Wednesday, April 20, 2011

2010 Index of Dependence on Government


This post is the foundation for the rational for what the federal budget this year and in future years should entail. The post today is just the first few paragraphs of the report. The full report may be downloaded as a PDF from the above website.

“2010 index of dependence on government
Published on October 14, 2010 by William Beach and Patrick Tyrrell

Abstract: The number of Americans who pay taxes continues to shrink—and the United States is close to the point at which half of the population will not pay taxes for government benefits they receive. In 2009, 64.3 million Americans depended on the government (read: their fellow citizens) for their daily housing, food, and health care.

Starting in 2015, the Social Security program will not receive enough taxes to pay all the promised benefits—which will be hard for all job-holders, but devastating for roughly half the American workforce that has no other retirement program. [Social Security was NOT intended to be either the only or primary source of retirement income. It was supposed to be supplemental!—my addition] Add in last year’s preposterously named American Recovery and Reinvestment Act, spiraling academic grants, flat-out farm socialism, the swelling ranks of Americans who believe themselves entitled to ‘free’ government benefits—and now the government takeover of the nation’s health care system—and the very nature of this country’s republican form of government is called into question. Like they have been doing since 2002, Heritage Foundation policy experts lay out the increasingly gloomy facts. Can Americans pull back from the brink of complete dependence on government?

This year’s publication of the Index of Dependence on Government marks the eighth consecutive year that The Heritage Foundation has flashed warning lights about Americans’ growing dependence on government payments and programs. For eight years, the Index has signaled troubling and rapid increases in the growth of dependence-creating federal programs, and for each of these years Heritage has raised concerns about the challenges that rapidly growing dependence poses to this country’s republican form of government and for the broader civil society.

The 2010 Index results dramatically underscore Heritage’s concerns of years past. According to The Heritage Foundation’s Center for Data Analysis (CDA):

1) The Index of Dependence on Government grew by 13.6 percent in 2009;

2) The Index variables that moved the most over that past year were

– Health care and welfare at 22 percent,
– Rural and agricultural services at 20 percent, and
– Housing at 15 percent;

3) The increase from last year means that the Index has grown by 49 percent just since 2001;

4) The Index begins in 1962 and has increased by more than 14 times over the intervening 47 years through 2009;

5) This rapid growth of the Index has been accompanied by a rapid increase in the percentage of people who do not pay taxes. The percentage of people who do not pay federal income taxes themselves, and who are not claimed as dependents by someone who pays federal income taxes, jumped from 14.8 percent in 1984 to 43.6 percent in 2008. Counted this way, in 1984, 34.8 million tax filers paid no taxes; in 2008, 132.5 million paid nothing.[1] (The latest statistics on this, which I heard on the radio yesterday, is that 40% of those who filed a federal income tax made money through the income tax system. This was accomplished primarily through credits given to filers. Three of the major credits used by individuals are 1) the child tax credit which provides up to $3,000 for having 3 children under 17 years of age 2) the earned income credit which provides up to $5,666 for three children and 3) the making work pay credit which pays up to $800 for a married couple. Some credits end when the taxes owed reach zero. These three continue and provide extra money to the filer. In all, including the previously mentioned 40%, 47% of federal income tax filers paid NO federal income tax!—my addition.)

It is the conjunction of these two trends—higher spending on dependence-creating programs and an ever-shrinking number of taxpayers who pay for these programs—that worries those interested in the fate of the American form of government. Americans have always expressed concern about becoming dependent on government, even while understanding that life’s challenges cause most people, at one time or another, to depend on aid from someone else. Americans’ concern stems partly from deeply held views that life’s blessings are more readily obtained by independent people and that growing dependence on government erodes the spirit of self-reliance and self-improvement. These views help explain the broad public support for welfare reform in the 1990s.

This ethic of self-reliance combined with a commitment to the brotherly care of those in need appears threatened in a much greater way today than when this Index first appeared in 2002. This year, 2010, marks the first year that the Index contains significant retirements by baby boomers. Over the next 25 years, more than 77 million boomers will begin collecting Social Security checks, drawing Medicare benefits, and relying on long-term care under Medicaid. No event will financially challenge these important programs over the next two decades more than this shift into retirement of the largest generation in American history.

It is not only financial tests that these programs will face. Certainly, financial challenges will be great over the next several decades, given that none of these ‘entitlement’ programs can easily meet their obligations even now. Doubling the number of people in retirement will constitute a massive growth of the dependent population in the United States and a potentially ruinous drain on federal finances. Perhaps the most important aspect of the boomer retirement is its dramatic reminder of the rapid growth of dependence on government in the United States.

There was such a rapid growth in dependence in 2009 that the twin concerns—how much damage this growth has done to the republican form of government, and how harmful it has been to the country’s financial situation—have deepened significantly. Not only did the federal government effectively take over half of the U.S. economy and expand public-sector debt by more than all previous governments combined, it also oversaw the largest single-year expansion in total government debt in U.S. history. (Approximately 1.6 trillion dollars in one year!—my addition) Much of that growth in new debt can be traced to dependence-creating government programs.”

Biblically, who is responsible for the support, upkeep, and well-being on an adult individual. Here is the order of RESPONSIBILITY:

1) the person himself is responsible for himself

2) if married (man and woman only!), the husband is responsible

3) the immediate family is responsible

4) the extended family is responsible

5) the church is responsible (Since the church is a FAMILY of believers, its responsibility may be involved to some extent throughout.)

6) the local community is responsible

Nowhere in GOD’S equation is the government responsible for the support and upkeep of an individual! NOWHERE!