On Friday Nicholas Eberstadt noted that we have become a nation of takers. He stated that since 1960, entitlement transfers grew twice as fast as personal income and now account for 2/3 of the federal budget (up from 1/3 in 1960). How does this compare to other industrialized countries?
The US government spends a higher percentage of its GDP on social welfare programs than does Australia and Canada, even counting the fact that both countries have nationalized health care. On top of that, private US citizens spend decisively more on private sector social charity than citizens in any other country in the industrialized world. Put together only six industrialized countries spend a higher percentage of their income on a social safety net than does the US (France, Belgium, Denmark, Sweden, Netherlands, and Finland), and they are all poorer than the US. The US is less than 1% point of GDP behind both Finland and the Netherlands. It is higher than other “social democracies” like Austria, Germany, the UK, Spain, Italy, and even Norway.
Given that the US has a significantly higher per capita income than any of the six countries that spend a higher percentage of their income on social welfare programs, the US spends more money (publicly and privately) on social welfare programs than any other country in industrialized world. This fact cuts two ways. It means that Americans are some of the biggest (if not the top) givers in the world. The flip side is that since this money is given to other Americans, Americans are some of the biggest (if not the top) takers in the world. In private and public dollars per person, the US hasn’t just become a nation of takers; it has become THE nation of takers.
Can US citizens be generous to a fault? Are its citizens guilty of being enablers of poverty rather than solvers of generational poverty? Might Americans need to learn that actions have consequences? Might Americans need to rediscover the self-sufficient can-do attitude that once made the country strong? The answers to all of the above are yes.
Why has the American sense of entitlement risen even as incomes have increased? Is it that Americans have become increasingly covetous of their neighbor’s crib? Is it that receiving something for nothing is addictive? The fact that we refer to social welfare spending in the US as “entitlements” should tell you something.
Is it that the poor are poorer now than in 1960? No. The poor’s standard of living has risen dramatically. Just look at the pictures of the poor in the 1960’s. They were skinny because they were hungry, not because they were in shape. Now the biggest health concern of the poor in the US is obesity. The poor have greater access to healthy food, medical care, air conditioned housing, and electronic gizmos than ever before. The US government spends over $1 billion a year providing cell phones for the “poor”. The more the poor have gotten in transfers, the more they have demanded even as they worked less.
This last point cannot be understated. As noted in these pages before, a two person household earning minimum wage is well above the US poverty line. The poor are defined not by the quality of their job, but by their lack of one. As Americans continue to drop out of the workforce while increasing their demand on other’s resources, one has to wonder just how long America can go before it becomes France, and not in a good way.