What are the pros and cons of replacing some welfare or unemployment?
We have this system in Britain for some things. You can apply for a special hardship loan if something major breaks that will stop you from having basic needs: this is aimed at the really desperate. You are talking about things like cookers, heating. The system is very bureaucratic. Things you can claim for that aren't contentious in the UK You can get a loan to buy a suit for a job interview. (free shirts) You can get a loan to start a business or for necessary tools and licences. You can get a loan to buy a computer. The main problem with these systems is they are very bureaucratic. It takes months to clear any decision and takes a huge number of staff to maintain. I may have a British view on this, but I always see tax as a deferred payment. I give the government money so they can look after me if I hit problems. It isn't so much about entitlement, but that I have paid up front. The tax is a lot higher in the UK, but you should get what you pay for. The UK has a system where you get lower rates of welfare, but they aren't time limited. The loans are usually an "extra". ( it is around $90 a week (plus rent) if you want a comparison.) I know the US system varies greatly My main problem with switching systems to a loan system is that it doesn't sound like an advance. I think it would cost a lot more to operate. Plus you would get the problem that if your loan became too large this would be a disincentive to find work. I don't think worklessness/ underemployment is caused by welfare it isn't often a choice people make. You wouldn't really benefit by converting to loans as a government because let's face it the majority of loans aren't going to be repaid. The decision process in who gets loans is not something governments are good at. Banks suck at it and they are meant to be experts. God help us if government gets involved. I think any loan that would get people working is a good idea.