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  • Fix Entitlement Programs to Save the American Dream

    The latest installment in a National Public Radio (NPR) series considers how entitlement programs impact Americans’ opportunities. This is a welcome discussion, because growing entitlement spending threatens the American dream for people of all generations.

    Spending on the three main entitlement programs—Medicare, Medicaid, and Social Security—is projected to double as a share of the economy within a few decades. Spending on Social Security is driven upwards as more Americans retire, while spending on Medicaid is driven upwards by rising health care costs. Medicare spending is driven both by demographics and rising health care costs.

    Under President Obama, the nation is building a bridge of debt to the unsustainable future. America is already suffering from almost four years of trillion-dollar-plus deficits; debt held by the public stands at over 70 percent of the economy and is rising. Congress and the President should offer solutions that put these programs on a budget to reduce costs today and preserve them as a safety net for the future.

    The nearly 80 different welfare programs the federal government operates also need substantial reform. Instead of addressing the causes of poverty, Washington’s approach has been to pour more taxpayer dollars—close to $1 trillion annually—into an increasing number of programs that tend to trap the poor in poverty. None of these programs includes functional provisions to promote personal responsibility, such as work requirements and time limits. And the government has made it much easier for people to get on welfare.

    For example, a recent government report about the food stamp program (or, as it’s now known, the Supplemental Nutrition Assistance Program, or SNAP) notes that part of the recent growth in the number of participants is due to policy changes over the last decade “designed to increase SNAP participation among working poor households.” The report adds that states have “implemented a number of program changes to simplify the administrative process to apply for and remain on SNAP.” Not only does the safety net become an ensnaring net, but it increases the burden taxpayers must bear.

    With such a failed a approach, it is no wonder that growing numbers of reports of welfare abuse have made recent headlines, from a million-dollar lottery winner receiving food stamps to a Massachusetts drug dealer attempting to use welfare cash to post bail to an Alabama nightclub advertising a “Food Stamp Friday” party.

    In the NPR installment, Pam Malcolm, a resident of Elyria, Ohio, describes welfare abuse she has seen and expresses frustration at having to work hard while seeing people buy sushi and crab legs as if “they have a thousand dollars a month in food stamps.”

    While dire, entitlement spending is not the sole threat to the American dream. Malcolm describes the substantial job losses in Elyria, saying, “It used to be a thriving area. It’s not thriving anymore because people aren’t working.” Yet the policy prescription recommended by some in Washington—that of tax hikes, stimulus spending, and more regulation—isn’t working to create jobs either.

    America needs Washington to stop threatening tax hikes (preventing Taxmageddon is a good start) and curb its torrent of regulations, both of which are preventing businesses from growing or starting in the first place. Follow that with pro-growth tax reform that cuts tax rates and eliminates the tax bias against saving and investment, and employers will be much more inclined to hire new workers.

    Americans need solutions from their leaders. The Heritage Foundation has a plan to Save the American Dream. This plan simplifies and improves the immensely complex tax system, paving the way for robust economic growth. It gets spending under control by returning government to a more limited role and restructuring and strengthening the entitlement programs. For welfare, it means rolling back spending to pre-recession levels once the economy recovers, instead of letting costs continue on an upward path, as well promoting personal responsibility through work.

    Saving the American Dream balances the budget within 10 years and keeps it balanced. Under the Heritage plan, the American dream—embodied by opportunity and freedom—will be secure for both current and future generations of Americans.

    Posted in Economics [slideshow_deploy]

    25 Responses to Fix Entitlement Programs to Save the American Dream

    1. Clifton jernigan says:

      It is my belief that job creation would take a major leap forward if there was a standard of requirements for welfare recipients regarding their efforts to find work. Right now there is really very little incentive for job searching or self employment. Government has created a mindset of "entitlement". I am a 78 yr. Old veteran, and I have a small SS check. I do not consider that entitlement! I invested in the program the Government forced me to pay into. The Government owes me that monthly check. I am highly incensed when the pundits call it welfare, etc. Real welfare, on the other hand, is food stamps, unemployment checks, SS support for folk who pay no taxes, etc., and are too lazy to scratch an itch! My solution? Remove them from welfare rolls and watch how fast they hit the streets looking for work! Voilà! Less money for welfare(1), more job creation(2). Easy as 1,2,3 !

    2. Blair Franconia, NH says:

      Privatize Social Security, Medicare, and Medicaid.

      • Pragmatic says:

        You can't privatize medicare. Medicare exists because no insurance company could cover seniors and disabled citizens and remain profitable.

