AMERICA'S GROWING DEPENDENCY ON GOVERNMENT
The Honorable Jim DeMint
I often visit Hilton Head Island in my home state of South
Carolina. One of my favorite things to do when I'm there is to get
up early and go down to the South Beach Marina. I walk along the
boardwalk in front of the quaint stores, look at the boats, and
just hang around for a few minutes with a cup of coffee enjoying
One particular morning, I was at the marina looking down at the
boats. Behind the boats is a small bay of water, and over to the
side is a little beach along the inlet that leads to the open
ocean. On this day, about a dozen kids were on the beach with an
instructor and their windsurfing boards.
From my own experience taking a lesson on that same beach, I
know that windsurfing is one of those sports that is much more
difficult than it looks. As I saw the kids getting in the water for
their lesson, I knew it would be entertaining, so I sat down in a
big wooden rocking chair on the boardwalk and prepared to
The kids got on their boards and paddled out to the middle of
the water behind their instructor. I couldn't hear exactly what he
was saying, but I could tell from his hand motions that he wanted
them to pull up their sails, sail about 50 yards to a buoy, and
then come back to the beach.
The wind was swirling, and I knew what was about to happen. All
of the students got up on their boards and began tugging on the
ropes attached to their sails lying in the water. As they were
fighting to pull their sails up, a few began to drift toward a
marsh, others toward the boats at the dock, and two were being
pulled by the tide down the inlet on the way to the open water. The
instructor was waving his hands and shouting instructions with
One girl finally pulled her sail out of the water only to have
it knock her off the other side of her board. But she quickly got
back up, steadied her sail, and started moving slowly toward the
buoy. This inspired a couple of the guys near her to believe that
this must be doable after all, and they soon got their sails up and
began sailing slowly in the general direction of the buoy.
So now there were three or four of the kids inching toward the
goal of the buoy, but most of them were still in the middle
fighting with their sails and drifting in all directions. As I
watched the two who were being pulled out by the tide disappear
around the corner past the beach, I noticed there were two kids on
the beach with their boards who had never even gotten in the
Eventually the instructor told them all to make their way back
to the beach. As they came in, some were sailing, some were laying
on their boards paddling, some were in the water swimming with
their boards in tow, and the two who had been pulled out by the
tide had to be picked up by a pontoon boat.
When they all got back on the beach, something very surprising
happened. In spite of their limited windsurfing success, the kids
were all animated, giving each other high fives and jumping around
like they had just won the lottery and bragging about what they had
done. They were pointing to where they had been. Even the two who
had been picked up by the pontoon boat were talking about how they
had succeeded over the killer tide. They were all acting as if
something magical had happened to them. And you know, I think it
As the celebration continued on the beach, I looked at the
pontoon boat parked right next to them. I thought about how easy it
would have been just to put all those kids in that boat, drive them
around the buoy, and then bring them safely back to the beach. Then
they wouldn't have had to go through any of the strain and
But the whole purpose of showing up on the beach was the
individual battle they each went through by themselves. And
ironically, it was their individual struggles that created the
sense of unity and team spirit among the whole group. I could see
the magic results of individualism and the benefits of their
personal participation to both the individuals and the group.
As you visualize the experience of the kids with their
windsurfing boards, try to overlay this scene onto our American
society. There are a number of analogies from this story, when you
consider America's quest for social and economic equality, that are
instructive to today's political debates and to future policy
development. Just as with these kids, there are Americans who are
left behind on the beach and never get started; there are those who
are in the middle trying, but failing and being dragged down by the
tide; then there are the masses in the middle who are out there
fighting and having varying degrees of success; and finally, there
are the few who are super-successful, achieving the ultimate
Looking at this scene from a political perspective may help
explain where we are with today's political debates.
You would expect the left to look at that scene and say that it
just isn't fair. It's not equal. Everyone does not have the same
opportunity to succeed because some of the kids lack the necessary
capabilities to achieve the goal. Some are disadvantaged and
effectively disabled by their past. To paraphrase the words of
former Supreme Court Justice Thurgood Marshall, it is not equal
because everyone is not getting the same thing, at the same place,
at the same time.
From the perspective of the left, the ideal would be to get
everyone in the same boat and to make sure everyone achieves the
same goal. The problem is that we've discovered over several
generations of Americans that this perspective really destroys the
fabric of who we are: our love for freedom and individualism. We've
also discovered that encouraging sameness and dependency instead of
individualism and independence diminishes the will and the
capability of people to succeed in a free society.
On the right, some conservatives might look at the whole
situation and say, "What's the problem? Why change anything? Just
let them struggle on their own." While not all conservatives agree
with this characterization, it is undeniable that this is the
prevailing perception of conservatives in America at large.
