More than 67 million Americans dependent on government

16 Replies to “More than 67 million Americans dependent on government”

1. This is more a demographics chart or set of charts than anything else. As more Americans age and the younger population shrinks by comparison is it any surprise we see the chart jumping? Virtually everyone understood what would happen when the baby boomer pig moved toward the back end of the python, we would see the largest percentage in history of retired people on social security, medicare, medicaid, etc. etc.

   Let me know when the Heritage Foundation starts charting publicly traded corporations on government assistance (tax breaks, low corporate rates, direct subsidies, government contracts, untaxed foreign profits, low interest or no interest government loans, TARP, FED loans, all manner of insurance, pension take overs and insurance…..the mind boggles at all the corporate perks. I think at that point nearly 90% of the population could be considered on government assistance.

   As a friend of mine says, the fortune 500 would be the fortune 5 without corporate welfare.

   1. You seem to under-estimate the seriousness of the problem.

      1. Hardly, but I’m not in a position to solve it. I’m only interested in this point in profiting from it. It may look as if I underestimate it, but what exactly is a ‘regular citizen’ supposed to do? I feel like one of the ‘help’ on the plantation and the massa (and by this I don’t mean the President, but the entire moneyed class) is running the operation into the ground and they don’t want to pony up to halt the slide or feed the slaves. They continue to manipulate the system and bleed it for their own purposes while running up the debt and blocking any meaningful action to stop it and failing to come up with any real solution themselves except to starve the slaves. That might work until the slaves rise up…..
         In my foolish youth I got myself into some serious debt problems and I had to solve it in a comprehensive way, cut spending, lower interest rates, pay higher rate debts first and make more $$$ to pay my debt down. Apparently the monied class only sees one side of the ledger, mainly because cutting the debit side won’t have much effect on them, until they drive their limo out on the street and take their lives in their hands. It all depends on what kind of country they want to have, or if they want a country or world economy at all. To solve the debt problem will require sacrifice on everyone’s part. As a ‘boomer’ I realize I will likely not be able to enjoy the same retirement my parents did, that I will have to work, and that unless I can maneuver through this with some skill my daughter my be in worse shape than I am. So do I underestimate this problem?
         I don’t think so. It’s more like I feel like the Captain of the Titanic.

      2. I agree that the economy is mismanaged but voters don’t seem to care. Every four years they involve themselves in a futile “Coke v Pepsi” election where (almost) everyone picks sides and argues about inanities rather than the core issues. Nothing much changes no matter which side wins. The “monied class” have a bet each way, exercising considerable influence on both sides of politics.

2. I would be very interested to see how the australian statistics compare…are we really the nanny state or just average in terms of western governmnet welfare

3. What is not explained is payment of the state income tax which is the major tax in USA & is paid by many of those exempted from the federal tax. The USA state tax pays for things like most government services & infrastructure which in Australia is taxed at federal level & passed back to the states as federal grants based on the proportion of GST collected from each state, however the federal government in Australia still does fund some areas of infrastructure & services such as universities, major highways, some aspects of socialised health services, etc.,In both countries defence is a federal cost.
   The manner in which this information is presented is misleading to Australians who are used to only 1 income tax being paid.

   1. So state taxes vary by state and play a similar role to the GST in Australia. Why is that misleading?

4. These charts are not hard to explain and explain easily.

   Let’s take a company like Wal-Mart. It pays its people as little as possible and knows that by doing so, its employees MUST be dependent on government to supplement their very low wages (customers expect low prices so someone has to suffer). Everyone knows this. Wal-Mart knows it, its customers know it, investors know it and its workers know it.

   If you work for Wal Mart and have a child, you WILL need government help. But it’s not just Wal-Mart, it’s all over the place…every grocery story, every clothing store, every restaurant etc.

   So put another way, if Wal-Mart paid a living wage, a wage where its workers were NOT dependent on government, its profits would plummet and so would its stock.. Again, everyone knows this. This is the new economy so stop whining about it.

   1. Lifting the minimum wage will raise prices. So what do you see a s a solution?

      1. Not a hard question because the answer is also easy. Look at Costco. It pays its employees around $18 an hour, compared to Wal-Marts $10. It also has very little turnover so its costs of hiring and training new people are greatly reduced. Wal-Mart has one of the fastest turnovers in the country.

         Now look at Costco’s stock price and sales compared to Sam’s (part of Wal-Mart). Let’s start with stock prices. Wal-Mart is in the middle of very good run. It’s now sitting at $74, up around 24% YTD. Costco is at $107 and is up about 22%. Not much difference there considering these stocks move around a lot. Over 5-years both WMT and COST are up 67%,with WMT getting a fraction more than COST.

         Sales at Costco are about twice as high as Sam’s even though both companies started in the same year. So Costco has higher wages, higher sales and a comparable stock price. Do higher wages hurt companies (a myth) or do seasoned workers make the company more profitable? Clearly, the low turnover at Costco has been very good for the bottom line and for their stock price and sales.

         And here’s the best part (and this is a guess). Employees who work for COST are less likely to need government help because they get paid so much more than WMT.

      2. Besides stock price, customer loyalty is much higher for Costco customers (having been a member since 1989) and the customer base is broader, ranging from lower middle class to upper income business owners. AAMOF, when I joined you had to be a business owner, now anyone can be a member. In most cases prices are better at Costco which might surprise a lot of people. So what exactly is Walmart doing with those profits if it isn’t to keep prices lower? It sure isn’t used for employees. Besides better wages, Costco also has medical coverage and retirement plans while Walmart externalizes those costs to the taxpayers.

5. Misleading charts and Data. The Heritage foundation massages their info to suit their ideology. If you did any real research you would know that US Defense spending is more than half of all federal spending. That includes spending on wars past and present.

   1. More like 20 percent according to CBO 2010 historical tables.

6. What these charts should show us is very simple. Corporate America is failing and the only way it can continue to make profits is to squeeze the middle class and elderly to death.

   When corporations stop paying health care benefits to retirees, do we blame government, the retiree, or the corporation that breaks its promise? This is a very simple question with a very simple answer. Any sane person blames the guy who broke the promise (the union busters).

   In 1998, according to Heritage, the # of companies that paid retiree health care was 66%. A few years later, by 2002, it was down to 34%, cut in half because….? Again, the failure of corporate America to keep up with the baby boomers is in itself staggering because it’s passing its bills to the American taxpayer. The charts don’t show this, but the numbers do.

7. Interpreting people who receive government assistance as ‘dependent on government’ may skew the figures a bit but I guess that is the idea since the heritage foundation are a right-wing think-tank.

   1. In fact in the 2011 figures from the Tax Policy Center (see link below) 9.9% of tax units listing income above one million dollars still had cash income in the ‘Other Income’ bracket which makes them dependent on the state by most measures… That is nearly 127,000 ‘Tax units’!
      http://www.taxpolicycenter.org/numbers/displayatab.cfm?DocID=3262&topic2ID=150&topic3ID=160&DocTypeID=1

Comments are closed.