Lying to Ourselves: America's Welfare State

· Tuesday, February 28, 2012

If you fear America is becoming like Europe, fear not -- because it's too late.

In Hamlet, Polonius, the Chamberlain to the King, gives his son what is probably the most famous piece of fatherly counsel in all of literature: "This above all: to thine own self be true."

Polonius's exhortation is one that Americans should take to heart -- and his famous words came to mind while reading a recent New York Times article. The article was about the residents of Chisago County, Minnesota, who, according to the Times, "describe themselves as self-sufficient members of the American middle class and as opponents of government largess."

At the same time, they "are drawing more deeply on that government with each passing year." In 2009, the last year for which data is available, the residents of the county received an average of $6,583 in federal benefits -- a 69 percent increase since 2000.

While most of the benefits go to older residents, assistance to younger residents is growing at about the same rate.

To be fair, Chisago County is far from unique – on the contrary, it's typical. What comes to mind for most Americans when they think of the beneficiaries of "government largess" is an African-American single mother. But a more complete representation requires looking in the mirror.

If this comes as a surprise to you, it's because the architects of the American welfare state have worked hard to hide that fact.

As David Brooks recently wrote in the New York Times, "the U.S. does not have a significantly smaller welfare state than the European nations. We're just better at hiding it." Whereas European countries "provide welfare provisions through direct government payments," the U.S. does it "through the back door via tax breaks."

For instance, "European governments offer public childcare. In the U.S., we have child tax credits." European governments openly "subsidize favored industries." We provide "special tax deductions and exemptions" for Washington's favored industries.

This back-door approach allows Americans to indulge in the fantasy of their self-reliance and rugged individualism without actually being self-reliant or rugged.

The back-door approach is also grossly inefficient: Many of the benefits flow to "those who need them least." It's a system that rewards those with the best lobbyists instead of protecting those who truly need help or who would put taxpayer's money to the best use.

Even worse, it's unsustainable. The same day Brooks' column appeared in the Times, European Central Bank President Mario Draghi told the Wall Street Journal that the European "social model" was "already gone." In other words, it's a thing of the past -- it's failed -- Europe can no longer afford it.

Neither can we. When you include both direct and back-door social spending, our welfare state is bigger than Italy's. It is "far above average" when compared to other industrialized nations. Unless we intend to leave our children and grandchildren with an unconscionable debt burden, that must change.

That change, as Polonius would tell us, begins with being true to ourselves. Americans say that they are concerned about the deficit, which they propose to close by cutting someone else's benefits.

Well, we are all "someone else." Nothing will change until we and our leaders admit this fact.


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Comments

Walter P

"For instance, "European governments offer public childcare. In the U.S., we have child tax credits." European governments openly "subsidize favored industries." We provide "special tax deductions and exemptions" for Washington's favored industries."

Sorry, but me keeping more of my own hard earned money is not 'Welfare'. Same goes for industry. To make the argument that a tax break is 'welfare', you have to start by assuming that all of our earnings belong to the government and they are being 'compassionate' by letting us keep some of it. I'm referring here strictly to tax breaks, not subsidies or any other form of unearned income. That would truly be 'welfare'.

Posted February 28, 2012 at 12:19:42 PM


JTG

I'm all for no breaks for anyone or anything. No deductions, no credits and a single flat tax rate.

Anyone who is not on the government dole would be too.

Posted February 28, 2012 at 1:07:02 PM


P. Long

I'm with JTG. Let's cut the deductions and breaks for everybody and every business and corporation. If's the tax is too onerous for one guy or business, it's too onerous for the next.

Posted February 28, 2012 at 2:04:14 PM


steve

"We must not let our rulers load us with perpetual debt..... And the fore horse of this frightful team is public debt. Taxation follows that, and in its train wretchedness and oppression." ---Thomas Jefferson

As Colson points out, it's too late. We are ALREADY loaded with debt and adding more even faster. See the frightful numbers rolling in real time here:

http://www.usdebtclock.org/

In addition to $15.5Trillion dollars in interest bearing debt, we have $117 TRILLION in unfunded obligations for Medicare, Social Security, Drugs.

Divide the total debt $133 T($15.5 Trillion plus $17.7 Trillion) by 311 million Americans and you get $428,000 personally owed by every man, woman and child. BUT...but, since only half of these people pay taxes, that leaves each taxpayer owing $856,000. USDebtClock.org calculates the liability PER TAXPAYER at $1.2 million each. Yes, EACH.

Many Americans want to live at the expense of someone else. We have an age bubble coming as the baby boomers age into retirement and the only growing population is with lower income demographics. Will those young people be willing to surrender more than half their incomes to keep the seniors comfy?

It would be ugly if we started dealing with this issue TODAY... but since we're not, our delay will make the day of reckoning even more ugly. OK, it will be bloody.

Posted February 28, 2012 at 2:21:04 PM


Capt. Call

It will be ugly if we try to slowly wean the people off of the government's largess, true. It will also be ugly if we do it "cold turkey." Hmmmm. Ugly either way...I say we go cold turkey!

Posted February 28, 2012 at 3:39:05 PM


David Bates

Not coincidentally, each year thousands of our very own precious babies are sacrificed to the god of convenience--it is not convenient to the mother at the time. Each child is a miracle of God, but in our godless society that fact is quickly discounted or flatly denied. But to comment on the above horrible mess our country is in, our leaders in gov't are deliberately keeping birth control down so that we are numerically unable to meet the individual tax burden on this country.