Unfortunately, many believe that conservatives don't care about
inequities, that we don't recognize that there are disadvantaged
and disabled people, and that we do not believe the government
should be involved with helping to equip those who do not have the
capabilities to succeed.
I believe conservatives have allowed this perception to persist
unchallenged for so long that, without knowing it, we have had to
surrender our basic principles in order to get and stay elected. In
my four years in Congress, it has become clear to me that very few
conservatives are fighting for policies that promote individualism
and independence. We have basically given up and agreed to put all
Americans in the same boat; but to save face, we sometimes muster
up the courage to insist that it must be a cheap boat.
The fact is, we have now forced such large blocs of Americans
into the boat of dependency that it has become politically risky to
even suggest that people would be better off sailing their own
ship. The American people cannot be faulted for abandoning freedom.
Misguided policies have subtly forced Americans into a position
where few have the will or ability to live independently from
Consider several major areas of government dependency:
Almost every parent in America is dependent on the government to
educate their children. The government, not the parent, decides
where children go to school and what they learn. And it's not that
Americans aren't paying a lot individually for education; they are
paying more than any other nation. But instead of offering parents
the many choices necessary to meet the wide variety of needs of our
children, the government crowds all children into the same boat.
Incredibly, even as the undeniable evidence of the failure of our
public schools becomes more and more apparent, talk of more choice
for parents has actually become a political liability for most
Very few Americans control their own health care. Their employer
owns their health insurance while they are working, and after they
retire, when they need health care the most, they all receive their
health insurance from the federal government. It is obvious to all
who have the courage to face the facts that, with the number of
retirees soon to double, the current health care system is
unsustainable. Many employers are also on record as saying they can
no longer afford to continue to pay for the constantly rising cost
of health insurance for their employees. In spite of these
problems, many conservative politicians seem to be afraid to talk
about more consumer-directed health care, and more individualized
options for health insurance. There is great fear that if we allow
any to get out of the boat, the boat will capsize.
Every American is dependent to some degree on the government for
their income when they retire. For a large majority of retired
Americans, Social Security is their primary source of income.
Without thoughtful changes, the current Social Security system will
remain unfunded and unsustainable. And even though the government
is taking enough from every paycheck to make even the poorest
American wealthy in retirement, most conservative politicians are
afraid to talk about the advantages of saving Social Security
contributions by workers in personal accounts to give them real
wealth and security in retirement.
And these are just a few of the larger government programs that
make Americans more helpless and dependent on the government. There
are dozens of additional programs, from welfare to farm subsidies,
that are rendering more and more Americans incapable of living free
and independent lives. Conservatives, those who love freedom and
individualism, need a strategy that promotes independence, a
strategy that begins to reverse this trend that is destroying the
very fabric of America.
But to succeed, conservatives must also recognize that most
Americans are already too dependent on government to be won by
promises of smaller government and less taxes. It is security more
than freedom that Americans crave, and too many are convinced that
security comes from a larger and more intrusive government. We must
convince Americans that we can make them even more secure by making
them more free and independent. We must also convince Americans
that we cannot help people by making them more dependent on the
government. Dependency destroys people and it will surely destroy
our country if we don't reverse the current trend.
As part of developing new political strategies, we as
conservatives must recognize that whether as a parent or a pastor,
a politician or an employer, our goal must be to develop people's
ability to live freely and to empower them to live independent
A good illustration of what I'm talking about is the South
Carolina School for the Deaf and Blind. This is a truly amazing
place to visit. Folks there have incredible disabilities: Some
can't see and some can't hear, and some can do neither.
But the whole idea of the school is to maximize the independence
of every individual. It is undeniable that all the students start
at a different place and they finish at a different place. But even
though the ultimate goal for each student is different, the overall
goal for the school is the equalizing factor: maximize the capacity
of each student to live freely and independently. One testimony to
the success of this goal is that a graduate of the school works in
my office and is one of our best caseworkers.
If this institutional goal is adopted by our government, it will
create a fundamentally different way to address the inequities we
face in our society. This approach will not be a novel idea for
anyone who has worked with people with disabilities. If you visit
any rehab center in the country, you will hear the same thing: You
must never let someone who is disabled get comfortable with
dependence, but instead, help them in every way you can to reach
the highest level of independence that is
Now if we use these ideas to develop a new political philosophy,
some might characterize the approach as liberal and the outcome as
conservative. I believe this is true, because if we redirect
government resources to help Americans reach their maximum level of
independence, we will create more demand for freedom and
independence. As newly emancipated citizens, these individuals will
eventually demand less government involvement in their lives.
My perspective comes not so much from my political experience,
but from my career in marketing research and strategy development.
