choice wanted to retire early and are on a strict budget to achieve it.  Its pretty much the same in my mind as faking disability, getting SSDI, and continuing to work.  It's fraud.

The donate-to-charity option is really fascinating too. How would you feel about someone who's financially independent and doesn't need any more money, yet still claims the maximum welfare/SNAP/free lunch/EIC/Pell Grant benefits he can get...but then donates it to charity? Still immoral?

Robbing Peter to pay Paul?  Yes, still immoral.  Donating to charity while robbing a system to get food?  There are some serious contradictions there. 

Thinking about this further and reading some of the responses from the other camp, I'm starting to see where they're coming from, and I'm teetering on the verge of changing my mind. I feel like poorly drafted laws and regulations that allow wealthy people to claim public assistance are essentially loopholes. I feel a sense of disgust and contempt when, for example, hugely profitable multinational corporations abuse analogous loopholes to avoid paying taxes or to collect corporate welfare. So maybe I really ought to feel the same disgust and contempt for individuals who do basically the same thing. But it's so much easier to condemn a faceless corporation than it is to condemn, say, a financially savvy mom who worked hard for her stash, sat down and read the law, figured out that there was more money, free for the taking, and jumped on it. I even hesitate to stick the "immoral" label on the hyperrich who engage in complex wealth-sheltering, because I feel like it's a "don't hate the player, hate the game"-type scenario where people are just responding to the incentives that the government is putting in front of them, for better or for worse. But maybe the hyperrich ARE bad people, and maybe that mom IS a bad person, for taking money that obviously wasn't MEANT for them.

Very thought-provoking topic!

Yes, I agree the problem is primarily with the system.    I think that it makes no sense to incentivize people thru the tax code to do things they should be doing anyway, things that are in their best interest to begin with.  Deductions for children, for saving, for buying a house?  You should save because its in your best interest.  You should only have kids if you can afford them (although having kids, if I was poor I would be desperate since they are so awesome).  Same for the house.  Plus, lots of very wealthy people pay comparatively little tax since we treat wages different investment income.  If we treated all income the same and got rid of all deductions, I bet rates could be exceptionally low.

[MrsPete]

If the government gives it to me, and I didn't lie or cheat for it, then it is, in fact, MY money. Argue all you want about the morality of the governments decision to give it to me, but accepting something willingly given is never immoral in my mind.

Disagree.  The government may hand it to you, but if you didn't earn it, it is still charity.  NOT your own money. 

As far as using SNAP being laziness, this is an odd statement (well, not odd if one considers the stereotypes associated with SNAP), but the idea that saving money through one gov't program is okay, but another is "lazy" is unsupported.

Food stamps might be laziness, might not be laziness . . . but in the course of this discussion, we're talking about people who could work but would -- given the chance -- take taxpayer's money to feed themselves and their children.  We're not talking about the factory-worker mother who sets out to have one baby and instead finds herself with triplets, or the grandparents who unexpectedly find themselves raising their daughter's children; we're talking about the person who voluntarily retires early, yet takes free lunch to feed his kids.  In that scenario, it is laziness. 

 

Great discussion, love this topic - thanks, Emilyngh.

For those folks who would decline these benefits or who, like MrsPete hvgotcodes, et al., believe it would be in some way morally reprehensible to do so - do you also intend never to claim social security benefits in retirement? If you do intend to do so, is there a principled distinction you can make between that and this?

I already addressed this idea.  I have no problem with EARNED benefits -- military pensions, Social Security. . . to take it a step further, using public schools to educate your children.  Earned benefit programs are a form of saving.  When a person has paid into a system for years and receives a benefit later, that's just fairness.  My problem is with people taking from programs meant for the poor and unable to work, when they themselves have the option of working. 

Reduced price lunch I might qualify for eventually, and I would take it if I qualify.  It would benefit me slightly, but benefit our kids' school greatly.  They get large subsidies for each qualifying free/reduced priced kid, and the school needs all the help it can get.  I help the school out however I can, and this would be another way. 

Not true.  At least, not true in the way you've presented it.  If X number of kids get free lunch, the school does get extra funding . . . but they are required to use it to provide specific remediation programs, etc.  It requires more work from the school, takes effort away from basic classes, and the school is not free to use the money in the spots they believe it's most needed.  It means greater federal control within the school. 

You are NOT "helping" your child's school by having them take free lunch.

Pretty sure I am.  These things work differently in different districts.  So I wouldn't assume too much about the different funding structures and flexibility of using funds in your school or your district and extrapolating them to other districts.

The remedial help my children receive or don't receive is based on assessments by their teachers and fairly objective tests.  My kids can get straight 4's on their assessments (like an A or A+ for those not familiar) and receive zero remedial help.  But if I check the box for free/reduced lunch, the school gets money.  You may say it has to be spent in certain areas.  Sure, maybe in some cases, and I am familiar with a few cases.  But it isn't generally true.  We definitely get the option for certain programs if we are Economically Disadvantaged (free after school tutoring being one program). 

It's like this: the school has to hire X number of literacy and math coaches and remedial teachers and ESL teachers.  The administration might decide they need a couple extra to get the job done.  They lose the music teacher and art teacher to provide the extra remedial teachers (the administration wants to hit their growth targets after all).  In steps the root of good family, and checks a few boxes and the school gets a few thousand bucks.  Boom!  A little closer to rehiring that music or art teacher.

I see that you're convinced, but your facts are just plain wrong.  No, the extra money doesn't result in extra art teachers, etc., and, no, the National Lunch Program is not administered differently in different districts.  What it really means is that the money must be spent on specific types of programs, and the federal government oversees them.  It results in less autonomy for the school, fewer choices for the administration.  I teach in a Title 1 school, so I do know of what I speak.   

[Russ]

Yes.  FI means *independent*.  If you need or even use a government handout thats not independence according to my understanding of the term.

You're not independent if you use it but don't need it? I like eating pomegranates but I'm not dependent on them to live.

[RootofGood]

This is an interesting topic!

Agreed!  Always interesting to see the diversity of opinions on a divisive subject like entitlements.

