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Opinion from a Libertarian ViewPoint

EconomicPolicyJournal.com: Abolish the Welfare State to Solve the National Debt Crisis

Posted by M. C. on April 18, 2019

https://www.economicpolicyjournal.com/2019/04/abolish-welfare-state-to-solve-national.html

Richard Ebeling emails:

I have a new article on the website of the Future of Freedom Foundation (FFF) on, “Abolish the Welfare State to Solve the National Debt Crisis.”

Few things are more frustrating to the friend of freedom than the difficulty in successfully making and winning the case for liberty. But a major reason is the hesitancy or unwillingness of some declared friends of freedom to forthrightly make the case for the abolition of the interventionist-welfare state.

It is the “entitlement” programs of the welfare state that are really behind the growth in government spending and the increasing national debt of, now, over $22 trillion as a result of annual budget deficits to help fund these redistributive expenditures. Rather than politically taking the bull by the horn, too many think that they can fight the growth in government spending and the increasing national debt through fiscal subterfuge.

I take to task “supply-siders” such as Steve Moore, who argue that cutting taxes can stimulate sufficient growth in the economy that government spending and the national debt can be reduced as a percentage of Gross Domestic Product; thus, growing our way out of fiscal ruin.

I detail some of the practical problems and political impossibilities of ever hoping to solve the problem of Big Government primarily through playing around with the tax code, so as not to have to deal with the core problem head on: government should not be playing the role of political paternalist in managing and co-opting individual freedom and choice in such matters as old age and health care.

Until this is admitted and the case for abolishing the entitlement programs is forthrightly defended and argued for, the welfare state and the national debt will continue to grow.

Best,

Richard

Abolish the Welfare State to Solve the National Debt Crisis
By Richard M. Ebeling

Why is it so difficult to win the case for freedom in modern American society? A variety of possible answers come to mind. The collectivists are more effective in appealing to people’s emotions. The interventionist-welfare-statist argument is easier to make than it is to follow the logical chains of reasoning required to make the free-market case. Socialist-leaning teachers and professors who indoctrinate their students with statist ideas from a very young age dominate the government educational system from kindergarten through the Ph.D.  Popular, celebrity culture inculcates society with leftist biases and presumptions.

All those answers have strong elements of truth in them. But there is one other element at work that makes it difficult to effectively make the case for a fully and truly free society, indeed, that can undermine the ideal and understanding of the free society. That element is that too many advocates of a free society compromise its case.

Trillions more in debt on the way.

For example, let’s look at the national-debt crisis. The Congressional Budget Office (CBO), in its June 2018 Long-Term Budget Outlook projected that given current trends for federal tax revenues, government expenditures under existing legislation for “entitlement” programs, and likely general economic growth over the next ten years, the national debt will continue to dramatically increase because of the return of $1 trillion-a-year budget deficits just over the horizon.

The primary source of all the federal government’s budgetary problems is the entitlement programs. In Uncle Sam’s 2018 fiscal year that ended on September 30, 2018, total government spending was $4.1 trillion. Social Security and health-care spending (Medicare and Medicaid) combined, was about $1.95 trillion. Net interest on the national debt came to $371 billion. Together these mandatory spending categories came to almost 60 percent of the federal government’s total budget. Department of Defense and other related military spending came to $601 billion, or 15 percent of Uncle Sam’s expenditures. The remaining items in the budget were those counted as part of “discretionary spending.”

The CBO projects that in ten years, in 2028, total government spending will come to $7.05 trillion, with total tax revenues of $5.52 trillion. The budget deficit a decade from now will be $1.53 trillion just for that fiscal year. The CBO forecasts that because of annual budget deficits of more than $1 trillion, by the end of the federal fiscal year for 2028, the national debt will have increased from its approximately $21.8 trillion today to $34.8 trillion, for a 60 percent increase over the decade.

The growing debt burden

Be seeing you

Uncle Sam's "Debt Crisis Is Coming Soon" | Zero Hedge ...

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