The End Of The World As We Know It

Ed BurghardI was very disturbed by an article I read recently entitled “The American Dream is Over: 70 Million people Would Be Starving In The Streets Without Government Welfare Programs”. The author (Mac Salvo) suggests American has reached a tipping point and things are only going to get worse going forward.

The End Of World As We Know It Is Happening Now

The author’s claim is based on a Department of Health and Human Services report indicating that nearly half of the people in the United States are now dependent on some form of government benefit, and nearly one in four are receiving welfare. The data do not go beyond 2011.

PIA14415What is the author’s ultimate conclusion? “The end of the world as we know it is happening now.”

The statistics are alarming, but should also be taken in context. For example, the “nearly half” claim includes people receiving social security, Medicare and veterans benefits.

In my opinion, social security payments represent earned income on your forced savings. Not only did we each contribute to social security while we worked, but so did our employers. I have read articles that suggest (rather convincingly) had you been allowed to invest the money paid to social security on your behalf in any investment that delivered more than a 1% interest rate compounded monthly, you would have made nearly three times as much as the government is paying. Net, we were each forced to make an arguably poor investment so the government could underwrite social welfare programs.

Also, in my opinion veteran’s benefits should also be considered earned just like any other retirement benefit from the private sector would be.

And, when you turn 65 do you truly have a choice when it comes to Medicare? I don’t know anyone who had private insurance and was happy they were forced to switch to Medicare when they turned 65 years old. That is why so many continue to pay for private insurance.

I don’t think it is appropriate to include recipients who receive “benefits” from of any of these three programs in support of the claim that “Nearly half of the people in the United States are now dependent on some form of government benefit”

Maybe Not The End Of The World, But We Do Have A Problem

Even though I disagree with the calculations, I do think the article’s author makes a good point. We are creating a government dependent population in the United States. And, I don’t think that is good for the American Dream.

Bob Lonsberry wrote the following and it makes a lot of sense. And, no it wasn’t Lou Holtz contrary to the eRumor.

“There are two Americas. The America that works, and the America that doesn’t. The America that contributes, and the America that doesn’t. It’s not the haves and the have not’s, it’s the dos and the don’ts. Some people do their duty as Americans, obey the law, support themselves, contribute to society, and others don’t. That’s the divide in America. It’s not about income inequality, it’s about civic irresponsibility.”

Now, there are obviously citizens who are incapable of working and require help to achieve their American Dream. But, it is by no means the majority of people living in the United States (nor should it be). Creating a condition of government dependency undermines the notion of the American Dream by disempowering people. And that is a slippery slope that could lead to “the end of the world as we know it”.

A great example of how this happens is provided in the article “Does Socialism Work? A Classroom Experiment”. The five morals from the article’s story are:

1. You cannot legislate the poor into prosperity by legislating the wealthy out of prosperity.

2. What one person receives without working for, another person must work for without receiving.

3. The government cannot give to anybody anything that the government does not first take from somebody else.

4. You cannot multiply wealth by dividing it!

5. When half of the people get the idea that they do not have to work because the other half is going to take care of them, and when the other half gets the idea that it does no good to work because somebody else is going to get what they work for, that is the beginning of the end of any nation.

The American Dream

The definition of the American Dream in James Truslow Adams’ The Epic of America is essentially spot on. He described it as “The dream of a land in which life should be better and richer and fuller for every man, with an opportunity for each according to his ability or achievement.”

In my opinion, the operative word is “opportunity”. The American Dream requires work to achieve. It is not a dream of entitlement. The dream of a freer and more fulfilled life is what all Americans seek, and is embedded in the core promise of our nation. It is the fundamental reason people immigrate to America and the driving reason residents get out of bed each morning to tackle the myriad challenges they face on any given day. As was learned in the classroom experiment, when people believe they don’t have to work because their needs will be taken care of by the government, the will to achieve is undermined.

Dr. Greg Smith, co-inventor of the ADCI and chair of the management information systems department, and Roger Fortin, academic vice president and provost for Xavier University, wrote, “Fundamentally, the American Dream is about hope — the hope that every individual of whatever status has the chance to be all that he or she can be. It is America’s highest aspiration and promise and is inextricably bound to our nation’s ideals of freedom, equality, justice, and opportunity for all people. Individuals’ pursuits, collectively, constitute the moral and economic engines that drive this nation forward.