I believe we can expand the market for freedom in America, but we
must first understand why the market is currently declining.
The underlying problem is that, every day in America, more
people are receiving benefits from government and fewer are paying
the taxes that fund these benefits. As someone once said, "any
government that robs Peter to pay Paul, will always have the
support of Paul." Unfortunately, there are now more Pauls than
Peters in America. Voters are increasingly electing the politicians
who promise the most from government because, with our increasingly
progressive tax code, new government benefits are virtually free
for the majority of Americans.
This situation presents Americans with the most critical and
difficult issue of all: our democracy cannot continue if we do not
reverse this trend. Democracy depends on the tension between voters
and government. When taxes and benefits are evenly distributed, the
size and the cost of government will be limited by the voters who
don't want to pay for more government through their taxes. But this
whole idea has been invalidated by our current progressive tax code
that gives more and more people access to personal benefits such as
income, health care, and education directly from government, all
the while exempting nearly half of the voters from paying for the
benefits that they are receiving.
More than two years ago, I told Ed Feulner, the President of the
Heritage Foundation, that his organization is a tremendous resource
to conservatives in Congress and to people all over the country.
But unfortunately, because of the growth in dependency on
government, the market for the information and ideas created by
Heritage is shrinking in America. The simple fact is, dependent
voters don't vote for conservatives. Dr. Feulner responded with a
strong commitment to change this trend. The Heritage Foundation has
now developed an index to measure dependency and quantify the
growth in government dependency. I believe that this Index of
Dependency, which is really a measure of the decline of personal
freedom, may be the foundation of a new era of conservativism in
I hope this index will be used to guide the development of
policies that promote independence rather than dependence. In the
very near future, we will use this Index of Dependency to create
new policies, better ideas for welfare reform, Social Security that
builds wealth and independence in retirement, individually owned
health savings and health insurance plans, and more choices in
education. These are essential policy changes, not just for
political reasons, but to restore the very fabric of America.
Some of you may remember seeing the movie The Shawshank
Redemption. It told the story of prison life in the 1940s, and it
focused on two men and their emotional journey through their years
One of the prisoners named Red, who was a ringleader and one of
the more seasoned prisoners, explains what happens to all of us
when we live without freedom for too long. He said, "At first,
these walls, you hate them. Then they make you crazy. After a
while, you get used to them, don't notice them anymore. Then comes
the day that you realize you need them."
In America, we can't see the walls of dependency, but they're
just as real as the walls in a prison. Misguided government
policies are actually training Americans to prefer dependence
rather than independence, slavery instead of freedom.
Today, I am hopeful that we will begin the process of reversing
this trend, because as we recognize, measure, and quantify
government dependency, we will have a tool to transform government
programs from those that trap people in dependency to those that
develop the capabilities of Americans to live free. By using the
new Heritage Index of Dependency to evaluate and create policy, we
will once again see the wonder of individualism and independence
emerge in the hearts of Americans from sea to shining sea, just
like the magic I saw that morning on a little beach on Hilton Head
The Honorable Jim DeMint, a Republican, represents the 4th
District of South Carolina in the U.S. House of
MUTUAL AID VERSUS DEPENDENCY
David T. Beito
Reflecting on why I chose to become an historian of social
welfare history, I realized that the issue of dependency, and the
multiple meanings of dependency, has been at the core of my
research agenda. A set of apparent paradoxes has always fascinated
The first of these was the simultaneous existence of high
poverty rates and low rates of dependency on governmental aid or
organized charity throughout most of American history. Poverty
rates at the turn of the last century, for example, would be
considered catastrophic if we faced them today. Upwards of 40
percent of Americans fell under what could be called today a
poverty line. Today, by contrast, the official poverty rate is only
about 10 percent of the total population.
In addition, high percentages of the poor at the time were
illiterate, knew no English, and worked menial occupations. Blacks
in poverty, who were then just beginning to migrate to Northern
cities, spoke English but suffered from the added problem of
intense racism. Yet, though many Americans were poor, very few
depended on any form of governmental aid or organized private
Although we do not yet have an "index of dependency" for this
period, a few statistics allow us to draw some general conclusions.
We know, for example, that the combined impact of tax-funded
welfare and private top-down organized charity was Lilliputian by
modern standards. Governmental aid at this time mainly entailed
indoor relief including orphanages, hospitals, homes for the aged,
alms-houses for the poor, asylums for the insane, and schools for
the deaf and blind. According to a U.S. Census study in 1905, a
total of 4,207 public and private philanthropic institutions were
operating in the United States and their combined population
(excluding prisoners) was 1 out every 150 Americans. Although
almshouses dispensed most of direct governmental poor relief, they
housed a minuscule percentage of the population, especially when
compared to the caseloads of the modern welfare state. In 1880, 1
out every 750 Americans was in an almshouse. Despite growing
urbanization and the arrival of the new immigrants, this ratio
actually declined to only 1 out of 920 Americans in 1900.
