Entitlements are leading the country headlong to insolvency. These include a whole range of programs such as Social Security, Supplemental Security Income, Medicaid, Medicare, Aid to Families with Dependent Children, Food Stamps, etc. Some entitlements are “permanent appropriations,” which means the money to pay for them is automatically appropriated and distributed to whoever meets the criteria for receiving a handout. The two biggest programs in this category are Social Security and Medicare. The sum of interest on the national debt plus permanent appropriations is “mandatory spending,” which is known in Washington’s parlance as “untouchable.”
The figures are startling. This year, Social Security will cost $600 billion, about 40 percent of the federal budget. By 2004, if trends continue, the figure will double. Social Security began going bust when Congress raided it to give money to welfare mamas, alcoholics, and drug addicts and when retirees began to outlast the benefits to which they were entitled. But things will only get worse. Right now, four American workers support one retiree. By 2030, the ratio will have dropped by half.
If what is past is prologue, consider the past three decades of entitlement spending in general. In 1963, 70.4 percent of federal spending was discretionary, meaning Congress had a choice of how much to spend. A decade later, that figure dropped to 55 percent and entitlements had grown to 38 percent of the federal budget, with net interest on the national debt at 7 percent. By the time Ronald Reagan was two years into office, entitlements constituted 45 percent of the budget. Net interest was 11.1 percent. Now entitlements consume 47 percent of the budget, with interest on the debt pulling down another 14.1 percent. “Mandatory spending” is now 61.4 percent of the federal budget. By 2030, according to one estimate, the annual deficit will reach $4.1 trillion, the size of the national debt today.
Scared for your kids yet? Listen to even more figures from the Bi-Partisan Commission on Entitlements and Tax Reform: by 2010, entitlements and interest on the national debt will consume the federal budget. By 2030, federal revenues will not cover entitlements. Now the national debt is $10,000 per American. By 2030, the figure will rise to $64,000.
And who are the entitled? Not just ghetto-dwelling, black crackheads scamming the government. About $150 billion in Social Security payments this year will go to households with an income exceeding $50,000, meaning home-owning, white Republicans. Ayn Rand would have called them all “looters,” and what these disparate groups of people have in common is an Atlas to shoulder the ponderous burden they represent. That would be the working, taxpaying American.
In any event, a number of lawmakers want reform, and Senator Judd Gregg chaired a Republican commission on entitlements, which was scheduled in March to release a report that suggested a number of “reforms.” If all went according to plan, legislation is now coursing through the veins of Capitol Hill’s body politic. Gregg rightly observes that the Constitution does not entitle anyone to anything, but he and his well-meaning group do not seem to understand that “reform” is not the answer. Congress should not reform entitlements by “block grants” that would “let the states decide” how to distribute welfare or by tinkering with Social Security to stave off its impending insolvency. If Gregg is right, then entitlements are unconstitutional and must be scrapped.
This cardinal goal ought to be approached by zeroing in first on Social Security, the most important target for a reason that has less to do with the staggering cost of subsidizing the well-to-do Bush generation than with the cultural and social problem it has created: militant old people. “The system was supposed to promote self-sufficiency and independence,” says Paul Hewitt of the National Taxpayers Union. “But what it says is ‘Don’t save, we’ll tax your kids'” to pay your freight. In short, claims Hewitt, Social Security has created a “belligerent dependency pitting senior citizens against their children and grandchildren.”
Yes, Hewitt notes. Social Security has promoted “independence.” But it is the independence of parents from their children, not of parents from the state, almost the exact opposite effect welfare spending has on families in the ghetto. Social Security has created a bottomless chasm between the generations that will worsen with time and is responsible for the shameless and aggressive panhandling in Congress by the American Association of Retired Persons, which owes its clout to 64 million Americans who joined it to get cheap airline tickets and health insurance.
Of course, scuttling the welfare state’s ship will not be easy without first getting rid of its crew, meaning the bureaucrats trying to protect their jobs. Yet progress on the issue lies not in firing bureaucrats or converting politicians but in showing middle-class Americans that killing entitlements is required as a matter of principle as well as practicality. Forget about constitutionality for a moment. Toppling the welfare state would eliminate the need for laundering money in the federal bureaucracy, which would mean the states really could decide how they wanted to address the needs of their residents. That’s what the House Speaker’s “contract” is all about, isn’t it?
Maybe it will be hard, if not impossible, for members of Congress to relinquish control over the entitlements on which their power is based. But one thing is certain. By 2010, the money runs out. Then Americans will have a choice: either spend money on legitimate functions of the federal government or turn everything over to the looters. At that point. Atlas may finally shrug.