Entitlements–The Point of No Return

Over the course of the past 75 years, the U.S. has strayed from the Biblical model by falling into a trap of massive government entitlements.  2 Thessalonians 3:10 says, “If a man will not work, he shall not eat.”  The Bible calls for each of us to work, and to earn our own way, as much as we are able to do so.  Obviously, the sick and disabled need charity, as well as the poor who have fallen on hard times, but this help should come primarily from the Church (Acts 2:42-47)–not from the government.

Most of our tax money now goes to entitlement programs and overhead.  I believe that the question at hand is:  Have we finally gone past the point of no return?  If you don’t receive a monthly check from the government, you’re in the minority.

A society can reach a point where there are too many people receiving entitlements, because there are too few left who are funding most of that burden.  As an obvious example, if 1% of the population was taxed in order to pay for entitlements for the other 99%, there would no longer be enough wealth generated to sustain that economy.  Although we haven’t gone that far yet, I believe that it is quite enlightening to see just where we are on that scale, including the overhead (government employees) required in order to sustain our current model.

Let’s consider how many people are receiving checks from the government:

Program # of Recipients $/Year–Total $/Month–Each Comments
Totals 235 million $2.101 trillion
Entitlements:
Social Security 51 million $615 billion $1,150 Retirees, survivors, dependents, disabled
Supplemental Security Income (SSI) 8 million $41 billion $475 Needy families
Food Stamps 28 million $34 billion $100 Needy families
Unemployment 3 million $4 billion $1,250 Average = 116 weeks
Medicare 42 million $297 billion $600 Primarily a subset of those receiving Social Security checks
Medicaid 52 million $305 billion $500 This number will grow quickly with the new health care legislation
Farm Subsidies 10 million $178 billion $1500 Paying farmers not to grow crops
Government Employees:
Military 2 million $146 billion $5,000 Active and Reserves
Veterans 2 million $84 billion $3,500 Retirees, Medical, etc.
Retirees 22 million $78 billion $5,800 3 million federal; 19 million state and local
Civilian Retirees 15 million $319 billion $1,800 5 million federal; 10 million state and local

(Data from The Statistical Abstract of the United States–online)

The government writes at least 235 million checks each month, to (or on behalf of) about 180 million different recipients (60% of the population).  The average amount of each monthly check is close to $1,000.

This leaves only about 120 million people (40% of the population) who receive no checks from the government.  While it’s true that a good portion of the 60% of recipients of government checks pay a certain amount of taxes, it’s also fair to say that most taxes are paid by the other 40% (and businesses and corporations).

These findings were further substantiated by Dick Morris in January, 2009. When he estimated the effects of President Obama’s economic stimulus package, Morris said that it would result in 57% of Americans being off the income tax rolls, while only 43% would be paying all of the income taxes. Now, with the passage of the health care bill, these numbers become even more unbalanced.

As noted in The Role of Government, the number of people receiving government checks already outnumbers those who don’t (and who are paying most of the taxes).  Furthermore, this trend is continuing, especially with the massive spending of the Obama administration, but it cannot be sustained.  Unfortunately, with over half of our population already dependent upon a monthly check from the government, we have probably already reached the point of no return.  We believe that we can’t cut entitlement programs, because the recipients are dependent upon (and “entitled” to) their monthly checks from the government.  We feel like we can’t reduce the role of the federal government to its proper size because so many government employees would lose their jobs, and retirees pensions would be in jeopardy.

Now, those receiving Social Security benefits can justifiably argue that they are “entitled” because they paid into the system for so many years.  Likewise, government retirees can argue “entitlement” because of their many years of service. However, this still doesn’t change the fact that this trend cannot continue, because soon there simply won’t be enough tax money generated in order to make all of these payments.  (Yes, we’ll print more money, but inflation will destroy the value of our currency.)  Yes, it would be unfair if retirees didn’t receive 100% of their expected pensions, but this is happening in the corporate world every day. It’s also unfair to have most people collecting a check from the government each and every month.

Can we recover?  Probably not.  Over half of our $4 trillion national budget goes to entitlement programs and overhead, and this trend is rapidly increasing.  We have now given in to socialism, like so many of the European countries.  We simply have too many people dependent upon the government.  If you don’t receive a monthly check from the government, you’re in the minority.  As stunning as this sounds, it’s true.

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