A Nation of Takers: America’s Entitlement Epidemic (New Threats to Freedom Series) Kindle Edition

Every day that the stock market closes up higher I keep wondering when people will realize that it is all being propped up by inflationary monetary policy at the Federal Reserve. I also wonder when people will realize that the ever-expanding cost of Medicare and Social Security are a serious threat to the economic stability of the country. This is not to say that either program needs to be eliminated, but serious changes need to be made if we are going to overcome the fiscal challenges ahead. Eberstadt does an outstanding job of illustrating just how much money we spend on various entitlement programs, especially healthcare, with data, charts, and insightful analysis. The back-and-forth commentary at the end of the book is a great debate about what we can do, and more importantly, if we can do anything, to prevent us from going over the real fiscal cliff that keeps getting pushed down the road a bit further with each inept congress that we get stuck with. Hopefully more people will pay attention to just how much of our economy is tied up in the various entitlement programs before it is too late to effectively change them for the better.

This is a short, easily comprehendible, fact filled description of where America’s social structure stands today. The chronology of that structure is given clearly and simple to understand. The fact sources are clearly identified. In addition, the extensive graphic presentations alone make the book worth having.This work is a bit unique, despite being compact and “non-wonkish,” in that it includes two commentaries, designated as “dissents,” by William A. Galston and Yuval Levin, respectively. The Galston commentary is mainly supportive of the current status quo and how we come to be in this condition. The Levin commentary appears to support the functions of governments questioned by the author, but urging better efficiencies or uses. A critique of the two commentaries would make this review appear politically partisan, which is not its purpose.What makes the book worth reading is gaining an understanding of the penetration into our entire social structure of governmental “programs” constructed for particular interests. While the term “General Welfare” is broadly applied to justify governmental programs, the author simplifies those particular interests into six “baskets” of particular benefits, which, taken in order of their economic drain, are: 1) Income Maintenance; 2) Medicaid; 3) Medicare; 4) Social Security; 5) Unemployment; 6) all others. It is readily apparent that the particular interests are demographic, principally those for the elderly covered by 2, 3 & 4. They are not “General” in any sense of the word.The statistics provided are equally striking in what they reveal as the cultural damages and losses from the patterns of these programs for particular interests. What is missing from the discussion in the text of this work is how and why these extensive transfers of incomes and benefits have come to be established. The author makes a brief reference to their having been “purveyed” to the public by “Government.” Avoiding that discussion keeps the thrust of the information factual and nonpartisan. However, it leaves open for readers to recognize the enormous scale on which the people of the United States have become “Users” of the mechanisms of their local, state and federal governments for their own particular group and individual economic, ideological and political interests. For the “wonks,” we have become a Rent Seeking Nation, a Nation of Users. This work does not offer remedies or mitigations, although the critical need for them is clearly defined.

At 144 pages, this is hardly more than a long pamphlet, but addresses a very serious problem for the United States. Subtitled America’s Entitlement Epidemic, this looks at the crises brought about by a multitude of welfare and income transfer programs that are threatening to overburden our financial system. He presents a quote made by Patrick Moynihan in 1973: “The issue of welfare is the issue of dependency. It is different from poverty. To be poor is an objective condition; to be dependent, a subjective one as well. That the two circumstances interact is evident enough, and it is no secret that they are frequently combined. Yet a distinction must be made. Being poor is often combined with considerable personal qualities; being dependent rarely so. That is not to say that dependent people are not brave, resourceful, admirable but simply that their situation is never enviable, and rarely admired. It is an incomplete state of life: normal in a child, abnormal in an adult. In a world where completed men and women stand on their own feet, persons who are dependent – as the buried imagery of the word denotes – hang,” Neither FDR or Thomas Jefferson would be able to recognize today’s U.S. government. Entitlements as a term was first used in 1942. In 2010 over 50 separate types of programs accounted for almost a fifth of personal income. In 1960 transfers to individuals totaled $24 billion. By 2010 it was almost 100 times that. Up to 1960, spending transfers amount to approximately a third of government outlays. By the early nineties, it was 51%, by 2010, 2/3 of all federal spending. The transfers fall into 6 categories: Income Maintenance, Medicaid, Medicare, Social Security, Unemployment Insurance, and Other. The first five take almost 90% for transfers to individuals. As for political parties, since 1960, the growth has been higher under Republican adminstrations than under Democrats. Rural areas of Red States were more dependent than those of the Blue States. In 2011, just over 49% of all households used at least one government program for help. There used to be a social stigma against dependence on government largesse, but now, more Americans have turned their entrepreneurial not simply to maximizing their takes from existing entitlement systems, but to extracting payments that were never intended under the programs, gaming and defrauding the systems. In the mid-nineties, an overhaul of the notorious AFDC made it into the TANF (Temporary Assistance for Needy Families) but the middle class came into play too. In 1960, the average monthly dole went to 455,000 people. In 2010, it was 8.2 million people, in 2011, it came to 8.6 million people. One of the most heavily abused is the Social Security Disability program. In 1960, .56% of workers from 18 to 65 years old received payments. In 2010, the number was 5.6%, In 1960 there were 134 people employed to every disabled worker. In 2010, there were 16 employed to every disabled worker. And, contrary to most expectations, it seems white workers are more abusive of disability payments than black or Hispanic workers, In West Virginia with a 93% white population, 9% of all workers were on disability. In 94% white Maine, 7.4% were on disability. In DC, 65% black, 3.3% were on disability. (There seems to be some cherry-picking going on here) Statistics show that men are working less now than ever before. It’s no longer socially unacceptable for a man to be chronically unemployed. The female part of the workforce in 1960 was about 30%, 60% in 2010. The male participation in 1960 was 89%, in 2010, 73% (no explanation for the disparity is percentage sums). Over the next twenty years there is expected to be 12 million female workers to 10 million male workers. So where does the money come from to pay for it? In 2010 America was spending over 3 times as much on entitlements than on the entire national security. Take it from defense? In 1961 9.4% of GDP went for defense. In 2010, 4.8% of GDP went for defense. The Social Security system and Medicare depend solely upon having our heirs and descendants pay for it.