Reclining Right 6/30/2011

“There is nothing that politicians like better than handing out benefits to be paid by someone else” (Thomas Sowell). As a result, almost 60% of US households receive cash handouts from the government (Fox News, 4-20-11).

Has the majority of our nation become ‘takers’ instead of producers? According to the Census Bureau (2009) it has.

46.5 million receive social security checks; 42.6 million get Medicare; 42.4 million get Medicaid; and 44 million now get food stamps, up almost 70% since the Democrats took control of the government purse strings in 2007! Also 12.4 million receive housing subsidies and 3.2 million get Veterans benefits.

According to the Census Bureau, government handouts have accounted for almost 80% of all household income growth since 2007. Most of this came from the government printing money. The unemployment rate and number of recipients has almost doubled due to the government sucking away private sector investment capital that otherwise could be used to create productive jobs.

Nearly twice as many people work for the government (22.5 million) than work in manufacturing (11.5 million) according to the Wall Street Journal’s senior editorial page economics editor, Stephen Moore.

For the first time since the Great Depression, our Federal government is paying out more in benefits than it takes in (Bureau of Economic Analysis). This is at a time that many holders of US debt are asking for their money back as they see the irresponsible spending of our government eroding the purchasing power of the dollars they hold.

As the former Prime Minister of Great Britain, Margaret Thatcher once pointed out, “The problem with Socialism (‘redistributing the wealth’) is that eventually you run out of other people’s money.” We have reached that point in the USA.

Socialism is the philosophy adopted by our government leaders to forcibly take other people’s money for allegedly ‘the common good.’ They take it from those who earned it by producing a good or service that someone else actually buys voluntarily. Our leaders then give it to a favored group of people who produce nothing of value, usually in order to obtain the latter’s vote.

While growing up I remember the proverb that you can keep a man in servitude if you feed him a fish every day. But if you teach him how to fish, you will not have to feed him and he will be able to feed himself, his family and others.  Compassion is not giving someone a handout for doing nothing, but helping another person become self sufficient.

Any government program that does not encourage self sufficiency should be abolished except for those that are physically and/or mentally unable. For example, to receive food stamps should require some form of work in return.

Only 45.4 percent of Americans in 2010 had jobs according to USA Today (4-13-11). That means that more people (54.6%) do not work than have jobs.  The government is taking from the people working to pay those not working. What happened to our rugged individualism and self sufficiency ‘can do’ attitude?

Clearly we cannot afford all the entitlements that our government has promised us. And as Harry Browne sagely commented, “For those looking for security be forewarned that there’s nothing more unsure than a political promise.”

It is about time we all faced up to the fact that our government will have to cut our entitlement programs mentioned above by at least 40%. Otherwise our currency and savings will continue to lose their purchasing power and our standard of living will continue to worsen.  It is time for a reality check. Plan accordingly.

James F. Davis  6-30-11