        • Bobbie says:

          When people use their money to pay into a system, it's private. When government is in control that doesn't work up to their word and steals the money to make a dishonorable profit to fit their designed crisis, it becomes corrupt. what do you mean you can't privatize when honorable people are handling it? There's no need to include an undesirable, conflict of interest called government.

    3. Bob says:

      Entitlements my ass. I paid a lot of tax dollars to this por excuse of a govebnment to ensure that my retirement would be a viable option after working for 40 some years. If you want to talk about entitlements, let's talk about congressional saleries. Let's talk about congressional retiement plans. Same with the Senate. At least I worked for a living, not like these leeches. I didn't exclude myself from some far reaching plan that was just for the lower classes. You want to talk about entitlements? Let's talk about welfare benefits that make it profitable to have babies so that the government subsidies go up in an amount proportional to the number of kids I produce with as many fathers as I can muster. Let's talk about benefits for illegal immigrants who want no part of being a citizen of this nation, only the money it will provide.

      • Alexia Brandon says:

        I agree whole heartedly with Bob's comments. He has said it all, except that by Obama trying to rule the countries all around the world by giving them a lot of money (taxpayer's money), he is making the USA somewhat like Rome, when she was trying to own the then known world. The latest outrageous amount of money is being spent in the country where he was born. Alex

    4. Jeanne Stotler says:

      I agree with Bob and Clifton 100%, I worked many years paying into SOc. Sec., not by choice, but by law. If LBJ had left this where it was suppose to be and invested in US Treas. bonds, this would not be broke. This was suppose to be for those who worked, not illegals or others that didnot pay into it. As for Medicaid, Welfare, why not put a cap on what you can recieve, SOc. SEc. orphan benefits is the same for 4 kids as it is for 2 kids, Now lets put welfare like unemployment, so many weeks and poof you are looking for work. 4 and 5 generations on welfare is a disgrace, food stamps I am not sure of, but they should be limited to the working poor and a temp. break for those on unemployment. Dry up these perpetual benefits for being lazy and you'll see them work.

      • Pragmatic says:

        The Social Security Trust Fund is fully invested in treasuries and other government debt. Social Security has problems because it is a "pay as you go" system. What you pay in is paid out to beneficiaries, and any excess is invested in the Trust Fund. Just FYI.

        A large part of why its going broke is the shift in demographics as well. We don't have the population growth that we once had an now we can't pay for the baby boomers. Social security is in desperate need of reform.

        • Bobbie says:

          Demographics shouldn't matter! What are you implying? a large part of why it's going broke is because it's out of the peoples' control and the incompetent, disingenuous control it's in is not serving the intention!!

        • Alexia Brandon says:

          Social Security is going broke because the USA government has "borrowwed" 25% of the National Debt from the SS account.

        • g bushy says:

          you left out that although it's going broke, it's solvent for many years to come, and that it does not directly add to the debt or deficit

          id like to agree with your final statement, and add that the best way to reform it is to lift the ceiling on how much people pay into

          those who make under $110k (if i remember right) pay into the full amount… those making $110,001 will pay into the full amount and then for every dollar earned afterwards, will not pay anything

          if people are concerned with "redistribution of wealth" (im sure anyone making that kind of money for years on end will really miss it) in this case, just increase the maximum amount paid out by Social Security for the top income bracket when they retire… either way, the program will be solvent for centuries, by just implementing this kind of reform for a few years

    5. saveamerica says:

      Remove those that aren't qualified! Those who are exempt from paying into but receiving ANYWAY by democratic/government corruption…

    6. Kurt Schamber says:

      I do not consider Social Security and MEDICARE a Free Entitlement. I have paid into both all my working life
      Now if you take it into consideration of the people who are drawing these without paying anything into these funds, then they are Free Entitlements..

    7. Stirling says:

      The problem with "Entitlements" is that it's a Government PONZI Scheme. Once people realize it's a scheme entitlements will fall like a deck of cards.. Just because something is "Government backed" it just means that everyone shares in the missery once it's exposed.

      Those of us that realize this "Lie" promised by the government will be better off distancing ourselves from reliance on the government for retirement and basic living expences. We can save the american dream but it should be a personal decision coupled with accountablity in ones own life.

    8. Pragmatic says:

      Thank you Heritage for acknowledging that NPR can produce good journalism.

