J. D. Heyes
February 3, 2012
It’s no secret that the U.S. national debt is poised to increase by more than $6 trillion during President Obama’s first four years in office. All of this additional spending, he has often said, was needed to “stimulate the economy”, curtail unemployment and get Americans moving forward again.
Only, the oft-tried Keynesian strategy of profligate government spending as a way to spur a capitalist economy has not only failed miserably, which was predictable, but it has created a class of Americans who subsist nearly entirely on government largess.
GOP presidential candidates Newt Gingrich and Mitt Romney have hit on this as part of their campaign strategy. Romney has said “over the past three years, Barack Obama has been replacing our merit-based society with an entitlement society”. Gingrich has labeled Obama “the best food-stamp president in American history.”
Given, the country was headed down Entitlement Lane long before Obama took office. Social Security is regarded as an untouchable “Fourth Rail” of government; Medicare and Medicaid consume a huge portion of the budget every year, and policies all three line items are expected to gobble up every cent by mid-century.
But there is no doubt that Obama has accelerated the problem, adding more red ink in three years than George W. Bush did in eight and a host of presidents did before those twocombined. In particular, under Obama, direct federal payments skyrocketed by 32 percent, or $600 billion, and those payments are expected to rise another $500 billion by 2016. When combined they would account for fully two-thirds of the entire federal budget.
In 1983, less than one-third of Americans were government beneficiaries. When Obama took office, that number had risen to 44 percent; now it’s at 49 percent, according to the Census Bureau.
The GOP candidates are making the case that Obama is the “food stamp president.” They are right. In 2012, 45 million Americans (fully 15 percent) will have to rely, at least in part, on food stamps in order to make ends meet.
Then there is the issue of continual extensions of unemployment benefits. On the surface that seems like the “humane” thing to do, especially since Obama’s policies haven’t done much to lower the nation’s stubbornly high unemployment rate. More and more labor experts are beginning to believe that unemployment, in fact, pays better than having a job, and that endless benefits are actually discouraging millions of Americans from even looking for work.
“Somebody who’s been on unemployment for a very extended time, and this is not everybody, if you get on unemployment and get used to it, will say ‘I’m not looking for anything right now but will when my benefits are about to run out,'” says Georgia Labor Commissioner Mark Butler. He bases his observation on what labor department managers around the state tell him: that benefit recipients tend to get a bit moreenthusiasticabout finding a job when their benefits are close to running out.
Such benefits are “supposed to help you get by until you can get a replacement job. Its intent is not to be a replacement income,” says Butler.
The worst part about a federal benefit is that once it begins, it’s atrociously hard to get rid of – as evidenced by the perpetual congressional renewals of successive unemployment benefits (now 99 weeks or better).
“Once we thought ‘entitlement’ meant that Americans were entitled to the privilege of trying to succeed in the greatest country in the world,” Romney said in a recent speech. “But today the new entitlement battle is over the size of the check you get from Washington.”
This article was posted: Friday, February 3, 2012 at 3:54 am