There Is A Big Difference Between A Hand Out And A Hand Up

According to Xavier University research, on average roughly two-thirds of the American Dream is being realized. In my opinion it is an unacceptably low figure. Based on my own look at the data, it is clear that the ability to achieve the American Dream varies state to state and city to city.

The implication is that policies of local elected officials can make a positive or negative impact on your ability to achieve your American Dream. In my opinion, we should hold elected officials accountable for enabling the American Dream. In that way we can ensure policies and programs that focus on empowering residents rather than make them dependent on the government under the guise of lending a helping hand. There is a big difference between a hand out and a hand up.

With thirty-six Gubernatorial elections in 2014, I am hoping the candidates viewpoint on how to better enable residents to achieve their American Dream will be a core differentiator in who gets elected. If we elect “Pro American Dream” officials, we can certainly avert “the end of the world as we know it.”.

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4 Comments so far

  1. will novosedlik

    July 14, 2014

    Hmm. It’s much more complicated than this article makes it look.

    With respect, I think Bob Lonsberry’s view is completely devoid of analytical rigour, and his pronouncements typical of the sound-bite level of wisdom that passes for truth these days. It IS totally about inequality. What about all the working poor? The people working for punishingly low minimum wages? Are they not ‘doers’ too? And yet many of them are so poorly compensated that they need government support. What does the ‘dream’ mean to them?

    If there is any civic irresponsibility – and there is a ton of it – it is the behaviour of the financial management class and the corporations who ship jobs offshore and who refuse to pay their share of the taxes required to fund the basic needs of any democratic society.

    Without health and education, without decent jobs, there is no society. America is right on course for creating the kind of world where, as Margaret Thatcher once so disgustingly said, “There is no such thing as society. There are only individuals and families.” That is certainly coming true in America. The role of government should not be just as a facilitator of individual and corporate wealth. It should be there to keep the infrastructure that allows everyone and every organization to function and prosper in place. And that requires taxation, pure and simple.

    Canada is not far behind. We do fund health and higher education in a way that makes both far more accessible to anyone who needs access. So don’t get me wrong – I love Canada and many things about America too – but unless the ‘dream’ is collective and not just individual, then there is no hope for our fragile democracies to survive in the form that they were meant to. You can’t have a nation built of people who are all out for themselves.

    Certainly Adam Smith thought so, as did Alexis de Toqueville. They both thought that any democracy whose primary concern is to facilitate the amassment of personal wealth is a democracy doomed to fail. And I think that’s what we are seeing today.

    An excellent book on this subject is ‘Ill Fares the Land’ by Tony Judt. Short, excellent analysis of why the dream is failing.

  2. Edward

    July 14, 2014

    Will -Outstanding additional perspective.

  3. Graham Nicholson

    July 15, 2014

    Very interesting contributions on all sides. If I may give a European perspective, the ideal of the American Dream can appear very individualistic. It is perceived to be about the right or opportunity of each person to achieve personal prosperity and goals – all of which is laudable in itself. Indeed the role of incentives and competition between individuals, and the notion of personal liberty which is so robust in America, contributes to economic success without doubt.

    But that isn’t in itself sufficient to create a great society. Pursued alone it will lead to gross inequalities and the disaffection of the many who are not ‘winners’. A cooperative society where all or most people feel they have a stake incentivises us to build our communities and public institutions, and to value and look after each other whether they are young or old, rich or poor. This is not socialism but a pragmatic humanism that says our society is better and stronger if we cooperate and don’t view things just from an individualist perspective. Sure, I sometimes worry about benefits dependency but I do think we have an obligation to see the sick cared for, the unemployed helped, the lonely comforted and the public realm of our cities cared for.

    As an example of the limits of the individualistic approach I cite the US gun laws – at the risk of being controversial, I and most in my country, the UK, find these laws unfathomable. They appear to offer the means of personal security but also offer the disaffected opportunities to do harm. The outcome is a disaster for community safety. The risk of being murdered by a firearm in the States is about 65 times what it is in my country where our ‘liberties’ are constrained by the most stringent gun restrictions. In this instance the welfare of everyone is secured by looking at the needs of the community as a whole – pace Margaret Thatcher.

  4. Edward

    July 15, 2014

    Graham – It is always great to get an outside perspective.

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