A second and related paradox has driven my research agenda.
Although Americans at the turn of the last century received low
levels of aid, and had high levels of poverty, they enjoyed
impressive rates of upward mobility. For example, many Eastern
European immigrant groups were more likely than the native born to
own their own homes by the 1910s and 1920s. Even when governmental
aid and organized charity was available, the poor generally avoided
it. Writers at the time often noted the existence of a stigma
associated with pauperism and dependence on private or public
The co-existence of high rates of poverty and high rates of
mobility with low rates of dependence contradicts the conventional
wisdom of policy analysts and politicians (many of them
conservative ones). Most politicians believe that it is impossible
to solve the problem of poverty without governmental aid whether in
the form of a hand-out or a hand-up. Yet, Americans at the turn of
the 20th century had neither. How were they able not only to
survive but move into the middle class?
One part of the explanation was that the poor benefited from an
environment that fostered economic freedom. There were no minimum
wage laws, indeed few labor laws of any kind, to impede their
employment opportunities. Building and zoning codes were minimal,
allowing a wide array of housing options. Hence, the poor had
maximum flexibility to develop survival and advancement strategies
in the employment and housing market.
The fact that few Americans depended on governmental welfare or
charities, of course, does not mean that they shunned all social
welfare. They were able to turn to numerous mutual aid and
self-help arrangements which, for the most part, rested on
principles of reciprocity. Because today's recipient could be
tomorrow's donor and vice versa, obtaining help from these sources
did not carry the same stigma as top-down private or public aid.
The most prevalent method of reciprocal relief was informal giving
by individuals. At its most basic level, it found expression in
countless, and unrecorded, acts of kindness from neighbors, fellow
employees, relatives, and friends. For obvious reasons, it is
difficult to estimate the dollar amounts involved. This research
challenge explains in part why informal giving still has not
received great attention from historians.
In this regard, Edward T. Devine, a prominent national leader in
the social-work profession, used an article in the Survey in 1913
to remind his colleagues that millions of poor people both survived
and progressed without recourse to organized charities and
governmental aid. According to Devine, the self-help and informal
neighborly arrangements created by the poor themselves dwarfed the
efforts of formal social welfare agencies:
We who are in engaged in relief work...are apt to get very
distorted impressions about the importance, in the social economy,
of the funds which we are distributing or of the social schemes
which we are promoting...[I]f there were no resources in times of
exceptional distress except the provision which people would
voluntarily make on their own account and the informal neighborly
help which people would give to one another...most of the
misfortunes would still be provided for, and that very probably,
the death rate, the sickness rate, the orphan rate, and the rate of
physical and nervous exhaustion might be very little, if any
higher, than at the present time.
Fraternal societies were especially visible carriers of
reciprocal relief. Their ranks included such well-known groups as
the Elks, the Odd Fellows, and the Sons of Italy. At the turn of
the last century, millions of Americans belonged to as many as
10,000 thousand such organizations in over 100,000 local lodges. At
least one-third of all men were members, and among blacks and many
immigrants groups, the proportions were even higher. By contrast,
fewer than 10 percent of workers belonged to unions during this
Resting on a principle of cooperative insurance, fraternal
societies provided a wide gamut of social welfare services,
including hospitals, homes for the elderly, life insurance,
unemployment benefits, and orphanages.
In the conclusion of From Mutual Aid to the Welfare State, I
noted that fraternal societies arose from necessity. By this, I
meant that the lack of a welfare state led Americans to pool their
resources and form non-governmental alternatives. There was also a
psychological component to this necessity, however. Even when they
had access to aid from government and organized charity, most of
the poor rejected it as badge of shame and dishonor. While I am
skeptical of many policy proposals put forward in recent years, I
would say this. If history gives us
any guide, it is that these two conditions, a popular aversion
against dependence on outsiders and sheer financial necessity, are
crucial to fostering an environment where mutual aid and self-help
David T. Beito is associate professor of history at the
University of Alabama in Tuscaloosa and is the author of From
Mutual Aid to the Welfare State: Fraternal Societies and Social
Services, 1890-1967 (University of North Carolina Press).
WHY WE MUST WEAN OURSELVES OF GOVERNMENT
Peter N. Kirsanow
Dependency upon government is perhaps most pronounced in black
America. For insight into the destruction growing dependency can
wreak, one need not research the malaise in Europe or the
dislocation in former communist countries, but rather look no
further than our own inner cities.
