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Government The Almighty Buck United States

70% of U.S. Government Spending Is Writing Checks To Individuals 676

Posted by timothy
from the that's-rather-a-pointed-description dept.
An anonymous reader writes with this excerpt from Investor's Business Daily:"Buried deep in a section of President Obama's budget, released this week, is an eye-opening fact: This year, 70% of all the money the federal government spends will be in the form of direct payments to individuals, an all-time high. In effect, the government has become primarily a massive money-transfer machine, taking $2.6 trillion from some and handing it back out to others. These government transfers now account for 15% of GDP, another all-time high. In 1991, direct payments accounted for less than half the budget and 10% of GDP. What's more, the cost of these direct payments is exploding. Even after adjusting for inflation, they've shot up 29% under Obama." It's very hard to lay blame on only one part of the U.S. government, though; as the two largest parties are often fond of pointing out when it suits them, all spending bills originate in the House.
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70% of U.S. Government Spending Is Writing Checks To Individuals

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  • And... (Score:4, Interesting)

    by beelsebob (529313) on Tuesday March 11, 2014 @04:42PM (#46457645)

    Why is this a problem? You've outlined some interesting results here, but what makes you think there's an issue here?

    • by Anonymous Coward

      Goddammit, if the government is going to give money, it should be to corporations. Pah!

    • Re:And... (Score:4, Insightful)

      by Anonymous Coward on Tuesday March 11, 2014 @04:55PM (#46457783)

      What I have a problem with is that I know several illegal residents here with their entire family living off of state and federal programs. One of them hasn't worked in years and hasn't needed to.

      Now they don't live like the middle class, but sure live better than some of the homeless people that I have come across. They qualify for these programs because they have never had a job before.

      What would you rather do? Work hard in your home country and live in poverty or come to the US illegally and live slightly above the poverty line and never have to worry about working at all?

      I have a friend who has run out of unemployment insurance and has no possibility of a job in the near term because he is over qualified for almost everything. He is in the process of losing all that he has ever worked for.

      Tell me you don't see a problem.

      • Re: (Score:3, Insightful)

        by Grishnakh (216268)

        Illegals like that don't just sit around and not work; they frequently work under-the-table, so they keep their healthy benefits while getting extra tax-free spending money. All those landscapers you see driving around are not W-4 employees and do not pay any taxes into the system.

        • Re:And... (Score:4, Insightful)

          they frequently work under-the-table

          Correction: Someone pays them to work under the table. The same person who won't pay you to work above the table.

      • Re:And... (Score:5, Funny)

        by 0xdeadbeef (28836) on Tuesday March 11, 2014 @05:25PM (#46458115) Homepage Journal

        I know several illegal residents here with their entire family living off of state and federal programs

        I know several people who make up stories like this and post them anonymously on the Internet.

        • Re:And... (Score:5, Interesting)

          by Above (100351) on Tuesday March 11, 2014 @06:45PM (#46458819)

          Here's a fun fact the right doesn't often talk about. I've spoken to a number of actual illegals over the years about how much they fear being captured. Several of them appear to have what are "above board" jobs, having gotten identification numbers on a temporary work via and then continued to use them, or on various other methods. They overstayed, and are now illegal.

          The general response was interesting. INS doesn't have enough resources to do anything unless you're a felon. Even getting arrested for a misdemeanor is unlikely to get INS involved unless your in a few border areas. They really didn't fear INS at all. However, each said they very carefully paid their taxes to the IRS each year, often omitting some questionable deductions to which they might be entitled. Why? The IRS will audit them. And while the IRS is forbidden by law to share information with other federal agencies so a return won't get you arrested, if the IRS choses to arrest you then you're in the federal system, automatically handed over to INS, and deported in short order.

          The result is in fact many illegals pay taxes, but are not entitled to receive many of the benefits that other tax payers could receive. They are in fact the opposite of takers, but are rather over contributors.

          I wish I had a citation, but I don't.

