CONTINUED dissatisfaction with AFDC has kept the issue of an income maintenance program at the forefront of public discussion. Tobin lists two basic strategies in the effort to control poverty; he labels these as structural and distributive. The structural strategy is represented by efforts to build up the capacities of the poorest segment of the population so that they may earn incomes that will provide an adequate living standard. The distributive strategy is represented by methods of income payments or arrangements to provide a base of financial support to ensure an adequate living standard for every family. The decentralized public assistance mechanism has been found to be ineffective, costly, and destructive for this purpose. As a consequence, it has been reorganized for all aged, disabled, and blind persons. Pressure to drop the public assistance mechanism for all others and to replace it with an income maintenance scheme for all has mounted in recent years. As a distributive strategy, the public assistance model has been considered a failure. The debate in recent years has centered on alternative models of income maintenance which are purportedly more effective and less destructive than public assistance.
Alternatives to public welfare which have been suggested generally fit four classes of options: (1) the model based on family income which sets a minimum floor under family income; (2) the children's allowance or universal payment (demogrant) in which all individuals receive grants, which are then retrieved by differential tax rates among the nonpoor as suggested by Greene and Handler; (3) the model based on categorical guarantees, providing a floor under the income of protected categories of the population; and (4) the model based on income and ownership policies that have underlying assumptions of basic changes in the economy which will eliminate or prevent poverty. A demogrant is a lump sum given to each person in the society to be used as he or she wishes. The government, hopefully, regains much of the money given to persons who do not need it by means of the income tax. In other words, the demogrant is