This is an enormous topic. Why must we wean ourselves of
government dependency? There are a multitude of reasons, but in
these extemporaneous remarks I will limit myself to three.
The first is a big picture reason. Government dependency is the
antithesis of liberty. Consequently, it is the antithesis of
America itself. The Founders did not sign the Declaration of
Dependence. Since liberty is one of the three macro-rights set
forth in the Declaration of Independence, the expansion of the
welfare state may rightly be considered a civil rights issue.
Liberty is fundamentally a right of self-determination. But a
people dependent upon government are vassals of the state, who have
forfeited control over their lives to government.
For example, there are nearly 100 major federal government
programs that foster dependency: TANF, Section 8, SSI, SSD,
Medicare, Medicaid, LEAP, Head Start, JTPA, School Lunch, Section
533, School Breakfast, Food Stamps, Supplemental Food Program, to
name just a few.
Those who get government housing forfeit their right to choose
where, how, and with whom they live. Those who get food stamps
forfeit choices on where and for what to shop. Those who depend on
government education give up the ability to choose how their kids
are taught. Dependency is degrading, demeaning, and dehumanizing.
It is not an exaggeration to say that it is modern serfdom and it
does violence to the notion of an America with liberty and justice
The second reason is its inefficacy; it creates and/or
exacerbates myriad pathologies in the dependency class while
perpetuating the problems it is designed to address. As Michael
Tanner and Robert Rector (from whom many of the statistics used in
my remarks come) have noted, in the 20 years before the Great
Society's War on Poverty, the poverty rate for blacks declined from
75 percent to 30 percent. But after the Great Society, and $6
trillion in government spending, the rates plateaued and many
blacks have remained in poverty for years.
We spend 400 times more per year on social welfare programs than
during the New Deal. Yet since the Great Society poverty rates for
black children compared to white children have actually gotten
worse. Eighty percent of black children spend at least one year on
welfare. Blacks are four times more likely than whites to remain in
poverty for seven years or more.
And not only do government programs perpetuate these
pathologies, but in a circular way they perpetuate themselves.
Single motherhood is the primary predictor of poverty status.
Single mothers are the cohort most likely to access government
welfare benefits. As June O'Neill has shown, a 50 percent increase
in welfare results in a 43 percent increase in out-of-wedlock
births; which in turn results in even more widespread welfare
dependency (by welfare, I don't simply mean TANF, etc. or Medicaid,
but the full panoply of dependency programs).
Third, as de Tocqueville, James Madison, and just now
Representative DeMint have noted, when citizens figure out that
they can vote themselves benefits paid for by others, they will do
so with unbridled gusto. This problem is fed in part by our
radically progressive tax code, in which the top 25 percent of
taxpayers pay 80 percent of all taxes and the bottom 50 percent pay
only 4 percent. This doesn't include the millions who pay no taxes
whatsoever. And those who pay little or no tax are the ones most
likely to access dependency programs. This will continue
interminably because in America, Atlas rarely shrugs.
Government has a clear and important role in protecting those
who cannot care for themselves. But government has expanded far
beyond that role. Indeed, we have succeeded in dividing America
into a provider class and a dependent class. (Actually, three
classes. The third, a hybrid of provider and dependent is growing
most prodigiously). Although this is primarily a class issue, to
the extent the dependent class is disproportionately minority, it
aggravates the racial divide. It goes without saying that the
dependent class will vote almost monolithically for those who
provide the goodies on the dependency plantation. We saw this with
the advent of the New Deal and it solidified during the Great
Society. And it is a plantation, with demoralizing restrictions and
Ken Auletta showed in his work The Underclass that government
dependency not only fosters an entitlement mentality but reduces
self-sufficiency and erodes the work ethic for generations. As de
Tocqueville said, "the species of oppression by which democratic
nations are menaced is unlike anything which ever before existed in
the world; it does not tyrannize but it compresses, enervates,
extinguishes and stupefies a people until each nation is nothing
more than a flock of timid animals of which the government is the
So what can we do about this?
It is imperative that we prevent continued stratification of
society between providers and dependents. Since it is contrary to
human nature for people to stop voting for perceived free benefits
for themselves, it is imperative to stop feeding the monster--that
is, we must address tax policy. Since those accessing the benefits
are paying little or nothing for them, our tax system must be
revised so that these individuals more readily understand that they
are paying something.
Now that may sound implausible. No way are we going to be able
to increase taxes on the bottom 50 percent of taxpayers or the
millions more who pay nothing at all. To raise taxes in such
fashion is anathema to conservative politicians and political
suicide for liberal politicians. But remember what Shakespeare
wrote: "Our doubts are traitors and make us lose the good we'd oft
might win by fearing to attempt."
