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February 12, 2012

On the Dole: A Fifth of All Americans

By

Skyrocketing food-stamp enrollments over the last few years have played a notable role in this year’s presidential race, but it’s not just food stamps that have exploded — it’s entitlements, generally: housing subsidies, Medicaid rolls, college loans and much, much more.

And the trend is threatening to chip away at the very pillars that keep America’s civil society functioning.

Today, one in five Americans — 67 million of us, all told — rely on federal aid in obtaining housing, food, income, health care or education.

The dependent population has been growing for years, of course. But the “Index of Dependence on Government,” published annually by The Heritage Foundation, shows remarkably sharp spikes in dependence in the years since President Obama entered the Oval Office.

Over the two-year period 2009-2010, the number of people receiving aid from the feds grew 7.5 percent. And the payments got much more generous, too. In 2010, the average recipient of federal assistance collected benefits worth $32,750. That’s more than the average per-capita disposable income in America.

Dependency-related programs now cost $2.5 trillion annually. That’s roughly 70 percent of the federal budget.

And, no, the growing dependence on government isn’t simply a reflection of hard economic times. From 1980 to 2000 — a period of good times and bad — dependence, as measured by the Index, rose 79 percent. It rose 36 percent from 2000 through 2008, and 23 percent during the recessionary four-year period thereafter.

Overall, we estimate that only about a fifth of the Index’s increase reflects responses to economic downturns. Another fifth can be attributed to population changes. The rest is due to policy decisions. Yes, Washington has actually decided to make government bigger and more people dependent on it.

Typically this is done by expanding pre-existing entitlement programs: Congress decides to expand Medicare to cover prescription drugs, not just physician and hospital expenses. Medicaid, intended to provide health care for the poor, is expanded to cover middle-class and even more affluent children. Disability Insurance expands to cover more and more conditions, such as classroom stress for teachers.

All of these decisions were made independent of the business cycle (and before Obama entered the White House). Unfortunately, when economic times get bad, these decisions mean that dependency grows even faster.

From 1980 to 2000, the Index rose an average of 3.6 percent per year. That rate accelerated to 4.25 percent annually, 2000-2008. In the first two years of the Obama presidency, it’s averaged 11 percent per year.

Clearly, this kind of growth is unsustainable. 2010 was a watershed year, marking the first time average federal assistance payments outstripped average disposable income. Another watershed moment is not far off. Today, some 49.5 percent of us pay no income taxes (another record high). How long can a representative system of government survive when the number of folks receiving government largesse continues to grow, while those who pay for government dwindle?

Fiscal reality aside, there’s an equally dangerous consequence to increasing dependence on government: damage to our civil society.

Traditionally, Americans lean on families, neighbors, churches and voluntary associations for help in time of need. These social, civil institutions create relationships that actually strengthen community: I help you today; you help me tomorrow.

That kind of reciprocity does not exist between the people and their government. After all, the state never falls sick, loses a job or needs a place to stay. It’s a one-way relationship that may be superficially attractive to the recipient, but deprives individuals and their communities of a chance to become stronger. In the long run, the state’s eagerness to help weakens civil society and the human bonds among us.

So, yes, it’s worrisome that the Supplemental Nutrition Assistance Program, the major federal food-stamp program, has doubled in cost since 2008. But that’s just the tip of the entitlement iceberg threatening the very fabric of American society, even as it imperils our fiscal future.

William C. Beach is director of The Heritage Foundation’s Center for Data Analysis and lead author of its “2012 Index of Dependence on Government.”

First appeared in The New York Post

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