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The Cost Of The Left’s Compassion

In his column this week, posted at Investors Business Daily Editorials, Dr. Walter E. Williams, a professor of economics at George Mason University, focuses on the price of the welfare state. The evidence comes from Edgar K. Browning's “new book aptly titled "Stealing From Each Other." Its subtitle, "How the Welfare State Robs Americans of Money and Spirit." Dr. Williams writes:

“In 2005, total federal, state and local government expenditures on 85 welfare programs were $620 billion. That's larger than national defense ($495 billion) or public education ($472 billion).

“The 2005 official poverty count was 37 million persons. That means welfare expenditures per poor person were $16,750, or $67,000 for a poor family of four.

“Those figures understate poverty spending because the poor benefit from non-welfare programs such as Social Security, Medicare, private charity and uncompensated medical care.

“The question that naturally arises is, if we're spending enough to lift everyone out of poverty, why is there still poverty? The obvious answer is that poor people are not receiving all the money being spent in their name. Non-poor people are getting the bulk of it.”

What is the effect of all this redistribution of income? According to Dr. Williams:

“Browning's concluding chapter tells us what the welfare state costs us. He acknowledges the non-economic costs such as infringements on liberty and strains on the political process, but focuses on the quantitative economic costs.

“The disincentive effects of Social Security have reduced the GDP by 10%, the federal income tax (as opposed to a proportional tax) by 9% and past deficits by 3.5% for a total of 22.5%. Browning guesses that welfare programs have reduced GDP by 2.5%. The overall effect of redistributionist policies has created incentives that have reduced GDP by a total of 25%. Without those, our GDP would be close to $18 trillion instead of $14 trillion.”

Rest assured, too, the left is always willing to identify additional, so-called, unmet needs, if only they can find productive Americans to pay for them. And even if they can't, taxpayers will just have to dig deeper into their pockets.


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