The reduced lunches is a more complicated issue.  We don't need the lunches; the kids have plenty to eat and would never go hungry w/o it.  Reduced lunches is actually important for college aid.  If the family is eligible for free or reduced lunches,  and our AGI is below certain thresholds, the college kids are eligible for the simplified needs test (no asset test) for AGI under $50k, or possibly an EFC = 0 if AGI is under $23k.  That is the main reason that we apply for free/reduced lunches: it is thousands of dollars in financial aid.

Thanks for sharing!  I had never heard of free/reduced lunch qualifying kids for simplified needs test (no asset test). 

I'll have to look into this as my kids get closer to college age.  They are so many interlinking contingencies with these social programs that it can be hard to optimize benefits.  Our AGI will be low-ish, but our assets will most likely not be low. 

[RootofGood]

Wow.  There are some cranky people here. 
I wouldn't take SNAP or welfare because, Hello, they are HARDER to get than a job.  I have accompanied friends to help them fill out paperwork for these things.  6 hours later we were still sitting there in a waiting room overflowing with bored children.  My personal vision of Hell.  And WIC is crazy!  All those monthly meetings, to be taught amazing things like "Don't feed your newborn honey, use a car seat, breast feeding is best" just to get a couple gallons of Apple juice, formula, and milk?  I don't know what the hourly return on using those programs are, but I am too lazy to use them!  They are just an elaborate form of subsidizing Monsanto and Archer Daniels Midland, anyway.
  Free lunch?  Why not.  Another farm subsidy.  Oh, you thought that was for children?  Have you seen what food is on those trays?  Not designed to nourish children!  Designed to most quickly use up corn/wheat/soy/dairy.  My kid went to an elementary school that offered every kid a free breakfast every day, regardless of economic status.  Of course, my little guy wouldn't eat it because he wasn't wiling to stand in line when he could be playing before school.  But should I have told him not to eat, because it was free?
  I will choose not to RE until I don't need these programs, but I will use any that I believe are advantageous to me.  But most of these kind of programs aren't - they are a pain in the neck to actually use.

Exactly my sentiments.  I think I said something along the lines of "I'd do it if I qualified and the burden of applying to the program and complying with the program weren't onerous". 

I've helped my in-laws apply for some benefits like SNAP and medicare extra help.  We gobbled up the easy stuff and bypassed the other programs that required excessive reams (literally) of paperwork.  No wonder poor people can't get jobs - they are knee deep in paperwork and compliance.  That isn't only personal anecdotal opinion; it's also been recorded in the academic literature.  See, for example, Cheating Welfare: Public Assistance and the Criminalization of Poverty - Kaaryn Gustafson.

+1 on the free lunch = farm subsidy.  Ever wonder why the Dept. of Agriculture is funding the free/reduced lunch program? 

Our kids go to a school where everyone gets free breakfast, but they rarely eat it.  It's only milk and cereal and fruit (on good days) or junky plastic wrapped muffins or waffles served cold on bad days.  We have that at home and often better quality and variety.  I have no ethical problem if they eat the free breakfast (I told them to do it this morning since they didn't eat at home). 

I feel the same way about lunches - we will probably qualify for reduced lunches, but they won't eat at school every day.  These aren't "low income" programs by any means.  We could earn $51,000 per year and qualify for reduced price lunches.  When did $51k/yr become "low income"?  $35,800 per year equals free lunch.  Eligibility chart: http://www.fns.usda.gov/cnd/governance/notices/iegs/iegs.htm

[RootofGood]

This isn't directed at you because I have no idea your employment situation.  But I wonder how the government employees here can justify the extortionist contributions that the taxpayers must make to fund their cushy government pensions.  I guess some here might have to delete "collect a government pension" from their retirement plans due to ethical concerns.  Why take it if you don't need it, right?

This is nonsense, and I think you know it's nonsense. Why would taking compensation given to you by your employer be unethical?

I honestly don't think it is nonsense.  I'd throw collecting government pensions in there with the other government handouts.  I mean if you don't really "need" the government pension, should you take it and deplete the funds of the pension plan?  Part of the pension funding comes straight out of the public treasury (ie taxpayers' pockets).  Why not withdraw your contributions (plus interest) and forfeit your pension if you are highly principled?  I see no one opting for that choice. 

[RootofGood]

Pretty sure I am.  These things work differently in different districts.  So I wouldn't assume too much about the different funding structures and flexibility of using funds in your school or your district and extrapolating them to other districts.

The remedial help my children receive or don't receive is based on assessments by their teachers and fairly objective tests.  My kids can get straight 4's on their assessments (like an A or A+ for those not familiar) and receive zero remedial help.  But if I check the box for free/reduced lunch, the school gets money.  You may say it has to be spent in certain areas.  Sure, maybe in some cases, and I am familiar with a few cases.  But it isn't generally true.  We definitely get the option for certain programs if we are Economically Disadvantaged (free after school tutoring being one program). 

It's like this: the school has to hire X number of literacy and math coaches and remedial teachers and ESL teachers.  The administration might decide they need a couple extra to get the job done.  They lose the music teacher and art teacher to provide the extra remedial teachers (the administration wants to hit their growth targets after all).  In steps the root of good family, and checks a few boxes and the school gets a few thousand bucks.  Boom!  A little closer to rehiring that music or art teacher. [/quote]

I see that you're convinced, but your facts are just plain wrong.  No, the extra money doesn't result in extra art teachers, etc., and, no, the National Lunch Program is not administered differently in different districts.  What it really means is that the money must be spent on specific types of programs, and the federal government oversees them.  It results in less autonomy for the school, fewer choices for the administration.  I teach in a Title 1 school, so I do know of what I speak.
[/quote]

I guess the teachers, principals, and staff at my kids school, as well as the district superintendent, chief business officer, chief financial officer, and elected school board members have all made a concerted effort to mislead me in how school funding works, and what additional funds they receive for each kid that checks the box on the free/reduced lunch form.  I'm an appointed official at a policy level, and frequently talk with administrators, elected officials, and district executive leadership.  Granted, it's "only" a volunteer position, but one that interests me to a great degree, and one in which I have been effective at bringing about positive change for my kids' school and the district over all. 

I could be totally wrong on this point.  I'm not referring to the funding that pays for the actual free/reduced lunches - I think virtually all of that goes to offset the provision of the meals themselves, and covers some administrative costs of Child Nutrition Services at the local and state level (but we are talking pennies per lunch really). 