    • Re: (Score:3, Insightful)

      by BitterOak (537666)

      Why is this a problem? You've outlined some interesting results here, but what makes you think there's an issue here?

      Because the United States is not supposed to have a redistributionist government, but the figures seem to suggest that's exactly what it is.

      • Re:And... (Score:5, Insightful)

        by timeOday (582209) on Tuesday March 11, 2014 @05:28PM (#46458143)
        It's mostly "redistributing" money from people, to their older selves. It's effectively forced savings.

        The bottom line is that the term "government spending" is highly misleading, since the government is exercising no discretion on how it is spent... the government simply sends it to individuals (mostly old folks) who decide what their individual priorities are and where to spend it.

        • Re: (Score:3, Insightful)

          by Charliemopps (1157495)

          Ah, no. The vast majority of people get back far more in social security payments than they ever payed into it. It's the same ponzi scheme pensions relied on (except pensions require the corporation to grow forever rather than the population of the country) and why they to are failing. The only way our social programs can work is if the population of the united states continues to grow at the rate it did in the first half of this century, forever. Currently it is not, and that is why we have a problem. It's

          • Re:And... (Score:5, Insightful)

            by timeOday (582209) on Tuesday March 11, 2014 @07:32PM (#46459217)
            Sure, when the ratio of unproductive old people to productive young people increases, the burden on the young people increases. This is true whether your accounting of chits uses dollars, entitlement programs, social customs (obliging children to support their parents directly), or anything else. There is no avoiding it. The only real questions are how to distribute the burden among the able-bodied, and how quickly the assets of the old are transferred to the young.
        • Re:And... (Score:4, Funny)

          by Tablizer (95088) on Tuesday March 11, 2014 @06:51PM (#46458883) Homepage Journal

          It's mostly "redistributing" money from people, to their older selves

          Time Socialism: a new evil for the right to rant about. It'll take their mind off birth certificates.

      • by beelsebob (529313)

        Because the United States is not supposed to have a redistributionist government

        Isn't it? Who said? Why does the government have to believe them?

    • Re:And... (Score:5, Funny)

      by painandgreed (692585) on Tuesday March 11, 2014 @05:16PM (#46458015)

      Why is this a problem? You've outlined some interesting results here, but what makes you think there's an issue here?

      Because they are paying people, when they should be paying corporations!

    • My thoughts exactly.

      I think this is a primary role of the government: supporting society by supporting those who for historical reasons got left out. Be it age, natural disasters or other factors.

    • Re: (Score:3, Insightful)

      by briancox2 (2417470)
      Thank you for that question. I'm glad you asked.

      The concern here is for the financial well-being of our country. Once a majority population of a Democracy has figured out that they can just vote themsleves gifts from the coffers of the country, that country will certainly head down a swift path to financial ruin. That's why we don't have Democracy.

      The founders of the United States fortunately were aware of this history, so they slowed this phenomonon down by deciding upon a Republic. By voting onl
      • Re:And... (Score:4, Informative)

        by dryeo (100693) on Tuesday March 11, 2014 @10:50PM (#46460579)

        Funny thing, as far as I know there are only 2 countries that practice direct democracy, one of which is a Republic, namely Switzerland and one has a monarch, namely the Principality of Liechtenstein. Both are very successful countries that have not gone down the path of financial ruin, at that the exact opposite has happened with the Swiss considered one of the most financially stable countries on Earth.
        BTW, all republic really means is not having a sovereign and lots of monarchies have representative governments and some are even federal laid out unions of sovereign states or provinces. There are also lots of republics that are totalitarian dictatorships.

  • by lgw (121541) on Tuesday March 11, 2014 @04:42PM (#46457647) Journal

    I hate to be the guy saying "why is this on Slashdot", especially since I've been posting these very budget numbers here for years, when it has been relevant to the thread, but WTF? This is a blatant political click-troll story. It's not news (been this way for many years), and it's not "for nerds".

