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February 8, 2012

2012 Index of Dependence on Government: No Slowdown in Sight

Greater Handouts Result in a Dependency Nation

  • Americans Receive More Than Ever Before:Americans relying on the federal government received an average $32,748 worth of benefits in 2010. That’s more than the average American’s personal disposable income of $32,446.

  • A Growing Population Looking to Government: Now, more than 67.3 million Americans depend on the federal government for everything from food stamps and college tuition to retirement services and health care. The Index saw overall dependency on the government jump 8.1% in 2010. This cost federal taxpayers roughly $2.5 trillion.

  • Fewer Federal Taxpayers to Support Programs:At the same time, nearly half the nation (49.5%) does not pay any federal income taxes. This means a shrinking number of taxpayers are funding a growing number of people who rely on the government for their daily existence—a recipe for the government’s fiscal collapse.

  • Higher Spikes on the Horizon:With more than 77 million baby boomers retiring in the next 25 years, Heritage’s Index could show even higher spikes as seniors start collecting Social Security checks, using Medicare benefits, and relying on Medicaid for long-term care.

Graph showing that 1 in 5 Americans Dependent on Government

Reliance on Washington Weakens America

  • Growing Voter Base Dependent on Government:A new crop of voters would vote for more benefits that would be paid by a shrinking pool of taxpayers. This would put tremendous pressure on the nation’s democratic government process.

  • Unsustainable Federal Spending: Right now, the federal government devotes 70% of its spending toward individual assistance programs. Without true welfare and entitlement reform, the nation’s budget will be crowded out by these programs—corroding important interests like national defense.

  • Government Fails to Adequately Replace Private Aid: While government assistance programs have replaced many functions that were done by communities, neighborhood groups, and private charities, research shows that private aid has better success than federal handouts in helping individuals become independent. Plus, local and private aid is often more effectively distributed than through government’s bureaucratic channels.

How Do We Change Course?

  • Reform Welfare and Entitlement Programs: Heritage’s long-term fiscal plan, Saving the American Dream, provides the framework for reforming Social Security, Medicare, welfare, and other assistance programs so that they serve the neediest first and are sustainable for future generations.

  • Curb Washington’s Addiction to More Spending: Congress should rein in its runaway spending if it plans to not burden future generations of taxpayers with an insurmountable debt. With welfare and assistance programs tying up a large chunk of the budget, Congress should streamline these programs so they work more efficiently.

  • Encourage More Community-Aid: Dependence on the federal government for life’s challenges has robbed civil society of its important role in working those in need. Allowing these groups to lead local efforts helps struggling Americans achieve their natural-born exceptionalism.

To read the full Index of Dependence on Government, please visit www.heritage.org.

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