I'll throw out an example of general education funding being tied to free/reduced lunch pupil counts: http://www.marketplace.org/topics/wealth-poverty/education/how-free-lunches-pay-schools

From the article:

“We get approximately $5,000 per child in state aid for every free and reduced student that we can identify as of October 31 each year,” says Walker. This year that adds up to more than $323 million.

I'm not saying my kids' school gets $5,000 extra per pupil that is free/reduced lunch, because I think the number is closer to $1,000-2,000.  But this phenomena certainly exists in my district, and other places all across the country.  It's just a fact. 

Now we can argue policy - is it the right way to fund schools?  Or fairness - should my kids who come from a millionaire household qualify their school for thousands in extra funding, even though they get top scores at school and don't need any extra assistance (other than enrichment/academically gifted support)? 

[teen persuasion]

This is an interesting topic!

Agreed!  Always interesting to see the diversity of opinions on a divisive subject like entitlements.

The reduced lunches is a more complicated issue.  We don't need the lunches; the kids have plenty to eat and would never go hungry w/o it.  Reduced lunches is actually important for college aid.  If the family is eligible for free or reduced lunches,  and our AGI is below certain thresholds, the college kids are eligible for the simplified needs test (no asset test) for AGI under $50k, or possibly an EFC = 0 if AGI is under $23k.  That is the main reason that we apply for free/reduced lunches: it is thousands of dollars in financial aid.

Thanks for sharing!  I had never heard of free/reduced lunch qualifying kids for simplified needs test (no asset test). 

I'll have to look into this as my kids get closer to college age.  They are so many interlinking contingencies with these social programs that it can be hard to optimize benefits.  Our AGI will be low-ish, but our assets will most likely not be low.

Just beware that they change the rules all the time!  A few years ago, the cutoff for EFC = 0 was at $31k, they raised it to $32k and then retroactively lowered it to $23k.  With 401k contributions, we were under $31k or so, but $23k is out of reach.  If you don't make the cutoff and calculations are continued, the formula adds back in all your 401k, etc. contributions.  For some reason, they only calculate the FICA as paid on the AGI, though.

There are other ways to qualify, such as being eligible to file a 1040EZ or 1040A.  Alas, we have an HSA, and that alone requires that we file 1040.  As you said, interlocking contingencies.

If you'd like to examine the (current) formulas to see what affects the calculation of EFC, here is the link:http://www.ifap.ed.gov/efcformulaguide/attachments/091913EFCFormulaGuide1415.pdf
You have to put plans into place earlier than you'd think.  My DD3 just started college this fall.  We filled out the FAFSA in January, and it is based on a snapshot of our account balances at the time we filled it out (if assets are included) and on our 2012 taxes.  IOW, for a student graduating HS in 2013, changes needed to be in place by the end of 2011.

I see that I misspoke about the $23k threshold.  It is now $24k.

[StetsTerhune]

This is such an interesting topic to me because it's something that I'm 100% sure I'm right and can't make myself consider on any level the opposing view (which many people have been espousing passionately). I've worked very hard in life to always be able to see the other side of an argument, but I don't see it at all here.

[beltim]

This isn't directed at you because I have no idea your employment situation.  But I wonder how the government employees here can justify the extortionist contributions that the taxpayers must make to fund their cushy government pensions.  I guess some here might have to delete "collect a government pension" from their retirement plans due to ethical concerns.  Why take it if you don't need it, right?

This is nonsense, and I think you know it's nonsense. Why would taking compensation given to you by your employer be unethical?

I honestly don't think it is nonsense.  I'd throw collecting government pensions in there with the other government handouts.  I mean if you don't really "need" the government pension, should you take it and deplete the funds of the pension plan?  Part of the pension funding comes straight out of the public treasury (ie taxpayers' pockets).  Why not withdraw your contributions (plus interest) and forfeit your pension if you are highly principled?  I see no one opting for that choice.

The taxpayers fund it, but it's part of your compensation. There's no difference here between a government pension and a private pension - its a benefit earned by the employee for work performed. I cannot fathom what you're thinking here. It would be like giving back all of the contributions in a 401k that your employer made because you "don't need it.". There's simply no ethical basis to require this.

[RootofGood]

This isn't directed at you because I have no idea your employment situation.  But I wonder how the government employees here can justify the extortionist contributions that the taxpayers must make to fund their cushy government pensions.  I guess some here might have to delete "collect a government pension" from their retirement plans due to ethical concerns.  Why take it if you don't need it, right?

This is nonsense, and I think you know it's nonsense. Why would taking compensation given to you by your employer be unethical?

I honestly don't think it is nonsense.  I'd throw collecting government pensions in there with the other government handouts.  I mean if you don't really "need" the government pension, should you take it and deplete the funds of the pension plan?  Part of the pension funding comes straight out of the public treasury (ie taxpayers' pockets).  Why not withdraw your contributions (plus interest) and forfeit your pension if you are highly principled?  I see no one opting for that choice.

The taxpayers fund it, but it's part of your compensation. There's no difference here between a government pension and a private pension - its a benefit earned by the employee for work performed. I cannot fathom what you're thinking here. It would be like giving back all of the contributions in a 401k that your employer made because you "don't need it.". There's simply no ethical basis to require this.

Companies are privately owned and funded.  Governments are publicly "owned" and funded by people like you and I (we, the taxpayers). 

Companies can pay whatever they want.  When the government starts asking me to pay for the cushy pensions of others, it bugs me.  Our state, for example, pays over 13% of each employee's salary into the pension fund.  That's way more than most private employers chip in.  And that's 13% in good times and bad. 

I "earn" the ability to participate in government provided handouts by virtue of meeting eligibility requirements.  I'm subject to the government's system of taxation, so I might as well avail myself of the benefits extended by the same government.  I can't feasibly opt out of either system (short of giving up citizenship, which isn't an option). 

[beltim]

This isn't directed at you because I have no idea your employment situation.  But I wonder how the government employees here can justify the extortionist contributions that the taxpayers must make to fund their cushy government pensions.  I guess some here might have to delete "collect a government pension" from their retirement plans due to ethical concerns.  Why take it if you don't need it, right?

This is nonsense, and I think you know it's nonsense. Why would taking compensation given to you by your employer be unethical?

