Republican Presidential candidate Bob Dole has signed on to a revolutionary plan that over time would allow a portion of tax dollars now allocated to federal welfare programs to be turned back to individual tax payers so that they could allocate the money to charities of their choosing.

Taxpayers are more familiar with their neighbors' and their communities' needs than are Washington bureaucrats. Under a taxpayer choice plan, individual taxpayers could allocate their tax dollars that pay for welfare to any qualified institution, public or private.

Anyone could start a private charity and qualify for tax dollar contributions, provided the charity had a social welfare purpose and met certain minimum requirements. The plan is revenue neutral, in that tax credits would be exactly offset by reductions in block grants or matching fund payments to the states in which the taxpayers reside.

• U. S. taxpayers have spent $5.4 trillion (in 1992 dollars) on federal means-tested poverty programs since 1960.

• Yet the poverty rate is higher today than it was in 1965, when War on Poverty programs started.

• Currently, we are spending almost $400 billion -- about two-thirds of it federal dollars -- on federal antipoverty programs each year.

• Minus Medicaid, the figure is $240 billion -- some $6,100 per poor person, or $24,400 for a family of four every year.

According to a Census Bureau report, not all antipoverty funds go to poor people. And not all those officially classified as poor receive aid.

• Only 43 percent of all poor families receive food stamps, and 23 percent of food stamp families have incomes above the poverty level.

• Only 19 percent of poor families live in public housing or receive housing subsidies, while 40 percent of families receiving housing benefits are not poor.

• Only 41 percent of poor families are covered by Medicaid and 35 percent of all Medicaid beneficiaries are not poor.

• Amazingly, 46 percent of all poor families receive no means-tested benefit of any kind, and 40 percent of families who receive at least one means-tested benefit are not poor.

While government-run welfare programs do not require a change in behavior or seek evidence of a willingness to change on the part of aid recipients, well-run private charities often do. The private sector is more likely to encourage greater self-sufficiency and self-reliance, while preserving families and using resources efficiently.

Private charities are often more adept at identifying the truly needy. Private organizations now operate more than 94 percent of all U. S. homeless shelters, and as many as 80 percent of low-income people initially turn to the private sector in times of crisis. In contrast, two-thirds of federal welfare spending ends up in the pockets of people who are distinctly not poor.

Privatizing welfare is attractive for a number of reasons. It would de-politicize the process, reduce the influence of powerful special interests, and spur competition to place welfare dollars where they are truly needed and would have the most beneficial effect. Under the current system, the public welfare monopoly faces no marketplace competition, can spend money in wasteful and inefficient ways, fail miserably to achieve its objectives and generally misbehave without fear of losing its "customers" to a competitor.

By dividing total federal welfare spending by total personal income tax payments in each state, one can obtain the fraction of personal federal income taxes taxpayers should be free to allocate. Currently, spending for federal means-tested programs (minus Medicaid) consumes about 31 percent of all personal income taxes. Thus, in the average state, taxpayers should be able to allocate about $1,600 per year per household or about $2,100 per household if state taxes and welfare programs are included. However, bills currently before Congress would limit the amount to anywhere from $100 to $500 per year per individual, or $1,000 for a couple.