How many Americans are ready to accept the sacrifices we have to make to right our fiscal ship?
The Republicans are feeling confident these days. The slow-motion debacle of Obamacare promises to keep that albatross around the necks of the Democrats at least through next year’s midterm elections. The IRS, NSA, and Benghazi scandals are still simmering, and any day new information may emerge that puts them back on the front page. Obama’s disapproval rating is at 53.4%, according to the RealClearPolitics average of 11 polls. The Republican Party’s approval numbers are still lower than Democrats’, but they are trending up while the Dems are moving down.
The recent budget deal passed in the House supposedly augurs well for the Republicans as well. Many see the bipartisan agreement to fund government spending for two years as a tactical victory that takes the bad public relations of a government shutdown off the table, thus keeping the focus on the Obamacare disaster. Growing more confident, the “establishment” Republicans are marginalizing the Tea-Party “extremists” who generate so much bad press for the GOP. Or as the Huffington Post gloated, House Speaker John Boehner “was at least declaring war on the well-funded agitators” who “jumped the shark” by opposing the deal.
The Republicans may have achieved a tactical victory, but only time will tell if it translates into taking back the Senate and the presidency. But even if they do, it is still unlikely that they will achieve any meaningful reforms that can reign in the federal leviathan, seriously reduce metastasizing debt and deficits, or fix the looming disaster of unfunded entitlement liabilities. For the fact is, the Progressive vision now a century old has won the political debate over the power and goals of the federal government.
The Progressive agenda starting with the administration of Theodore Roosevelt is now political reality. The Constitutional idea of a limited federal government checked and balanced by Congress and the sovereign state governments––the obstacles to Progressive ambitions to guide the evolution of the nation toward greater “social justice” and fiscal equality––is now a distant memory. Most people assume that the job of the fed is to “solve problems” through a vast bureaucracy of technocrats. The notion that state and local governments, or the institutions of civil society perhaps should have the responsibility to “solve problems,” gains little traction among the mass of citizens, especially when it comes to mitigating the slings and arrows of human existence.
As a result of this assumption, the size and coercive concentrated powers of the federal government at the expense of state governments and individuals alike have grown to an extent that would have shocked the Founders. As of January 2012, the federal government employed 2.3 million workers, excluding military personnel, at a cost of $200 billion a year. Total federal spending in 2013 was $3.5 trillion, a 40 percent increase over the last decade. Equally significant is the intrusive, coercive regulatory apparatus that has followed this expansion of the federal government. In 2012, the Federal Register, which publishes proposed new rules andfinal changes to existing rules, comprised 78,961 pages. The Code of Federal Regulations, which publishes general and permanent rules and regulations, totaled 174,545, with over one million individual regulatory restrictions. Just the Dodd-Frank Wall Street Reform and Consumer Protection Act passed in 2010 is up to nearly 14,000 pages of rules––and is only 39 percent complete. The Competitive Enterprise Institute puts the total cost of complying with all these rules and regulations written by anonymous, unaccountable federal bureaucrats at $1.8 trillion. As Robert Nisbet writes in his invaluable book The Present Age, “There isn’t an aspect of individual life, from birth to death, that doesn’t come under some kind of federal scrutiny.”
This expansion, moreover, has come under Republican administrations as well as Democratic ones. The Environmental Protection Agency’s some 7000 rules cost $353 billion a year. Just six proposed new rules could cost between $36 and $111 billion, according to the EPA’s own lowball estimate. The legislation establishing the EPA was signed by Richard Nixon. Or take Social Security Disability Insurance. The number of workers receiving disability insurance has increased from 2.9 million in 1980 to 8.8 million in 2012. In 2013 SSDI will cost around $150 billion, a trend that will leave the program insolvent in 2016. This increase is mostly the result of the loosening of medical eligibility requirements to include more subjective conditions such as mood disorders and musculoskeletal problems. This change was legislated under the Social Security Disability Benefits Reform Act of 1984. That legislation was signed into law by Ronald Reagan. More recently, George W. Bush signed into law the Medicare Prescription Drug Act of 2006, which will cost $549 billion between 2006 and 2015.
The last three examples demonstrate that bigger government has been driven by a relentless expansion of entitlement spending both by increasing the number of recipients of existing programs, and by creating new ones. But as everyone knows, spending on entitlement programs is on a path to national bankruptcy due to 76 million Baby Boomers retiring at a rate of 10,000 a day. In 2012, Medicare, Medicaid, Social Security, and other health spending made up 45 percent of the $3.6 trillion budget, with another 19 percent going to federal employee retirement and benefits, veterans’ benefits, and anti-poverty programs such as food stamps and welfare. Add in the costs of servicing the $17 trillion in debt necessary for financing all this largesse, and by 2050 just health care entitlements alone will consume every dollar of federal taxes.
Here too Republicans, when they haven’t been creating new programs, have at best attempted to cut back increases in spending, rather than holding spending flat or reforming programs to decrease spending. As for questioning the existence of such programs, that is the fast track to political suicide. Indeed, just recommending modest reforms will bring down on any politicians charges of heartless indifference to the old and poor. Just ask Paul Ryan, whose 2012 budget that called for entitlement reform earned him a starring role in an attack ad in which he pushed a granny in a wheelchair over a cliff.
Finally, all this largesse is funded by a federal income tax that is a mechanism for the redistribution of property that troubled critics of democracy from the ancient Greeks to the American Founders. The U.S. has one of, if not the most, progressive tax rates of the world’s 24 richest countries. This progressivity of U.S. income taxes results in a redistribution of wealth from higher income to lower income citizens, even taking into account payroll and state taxes. According to the Tax Foundation, “The typical family in the lowest 20 percent in 2012 (with market incomes between $0 and $17,104) pays an average of $6,331 in total taxes and receives $33,402 in spending from all levels of government. Thus, the average amount of redistribution to a typical family in the bottom quintile is estimated to be $27,071. The vast majority of this net benefit, a total of $21,158, comes as a result of federal policies.” The top 20 percent, on the other hand, paid $87,076 more in taxes than it received in government spending, while the top one percent paid $867,473 in taxes and received $55,078 in spending. In 2012, about $2 trillion was distributed via entitlement programs and tax credits from the top 40 percent to the bottom 60 percent of taxpayers.
The truth is, we all have become a “nation of takers,” as Nicholas Eberstadt documents in his important book. We all consider normal a gigantic federal government of bureaucrats and technocrats whose job is to redistribute property in order to finance a vast network of entitlement spending from which most of us benefit either directly or indirectly. Beneficiaries of these programs have powerful lobbies that monitor and punish any politician who dares challenge this status quo. Just consider how easy it has been to marginalize the Tea Party as racist extremists, the only political organization calling for the return to the limited government of the Constitution, the reigning in of unsustainable debt and deficits, and the reform of entitlement programs so that only the truly needy are served. The existence of a vast constituency for government handouts has enabled this demonization of the only people crying “Iceberg ahead!”
Other Republicans may believe that once they return Congress and the Presidency to the Republicans––something they say the polarizing Tea Partiers make difficult, if not impossible––then they will turn to addressing the coming debt-deficit-entitlement crisis. Perhaps they are right. I hope they are right. But history gives us little hope that they will achieve anything other than a slow-down of the disaster. Not because they are “establishment” insiders or liberal wolves in conservative sheep’s clothing, but because not enough American people are ready yet to face reality and accept the sacrifices we’re all going to have to make to right our fiscal ship. Until then, the Progressives will keep winning no matter which party is in power.
Freedom Center pamphlets now available on Kindle: Click here.