I honestly don't think it is nonsense.  I'd throw collecting government pensions in there with the other government handouts.  I mean if you don't really "need" the government pension, should you take it and deplete the funds of the pension plan?  Part of the pension funding comes straight out of the public treasury (ie taxpayers' pockets).  Why not withdraw your contributions (plus interest) and forfeit your pension if you are highly principled?  I see no one opting for that choice.

The taxpayers fund it, but it's part of your compensation. There's no difference here between a government pension and a private pension - its a benefit earned by the employee for work performed. I cannot fathom what you're thinking here. It would be like giving back all of the contributions in a 401k that your employer made because you "don't need it.". There's simply no ethical basis to require this.

Companies are privately owned and funded.  Governments are publicly "owned" and funded by people like you and I (we, the taxpayers). 

Companies can pay whatever they want.  When the government starts asking me to pay for the cushy pensions of others, it bugs me.  Our state, for example, pays over 13% of each employee's salary into the pension fund.  That's way more than most private employers chip in.  And that's 13% in good times and bad. 

Even with benefits, government pays highly qualified employees far less than the private sector.  The "cushy pensions" are one of those benefits that partly (but only partly) ameliorates the much lower salary. You're already getting a bargain (paying less than private employees), and now you want to dictate in what form that compensation is paid?

Again, nonsense.

[mpbaker22]

Even with benefits, government pays highly qualified employees far less than the private sector.  The "cushy pensions" are one of those benefits that partly (but only partly) ameliorates the much lower salary. You're already getting a bargain (paying less than private employees), and now you want to dictate in what form that compensation is paid?

Again, nonsense.

Yes and no.  In my experience the mid-level employees are paid more than the private sector and are usually not qualified.  That's my experience with only a handful of employees, so not exactly a large sample size.

[RootofGood]

It's too bad we can't form a society of only MMM'ers.  With 59% to 92% of you deciding to forgo the various listed government subsidies in the poll, and extrapolating that into other areas of government subsidies, our social spending as a society could be virtually zero! 

And discussions here are never dull to boot. 

[beltim]

Even with benefits, government pays highly qualified employees far less than the private sector.  The "cushy pensions" are one of those benefits that partly (but only partly) ameliorates the much lower salary. You're already getting a bargain (paying less than private employees), and now you want to dictate in what form that compensation is paid?

Again, nonsense.

Yes and no.  In my experience the mid-level employees are paid more than the private sector and are usually not qualified.  That's my experience with only a handful of employees, so not exactly a large sample size.

The relative compensation of government employees is only a minor point here, and I don't want it to distract from the larger point that government pensions are compensation, and thus not even remotely comparable to government subsidies that use income as a qualifier.

However, for your edification, there's a really good CBO survey at http://www.cbo.gov/sites/default/files/cbofiles/attachments/01-30-FedPay.pdf
I particularly like the distribution figures on pages 8 and 9.  Of course, this study only used educational attainment, not experience, and the average age of the federal workers surveyed was significantly higher than those of the private sectors, so it's not a perfect comparison.  But it nonetheless quite interesting!

[clutchy]

I'm quite shocked to see so many willing to use the EIC contrary to its purpose.

the EIC was put into place to encourage people to work and support themselves and in turn the government will also help you out. 

Being an Early retiree(choosing not to work) clearly takes you out of that category and puts you in the morally dubious category.


taking the EIC while being retired is not ethical.

[seattlecyclone]

I'm quite shocked to see so many willing to use the EIC contrary to its purpose.

the EIC was put into place to encourage people to work and support themselves and in turn the government will also help you out. 

Being an Early retiree(choosing not to work) clearly takes you out of that category and puts you in the morally dubious category.


taking the EIC while being retired is not ethical.

I have no moral or ethical qualms with claiming any tax credit that I am eligible for. I won't lie on my taxes to qualify for a credit, but if I honestly qualify I'm more than happy to take that money.

That said, I find it unlikely that many early retirees will find themselves in a position where they would be eligible for the EIC in the first place. The requirements for this credit (in a nutshell) are:
1) You need to have some income from work.
2) Your total income has to be below a certain level (that depends on your filing status and number of children).
3) Your total investment income (defined as the sum of interest, dividends, and capital gains) must be below $3,200.

I think part (3) is what will disqualify most early retirees. I know I expect to have a fairly sizable amount of money invested in index funds in taxable accounts before I retire. Most index funds pay dividends in the 1-3% range. Suppose your index funds have a weighted average yield of 2%. Having $115k invested in a taxable account will disqualify you from the EIC because of dividends alone, before any capital gains from selling shares is even considered.

I suppose you can imagine an early retiree who has a low-paying part-time job they do for fun, and tries very hard to qualify for the EIC by specifically choosing taxable investments that pay no dividends, and paying most of their living expenses out of a Roth IRA. I expect the vast majority of early retirees will find that such a strategy is not worth their time at best, and actually counterproductive to maintaining their wealth at worst.

Of all the programs mentioned here, I think the EIC has the best overall balance. It provides a good benefit for those who need it. It has a means test that uses investment income as a proxy to exclude most moderately wealthy people from qualifying. The means test level is high enough that it doesn't create large disincentives for poor people to save their money. Finally, the administrative burden of applying for and receiving this benefit is quite low.

[LRS]

Some benefit programs are intended to address specific needs. That they are adopted reflects some sufficient agreement that a particular need---or some less than ideal mix of needs, from each necessary supporter's view---should be met. The eligibility test for such a benefit may imperfectly reflect the status of having the targeted need as it was intended by any necessary supporter. While perfectly legal to accept the benefit by meeting the eligibility test, if you don't believe you have the intended need, taking the benefit is unethical, and others may reasonably conclude that you are acting exploitatively. Social security, work-based retirement pensions and similar don't even purport to be addressing specific, rather than general, needs (i.e., completing the required contribution, whether of taxes or service, entitles all who have done so to take the benefit, regardless of further contributions or any type of need). I think that food assistance programs and other programs traditionally regarded as "welfare" in the U.S. reflect a general expectation that the recipients need the assistance regardless of making some reasonable efforts to avoid it, and that's the major difference between your intended receipt of the aid and an ethical receipt of it, in my view.   

