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Welfare is not Just for the Poor

At CNS News today, Terry Jeffrey writes, "The Congressional Budget Office released a report last week indicating that the federal government paid an average of $4,000 in means-tested benefits and refundable tax credits to Americans living in households with an average income of $35,500."

Jeffrey explains this by writing:

"The CBO analysis looked at the means-tested federal payments and refundable tax credits for 2006 because that was the most recent year for which all the relevant data was available.

"The CBO's overall report looked at the growth in federal spending on Medicaid, the low-income subsidy for the Medicare Part D prescription drug benefit, Supplemental Security Income, Temporary Assistance for Needy Families, the Supplemental Nutrition Assistance Program (food stamps), child nutrition programs, housing assistance programs, the Pell Grant Program, the refundable portion of the earned income tax credit, and the refundable portion of the child tax credit."

< . . . >

"The CBO projected that the cost of these federal wealth-transfer programs will continue to rise in the coming decade in part because of new federal health-care subsidies enacted in Obamacare—or the Affordable Care Act."

Jeffrey described the way that CBO decided which groups got how much, writing:

"In its analysis of who got how much from federal means-tested benefits programs in 2006, the CBO divided the nation’s households into income quintiles, earning average annual incomes of $9,600; $35,500; $61,600; $96,400; $271,000.

"CBO concluded that households in the second quintile, earning an average income of $35,500, received an average of $4,000 worth of benefits from federal means-tested programs.

"Households in the lowest quintile, earning an average income of $9,600, received an average of $8,800 worth of benefits from federal means-tested programs. Households in the third-highest quintile, earning an average income of $61,600, received an average of $1,600 in federal means-tested benefits. Household in the fourth highest quintile, earning an average income of $96,400, received an average of $800 worth of benefits from federal means-tested programs.

"Households in the top quintile, earning an average income of $271,000, received an average of $500 in benefits from federal means-tested programs."

If case you were wondering, someone earning $35,000 annually earns just under $17 per hour. The CBO report, available here, provides the background on the programs the CBO looked at. Briefly:

  • "The federal government devotes roughly one-sixth of its spending to 10 major means-tested programs and tax credits."
  • Excamples include Medicaid, low-income subsidy for Medicare Part D, supplemental security income, food stamps, and Pell grants.
  • "In 2012, federal spending on those programs and tax credits totaled $588 billion." For the record, Social Security and Medicare are not "means-tested programs" since "they are not limited to people with specific amounts of income or assets."
  • "Total federal spending on those 10 programs (adjusted to exclude the effects of inflation) rose more than tenfold -- or by an average of about 6 percent a year -- in the four decades since 1972 (when only half of the programs existed)."

If you don't regularly check the CNS News website, you're likely missing a wealth of useful information not covered by the so-called mainstream media. We've frequently growled about welfare spending, including February 10 and January 23, 2013 and December 16, December 14, December 9, and October 20, 2012.

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