Conservative Policies Ensure a Lasting Welfare State
Tuesday, April 30th, 2013 @ 7:35AM
During the run-up to the presidential elections in November, Republicans were quick to label President Barack Obama “the Food Stamp President” because the number of Americans receiving benefits from the Supplemental Nutrition Assistance Program (SNAP) had soared to more than 47 million. Conservative pundits decried this increase as a sign that President Obama and Democrats were actively recruiting Americans to get on the government dole. Dependency! Takers! These people snapping up SNAP were a huge chunk of the 47 percent of slackers that candidate Mitt Romney had ridiculed.
So were Democrats loosening regulations so that more people could get food stamps? Not so, because eligibility and application processes are decided at the state level and more so-called red states were reporting higher levels of food stamp usage. If you check the record, food stamp usage dropped significantly during the Clinton presidency, reaching a low of 17.2 million participants in 2000, his last year in office—down from a high of 27.5 million during his second year in office. So, there is no real evidence Democrats push food stamps.
What we did see was a significant increase in the use of food stamps during President George W. Bush’s years in office with 14.7 million Americans being added to the rolls. The number of people receiving foods stamps climbed to 33.5 million during the Great Recession and reached its peak in late December. The bottom line is that there are a lot of Americans requesting assistance with their grocery bills. Eating is not an arbitrary decision. Eating is fundamental.
But the food stamp controversy is just a microcosm of the welfare state and Conservatives see the welfare state as an anathema to freedom and liberty. They began trying to roll back the “welfare state” before the ink was dry on President Franklin D. Roosevelt’s New Deal legislation in 1935. In 1980 with the election of President Ronald Reagan, they seemed finally to find the winning formula. As former budget director David Stockman admitted, the plan was to limit the ability of the federal government to fund social welfare programs by “starving the beast”—giving huge tax cuts mostly to the wealthy while significantly increasing military spending.
President Clinton interrupted the strategy with tax increases that helped put the federal government’s fiscal course back on the right track, but his successor reinvigorated the strategy with a $1.3 trillion dollar tax cut that mostly favored the rich while further draining federal coffers with two wars that were not accounted for in the federal budget. The results of these policies are a huge federal debt burden and the most lopsided wealth inequality this nation has seen.
This progress began when President Reagan reduced top marginal tax rates from 70 percent when he took office in 1981 to 28 percent before he left. President George H. W. Bush, Sr. raised the rate to 31 percent and President Clinton raised the top rate to 39.6 percent. President George W. Bush lowered the rate again to 35 percent. There is legitimate debate about how much these tax cuts contributed to the federal deficit but there is little dispute that they helped to redistribute income and wealth upward.
The share of income going to the top one percent of Americans was 8.9 percent in 1976. By 2007, that share had climbed to 23.5 percent while hourly wages were declining seven percent during the same period. The top one percent of Americans now own about 40 percent of the nation’s wealth. The top 20 percent controls about 85 percent which leaves 15 percent to be divided among the bottom 80 percent of the population. We have witnessed a significant shift in income and wealth to the richest Americans over the last several decades.
Conservatives tend to see the worse in people. They see the poor as shiftless and unmotivated. They see people on welfare as people who are looking for a handout. They believe if you give people unemployment insurance they will stop looking for work. Of course there are deadbeats in every crowd, but I believe the vast majority of Americans who find themselves relying on the safety net do so reluctantly. They would rather work than take welfare, food stamps, or unemployment.
But when household income is declining and there are not enough adequate paying jobs for those who want to work, people are going to rely on their government to provide for their basic necessities to get them through difficult economic times. That is the definition of the safety net. That is the purpose of the welfare state. In a perfect world, there would be no need for the welfare state—everyone would have the means to take care of themselves. But this is not a perfect society.
Certainly those who work hardest and smartest should reap greater rewards, but is that what we’re experiencing today? The strength of the American experiment has been our strong middle class and it is being squeezed into the extremes. A few are making it into the upper echelon of income and wealth but far more are finding themselves moving towards the poverty line. We cannot pretend that this is just the result of natural order and not a function of policymaking. It seems Americans have little problems with income and wealth redistribution as long as it trends upward. Policies that seek to spread the wealth or create a more equitable society are immediately branded as acts of class warfare.
We are at a crossroads and there appears to be no definitive conclusions on whether these inequalities are sustainable or will—as they did in the 1920s—lead to a collapse of the economic engine and another Great Depression. Conservatives bridle at the thought of a broad and entrenched welfare state yet it may be that the policies they have been promoting will ensure that an expansive welfare state is a permanent fixture in the United States.