Contemplating this point has changed my mind on this question. While I retain an appreciation for the low cunning it takes to hack the bureaucracy and lay claim to benefits that would otherwise be left on the table, I can no longer avoid the conclusion that doing so, in light of the social context and the legislature's clear intent in enacting welfare programs, is, at best, ethically dubious, if not flat-out unethical. It subverts the good will of society in attempting to provide a safety net for its least fortunate citizens, and siphons into the already-swollen coffers of the rich from the meager pool of funds society has managed to allocate to aid the poor.

Just because something is legal doesn't mean it's necessarily right. When I remembered and meditated on this, I began to drift away from my initial instinct on this topic.

[Emilyngh]

I suppose you can imagine an early retiree who has a low-paying part-time job they do for fun, and tries very hard to qualify for the EIC by specifically choosing taxable investments that pay no dividends, and paying most of their living expenses out of a Roth IRA. I expect the vast majority of early retirees will find that such a strategy is not worth their time at best, and actually counterproductive to maintaining their wealth at worst.

What about an early retiree living completely off of their Roth with no taxable investments at all?   Is this that unusual (it's my plan, I have no taxable investments).   I would not be "trying very hard" to use the EIC (don't know if I'd claim it at all), but I think there's a good chance we'd qualify.    I don't see how a tax credit would be not worth one's time nor couterproductive to maintaining wealth.   I also don't know if it would really be so hard for a ER with a family and investments in 401ks, Roths, and traditional IRAs to qualify.

[NV Teacher]

I'm not saying my kids' school gets $5,000 extra per pupil that is free/reduced lunch, because I think the number is closer to $1,000-2,000.  But this phenomena certainly exists in my district, and other places all across the country.  It's just a fact. 

Wow, $1,000-2,000 per student?  Our school gets a little under $300/year per student for our Title 1 allocation. 
If my school had that kind of an allocation we could be getting over $1,000,000 a year in extra funding.

[Katnina]

I'm childfree, so none of the child stuff applies to me!  I would feel comfortable taking the EIC, if we were eligible.  Since my husband is still working, that would not apply until he is retired.  And even then, our income will likely surpass the maximum.  Plus it's only $475 if you don't have kids, so not like it would make a difference.

[grantmeaname]

Free lunch?  Why not.  Another farm subsidy.  Oh, you thought that was for children?  Have you seen what food is on those trays?  Not designed to nourish children!  Designed to most quickly use up corn/wheat/soy/dairy.

QFT.

[bacchi]

the EIC was put into place to encourage people to work and support themselves and in turn the government will also help you out. 

Being an Early retiree(choosing not to work) clearly takes you out of that category and puts you in the morally dubious category.

Yeah, there's the question of intent. Just because the EIC, etc., can be gamed by FIRE millionaires doesn't mean that it's moral. It may be legal and even ethical but it's certainly morally dubious. The intent of other government largesse mentioned is different. Social security or a tax credit for buying a Leaf (or a government pension) is not meant exclusively for people struggling to feed their children or pay the bills.

As far as the "they would've built in an asset test" argument, that was explained above. The likelihood of abuse is so small that it's not worth it to actually do a test (get bank statements, get IRS returns, maybe a lifestyle check). However, public outrage is evident when abuse is discovered.

http://www.dispatch.com/content/stories/national_world/2012/04/17/big-lottery-winner-charged-welfare-fraud.html

http://www.cbsnews.com/8301-201_162-57337957/couple-on-welfare-had-$1.2m-house-traveled-globe/

[Emilyngh]

Bacchi- both of those articles are cases of fraud where people did not report assets they are required to.   No one is talking about fraud.


Also, asking for assets to reported does not require stringent verification.   If assets are asked for and misreported, that is fraud.   My state has low asset levels allowed for welfare eligibility, and while I doubt they triple verify things, lying about assets would be fraud.

[bacchi]

Bacchi- both of those articles are cases of fraud where people did not report assets they are required to.   No one is atlking about fraud.

Yes and they relate to the "they would've built in an asset test" argument. It's so rare (actual fraud by millionaires) that an asset test would cost more than it saves.

In any case, the claim stands: It's certainly legal, and apparently ethical in some circles, but using a program meant for the impoverished is morally dubious at best (even if you think that you "earned it" by paying $75,000 in taxes each year for the past 10 years.)

[Emilyngh]

I have a question for any who think it's immoral for anyone in ER to claim the EIC on the grounds that it's using the tax code in a way not intended: is using the Roth pipeline immoral?

  Arguably, the point of 401ks and other tax deferred acounts as they were designed is to defer taxes, not to avoid paying them.   If one uses loopholes (like the Roth pipeline) to not pay taxes on huge amounts of contributions and gains (although these accounts were made for tax deferral, not avoidance), is that use of the tax code in a way not intended just as immoral?

[beltim]

I have a question for any who think it's immoral for anyone in ER to claim the EIC on the grounds that it's using the tax code in a way not intended: is using the Roth pipeline immoral?

  Arguably, the point of 401ks and other tax deferred acounts as they were designed is to defer taxes, not to avoid paying them.   If one uses loopholes (like the Roth pipeline) to not pay taxes on huge amounts of contributions and gains (although these accounts were made for tax deferral, not avoidance), is that use of the tax code in a way not intended just as immoral?

Interesting question. I would not use a nondeductible IRA to get around the Roth income limits, because it clearly circumvents the intended purpose of the program.  A deductible IRA rolled over to a Roth, however, is still a way to access funds intended to be tax-advantaged for retirement. So it seems like that kind of rollover is still in the spirit of the law. I'd be interested to hear counter arguments, though.

[Emilyngh]

A deductible IRA rolled over to a Roth, however, is still a way to access funds intended to be tax-advantaged for retirement. So it seems like that kind of rollover is still in the spirit of the law. I'd be interested to hear counter arguments, though.

Isn't the spirit of the law on a deductible IRA that taxes will be deferred (but then paid)?   If one rolls money from an ira into a roth slowly enough after already ER to not pay a penny of taxes on the money, the original money contributed to the IRA (plus all gains) is tax-free, not tax-deferred.

[beltim]

A deductible IRA rolled over to a Roth, however, is still a way to access funds intended to be tax-advantaged for retirement. So it seems like that kind of rollover is still in the spirit of the law. I'd be interested to hear counter arguments, though.