    Sure, I guess we could rehash the same old "NASA's budget is trivial in the scheme of thing" posts, but really.

  • by jeff4747 (256583) on Tuesday March 11, 2014 @04:44PM (#46457673)

    http://www.ssa.gov/ [ssa.gov]

    Feel free to run on eliminating it. After all, it's what you're complaining about in your post.

  • by jfengel (409917) on Tuesday March 11, 2014 @04:49PM (#46457721) Homepage Journal

    mandatory (adj): Obligatory; required or commanded by authority.

    As the article points out, most of this is going to mandatory programs, which would be the same even if it were Romney or McCain or Sarah Fucking Palin in office.

    What this means, for those dumb enough to believe what they read in IBD, is that what Obama has achieved is to reduce the amount of spending on the discretionary side. Agriculture, down 8%. HHS, down 7.6%. Even Homeland Security, down 2.8%. The Pentagon is down over $100 billion.

    But hey, by all means, let's make sure that this looks like Obama's doing a bad job, because that was clearly the author's goal before he wrote it. The rest is just a matter of selecting the data until it proves what you wanted it to prove.

    When we hear a serious discussion of how to cut benefits (something other than "the poor should die" and "let's give it all to Wall Street, because they're so freaking responsible"), we can have an actual conversation. But articles like this show why anything from Obama, no matter how reasonable, is doomed even before it gets printed.

    • Re: (Score:3, Informative)

      by Bartles (1198017)
      There is no such thing as a mandatory program unless it is mandated by the Constitution. We can choose to recognize this fact, or we can be forced to recognize this fact. Either way it will eventually happen.
    • You were doing well until you busted out the strawmen.

    • Re: (Score:3, Insightful)

      How mandatory is the payment of SSI? According to at least one Congressman [cnsnews.com], and the Supreme Court [cato.org] has also ruled that Social Security carries no legal obligation or promise. It is a benefits program that can be legally changed or even ended at any point, with no repercussion relating to the taxes collected from you. You have no legal right to your Social Security payments.

      I'd say that is a LONG WAY from being mandatory. Sounds more like it's at-will by the Government, since there is no legal obligation t

  • by PvtVoid (1252388) on Tuesday March 11, 2014 @04:52PM (#46457751)
    Seriously. The entire story should be modded "troll".
  • by grahamwest (30174) on Tuesday March 11, 2014 @04:52PM (#46457753) Homepage

    "Individual" in this case does NOT mean "person".

    If you download the spreadsheet you can see that they classify total spending as either "direct" or "grants", of which the vast bulk is "direct". Everything that is not a grant must be being paid to an entity of some kind, whether an actual person, a company, a non-profit or something. You can verify this is the total Federal spending using the Monthly Treasury Statements at https://www.fms.treas.gov/mts/... [treas.gov] - I recommend the PDF versions.

    As for the percentage going to veterans, I expect the number of veterans isn't growing very much, whereas the Federal budget is. So a constant amount in a larger total is going to be a smaller fraction.

    Bottom line, this article is FUD and should not be taken serious by anyone.

  • by Impy the Impiuos Imp (442658) on Tuesday March 11, 2014 @04:53PM (#46457757) Journal

    Much of the remaining 30% was things like defense and infrastructure -- this may be bloated, but in theory it benefitted fuure generations, so it was considered ethical to borrow from them to pay for it. But wealth transfer payments?

    That is flat-out current generations refusing to carry their own weight.

    By the way, taxing the rich won't cut it -- taxing 100% of the rich's income would gain you an additional $500 billion a year (assuming they continue to work for free, good luck with that and keeping their salaries pointlessly high). This is still hundreds of billions a year short.

    No, every elected politician knows you have to tax the middle class to pay for the middle classess' wealth transfers (social security, whether retirement or disability).

    And these politicians are cowards because they are a huge and motivated voting block.

