Welfare Recipients Take Out Cash in Bars, Liquor Stores, Strip Clubs And X-Rated Shops

In a report that is sure to raise the ire of many Conservatives and reawaken the often bitter debate about welfare, some disturbing trends were revealed about how Americans may be spending their welfare checks. According to documents released to the NY Post under a Freedom Of Information Act request, welfare recipients used their EBT (Electronic Benefit Transfer) Cards to make cash withdrawals at ATMs inside of dubious locations that included Hank’s Saloon in Brooklyn; the Blue Door Video porn shop in the East Village; The Anchor, a high priced SoHo lounge; the Patriot Saloon in TriBeCa; and Drinks Galore, a liquor distributor in The Bronx.

The prominent New York City daily newspaper received copies of the database of 200 million Electronic Benefit Transfer records from January 2011 to July 2012, after filing a FOIA request earlier in the year. The documents track the locations of the cash machines, but do not reveal how or where the cash was actually spent.

According to the website WelfareInfo.org, welfare has a very specific purpose and a strict set of guidelines:

“US Welfare can be divided into two categories, social and economic. Social welfare services includes any program intended to help disadvantaged people function more fully in society while economic welfare generally refers to financial support. The main purpose of an economic welfare system is to assist citizens who are not able to support themselves or their families due to unemployment, underemployment, hardship, unskilled labor capacity, disability, or other similar reasons. In many cases, elderly persons and single parents may also be eligible for aid. To receive benefits, most programs require proof of financial need as compared to a set standard. This is due to welfare abuse in the past that has threatened the credibility of the system. A common tool for this is a means test, which estimates earnings and measures them against the standard of living. When the income falls below what is considered to be the poverty level, economic assistance is given. In some cases, a person may be required to show regular attempts to gain employment in order to receive welfare benefits.”

US welfare services and benefits may include direct cash, support services, tax breaks, specific goods, or any other measure that provides assistance to individuals or families that can meet welfare requirements. When direct cash is given, the recipient has free rein to disperse the money. However, the use of in-kind benefits instead of cash tends to be more common in the US welfare system. Health care, vouchers for childcare, electronic bank cards for food purchases, subsidized rent, tax discounts such as the Earned income Tax Credit (EITC), job assistance and training, and programs for alcohol and substance abuse are examples of in-kind goods and services that may be awarded, and each one can be extremely useful to those in need.”

There has been a contentious backlash against welfare and other entitlement programs, especially among Conservative voters and leaders. Mitt Romney may have cost himself the Presidency with his now infamous 47 percent comment, in which he said that 47 percent of the voters were so dependent on the Obama Administration for handouts that they would only vote for Obama.

Prior to the election there was an ugly fight in the Congress over the workfare requirements for welfare recipients. Republicans accused Obama of gutting the requirements that those on welfare must look for work.

Michigan Rep. Dave Camp, the chairman of the House Ways and Means Committee, launched an all out attack on the President:

“President Obama has a long history of opposing tough work requirements in welfare. Despite his latest attempt at an end-run around Congress, this Accountability Office report clearly states that the administration must submit this rule to Congress for review before it can take effect. Work requirements were the centerpiece of welfare reform, and we cannot allow that progress to be undone.”

No matter what your opinion may be of the welfare system, there are millions of Americans who, through no fault of their own, are living below the poverty level and depend on their monthly check to feed their families. When businesses exploit the system and dishonest recipients misspend the money, those who have a legitimate need for the program also suffer. The more the system is abused, the more the demands to limit welfare increase, and the harder it becomes for those who truly need benefits to receive them.

It is important to remember that the figures in the study do not reveal where the money was actually spent. The withdrawals in question were made in many highly unsavory locations, some of which are known for violence and criminal activity, but how or where the cash was used is not revealed by the documents made available to the NY Post. While it is more than likely that a great deal of the cash was spent on purposes other than those intended by welfare laws, the current system is unable to track the cash and that contributes to the problem.

The flaws in the system are obvious and they need to be addressed. Restrictions must be placed on where the EBT Card can be used and how the cash may be spent. Many legislators feel the solution is to eliminate cash withdrawals altogether as there is high likelihood of continued abuse. The best choice may be to convert to an all plastic, cash free system with a specific registry of which businesses can accept the card.

One thing is certain. The welfare system is being abused by unscrupulous recipients and corrupt business owners. Every time one of these inflammatory stories hits the news, the haters start to scream about ending welfare and those who are in need of help begin to suffer.

Using the acts of the few bad actors who abuse the system to attack those in need is simply inexcusable. There are too many Americans living in poverty and they should not be punished for the sins of others. Stop the stalling and the partisan fighting, fix the welfare system and help Americans find the jobs they need and want.