I just finished explaining to a class of introductory economics students why all Government assistance to the needy should be CASH and not in the form of foodstamps nor other so-called in-kind transfers. We, economists, believe that the beneficiary of an assistance knows best his or her idiosyncratic needs and a third party (like the government) may be totally clueless of these needs. Hence, the best way to help is to give Cash so that the beneficiary could use as needed. Of what use would foodstamps be to a needy person who has enough food to eat ("prolly" because of a small farm he owns) but can't, forexample, pay his child's school fees? A $500 worth of foodstamps may therefore worth less to a beneficiary if food is not is what he primarily needs. As one could easily decipher, the philantropist can never go wrong with Cash Gifts.
It happens that the government is not the only entity to learn from this lesson. We all should begin issuing gifts in the form of cash, Visa Gift Card or any other highly liquid gift. If we can't ask the intended beneficiary of what he/she needs before we buy the gift, then you can't go wrong with Cash. Philantropists have no idea how some of their valuable gifts, in most cases, go unappreciated. I know of a man who handed over a Movado watch gift to another friend because he had numerous Movado watches. Governments' main excuse for continuing to offer in-kind transfers (instead of cash) is paternalistic altruism: they claim that they are scared that a cash gift might be used for unintended purposes like drugs, gambling, etc. But you know I don't do any of these things, so what's your excuse for not giving me cash this christmas?
Of course, cash is what economists think is the best gift? What do other social scientists think? Psychologists, Sociologists, etc what do you say?
Inflation? Hello? Surely your economics students posed the question that if your increase M0, without increased gdp you'll result in inflation?
Gkdapaah, i see where you are coming from but i would say that the best a government/philanthropist/donor could do is to do the feasibility study first before proceeding with their grant. A one-way street doesnt always work for the benefit of all concerned be it cash or food stamps. I say give the cash to those who prefer it and the food stamps to the other section and best of all make both systems redeemable against each other.
THE CRINGE FACTOR! WHAT MAKES YOU THINK THAT GOD MADE THREE WORLDS AND THAT I COME FROM THE THIRD WORLD. THE ISSUE OF RACE IS GEOGRAPHICAL AND NOT A STATUS SYMBOL AND NEITHER IS MY SKIN BLACK NOR YOURS WHITE.