“If the government wants poor children to thrive, it should give their parents money.”

That simple idea, the New York Times reported, has fueled a national push to provide low‑income families with regular, no‑strings‑attached payments. Alas, new economic research suggests alleviating poverty might not be so simple.

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A “rigorous new experiment” recently published by the National Bureau of Economic Research found that years of monthly cash payments had no effect on children’s well‑being — an outcome contrary to what researchers had expected. 

“I was very surprised — we were all very surprised,” said Greg J. Duncan, an economist at the University of California, Irvine, and one of six economists involved in the experiment.

The study, known as Baby’s First Years, was conducted over four years. Recruitment ran from May 2018 to June 2019 and involved 1,000 poor mothers, most unmarried. The families, from the Twin Cities, New York City, New Orleans, and greater Omaha, were given $333 a month. Data was collected at birth and again when the children reached 12, 24, 36, and 48 months old.

Researchers said the findings were unequivocal.

“The money did not make a difference,” Duncan, the study’s leader, told the outlet.

The findings are relevant as politicians in Washington continue to fight over whether work requirements should be part of welfare reform. Democrats have long opposed work requirements for SNAP and Medicaid, saying they’ll “kick off people” from vital assistance programs, while Republicans tend to argue that these programs disincentivize work and create poverty traps for the disadvantaged.

Debates over how best to help the poor are nothing new. America was founded primarily by ethical men who saw helping the poor as a moral imperative. But they also recognized that helping the needy was a complicated matter.

“I am for doing good to the poor,” Benjamin Franklin observed in 1766 in the London Chronicle. “I think the best way of doing good to the poor is not making them easy in poverty, but leading or driving them out of it.”

Franklin was not speaking purely theoretically. He observed that the government assistance programs of his day had an unintended effect: “The more public provisions were made for the poor, the less they provided for themselves, and of course became poorer.”

While many today see the persistence of poverty as a collective moral failure, Franklin understood that poverty alleviation couldn’t be cured by handouts alone. True compassion lies not in fostering dependence but in encouraging industry, thrift, and self-reliance — virtues Franklin considered essential for both personal dignity and healthy communities.

Many today sneer at Franklin’s advice about personal industry and self-reliance, but these values were what carried Franklin and countless others quite far. Unfortunately, these values are precisely what many of today’s welfare programs tend to undermine. Indeed, mothers who received monthly cash stipends in the Baby’s First Years experiment were “less likely to work full time during the pandemic.”

None of this is to disparage or discourage charity, of course. Giving to individuals in need and to organizations can help others (and ourselves). But it requires discernment to tell if one’s generosity is serving as a hand-up to someone in need or simply enabling them to be “easy in their poverty” (to borrow Franklin’s phrase).

Handouts may ease immediate pain, but they cannot build the good habits or self-discipline, especially the ability to delay gratification, that are essential for lasting success.

If we truly wish to lift people out of poverty, we must be honest about the government’s limitations in reducing poverty and its long track record of failure.

Between 1970 and 2000, total federal and state welfare spending was around $8 trillion (constant $2,000). During that same period, the federal poverty rate was virtually unchanged (12.6% to 11.3%) — a stark contrast to the period before the War on Poverty, during which poverty declined sharply.

The failure of the Baby’s First Years experiment is disappointing, but it shouldn’t surprise anyone familiar with the track record of past welfare programs — or with Franklin’s wisdom.

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Writing to an English friend in 1753, Franklin warned that Britain’s public relief was doing more harm than good: “Repeal that [welfare] law, and you will soon see a change. Industry will increase, and with it plenty among the lower people.”

His words remain a sober reminder that well‑intentioned handouts often undermine the very prosperity they aim to create.

Jon Miltimore is the senior editor at the American Institute for Economic Research. Follow him on Substack.