Isn't the spirit of the law on a deductible IRA that taxes will be deferred (but then paid)?   If one rolls money from an ira into a roth slowly enough after already ER to not pay a penny of taxes on the money, the original money contributed to the IRA (plus all gains) is tax-free, not tax-deferred.

Thats a reasonable interpretation, although its not necessarily that taxes are deferred, it's that income is deferred. Appropriate tax is then levied on the withdrawn amount at ordinary income tax rates. There's no ethical problem with withdrawing income from a traditional IRA at lower tax rates than you saved when you paid in - that is part of the design and appeal.

[Emilyngh]

There's no ethical problem with withdrawing income from a traditional IRA at lower tax rates than you saved when you paid in - that is part of the design and appeal.

Eh, I don't think this is any more morally justifiable than saying "There's no ethical problem with claiming a tax credit for low income families when one is low-income -that is part of the design." 

 The reality is that just as crafters of EIC probably did not have those who ER but have large savings in mind when writing it, I don't think using the Roth pipeline to pay $0 on all contributions and gains was the purpose of allowing rollovers to Roths.    If using one part of the tax law in a way that it was probably not specifically designed for is immoral, then I don't see why this standard would not apply across the board.

[Emilyngh]

it doesn't seem much different to me than if you weren't funneling the money into a Roth before 59.5, but were instead taking 72(t) withdrawals equal to or less than your annual deductions, which wouldn't be taxed either, and doesn't seem to be outside of any intent of the law.

It seems different to me, keeping in mind the best guess of the purpose of deductible accounts.   These accounts are sometimes even called "retirement accounts," presumably because they are intended for saving for retirement at a traditional retirement age.   So, I would say that getting tax benefits by withdrawing from the account after 72 is not the same as getting tax benefits by withdrawing the money before retirement through a roth pipeline.   If the tax code were intending to treat these withdrawals (those before and after traditional retirement age) equally, there would be no early withdrawal penalty.

[beltim]

There's no ethical problem with withdrawing income from a traditional IRA at lower tax rates than you saved when you paid in - that is part of the design and appeal.

Eh, I don't think this is any more morally justifiable than saying "There's no ethical problem with claiming a tax credit for low income families when one is low-income -that is part of the design." 

 The reality is that just as crafters of EIC probably did not have those who ER but have large savings in mind when writing it, I don't think using the Roth pipeline to pay $0 on all contributions and gains was the purpose of allowing rollovers to Roths.    If using one part of the tax law in a way that it was probably not specifically designed for is immoral, then I don't see why this standard would not apply across the board.

When I said that, I was talking about traditional IRAs.  I don't think there's any doubt that people intended withdrawals from an IRA to be subject to progressive income tax. 

As for a Roth pipeline, I still don't know. It gives me a queasy feeling, and I don't plan on ever using it.  It doesn't give me an immediate sense of revulsion that using food stamps while in early retirement would, but I can't say it's obviously ethical either.

[beltim]

it doesn't seem much different to me than if you weren't funneling the money into a Roth before 59.5, but were instead taking 72(t) withdrawals equal to or less than your annual deductions, which wouldn't be taxed either, and doesn't seem to be outside of any intent of the law.

It seems different to me, keeping in mind the best guess of the purpose of deductible accounts.   These accounts are sometimes even called "retirement accounts," presumably because they are intended for saving for retirement at a traditional retirement age.   So, I would say that getting tax benefits by withdrawing from the account after 72 is not the same as getting tax benefits by withdrawing the money before retirement through a roth pipeline.   If the tax code were intending to treat these withdrawals (those before and after traditional retirement age) equally, there would be no early withdrawal penalty.

72(t) payments are absolutely intended for early retirement.

Edit: That's why 72(t) distributions aren't subject to the 10% penalty.

[bacchi]

While trying to make equivalencies, we shouldn't forget that food stamps and NSLP are budgetary programs. That is, there might be (and often is) a wait list for getting SNAP. A 35 year old FIRE millionaire taking food stamps is legitimately taking the spot of someone else.

[Emilyngh]

Retreading Emilyngh's response, we may have mistakenly assumed she knows what a 72(t) withdrawal is, and if not, what we've said on this point might make not the most sense.

You are correct.   I am sorry, I made an assumption about what was meant, but going back and looking it up, I did not know what a 72(t) withdrawal was and responded poorly based on this.

Although, in just my quick reading into what it is, I noticed something about having to be at least 55 to do one.   Is this correct?   If it is, I do not consider over 55 really retiring before a traditional retirement age and do not see how allowing one to withdraw after 55 through a 72(t) is really evidence that the drafters of the tax code intend for ER to be able to use Roth pipelines to pay no tax on investments.

[Emilyngh]

While trying to make equivalencies, we shouldn't forget that food stamps and NSLP are budgetary programs. That is, there might be (and often is) a wait list for getting SNAP. A 35 year old FIRE millionaire taking food stamps is legitimately taking the spot of someone else.

I think this is a good point.   I, personally would not be comfortable using SNAP or any other program where I might be using resources that someone else could really need.   I am more on the fence about EIC, pell brants, etc.

[MrsPete]

I guess the teachers, principals, and staff at my kids school, as well as the district superintendent, chief business officer, chief financial officer, and elected school board members have all made a concerted effort to mislead me in how school funding works, and what additional funds they receive for each kid that checks the box on the free/reduced lunch form.  I'm an appointed official at a policy level, and frequently talk with administrators, elected officials, and district executive leadership.  Granted, it's "only" a volunteer position, but one that interests me to a great degree, and one in which I have been effective at bringing about positive change for my kids' school and the district over all . . .

Now we can argue policy - is it the right way to fund schools?  Or fairness - should my kids who come from a millionaire household qualify their school for thousands in extra funding, even though they get top scores at school and don't need any extra assistance (other than enrichment/academically gifted support)?

I see that you want to believe this, but having worked in the school system for years, I assure you that you've twisted this into something it isn't.  You're comfortable believing this, and you don't want to hear facts.  Fine.

