I agree that there is always going to be people who try to scam the system, but there's still a difference. The first is that the local charities and churches can decide that they've had enough and make informed decisions about who to help. The second difference is that the local charities and churches are doing the helping with money that was freely given by people and/or church members in that community instead of money that was stolen out of someone's paycheck.
I was a member of a small Baptist church way out in the woods. I don't know how much you know about small county churches, but for them their annual homecoming is a big deal. They have preaching, singing (sometimes with groups), and a big dinner.
We used to have one family that would only show up at homecoming. They wouldn't come to church any other day. There was four of them. A man, a woman, a grown son, and a grown daughter. They would show up just about the time the eating started. You could watch as each of them filled a plate, took it to their car, and put it in the trunk. Each of them would do this repeatedly. After doing this for several years the church deacons began doing some investigating.
The family did this to every small church in the area. They never went to any of the churches except to eat. None of them worked. None of them were disabled.
The next homecoming when the family showed up the deacons discretely had a talk with them. It's my understanding that they told the family that they were more than welcome to come to church any time they wanted. That if they were truly in need the church would be more than willing to help them in any way the church could. And that they were more than welcome to to eat at the church until their hunger was satisfied, but they couldn't fill up the trunk of their car like the church was their personal catering service because there were other people that needed to eat also.
The family never showed up again.
Well, the church that we've attended is pretty small - about 100 active members. Maybe 150 on the rolls.
I agree that the preferred approach up and down the line is to relegate charity to those organizations that are best equipped to handle it - churches, local charities being the favored - and that those organizations retain the decision-making to donate how much and to whom the proceeds go.
The government - even local government - is ill-equipped to make those decision and the federal government is so far out of touch it's ridiculous. Look at the Katrina debacle. While GWB took a lot of heat for a lot of crap, there's plenty of evidence that the breakdown occurred at the state level, which is a whole 'nother level of bureaucracy altogether.
Getting back to your illustration of your small country church, it seems to me that the church membership expected the church leaders to step up and, in an appropriate way, address or even confront these freeloaders. It sounds like they did it the right way and while extending an invitation to be a part of the church on a more or less regular basis, but close the door on providing food on a sustained basis.
Contrast this with my pastor. This is the type of guy who will NOT confront these freeloaders in any way, shape or form. He doesn't make a lot of money to begin with, but will dig in his pocket for whatever is there and hand it out to the local freeloaders whenever he can. And I knew another pastor from another church who did the same thing.
As long as they're passing out their OWN money, no problem. But if it's the church's money/assets/proceeds, a little bit of accountability is not out of line.