    No, we, the middle class, have to decide on an amendment to prevent ourselves from borrowing from our children. We won't, because we, and our politicians who we elect, are weak.

    • Re: (Score:3, Informative)

      by TubeSteak (669689)

      By the way, taxing the rich won't cut it -- taxing 100% of the rich's income would gain you an additional $500 billion a year (assuming they continue to work for free, good luck with that and keeping their salaries pointlessly high). This is still hundreds of billions a year short.

      The richest have been undertaxed for decades.
      So you're right, taxing them at 100% won't fix the problem, because it was a problem decades in the making.

      These types of budget problems cannot be fixed overnight, they require long term planning and gradual change.
      Oh, and they require higher taxes.

  • by gman003 (1693318) on Tuesday March 11, 2014 @04:56PM (#46457807)

    Of the 70% spent on "individuals", 39% is Medicare, Medicaid + "Obamacare" (I wonder what the split is - I'd guess 40-40-20), 33% is Social Security, 21% is poverty programs, and 5% is veteran's pensions, with the remaining 2% not accounted for in TFA (they mention farm subsidies and disaster payments later, perhaps that's what this is).

    • Re: (Score:3, Interesting)

      by Anonymous Coward

      Medicare, Medicaid and "Obamacare" - the money eventually ends up in the hands of private health care providers funneled through more and more private health insurance companies, so we could rightly call this corporate welfare.

      Social Security - This program is entirely self-supported by taxes specifically earmarked for Social Security (FICA). Guess what? Every year, there is a surplus. The treasury then converts this surplus into T-bills, and the surplus is then used to offset the deficit in the general fun

  • And...? (Score:5, Insightful)

    by Bob9113 (14996) on Tuesday March 11, 2014 @05:06PM (#46457917) Homepage

    taking $2.6 trillion from some and handing it back out to others.

    Ummm, what else is the government supposed to do with the money? If it gave the money back to the same people who paid the taxes in the first place, it wouldn't make much sense, would it?

    This year, 70% of all the money the federal government spends will be in the form of direct payments to individuals, an all-time high.

    Including medicare, medicaid, and Obamacare? So the payments for drugs and health care are counted as going directly to individuals. OK, and other than the military, what's left? Highways, schools, NASA, and the post office -- and we've been cutting all of those.

    So in short, article is saying that taxes are money transfers (which they had better be, or they'd be really stupid), and that health care and social security are going up, and everything else but the military is getting cut. That's news?

    an eye-opening fact

    Maybe if you're retarded.

  • Slashdot title is misleading, so had to RTFA to find out
  • by inglorion_on_the_net (1965514) on Tuesday March 11, 2014 @05:25PM (#46458109) Homepage

    At first, I thought the story here is that the U.S. government spends 70% of its budget on writing checks. To which my response would have been that moving to something more efficient than the ridiculous banking system we have in the U.S. would then make the federal government much more efficient.

    It appears to be that, rather, 70% of the budget is being paid out to individuals - much of it in the form of health benefits, social security, and income security. Is that cause for concern? Direct payments to individuals have increased relative to other things the federal government spends money on. Ok, the percentages move, that's expected. They're now at 70% of the total budget. Ok, that's somewhat interesting. But what's the actual story here? Is some program growing faster than tax revenue to the point that we have to be concerned that we won't be able to afford it anymore? Did total budget decrease, thus making the percentage larger? Do you feel that the government is spending money on things they shouldn't be spending (as much) money on?

    The article provides some more detail: it claims the percentage spent on income security will drop from 25% in 2009 to 17% in 2019, as more is spent on "middle-class entitlement programs such as ObamaCare". So I guess the problem isn't with the 70% being paid to individuals, but with the individuals it gets paid to. Fair enough, we all have our own ideas about which groups the government should be sending money to (if anyone), but perhaps it would have been more productive to get straight to that part, instead of suggesting that 70% is rather high, when the thing you would like money to be spent on is actually part of that 70%.

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