Anyone else who wants to know facts, The truth is that if X percentage of the students in a certain school receive free lunch, that school is labeled a "Title 1 School", and the school does get extra funding; however, it cannot be used for anything they please.  Its use is limited to very specific things aimed at helping children of poverty "catch up" to other kids.  It is all "extra", not anything that will ever hire extra teachers who will provide enrichment or alleviate overcrowding during the school day.  The designation "Title 1" also requires the school to jump through quite a few hoops, and it is in no way just an extra check that the principal can use to help the school.

The taxpayers fund it, but it's part of your compensation. There's no difference here between a government pension and a private pension - its a benefit earned by the employee for work performed. I cannot fathom what you're thinking here. It would be like giving back all of the contributions in a 401k that your employer made because you "don't need it.". There's simply no ethical basis to require this.

Yeah, I can't understand how people see social entitlement programs (i.e., Food Stamps) in the same light as benefits for paid employment. 

Lots of government jobs include pensions as a portion of the compensation.  These jobs tend to pay less than their counterparts in the private sector, but the pension is a part of the deal.  Teachers are a perfect example:  The job doesn't pay all that well, but the hours are great and the pension make up for the low paycheck.  It's the deal that's offered, and it's an earned benefit.  The teacher who stays in the job only 3-4 years ends up getting nothing, whereas the teacher who stays a full 30 years gets a nice pension.  The teacher who retires with a pension and lives only two years loses big -- he or she cannot leave that pension to children, and it's been a bad investment.  On the other hand, the teacher who lives to be 100 will "win" the pension game.  When the state hires a 21-year old grad, no one knows whether the state will "win" or "lose".  Regardless, it is in no way the same thing as a handout. 

Companies can pay whatever they want.  When the government starts asking me to pay for the cushy pensions of others, it bugs me . . .

I "earn" the ability to participate in government provided handouts by virtue of meeting eligibility requirements. 

If the government chose to do so, they could stop pensions . . . but if that portion of the workers' compensation package were to disappear, salaries would have to rise.  People wouldn't stay in the jobs otherwise.  Regardless, the state workers earn those benefits by working. 

You do not "earn" the right to be a part of a government entitlement program --  you qualify because of low income.  If you have voluntarily chosen a low income, when you have the ability to -- for example -- feed yourself, that is a questionable moral choice.

Yeah, there's the question of intent. Just because the EIC, etc., can be gamed by FIRE millionaires doesn't mean that it's moral. It may be legal and even ethical but it's certainly morally dubious.

And that's the root of the issue isn't it?  Do you choose to live your life in a moral way or not?

While trying to make equivalencies, we shouldn't forget that food stamps and NSLP are budgetary programs. That is, there might be (and often is) a wait list for getting SNAP. A 35 year old FIRE millionaire taking food stamps is legitimately taking the spot of someone else.

I'm not well-versed in how these programs work, but if the ER millionaire is taking the place of a single mother who genuinely needs food for her kids, I don't see how anyone could defend that position. 

I do know that low-income housing is difficult to come by, though I doubt a whole lot of millionaires are anxious to live in ancient shotgun houses in bad neighborhoods. 

[RootofGood]

I see that you want to believe this, but having worked in the school system for years, I assure you that you've twisted this into something it isn't.  You're comfortable believing this, and you don't want to hear facts.  Fine.

Anyone else who wants to know facts, The truth is that if X percentage of the students in a certain school receive free lunch, that school is labeled a "Title 1 School", and the school does get extra funding; however, it cannot be used for anything they please.  Its use is limited to very specific things aimed at helping children of poverty "catch up" to other kids.  It is all "extra", not anything that will ever hire extra teachers who will provide enrichment or alleviate overcrowding during the school day.  The designation "Title 1" also requires the school to jump through quite a few hoops, and it is in no way just an extra check that the principal can use to help the school.

This is probably as frustrating for you as it is for me.  I figured I might be misinformed, so I did a little digging this morning while I was volunteering at my kids' school.  I asked a few teachers how much a free/reduced kid brings the school, if any.  Answers varied, and tended to be vague and of low quality.  Some said "yes, kids get money for lunch" others said "we get a small amount". 

Then I spent about 30 minutes catching up with the principal.  Straight from my discussion with him:  Schools in our district are Title I when they exceed 30% free/reduced lunch.  We are at ~80% free/reduced.  Title I schools (in our district) receive funding base on a per pupil rate. In April, they give the school an estimated F/R headcount and an associated budget of Title I funding.  They true it up later in the summer and finalize it based on actual headcount of F/R students shortly after school begins.  The principal didn't have an exact per student Title I supplement amount, but said around $800 (but it wasn't exactly that), and that it varies each year based on a number of factors.  He said the funds resulted in almost $300k extra money for our school, which allowed him to hire five additional teachers above what he was allotted based on state funding formulas and class size requirements. 

He said that those extra teachers were placed into classrooms as primary teachers in order to significantly reduce class sizes.  Instead of 23-24 kids per class, he brought class size down to 16-17 for grades K-4 (screw 5th grade I guess??).  I am almost certain he is telling the truth about this, as each grade has an average of 69 children, which would have been 23 students per teacher with 3 teachers per grade.  With 4 teachers per grade K-4 (what we actually have), there is an average of 17.25 students per teacher.  I did a quick count in the lunchroom today, and the 2nd and 3rd grades had right around 16 kids per class (probably 1 per class sick on any given day).  I also know my kids have 16 and 17 kids in their respective classrooms. 

He said he had the flexibility to hire teachers and place them in different roles, but that small class size was the best choice for our population.  He could have bought a shit ton of iPads/pods/whatever instead of hiring teachers but we already have tons of tech toys (er, instructional aids). 

He's also spending a very small part of Title I funding (I estimate at around $12000) to provide free after school tutoring for students who need extra help.  That cost consists of overtime for teachers and snacks/supplies budget. 

I did a quick back of the envelope BS check on his numbers and $800/student seems about right given the 5 additional staff and after school tutoring program.  I think this number was higher in previous years, but I might be wrong.  It may even vary by school, but these were the numbers at my school. 

I'm providing this summary to you not to prove I'm right and you're wrong, because it could be that things work differently in different districts within our state.  Or K-5 funding works differently than high school.  Another alternative is that your administration doesn't want to do what my school's administration did.  Or they aren't being transparent with what they are doing.  Given the relative lack of knowledge of budgets, funding sources, and school finances among teachers I talked to, it could be that your administration is doing something creative (but totally permissible) with Title I funding and you aren't fully aware of it. 

