But the EITC is a program that involves complex rules for eligibility and size of payments, much more complex than Social Security. The EITC is aimed at low-income people, many of whom have economic and personal lives that are in considerable flux and many of whom have limited ability to deal with detailed paperwork, unlike the health care providers who receive Medicare and Medicaid payments. The envisioned health insurance exchanges are likely to end up serving many more people than the EITC. The complexity of decisions about buying health insurance is greater than the complexity of qualifying for cash payments from the EITC. When people’s eligibility for subsidies is moving and changing each year, as it is for the EITC and will also be for the health insurance exchanges, it will be difficult for the federal government to sort out eligibility. And as the complexity of the rules rises, it will spawn a network of people to help in filling out the forms, most of whom will be honest and forthright, but some of whom will focused on making people eligible for the largest possible subsidies, with little concern for legal qualifications.
Read the whole thing. Wonks should keep in mind that complex approaches that attempt to fine-tune incentives tend to be difficult to execute.
It doesn’t look all that complex to me:
http://www.irs.gov/Individuals/EITC-Home-Page–It%E2%80%99s-easier-than-ever-to-find-out-if-you-qualify-for-EITC
A summary page with 30 or 40 links is not complicated? I think most EITC recipients would say that it is.
I’m not sure what the number of links has to do with this. Yes, the page could have been cleaner, but there are about a dozen fairly straightforward requirements that almost anyone can understand, and they provide a guide to walk through the questions.
I don’t see how this collapses under the weight of it’s complexity.
With all due respect, I think that a dozen requirements makes something complex, not simple. Remember IBM’s “7 plus or minus 2” rule for foils (which is what slides used to be called)? This was for presentation to sophisticated audiences. EITC recipients are anything but.
Did you even ATTEMPT to READ that page?
The linked page itself contains exactly zero information that would help you figure out if you qualify for EITC. None at all.
The most prominent three links send you to pages or documents with varying levels of helpfulness – one of them not at all, the other two vague. One of those two vaguely helpful pages in turn has a link to a page that has some actual numbers on it that might help you determine whether you actually qualify!
There is an inverse relationship between cleverness and complexity.
If complexity is both inevitable and obstructing of these cherished policies, then the citizens will simply be relieved of the burden. I’ve already seen a dozen, “I can’t believe they won’t even fill out a simple form to get very valuable benefits” essays and studies. It’s a fact of modern life, it’s unacceptable to the proponents of these social policies, it can be overcome by technology, and so it will be overcome.
It is therefore obvious what is going to happen. The federal government will just arrange for the completion of these forms on behalf all these people. Obamacare, Medicaid, Income Taxes, EITC, means testing, anything really – it will just be the black-box government for low-complexity individuals.
Initially, it will be through through phone help lines and legal assistance clinics. Eventually, it will all be automated; there will be an app for that. Every life event will come with a digital transaction report to the appropriate government database, and payments and benefits will adjust accordingly. Just like the 1099 expansion – or a VAT scheme – requires. Legal hurdles with regard to consent and notice of information sharing will be overcome in the name of the policies at stake.
The greatest benefit to doing this once and for all will be in terms of policy flexibility. Never again will the argument, ‘that’s a compliance / reporting / administrative nightmare’ carry the day. “We need to modify the benefits package to discourage abuse by cohabitators, but how will we know if they’re living together?” Well, there’s a database for that. There’s going to be a database for everything. There already is, of course, the only roadblocks are the legal ones we’ve imposed upon ourselves. Where the bureaucracy requires that those roadblocks be removed to implement the larger concept, they will be removed.
The same app could provide personal assistive technology, showing individuals the governmental and financial consequences of their various courses of action, and helping to make recommendations. The government would also monitor these choices, measure the ‘market’ performance of regulations (whether the rules are having the desired psychological and behavioral impacts), and granted enough discussion perhaps even adjust the incentive environment to meet the desired performance targets. The potential for data-based social analysis to supplant unproductive, ideological and hypothetical speculations is unlimited.
I don’t know if ‘Information wants to be free’, but certainly, ‘The data wants to be mined.’
Accompanying the unburdening of filling out forms and worrying about applying for this government benefit or that will be the effectively impossible task of correcting errors in the database which will completely destroy the lives of the victims of such errors. Also, identity theft – see what’s happened to tax returns – will jump another order of magnitude or two.
Great….just great.
Exactly right. But it’s not going to stop it. Get ready!