So a modest proposal: Modify withholding. There is a reason why
the tax bite has nearly quadrupled since World War II. Withholding
of taxes from workers' paychecks is one of the most pernicious and
deceitful wealth redistribution mechanisms ever devised.
For many people, psychologically, the money taken out of their
paychecks was never theirs, so withholding is virtually painless.
Raising and maintaining taxes at a high rate is much easier as a
result. Those of you who have made the transition from withholding
to quarterly tax payments know the pain and sometimes shock of
having to write a check for taxes.
Most of those in the dependent class have never in their lives
written a check to any level of government. Can you imagine what
would happen if everyone was required to pay a portion of their
taxes outright as opposed to through withholding? Think of the
mental dominoes that would begin to fall: Why am I paying for this?
Where is my check going? Why so much? Pretty soon, people would
start questioning not just the amount but the need for the program
it finances. And inevitably, taxes and maternalistic government
would shrink. Not all withholding should be eliminated. Obviously,
that would be politically untenable. But perhaps just a tiny or
specific amount. For example, the payroll taxes directed toward
Which leads nicely to my next point. We need to promote choice
and privatization in at least three areas:
- Medical savings accounts, to reduce dependency on
government-provided health care.
- Social Security, to reduce dependency on government-provided
- Schools, to reduce dependency on government education.
The last is perhaps most important because George Orwell was
correct. Control of the individual and dependence on the state are
joined at the hip.
It is usually the province of liberals to engage in hyperbole.
But it is not hyperbolic to suggest that government dependency is
mental and spiritual tyranny. In this respect, de Tocqueville may
be less accurate than Jefferson, whose oath was "I have sworn upon
the altar of God eternal hostility against every form of tyranny
over the mind of man." Dependency on government is a form of
tyranny. We should be eternally hostile to it.
Peter N. Kirsanow is a Commissioner on the U.S. Commission
on Civil Rights.
AN OVERVIEW OF THE INDEX OF DEPENDENCY
William W. Beach
Are we more or less dependent today than 30 years ago on
government, specifically on the government in Washington? Has the
reliance on the income and social support programs of the federal
government been a steadily increasing aspect of American life, or
do the very different policy philosophies of administrations over
that period make some portions of these past three decades times of
rapid growth in dependency and others less so?
Put another way, how much have the social programs of the
federal government grown in areas where they might crowd out
similar programs and efforts by local governments, community
groups, and family networks? Has the civil society, in other words,
yielded ground significantly to the public sector?
Though aspects of the same process (mutual and reciprocal aid
provided by community networks yielding to aid provided by federal
programs), these questions address a number of difficult social,
cultural, and economic problems that continue to challenge social
scientists. Our own work (described below) elucidates and clarifies
aspects of the process, but it does not pretend to penetrate the
underlying causes for this gradual but significant
The purpose of the Index of Dependency is twofold. First, the
Index attempts to reflect the pace at which federal government
services and programs are growing in areas where private or
community-based services and programs exist that address the same
or nearly the same needs. Second, the Index is designed to permit
straightforward forecasting of its trend over the next 20 years,
thus giving policy analysts the ability to estimate the degree to
which changed public policy will affect the level and drift of
To accomplish both these goals, analysts in the Center for Data
Analysis of The Heritage Foundation constructed the Index in two
parts: 1) a rich historical database that is employed to study the
relationship between policy changes and other economic and social
indicators and 2) a set of equations that analysts can use to
forecast future values of the Index through the year 2020.
Theoretical Motivation of the Index
The Index stands on data drawn from a carefully selected
set of federally funded programs. Programs were selected in terms
of their propensity to duplicate or substitute for support given by
families, local organizations, and communities to people in need.
Every community can point to initiatives and projects designed to
assist people without adequate shelter, food, income, education, or
employment. In times past, local entities provided more instances
of assistance than they do today. Consequently, these local
organizations played a larger role in the lives of needy people
Over the course of the 20th century, government came to provide
more and more of the services that previously had been provided by
self-help and mutual aid organizations. Adequate housing certainly
is one of the most elemental necessities, and mutual aid,
religious, and educational organizations long had provided limited
housing assistance. After World War II, the federal and state
governments began providing the bulk of low-cost housing. Today,
nearly all housing assistance comes from government.
This shift from local, community-based, mutual-aid assistance to
government altered the relationship between the person in need and
the service provider. In the past, the person in need depended for
help on people and organizations in his or her community. The
community knew the person's needs and tailored assistance to meet
those needs within the budgetary constraints of the community.
Today, housing and other needs are met by government workers who
frequently have no tie to the community where the needy person
lives or know nothing about his or her needs beyond what they learn
in the periodic reports of social workers.
