Today’s column features a very depressing chart from a report published last year by the Congressional Budget Office and it shows that poor people now get about three-fourths of their “income” from handouts.

That’s far different from the data in 1979, when poor people actually earned about two-thirds of their income.

Here are some excerpts from the CBO report, documenting the shift from private income to government dependency.

For people in households with money income below the poverty threshold, the composition of that income has changed over time… In particular, the percentage of total income that is accounted for by money income decreased from 1979 to 2021… In 1979, money income accounted for nearly two-thirds of total income, and in-kind transfers (both health-related transfers and those unrelated to health) accounted for about one-third. In 2021, money income accounted for about one-quarter of total income, and in-kind transfers accounted for more than half.

The shift from private income to government handouts is distressing because the goal should be self-sufficiency.

Some of our friends on the left, however, think the goal should simply be to make sure the poor have money.

I wrote a two-part series (here and here) about this divergence.

There’s one other visual from the CBO report that I want to share, mostly because it underscores the wisdom of the late Walter Williams.

Walter pointed out that there is a very simple recipe for minimizing the odds of being poor.

As shown by Figure 14, he was right. The big difference between the charts is that the lowest quintile has a disproportionately large number of households that are “unmarried with children.”

For what it’s worth, I don’t know if there are easy ways to solve this problem.

But that’s one of the reason that I favor federalism. Get Washington out of the business of income redistribution and allow state and local governments to experiment with the best way of helping poor people without creating permanent dependency.

P.S. If you’re wondering about the orange part of Figure 15 (federal taxes), it’s showing that poor people actually paid some tax until the mid-1990s. Starting about 2000, however, the tax code became a vehicle for additional redistribution thanks to the “refundability” of the earned income credit.

P.P.S. If you’re wondering about the part of Figure 15 for “health-related in-kind transfers,” that’s Medicaid and Obamacare. Those programs don’t produce better health outcomes, but they are definitely huge burdens of taxpayers.