In his second inaugural address, President Obama
said, “The commitments we make to each other—through Medicare, Medicaid, and
Social Security—these things do not sap our initiative; they strengthen us.
They do not make us a nation of takers; they free us to take the risks that
make this country great.”
But…there is a growing body of empirical evidence
pointing to increasing dependency on state largess. The evidence documents as
well a number of perverse and disturbing changes that this entitlement state is
imposing on society.
For instance, since 1960, according to the Bureau
of Economic Analysis, entitlement transfers—government payments of cash, goods,
and services to citizens—have been growing twice as fast as overall personal
income. Government transfers now account for nearly 18% of all personal income
in America—up from 6% in 1960. The myriad welfare programs in America currently
dispense entitlement benefits of more than $2.3 trillion yearly. That amounts
to $7,400 per American man, woman, and child!
In 1960, the Office of Management and Budget,
social welfare programs accounted for less than ⅓
of federal spending. Today, entitlement programs account for nearly ⅔ of federal spending.
That is nearly twice as much as defense , justice, and everything else
Washington does combined.
Today, 49% of Americans
live in homes receiving one or more government transfer benefits—that is up
almost 20 points from the early 1980’s. And despite what the White House
suggested during the last election, this leap is not due to the aging of the
population. Only about one tenth of the increase is due to upticks in old-age
pensions and health-care programs for seniors.
Instead, the country has seen an expansion in
public reliance on “means-tested” programs—benefits intended for the poor, such
as Medicaid and food stamps. Today over 100 million Americans are accepting
money, goods, or services from “means-tested” government programs. This
percentage is twice as high as in the early 1980’s.
This might not be so bad if it had not been accompanied
by a flight of working-age men from the work force. The Bureau of Labor
Statistics reports that the proportion of adult men 20 years old and older
working or seeking employment have checked out of the labor market—that is 13
percentage points more than between 1948 and 2008. This male flight from the
work force includes 7% of men in their late 30’s, the prime working age group. Moreover,
this happened before the recent recession.
This workforce opt-out was more than twice the rate experienced in
Greece, the poster child for modern welfare-state dysfunction. America’s rate
of workforce dropout is worse than practically any Western European economy.
It is common knowledge that America’s entitlement
balloon has been keynoted by huge increases in disability benefits, mostly
because of musculoskeletal complaints and mood disorders. Both of these
problems are usually impossible for doctors to document objectively. Another
burgeoning expense to the government and the taxpayer is a large increase in
people on food stamps.
Transfers of wealth funded by other people’s
money tend to foster a pernicious “something for nothing” mentality—especially
when those transfers seem to be progressively and relentlessly growing year by
year. This “taker” mentality can only weaken civil society; and this pattern is
not sustainable.
Generosity with our own money is a virtue; but
generosity with other people’s money is not.
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