In both cases, a dependent relationship exists. The former,
however, is a dependent relationship with the civil society and
with that society's expectations of the person's future civil
viability, or the ability to participate in the aid of another
person. The latter is a dependent relationship with a political
system. The former is based on mutual and reciprocal aid, and the
return to civil viability is essential to the provision of future
aid, which, in turn, is essential to the life of civil society
itself. The latter is based on unilateral aid in which the return
to civil viability is not essential. Indeed, success in the latter,
political system frequently is measured by the growth of the aid
Beyond housing, aid providers have traditionally been focused on
a handful of needs. Obviously, one's health is a matter of nearly
equal importance to shelter, and early mutual aid societies
frequently provided low-cost health care for their members. Health
care assistance for the indigent who were not members of these
societies provided through churches and social clubs also typifies
the pre-World War II health care landscape.
Virtually that entire health care infrastructure is gone and
replaced by publicly provided health care coverage, largely
Medicaid and Medicare. Analysts doubtless are correct in noting
that Medicaid and Medicare do a better job meeting the health care
needs of indigent and elderly Americans than the earlier, largely
community-based systems. However, little notice has been paid to
the consequences of the shifting relationship between the person
receiving health care assistance and those paying for it. Today,
the dependence on government for indigent and elderly health care
is nearly complete. The protection against policy change provided
the government health care system's patients is so strong that
virtually no change other than increases in coverage are permitted.
In short, the measure of success is growth of the program.
Next to housing and health care, income assistance during a
person's working life and during retirement clearly addresses
elementary needs. Again, local, community-based charity nearly
always included an income component or near-income substitutes,
like free food. This element of mutual and reciprocal aid continues
to have local prominence, but, as with its housing and health care
counterparts, government's role has become dominating since World
War II. Today, Social Security provides nearly all of the income in
indigent and near-indigent households. The federal government's
Temporary Assistance to Needy Families and other supplemental
income insurance programs (both federal and state) address the
income needs of low-income workers. Unemployment insurance payments
provide nearly all of the income to temporarily unemployed workers
that once was provided by unions, friendly societies, and local
charities. Indeed, income assistance is quickly becoming a
government program with little if any connection to the local civil
Components of the Index
The Index consists of five broad categories of
- Housing assistance
- Health and welfare support
- Retirement income
- Educational subsidies at the post-secondary level
- Rural and agricultural services.
Federal programs and state activities supported by federal
appropriations were selected to fit in each category. To be
included in the initial data set, each program had to meet the
standards set up by the definition of dependency: that a reasonable
argument could be made that publicly provided goods or services
could crowd out or constrain private or local government
alternatives and that the immediate beneficiary had to be an
individual. This standard ruled out any expenditure by the states
on programs that would otherwise meet the definition of dependency.
The exception exists when the state is directly funded through the
federal government and acting as an intermediary.
Elementary and secondary education is the principal state-based
program excluded under this stipulation. Post-secondary education
is the only part of all government-provided education included in
Also excluded are military and federal employees. A national
defense is a primary function of the government and thus does not
promote dependency in the sense used in this research.
Indexes are intended to provide insight for their users into
some complex phenomena that either need not be followed in all of
their detail or are so complicated that simplification through
arbitrary but reasonable rules is required for obtaining anything
other than a rudimentary understanding. Thus, the famous Consumer
Price Index of the U.S. Department of Labor Bureau of Labor
Statistics is a series based on an arbitrarily selected "basket of
goods" that the Bureau surveys periodically for price changes. The
components of this "basket" are given weights to reflect their
relative importance to overall price change, which results, for
example, in energy prices being more important than clothing
prices. Multiplying the weight times the price produces a weighted
price for each element of the CPI , and summing up all of the
weighted prices produces, roughly, the CPI score.
The Index of Dependency generally works the same way. The raw
(or unweighted) value for each program (or that year's spending on
that program) is multiplied times a weight. Summing up these
weighted values produces the Index value for that year.
The Index uses the following weights:
- Housing assistance: 30 percent
- Health and welfare support: 25 percent
- Retirement income: 20 percent
- Educational subsidies at the post-secondary level: 15
- Rural and agricultural services: 10 percent.
The weights, which sum to 100 percent, are "centered" on the
year 1980. That means that the weighted values for the Index
components will sum to 100 for 1980, thus giving the Index a
reference year from which all other Index values will be
The year 1980 was chosen because of its apparent significance in
the history of American political philosophy. Many students of
American politics believe that historians will view 1980 as a
watershed year in U.S. history. It may mark the beginning of
decline in left-of-center public policy and the emergence of
right-of-center challenges to policies based on the belief that
social systems fail without the guiding hand of government.
