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The 2010 Index of Dependence on Government

Posted By Patrick Tyrrell On October 13, 2010 @ 8:00 pm In Ongoing Priorities | Comments Disabled

The Heritage Foundation’s 2010 Index of Dependence on Government [1], published today, showcases the disturbing trend of Americans becoming more dependent on their government – via their fellow non-dependent tax paying Americans – than ever before.

  • The surge in the Index of 13.6% over last year takes the Index to an all time high.
  • Government support for dependent persons has grown from $7,293 per person in 1962, to $31,950 per person in 2009, both amounts expressed in 2005 dollars.
  • Many Americans pay no federal income tax for the dependency related programs they use. 132.5 million Americans do not pay income taxes and do not have a head of household paying income taxes in their household. This is up from just 34.8 million in 1984.
  • And three entitlement programs, Social Security, Medicare, and Medicaid eat up 41% of all non-interest federal program spending. Unchecked, this will grow to 62% over the next decade as 10,000 baby boomers retire every day.

The problem caused by unsustainable promises of entitlement benefits to millions of Americans will not go away of its own accord. In fact, the IMF predicts that U.S. public-sector debt (federal plus state) will equal 100 percent of the U.S. gross domestic product by 2015 unless the annual deficits are immediately cut by an amount equal to 12 percent of GDP. 100 percent of the dollar value of everything produced in the whole country will be owed! It is no wonder that so many Americans feel the need to turn this ship around.

The images coming out of France and other parts of Europe today and over the past few weeks are a harbinger of what the U.S. will eventually face when entitlement reform is eventually forced on us by the end of the long debt train line that America has been riding for so long. An army of dependents will be angry. The French workers who are being asked to retire at 62 instead of 60 years old are angry now. Who knows how millions of Americans will react if the federal government is forced to reduce the aid currently flowing from dependency creating programs.

It is better to cut spending by 12 percent of GDP per year today than to suffer the financial and political repercussions that will inevitably stem from delay.

Click here to read the 2010 Index of Dependence on Government [1].


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URL to article: http://blog.heritage.org/2010/10/13/44821/

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[1] 2010 Index of Dependence on Government: http://www.heritage.org/research/reports/2010/10/the-2010-index-of-dependence-on-government

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