The Right Opinion

Are We Becoming European?

By Mona Charen · Jan. 4, 2013

Following the fiscal cliff melodrama, Senator Richard Shelby appeared on television to declare that we are becoming European. “We're always wanting to spend and promise and spend and borrow but not cut. We've got to get real about this. We're headed down the road that Europe's already on.”

There's no “heading” about it. We're there. Prof. John J. DiIulio, writing in “National Affairs”, outlined the true size of American government. When state and local government expenditures are added to federal outlays, government spending as a share of GDP easily competes with European nations. In fact, per-capita government spending in the U.S. is higher than in France, Germany and the United Kingdom, and our debt to GDP ratio is higher than most European states.

The Obama administration has set records for deficit spending in peacetime, but there is no question that the growth of government at all levels has been a decades-long process. In 1960, total government spending (local, state and federal) amounted to 27 percent of GDP. In 2010, it was about 42 percent. State spending has been almost as irrepressible as federal, leaving only nine states that can now boast AAA credit ratings. Many states are facing crises over unfunded pension liabilities that have the capacity to engender strikes and social unrest in the not too distant future.

Though President Obama and the Democrats are fond of citing the “two wars on a credit card” and the Bush tax cuts as drivers of our debt, the truth is that the first Obama term added $4.5 trillion to the national debt in just three years – more than the total debt amassed by the United States government in two centuries. DiIulio writes: “Add our annual debt per capita (about $49,000 in 2011) to total annual government spending per capita (about $20,000 in 2011), and we have a rough 'big government index' of nearly $70,000 for every man, woman, and child in this country.”

The difference between Americans and Europeans is that we aren't honest about our appetite for big government. We hide it through a variety of proxies, private contractors, and public/private partnerships. Leaving aside the Department of Defense, which employs 3.2 million Americans, government employs more than 20 million civil servants. Only 2 million of those are full-time federal workers. The Department of Homeland Security, for example, employs 188,000 federal bureaucrats, but also 200,000 privately contracted employees. Medicaid doesn't employ an army of civil servants but instead pays private employees of medical practices, hospitals, and nursing homes.

The EPA employs between 16,000 and 18,000 full time personnel. It has been able to expand its regulatory reach though by cooperating with 50 state EPA equivalents and by hiring tens of thousands of private contractors.

Most non-profits receive few government subsidies. But the largest ones with the biggest budgets are heavily government-dependent. One-third of all non-profit dollars come from government. Catholic Charities USA, for example, a marquee “private-sector” charity, received two-thirds of its funding in 2009 from Uncle Sam.

Americans prefer small government to big government – in the abstract. But 60 million receive Medicaid benefits, 54 million collect Social Security, 48 million participate with Medicare, 45 million receive Food Stamps, 7 million are in prison, jail, or on parole/probation, more than a million have de facto government jobs working for defense contractors, nearly a million children participate in Head Start and about 40 percent of K-12 students receive free or reduced price meals. There's some overlap in those categories, but it still adds up.

Taking a government check goes down much more easily when you can persuade yourself that you're only withdrawing money that you have faithfully paid in over the course of a lifetime. Indignant elderly callers to C-SPAN constantly invoke the “I paid for my Social Security” myth.

They didn't. The average beneficiary will receive far more in Medicare and Social Security benefits than he paid for in taxes.

We are, in short, a socialist-style society just like Europe. And Obamacare has yet to kick in.

The road to recovery begins with admitting you have a problem.

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5 Comments

Tod the tool guy in brooklyn ny said:

Mona Poppins-Great blog Governess! "Just a spoonful of sugar helps entitlements go down, in the most delightful way!" And--"Everyday's a holiday with UNIONS, get paid for a NO SHOW JOB!" How 'bout "Spend in time, spend in time, wasting nickels, wasting dimes!"And lastly, Governess,"Sp-Spending, sp-spendin, sp-spendin spree, waste more millions on green energy, throw me a bone , kuz that's lucky too!" Love yaz!

Friday, January 4, 2013 at 6:25 AM

Tex Horn in Texas said:

Just as many European countries are learning the truth about socialism and trying to change their ways, we blindly plow down that road, ignoring all the road signs seen in Europe and South America. Thank you, Dictator in the White House.

Friday, January 4, 2013 at 11:11 AM

India in GA said:

"Americans prefer small government to big government -- in the abstract."

BAM!! You said said it, girl.

Friday, January 4, 2013 at 12:54 PM

Wayne in Hinesville, GA said:

51% of the people in this country see no problem in going down the Socialist-Marxist road to loss of rights and freedoms. It's more important to them in what kind of freebies they can get from the government. It never occurs to the idiots where the money comes from to fund the giveaways. Every program that the government pays out to its citizens should be on the list of reforms. I am retired from the US Army, draw Social Security, have Tricare for Life Insurance,Tricare Prime Insurance for my wife and two grandchldren, and also have Medicare. If it takes cutting my benefits to help stablize the economy and start paying down the national debt so be it. It will hurt but I'll survive. Just make damn sure that all welfare programs and anyone else drawing any monetary benefit from the government be included in the cuts. However, the liberals will never agree to cutting welfare, Social Security, or Medicaid. I am convinced they will come after military retirees, VA benefits, and Medicare. I hope I'm wrong and that the cuts would be across the board.

Friday, January 4, 2013 at 4:31 PM

Murph in Berkeley CA said:

Retirement 101: A retiree may receive and ought to expect more in benefits than he paid in. In the private sphere, this happens through the miracle of compound interest and wise investment. But wise investment is what the Social Security tax tends to crowd out during many people's earning years. One also recalls from microeconomics that an earner pays not only the payroll tax but also his employer's "contribution" (by way of the pricing mechanism operating in the labor market). The studies that I've seen comparing Social Security benefits to those of private retirement investment suggest that Social Security pays rather modestly. I haven't made a similar study of the Medicare system.

Saturday, January 5, 2013 at 1:24 PM