Our Index certainly reflects such a watershed. The drift of the
scores clearly is upward over the entire period with the exception
of two periods: the periods 1980 through 1988 (Index scores of 100
and 101) and 1994 through 2000 (Index scores of 125 and 123).
These two "plateaus" in the drift of the data suggest that
policy change may have a significant influence on the growth rate
of the Index. After all, the early 1980s saw some growth in
domestic programs reduced to pay for increased defense spending
(which responded to policy efforts to end the Cold War); and, the
1990s saw significant policy changes in welfare and public housing,
all of which reduced the growth rate of the Index.
We also have calculated Index values by presidential tenure. For
example, the Index stood at 80.6 in 1977 when James Earl Carter
took office. It had risen to 100 by the end of his administration.
The percentage change in the Index over that period is 24.1
It hardly surprises that the largest jump in the Index occurred
during the administration of Lyndon Johnson. Not only did the
Johnson years see the launch of Medicare and other health programs,
but LBJ vastly expanded the federal government's role in providing
and financing low-income housing. It is somewhat more surprising,
however, that the Nixon/Ford years saw a jump of 122 percent in the
Index (from 34.7 to 77.1). However, these years saw Republicans
implement and fund substantial portions of Johnson's Great Society
The two periods of more conservative public policy with respect
to the components of the Index stand out clearly. The slowdown in
spending increases during the Reagan years and welfare and housing
reform after the 1994 elections produced two periods of slightly
negative change in the Index. The return of budget surpluses during
the last years of the Clinton Administration led to significant
increases in spending for all of the components, particularly
education and health care. Thus, the Index has resumed growing at
roughly the average pace of the past 25 years.
Calculation of Covered Population
The Index reflects the growth of federal government
programs that arguably crowd out or substitute for similar
initiatives at lower levels of government or within the
organizations of civil society. While Index values do not depend on
the number of people who receive support through these programs,
that number nevertheless sheds additional light on what the Index
On the eve of the Great Society programs, some 18 million people
received assistance through those programs. Today, 17 percent of
the total U.S. population, or 49.7 million, receive some level of
assistance through the programs covered by the Index.
Growth in income and non-financial support among program
participants has accompanied the expansion of people receiving
assistance. Inflation-adjusted per capita support (both financial
and non-financial) stood at about $10,000 in 1966. By 2001, this
support had grown to nearly $24,000.
Data in the Index and complementary estimates of program
populations raise concerns about the ability of local governments
and civil society organizations to provide aid and other
assistance. They raise as well a traditional republican concern
about the long-term viability of political institutions when a
significant portion of the population becomes dependent on
government for most or all of their income.1
A ratio of 1 out of 6 Americans (or 17 percent) may or may not
be sufficiently high to trigger this concern. However, this
percentage grows to 24.8 percent when the number of federal and
state employees is added to the population of Americans receiving
aid through Index programs. In 1962, the sum of these two
categories (Index participants and government employees) stood at
26.9 million. The estimate had grown to 70.6 million by the end of
2001, or had increased by 162 percent since the early 1960s. This
percentage growth is three times the growth rate in the U.S.
population over this same period and twice the growth rate of the
population aged 65 and above.
Public policies appear to matter in the growth of the
Index of Dependency. Its rapid increase in the 1960s and 1970s
marked a commitment by the federal government to solve local social
and economic problems that had previously been the responsibility
of local governments, civil society organizations, and families.
The annual growth rate in the sum of government employees and the
population covered by Index programs grew dramatically, even if one
accounts for the military buildup of the Viet Nam War in the middle
years of the 1960s.
The 1980s and 1990s generally witnessed much slower growth in
the Index. Indeed, had the period 1989 through 1993 reflected the
policies of the periods 1981 through 1988 and 1994 through 1999,
the Index would have decreased in value. However, rather than fall,
the Index in 2001 appears to have regained the growth rates it
maintained in the Carter and senior Bush years.
While this reinvigorated Index appears to owe its newly found
vitality mostly to the spending opportunities provided by budget
surpluses rather than to dramatic reversals in conservative public
policy, several key policy debates of the next few years (for
example, welfare reform, federal support for higher education, and
health care reform) will likely determine the Index's rate of
change for the next decade, if not well beyond.
W. Beach is the director of the Center for Data Analysis
at The Heritage Foundation.
1. For histories of this republican concern, see Bernard Bailyn,
The Ideological Origins of the American Revolution (Cambridge,
Mass.: Harvard University Press, 1967) and Gordon S. Wood, The
Creation of the American Republic, 1776-1787 (Chapel Hill, N.C.:
University of North Carolina Press, 1969).