The Middle Class as Claimants

A democracy … can only exist until the voters discover that they can vote themselves largesse from the public treasury. From that point on, the majority always votes for the candidates promising the most benefits from the public treasury with the result that a democracy always collapses over loose fiscal policy … The American Republic will endure until the day Congress discovers that it can bribe the public with the public’s [own] money. — Alexis de Tocqueville (1830s)

There are 47 percent of the [American] people … who are dependent on government, … who believe the government has a responsibility to care for them, who believe they are entitled to health care, to food, to housing … That’s an entitlement … These are people who pay no income tax. — Mitt Romney (2012)

Alexis de Tocqueville was clearly prescient, although he didn’t anticipate Congress’s ability to bribe the public with other people’s money. Gov. Romney, who incorrectly conflated those who don’t pay federal-income tax with “dependency,” nevertheless is warning us correctly that America is now approaching a tipping point where government responsibility for funding our national defense, education, interest expense, infrastructure investments, foreign policy, many anti-poverty programs, and other operational concerns will be funded by a minority of the populace. The clear inference is that those who have no skin in the game — soon to be the majority — are inclined to vote for more largesse because they aren’t paying for it.

The dirty secret of dependency that nobody mentions is that we are talking about entitlements for the middle class, which first got hooked on government largesse back in 1935 with the introduction of Social Security. The middle class later benefitted from the introduction of Medicare in 1965. Entitlement was granted to all citizens with workers supporting the programs through mandatory contributions. After eight decades of government distribution to millions of the elderly, Americans are quite comfortable with the concept of government disbursing funds to them as individuals.

What is less apparent is the growth of other entitlement programs for the middle class, which are funded by taxes and not by direct contributions. One that may surprise you is the group of anti-poverty programs. The official definition of poverty is established by the U.S. Bureau of the Census, which determines an annual income figure. In 2010, a single person making less than $11,344 or a family of four with two children making less than $22,113 was considered poor. Congress allows some latitude in its guidelines to account for the differences in incomes and living costs: up to 130 percent of the poverty level for those not disabled and up to 200 percent for those with disabilities.

Government is quietly redefining poverty up? In 2010, the federal government spent $666 billion on anti-poverty programs, an increase in three years of 40 percent after accounting for inflation. The programs cost as much as the defense budget or Social Security, and more than Medicare. (If you add in the states’ contribution, the total U.S. anti-poverty programs consumed nearly $1 trillion of our taxes.) A review of the federal food, health-care, housing, and income-redistribution programs all show a dramatic increase in spending, especially since 2007. Some of it is attributable to the recession and the subsequent stimulus program as well as to modest inflationary pressures. Most, however, is directly attributable to increased enrollment, with more than half of the new enrollees living above the official definition of poverty.

David J. Armor and Sonia Sousa, writing in the Fall 2012 issue of National Affairs, conclude that if the government enforced its own anti-poverty guidelines, federal taxpayers could save nearly $170 billion annually. Of course, another option is to stop calling these programs “anti-poverty” and redefine them as entitlements of the middle class.

Government continues to take a larger portion of our economic output, crowding out the free-enterprise marketplace and those civic, fraternal, charitable, cultural, and religious institutions that build both society and individual character. Our concern should be about the growing numbers of our citizens who are not and need not be dependent concluding that they nevertheless are entitled to government benefits.

Yuval Levin, the editor of National Affairs, suggests that dependence is pernicious and enervating. “Because not only the poor but the great mass of citizens becomes recipients of benefits in our welfare state, too many people in the middle class come to approach their government as claimants, not as self-governing citizens.”

That brings me to the presidential election on Nov. 6, which will have a profound impact on whether this dependence continues to grow. I absolutely agree with President Obama that this election is about two different visions of America. He sees an ever larger government filling the space between the individual and government, the space we call civil society. In his worldview, individuals should turn increasingly to government for protection against the vagaries of life, and big government should be the driver of the marketplace, replacing the “Social Darwinism” of the private sector. Our citizens should trade their radical individualism for an understanding that things are only built because the preconditions for success were created by the greater society. Ergo, the government must continue to play a bigger role, according to the president’s vision.

In de Tocqueville’s words, the president’s plan is a prescription for the end of the Republic. It denies private initiative and achievement. His view degrades the importance of the family, our religious congregations, civic and fraternal groups, and private charities. Government may be capable of redistributing funds, but it cannot replace a family’s love, friendship, personal ambition, mutual support of your neighbors, love of country, or a desire to give your children and grandchildren more than you have. In short, what we need is a government that protects the space between the individual and the government, not a government that crowds it out through bloat.

This election is about putting limits on government and about a strong middle class that sees itself as self-reliant and not as claimants. The choice couldn’t be clearer.         

Norman Poltenson is publisher of The Central New York Business Journal. Contact him at npoltenson@cnybj.com