Wednesday, September 23, 2009

SPREADING THE WEALTH AROUND – or the makers verse the takers



I was told in a comment in one of my recent articles that I beat things to death and it is time to move on. I might go overboard sometimes with my articles but to be quite frank, I'm tired of being beat to death with all the programs that this government has, or is, putting into place, which is breaking my back and all other working taxpayers in this country. It is a time for all Americans to speak out. When Barack Obama told Joe the Plumber he planned to "spread the wealth around," many people didn't realize he was not talking about spreading the wealth only of the super-rich. Now after Obama is elected, he is rapidly expanding welfare handouts for non-taxpayers, running up a incredible national debt that will without doubt lead to higher taxes on working middle class Americans. Without a doubt this is in the process of happening. Did you ever stop to think why he is doing this?

The sheer size of this transfer of money away from working, taxpaying Americans to non-taxpayers (who voted overwhelmingly for Obama for president in 2008) has just been detailed in a incredible 53-page report by Robert Rector of the Heritage Foundation. This is a very good and informative article to read. I recommend everyone to read this. There are not enough words in the English language to effectively describe the massive amounts of money involved in the Obama administration's shocking cash transfers. He is spreading the wealth around as he said he wanted to do during his campaign.


Most people don't realize that the federal budget has become a vast machine for transferring wealth from the upper third of Americans (who pay 90 percent of federal income taxes) to the lowest third of people, who earn less than 200 percent of the government-stipulated "poverty" level and pay no income tax. The size of this massive annual transfer rose by 40 percent to $714 billion over the last 10 years and is projected to rise to $1 trillion per year by the end of Obama's first term because he is helping it along by his spreading the wealth around.

The term "welfare" embraces much more than this one program which was called AFDC that was "reformed" (and renamed TANF) in 1996. It includes 70 other programs that provide unearned cash and non-cash benefits to people living in low-income households (but does not include Social Security, Medicare and unemployment compensation, which are earned through work and available to almost everyone). Obama did not start them, he is just expanding these programs beyond all imagination. Most of these government programs was started with Lyndon Johnson's Great Society welfare programs. Like most government programs, the cost of these welfare and aid-to-poor-and-low-income-persons handouts has increased, and Obama has demanded enormous additional increases, which Congress passed in the stimulus and omnibus bills. So part of our money in the stimulus package goes to people who will not work. Maybe it is to stimulate them to work.

Welfare spending was 13 times greater in the fiscal year 2008 than it was when LBJ started the Great Society in 1964. Welfare spending then was 1.2 percent of our gross domestic product (GDP) and now has reached 5 percent. How much longer can this be put on the back of working tax payers? I wonder how much of our welfare system is being used to keep people who really could work but will not?

These programs are now the third most expensive government activity, ranking below Social Security and Medicare spending, and education spending. National Defense ranks only fourth. The real cost of these programs is unknown to the American people (one could say, kept secret from them) because the spending is dispersed and circulated by 14 departments and agencies though 71 different programs. We are fortunate that Robert Rector, a numbers expert, has made a painstaking investigation and study to show some light upon these transfers.

In fiscal year 2008, government spending on welfare or aid to the poor amounted to $714 billion, of which approximately three-fourths was federal spending and one-fourth came from state government funds. States are required to match a percentage of federal welfare outlays.

Of the total spending in Fiscal Year 2008, 52 percent was spent on medical care for the poor and low-income persons, 37 percent was spent on cash, food and housing aid, and 11 percent was spent on social services, training, child development, federal education aid and community development for low-income persons and communities. Roughly half goes to disabled or elderly persons, and the other half to households with children mostly headed by single mothers. (Where is the father in this deal?) Look at the cost of just this one thing!

Robert Rector ran an adding machine tape and concluded that handouts in Fiscal Year 2008 amounted to about $16,800 for every poor person, defined as below 100 percent of the selected poverty level. When welfare spending is related to the larger group of persons who qualify for benefits below 200 percent of the "poverty" level, we are giving $28,000 per year to every lower-income four-person household. How can a country keep this sort of thing up?

Why are we told that we have so much unfairness in the United States? Where is this unfairness? The unfairness is supporting millions of people who are truly capable or working and supporting their self and their children. It is because the Census counts only 4 percent of these welfare gifts to low-income people as their income, and most government discussions of poverty do not even refer to the massive transfers of money taking place as we can see here. To get an idea of how big the debt Obama is creating is, which in the end will have to be paid by the middle class tax payer, let's compare spending on welfare to spending on fighting wars. Since the beginning of LBJ's Great Society, our government has spent $15.9 trillion (in inflation-adjusted 2008 dollars) on welfare, which is more than twice the cost of all major fighting wars in U.S. history. We spent only $4.1 trillion (in 2008 dollars) on World War II, which was the most expensive single undertaking in U.S. history.

Under Obama's budget, which has already been passed by Congress, federal welfare spending will increase by $88 billion in 2009, plus an additional $175 billion in 2010. This two-year increase of $263 billion will bring total federal and state welfare handouts to $890 billion a year. Needless to say there are some people who need our help and we should do everything we can for them, We should be exactly like "The Good Samaritan", we should all go all out to help the needy, but the buck should stop there and it does not. We have people that have been kept by this Great Society since its conception during the LBJ years who would rather live off the government than work. The problem is that their children have been taught the same thing and their children's children are doing the same thing. This is one of the main reasons for the over load. The problem is increasing year after year. The fact is some people know that if you are a low income person you can get more money from the government by not working and still get more food, more health care, and a ton of other free benefits from this Great Society. This kind of help not only hurts the people who truly need it, it strains the tax payer, and takes away much needed resources from other important projects that are needed.





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