For a decade the Heritage Foundation has prepared an annual 'Index of Dependence on Government'. The latest edition, for 2012, has just been released. Here are some excerpts from the accompanying report.
Index measurements begin in 1962; since then, the Index score has grown by more than 15 times its original amount. This means that, keeping inflation neutral in the calculations, more than 15 times the resources were committed to paying for people who depend on government in 2010 than in 1962.
. . .
The ... Index has now grown by 60.7 percent just since 2001. One of the most worrying trends in the Index is the coinciding growth in the non-taxpaying public. The percentage of people who do not pay federal income taxes, and who are not claimed as dependents by someone who does pay them, jumped from 14.8 percent in 1984 to 49.5 percent in 2009. This means that in 1984, 34.8 million tax filers paid no taxes; in 2009, 151.7 million paid nothing.
. . .
There was such a rapid growth in dependence in 2010 that the twin concerns — how much damage this growth has done to the republican form of government, and how harmful it has been to the country’s financial situation — has deepened significantly. Not only did the federal government effectively take over half of the U.S. economy and expand public-sector debt by more than all previous governments combined, it also oversaw a second year of enormous expansion in total government debt at the federal level. Much of that growth in new debt can be traced to programs that encourage dependence. Chart 2 illustrates how 70.5 percent of federal spending now goes to dependence-creating programs, up dramatically from 28.3 percent in 1962, and 48.5 percent in 1990.
. . .
Many countries have already passed the fiscal tipping point at which reckless growth in dependence programs has produced domestic debt crises. How far along the path to crisis is the United States? Are Americans closing in on a tipping point that endangers the workings of their democracy? Or have Americans already passed that point? Can this republican form of government withstand the political weight of a massively growing population of Americans who receive government benefits and who contribute little or nothing for them? How seriously have these federal programs eroded civil society by nullifying what were once social obligations, and by crowding out services that used to be provided by families, congregations, community groups, and local governments?
. . .
Paying for ... entitlements in the coming years will require unprecedented levels of deficit spending. Focusing on Social Security and Medicare alone, Americans face $45.9 trillion in unfunded obligations (read: new borrowing) over the next 75 years. That is more than $200,000 per American citizen — an unsustainable level of debt that is sure to slow the economy and could force even higher rates of taxation in the future. The high costs of these programs, which will be shouldered by the children and grandchildren of baby boomers, could easily lead to further increases in dependence of future generations — which would be more likely to depend on welfare during a slow economy. This snowballing of dependence — caused by automatic reliance on Social Security, Medicare, and Medicaid — could easily send the country past the tipping point of dependence, eroding civil society and endangering the functioning of democracy itself.
. . .
The challenges that Congress faces in reforming these entitlement programs are heightened by the rapid growth of other dependence-creating programs, such as subsidies for food and housing and college financial aid, and by the growing number of Americans who incur no obligations for receiving them. How likely is Congress to reform entitlements in any meaningful way under such circumstances? Can Congress rein in the massive middle-class entitlements in an environment of fast-expanding dependence programs?
. . .
This trend should concern everyone who supports America’s republican form of government. If the citizens’ representatives are elected by an increasing percentage of voters who pay no income tax, how long will it be before these representatives respond more to demands for yet more entitlements and subsidies from non-payers than to the pleas of taxpayers to exercise greater spending prudence?
There's much more at the link. Bold print is my emphasis. Worthwhile - and worrying - reading.
Peter
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