I hope I haven't "twisted this into something it isn't" as you say, since I hold facts and truth in high regard. 

Since our school receives $800 per kid that qualifies for free/reduced lunch, when we qualify, I'll sign up for the program mainly to get more money for the school.  I can quantify the impact - I'm buying part of an additional teacher or additional after school tutoring for kids in need (not my kids).  Given our district's total (local, state, fed) expenditures of under $8,000 per pupil, an additional $800 per pupil is a huge amount of money (over 10% for those who haven't attended school recently).  Hey, I'll take it.  My kids might take advantage of free lunch, they might not. 

[MrsPete]

Root, I understand you've convinced yourself, and I'm not going to argue with you, but I have years of experience with this topic. 

[grantmeaname]

Then provide some evidence to support your position!

[seattlecyclone]

Yeah. RootOfGood's kids' principal seems pretty convinced that each free/reduced lunch student in his school causes his budget to go up by about $800, and that he is able to use this additional money to hire more teachers and reduce class sizes. This money may come with strings attached, but he and/or the school board consider it to be a worthwhile trade. Until proven otherwise, I'll assume the principal knows a thing or two about where the budget he manages comes from.

[thepokercab]

Here's a paper from the Institute of Education Sciences on the subject

http://nces.ed.gov/fastfacts/display.asp?id=158

Seems to back up much of what RootofGood is saying:

Schools enrolling at least 40 percent of children from low-income families are eligible to use Title I funds for schoolwide programs designed to upgrade their entire educational programs to improve achievement for all students, particularly the lowest-achieving students.

And..

In school year 2009-10, more than 56,000 public schools across the country used Title I funds to provide additional academic support and learning opportunities to help low-achieving children master challenging curricula and meet state standards in core academic subjects. For example, funds support extra instruction in reading and mathematics, as well as special preschool, after-school, and summer programs to extend and reinforce the regular school curriculum

I may not be a fan of Root's student loan re-payment avoidance program either, but he seems to know his facts in this case.

[beltim]

I agree with thepokercab, seattlecyclone, and grantmeaname: RootOfGood has provided pretty detailed support for his position, and any counterargument needs to provide a similar level of support.

I am, however, still waiting for RootOfGood to elaborate on why he thinks government pensions aren't compensation for employees.

[RootofGood]

I may not be a fan of Root's student loan re-payment avoidance program either, but he seems to know his facts in this case.

I'm not a fan of it either. I think the program is stupid and a waste of taxpayer money.  In the Ethical Dimensions of Income Based Repayment thread I started, I provided at least six ways the income based repayment program could be modified to cost less taxpayer money. 

I just fail to see how participating in a program for which you qualify that has extremely broad eligibility guidelines means you have somehow breached an ethical duty to the taxpayers.

Thanks for providing that link to Title I school funding.  I think the free school lunch = a bunch of money for my kids' school is well settled, perhaps with the exception of one individual. 

[RootofGood]

I agree with thepokercab, seattlecyclone, and grantmeaname: RootOfGood has provided pretty detailed support for his position, and any counterargument needs to provide a similar level of support.

I am, however, still waiting for RootOfGood to elaborate on why he thinks government pensions aren't compensation for employees.

I'm probably biased because I think government pensions tend to retain the worst employees because the best employees leave for greener pastures.  The worst employees are unemployable in the private sector due to poor performance, outdated skills, lack of work ethic or creativity, or some combination of those factors.  This is an ugly, broad generalization but based on my experience working with a particular governmental employer (from the public side and private side).  Good employees got offers for private employment and left.  Bad employees had no other recourse beside remain on the government payroll and continue sucking on the Hoover Dam spillway sized stream of government bennies (a fat paycheck and eventually a pension).

The pension system also means there isn't a lot of job mobility between public and private entities.  That stifles the information flow and creativity that comes from having different people from different backgrounds coming and going at your organization.  In other words, some degree of turnover is good.  I could write a book on the subject, so I'll leave it at that since it could be a controversial subject.  I might even exempt teachers from the generalization since there may not be enough of a private market to jump to and from (and I don't want to have an argument devoid of facts with certain teachers who post here).

I never stated government pensions aren't compensation for employees.  You can call it what you want, but at the end of the day, you're taking money from a public source that is funded by taxpayers.  In fact, government pensions are more funded by taxpayers than social security (which is funded solely through contributions of workers into their own system - it's a closed loop).  As a taxpayer, I'm funding the general fund that then contributes 13% of the salary of state employees to the pension plan.  If very wealthy retirees who don't "need" the pension opted out of the pension plan, then the state could spend less on funding the pension. 

Therefore, the ethical question arises "Should you retire early and draw on a pension when you don't really need it?".  Unquestionably you are depleting the treasury's coffers by taking a pension when you don't need (need - such a tricky word) it. 

Why are food stamps, free lunches, EIC, and Pell Grants similar to government pensions?  Your agreement to do your duty as a citizen and in return to avail yourself of the benefits of citizenship and membership in our society.

For men at least, you sign up for the selective service.  What I'm about to say is ridiculous today, but horribly relevant to anyone who lived during the Vietnam War era. The government can institute a draft and have your ass stuck in fatigues and shipped off to some god-forsaken wasteland to fight somebody you don't want to fight. 

You have to serve on a jury.  Try not doing so and getting slapped with contempt of court. 

You have to follow the laws.  Even ones that are stupid.

You have to pay tax.  Of course it is completely encouraged by the IRS to use any part of the tax code to minimize your tax burden.  It has to be legal though (tax avoidance ok, tax evasion is bad).  Taxes impact you in two ways.  You pay them on income you earn, and the onerous nature of taxation can dissuade you from earning more money or working harder.

In return for fulfilling your obligations as a citizen, you have earned the right to avail yourself of the benefits that we, through the government, have decided to offer. 

It's up to you whether you call this "compensation" in the same sense as a government pension.  But I think it is disingenuous to characterize government programs as "gifts" or "free".  To me, it is part of the social contract I implicitly agree to by remaining a citizen.  I haven't found a better country yet, so I'm just going to bunker down here as long as possible and make the place as good as I can.