Posted February 28, 2012 at 3:54:49 PM


rippedchef

suprised to hear this from Colson-"back door welfare" and "corporate welfare" are hogwash-since when is keeping more of what you earn welfare??I also love "how are we going to pay for that tax cut"-uh,maybe when the geniuses in Washington figure out HOW TO WRITE A BUDGET we might actually have some type of fiscal policy.I got a hot one for the Feds-spend only what we take in-amazing.Reminds me of a sermon I heard a few weeks ago concerning drugs and alcohol,the pastor says"millions of dollars spent on research as to the cause of alcoholism-I can save them the money,I know what causes alcoholism,ITS ALCOHOL......"Kinda like debt-I don't need any research to tell me what causes our debt-ITS SPENDING there Chuck and until somebody grows a set and speaks out and pisses off the 48% who pay no taxes, we'll continue to hurtle towards the same cliff as Greece,except they are falling down the Parthenon steps-we'll be driving off the Grand Canyon

Posted February 28, 2012 at 4:13:46 PM


mac

And who can guess why Obama wants to INCREASE spending?

...anyone?...

That's right!!!

To get past the point where Greece is now!

And why???

So government can take over EVERYTHING!

Marxists are funny like that.

Think it can't happen here, with the protections of our Constitution?

Just look at how Obama keeps stepping over those protections every chance he gets.

IT IS HAPPENING NOW!!!!!!!

Posted February 28, 2012 at 4:31:22 PM


pete

When I work I get money. That is fair trade. When you write, you sell your product for money.

Now tell me just exactly how any government does anything to deserve a single penny of your money or mine!

Posted February 28, 2012 at 6:03:03 PM


Oathkeeper Scott

Many excellent comments so far.

Ever wonder what all the czars and bureaucrats Obama and his handlers have put in place are doing?

They're laying down plans and regulations that will 'save' a fallen America torn by rioting and suceding states. The power of its iron fist will be 'justified' by the good intention of keeping the states united, and it will be as brutish and unconstitutional as the precedent set by Abraham Lincoln.

Woe be to a soft, dumbed down, distracted America that's largely become unskilled in hand-craft, agriculture, and survival. Add in a long-dwindling sense of honor, work ethic, and comfort with parasitically living off the fruit of other's labor, and you have the ingredients for chaos and fracture.

A time of great suffering is coming.

The Great Depression was a walk in the park compared to what's impending. We were not many decades removed from our pioneering days then. A man's word was his bond. Families were more intact. There was much more respect for justified authority. Dark times.

Posted February 28, 2012 at 6:12:53 PM


Jeremy

Colson got it wrong and Walter P got it right. There is a vast difference between letting someone keep more of their own money and giving someone someone else's money.

Of course, I'm all for letting everybody keep a whole lot more of their own money and shrinking government accordingly. I suspect we'll get there eventually, but, as others have noted, it'll be a rocky road no matter how it happens.

Posted February 29, 2012 at 12:37:42 AM


Dave

The thing all you guys advocating for "letting people keep their own money" don't get is that the current system of tax breaks isn't applied across all taxpayers. So the guy who buys the Chevy Volt gets to "keep his own money" via the special tax credit for buying electric cars, but the guy who buys the Ford Focus doesn't get to "keep his own money" because .gov has decided that petrol engined cars are bad. The guy who starts a business making solar panels gets to "keep his own money" as a result of the tax credits for solar energy, but the guy operating the gas fired electric plant that powers your home doesn't get to "keep his own money" because .gov has decided that fossil fuels are bad.

I suspect we all agree that government spending and taxes both needs to be a whole lot lower. These sorts of preferential credits are in fact government spending because they require the taxpayer that doesn't tow the line and participate in the right activities to shoulder a greater tax burden to pay for those segments of society that do take advantage of these special programs.

Posted February 29, 2012 at 9:30:55 AM


MNIce

There is most certainly welfare in the tax code. It's the so-called "Earned Income Credit" - a means the IRS uses to reward people who don't earn enough according to government standards. If you owe little or no income tax (before withholding), you may actually get a check from the US Treasury under this program. The IRS even runs radio ads encouraging low-income people to file returns so they can get these handouts.

You have to write NO on the EIC line to avoid this unconstitutional giveaway; if you leave it blank the IRS will calculate it for you. I suggest writing NO there even if you know you don't qualify - perhaps the IRS won't waste time and money checking.

Posted February 29, 2012 at 10:17:32 AM


p3orion

"It will be ugly if we try to slowly wean the people off of the government's largess, true. It will also be ugly if we do it "cold turkey." Hmmmm. Ugly either way...I say we go cold turkey!"

I agree, Cap'n. I don't want to go to my grave wondering how it'll all turn out. Besides, I shoot better than my children do.

Posted February 29, 2012 at 4:49:30 PM


rippedchef

not me p3-my 13 yr old can lay a slice of baloney over a full clip pattern from my glock at 25 yds and my 8 yr old is holding her own with a .22- and if I go down the wife is quick with the 20 gauge-big suprise for anybody coming into my crib

Posted February 29, 2012 at 5:23:16 PM


Abu Nudnik

Perfect. The nail on the head.

Posted March 4, 2012 at 12:48:31 AM


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