Newsweek: Our Sinking Welfare State

From an article in Newsweek titled, "Our Sinking Welfare State (And We Won't Even Admit We Have One)" today, "Raised in an individualistic culture, Americans dislike the concept of the 'welfare state' and do not use the term. But make no mistake, the United States has a welfare state, and its future is precarious.

"What most Americans identify as government 'welfare' are payments to single mothers, food stamps and (perhaps) Medi-caid, the federal-state health-insurance program for the poor. But that's not the half of it. Since 1960, government has changed radically. Then, 52 percent of federal spending went for defense, 26 percent for "payments to individuals"—the welfare state. By 2008, 61 percent went for "payments to individuals," 21 percent for defense. Social Security and Medicare—programs for the elderly—represented the lion's share: $1 trillion in 2008.


"In theory, expanding public welfare could offset eroding private welfare. President Obama's health-care proposal reflects that logic. The trouble is that the public sector also faces enormous cost pressures, driven by an aging population and rising health costs. The Congressional Budget Office projects the federal debt to double as a share of the economy (gross domestic product) to about 80 percent of GDP by 2019."

"Any sober examination of figures like these suggests that the system has promised more than it can realistically deliver. We are borrowing not to finance investment in the future but to pay for today's welfare—present consumption."