    9. Janice says:

      It's a shame that MCA is threatened to be shut off to people who have worked and payed in order to collect someday. What is wrong is giving money to unmarried women with children who live with the father instead of marrying. They ultimately lose in the long run. It's been going on for some time and now considered "the thing to do because the money is there". Aren't they collecting what should be saved for MCA money for our seniors? Why should there be money given out to young people who see this as a free lunch? These young people have not payed into the system.

    10. Josh says:

      I, like most senior citizens, do not consider SS to be an entitlement program. The concept of paying your money in increments over time to reap future gains/savings is not an entitlement in idealist terms. We pay property taxes for sanitation and education services, put money in a 401k for retirement, receive government rebates after make varying purchases. If SS is an entitlement, then you could make the argument that many more are as well. If a service, luxury, or money is provided to our citizenry from what they have earned, it is hard to make the case for them being entitlements.

      But truthfully, many seniors are completely unaware of the true danger of social security, and that is a gradual devaluation of the dollar's purchasing power over time. No member of congress is going to seriously impose cutting off or cutting back SS funding(and by that i mean stop sending out treadury checks). It is political suicide. And the consequences of privatizing social security would be a blunder of the greatest magnitude. As interest rates remain very low, and as banks start loosening up once again and start lending out the trillions they have been sitting for over 4 years after the big bailouts/mergers, and as china continues to shorten its supply of dollar-denominated assets by basically buying the world, and as congress and the white house continue to do everything in their power to incite WWIII with Iran(see the national defense authorization act of 2013), the dollar will plummet in value, and those $700 monthly checks from SS fund(although in reality no such fund exists) will buy1/2 of what they formerly bought.

      Most Americans simply don't understand that our only saving graces to our standard of living are the dollar's status as the world's reserve currency and our military might from the skies(we can just bomb our debtors and threats into surrender). "We still own the air as I like to say.".

      Food stamps is obviously a repulsive entitlement, as it promotes laziness over diligence. Welfare recipients can be rewarding to society, but only if the individual along with the state government agencies agree that is long a long- term relationship. Unfortunately the government authorities would never promote this kind of honor since a less-reliant person weakens their legislative and financial power.

      All that being said, SS is a program completely mis-handled by the government, not the people. In my opinion, after souring deficits from the great war, the panic of 1920, and the great depression, president Roosevelt declared the US government officially bankrupt, and then in the mid-1930's, out popped the social security act. Though on paper the law says it will help pay for retirement for eligible seniors during the industrial age, I believe it's true meaning was that now each person being born in the united states will be issued a SS card serving as the collateral on the debt owed to the world banksters, setting up a treasury department that would make decisions independent of the congress.

      And that is what I believe in a nutshell. The US government is not on the verge of bankruptcy as so many like to say. We reached that point over 75 years ago. All we have been doing ever since is managing the bankruptcy, and doing so quite poorly at that. Why do you think president Nixon ordered Americans to surrender their gold under the threat of imprisonment. The government needed more collaterall, completely violating the coinage act.

    11. Ed Ruthazer says:

      Looking at the graphs, Social security looks pretty stable and actually starts going down. No reason to tinker too much with that. Once the baby boomers are gone, the system will start to accumulate a surplus again.

    12. Betty says:

      I think if we are judicious in our efforts to curb spending we will be able to continue with Social Security and Medicare. I think alot of our money goes to paying government pensions and other entitlement of a growing government. I take issue with the government elite. People in the private sector are no longer getting pensions why should people in government? People are living much longer and pensions to government workers are not affordable. The people in the private sector pay for that as well. Too much money is given for food stamps. About one in every 6 people gets them. That is a huge economic cost. I believe that we are at a crossroads as America is declining in their position in the world. As Condoleeza Rice said, "We Can't Lead From Behind". We must cut frivolous spending and turn the economy around. We need a new president. Someone who can work with congress. We need to give someone else a chance.

    13. g bushy says:

      notice the graph was indeed (according to the bottom) made by the CBO, however, it also says (at the bottom) this is an "alternative fiscal scenario", meaning this isn't what was actually projected to happen… i really think this graph is almost humorous… spending into these federal programs will almost double in this time span? if so, it has nothing to do with baby boomers, as any of them still alive by 2050 will be about 100 years old or older…
      now taking into account the percentage of people who are 100 now, and given that healthy lifestyles and medical breakthroughs are increasing life expectancy, id give a rough guess that the amount of baby boomers alive in 2050 will be roughly 20,000…
      the folks who wrote this article seem intelligent and educated, but i believe that they are not so much as putting a spin on something, but leaving certain facts out so that the article spins itself… just my 2 cents

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