This is Extreme Wealth Inequality: How Does One Fix This?

[ProSense]

9. Imagine

There are two basic arguments against social welfare/safety net programs. The first is that it creates less economic incentive to work because one starts to lose their benefits once they find employment....This basic concept would replace all social safety net programs, including welfare, food stamps, unemployment and other non nonmedical programs. The benefits would be twofold. One, it is efficiency. The government isn't trying to control the money or regulate it.

...more RW arguments.

To Beat Back Poverty, Pay the Poor

By TINA ROSENBERG

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Today, however, Brazil’s level of economic inequality is dropping at a faster rate than that of almost any other country. Between 2003 and 2009, the income of poor Brazilians has grown seven times as much as the income of rich Brazilians. Poverty has fallen during that time from 22 percent of the population to 7 percent.

Contrast this with the United States, where from 1980 to 2005, more than four-fifths of the increase in Americans’ income went to the top 1 percent of earners. (see this great series in Slate by Timothy Noah on American inequality) Productivity among low and middle-income American workers increased, but their incomes did not. If current trends continue, the United States may soon be more unequal than Brazil.

Several factors contribute to Brazil’s astounding feat. But a major part of Brazil’s achievement is due to a single social program that is now transforming how countries all over the world help their poor.

The program, called Bolsa Familia (Family Grant) in Brazil, goes by different names in different places. In Mexico, where it first began on a national scale and has been equally successful at reducing poverty, it is Oportunidades. The generic term for the program is conditional cash transfers. The idea is to give regular payments to poor families, in the form of cash or electronic transfers into their bank accounts, if they meet certain requirements. The requirements vary, but many countries employ those used by Mexico: families must keep their children in school and go for regular medical checkups, and mom must attend workshops on subjects like nutrition or disease prevention. The payments almost always go to women, as they are the most likely to spend the money on their families. The elegant idea behind conditional cash transfers is to combat poverty today while breaking the cycle of poverty for tomorrow.

- more -

http://opinionator.blogs.nytimes.com/2011/01/03/to-beat-back-poverty-pay-the-poor/

More suggested reading: Jared Berstein: Inequality, the Middle Class, and Growth
http://www.democraticunderground.com/1002251130