The product of a nation overburdened by welfare entitlements

February 20, 2013by Hoy Grimm0

This is from the Congressional Budget Office

What Caused Total Spending on Means-Tested Programs and Tax Credits to Rise Over the Past 40 Years?

Two broad factors were responsible for the growth of spending on means-tested programs and tax credits between 1972 and 2011: increases in the number of people participating in those programs and increases in spending per participant. (This discussion focuses on the 40-year period ending in 2011 because that is the most recent year for which data on the number of participants are available for those programs.) Both of those increases were themselves the result of multiple factors. For example, the rise in participation stemmed from three important causes:

  • Population growth (the U.S. population increased by almost 50 percent during that period),
  • Changes in economic conditions (particularly the recession that occurred from 2007 to 2009 and the weak recovery that followed it), and
  • Actions by lawmakers to create new means-tested programs and tax credits and to expand eligibility for some existing ones.

Increases in spending per participant resulted mainly from two factors:

  • Growth in the cost of providing assistance (such as rising costs for medical care), and
  • Actions by lawmakers to provide more generous benefits (such as increases in SNAP benefits).

 

In their recent research piece, 3D Hurricane, Research Affiliates calculates Structural GDP which factors in unsustainable growth derived from debt.

 

 

And compares our debt to other countries:

 

Hoy Grimm

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