The Welfare State -- You Didn't Build That

Last week, amidst the firestorm over the words “you didn’t build that,” actor Sherman Hemsley passed away. Americans remember Hemsley for playing George Jefferson, TV’s popular upwardly mobile black businessman.  Known for “movin’ on up to the east side” out of Archie Bunker’s neighborhood, we cheered George as he strutted triumphantly into his “deluxe apartment in the sky,” having “finally got a piece of the pie.”

Imagine George’s reaction were anyone to tell him that government was integral to his success, or that he didn’t build his business on his own -- he’d slam the door while hollering “Think Again!” 

Considering half of small businesses fail within five years, entrepreneurs like George deserve credit for more than “a whole lotta tryin’ just to get up that hill.”  Despite the risks of failure, George made it “in the big leagues” because he possessed unique entrepreneurial traits: business acumen, self-sacrifice, leadership and a willingness to hurdle government obstacles. 

Personal fulfillment derived from “odds-beating” industriousness is why America’s founders enshrined the right to pursue happiness in our national creed.  Earned success is both materially enriching and spiritually uplifting – and the source of America’s extraordinary prosperity.

Now in the midst of what CBS News labeled “the worst economic recovery America has ever had,” risk-takers like George deserve encouragement, not derision -- nor the toxic cocktail of tax hikes and increased regulations they face. Since 1993, their small businesses have created two-thirds of private sector jobs.  Furthermore, they and their employees are among a shrinking percentage of Americans who pay taxes to a government whose current annual deficit is the size of President Clinton’s first budget.

When tax-hike proponents justify expansive government by praising its most legitimate and necessary functions, they’re like David Copperfield, expertly distracting us with one hand so we don’t notice the other. The concern isn’t spending on roads, bridges, teachers or fireman; it’s the 60% of the federal budget consumed by our massive welfare state -- a catchall for Social Security, Medicare, Medicaid, and dozens of other “safety net” programs created by vote-hungry politicians.

Because all citizens -- not just the poor -- receive federal benefits, we’re all self-entitled “welfare queens” now. Consequently, welfare state defenders know it’s the proverbial “third rail” – politicians touch it at their peril.

The welfare state is the single biggest financial problem we face, annually consuming more than the combined cost of the Iraq and Afghanistan wars plus the TARP bailouts. Like the “blob,” it grows by devouring everything in its path, requiring us to borrow $41,222 per second just to keep government running. At almost $16 trillion, the national debt exceeds the size of our economy and is growing so rapidly, the Congressional Budget Office predicted it could cause a permanent recession by 2025.

Like an overweight jockey riding an emaciated thoroughbred, our bloated government sector is not only crushing the private economy, it’s handicapping our opportunity society. Americans are aspirational and self-reliant people, so it’s heart wrenching to note that after spending $15 trillion in the “War on Poverty,” America’s poverty rate has barely budged, food stamp dependency is at a record high, and the percentage of Americans in the work force is at a record low.

As economist Herb Stein said, “If something can’t go on forever, it will stop.” New York Times columnist Bill Keller called for that last week writing, “We should make a sensible reform of entitlements our generation’s cause.”  

But now that we’re in the fourth consecutive year in which the US Senate has abdicated its duty to pass a budget for fear of electoral consequences, where are the courageous leaders willing to discharge this fiscal suicide bomb? How do we secure America as a beacon of opportunity (and preserve benefit programs for the generations of Americans paying for them) unless we insist on the distinction between a welfare program and a welfare state?

Our founders were concerned America would reach this moment. John Adams warned: “Democracy never lasts long.  It soon wastes, exhausts, and murders itself.  There was never a democracy yet that did not commit suicide.” Americans are concerned too, according to last week’s Rasmussen survey in which a record low 14 percent expect today’s children to be better off than their parents.

We didn’t build the welfare state, but now that it’s crumbling and imperiling our way of life, we have the opportunity to transform our government so that it will serve us better.  Doing so will renew the moral promise inherent in the American Dream while making it accessible to all.

With free markets and limited government, entrepreneurial risk takers like George Jefferson can deliver renewed opportunity and prosperity, just as they took us from a colonial backwater to an economic superpower.

Think Again -- so our children can earn “a piece of the pie.”