In Mark Steyn’s recent treatise, After America, he makes the case that American society is doomed unless the people of the United States very rapidly repudiate the social welfare state and expansive federal government that they have voted for repeatedly over the last fifty years. This data, which I found at Zero Hedge, shows that almost half of American households are now recipients of state largesse via a benefit program (of which there are 69 such programs):
If half of American households are receiving a government benefit, and the size of that benefit is equal to $6640 per person per year, the question becomes: Who is paying? I suspect that the “half of households” receiving benefits lines up relatively well with the half of the population who don’t pay any US federal income taxes. And with a benefit cost of $6640 per person per year cost is clearly unsustainable. If we first assume that only two-thirds of Americans are actually of tax-paying age, and half of them don’t pay taxes, this means only 33% of the population is paying for these benefits. That means each of those taxpayers is on the hook for almost $20,000 dollars in taxes. Hmmm. Is the tax rate high enough on even those in lower tax brackets to recover that. No. And corporate taxes don’t do it either because they extract wealth from the economy that could be used to hire more taxpayers.
This is why America is broke and doomed unless it faces up to the fact that their welfare state is unsustainable.