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Gov’t Handouts Make Up 35% Of Wages

From CNBC:

Welfare State: Handouts Make Up One-Third of U.S. Wages

By: John Melloy
March 8, 2011

Government payouts—including Social Security, Medicare and unemployment insurance—make up more than a third of total wages and salaries of the U.S. population, a record figure that will only increase if action isn’t taken before the majority of Baby Boomers enter retirement.

Even as the economy has recovered, social welfare benefits make up 35 percent of wages and salaries this year, up from 21 percent in 2000 and 10 percent in 1960, according to TrimTabs Investment Research using Bureau of Economic Analysis data.

In other words, social welfare spending has increased three and a half times since 1960.

“The U.S. economy has become alarmingly dependent on government stimulus,” said Madeline Schnapp, director of Macroeconomic Research at TrimTabs, in a note to clients. “Consumption supported by wages and salaries is a much stronger foundation for economic growth than consumption based on social welfare benefits.”

The economist gives the country two stark choices. In order to get welfare back to its pre-recession ratio of 26 percent of pay, “either wages and salaries would have to increase $2.3 trillion, or 35 percent, to $8.8 trillion, or social welfare benefits would have to decline $500 billion, or 23 percent, to $1.7 trillion,” she said

Social welfare benefits have increased by $514 billion over the last two years, according to TrimTabs figures, in part because of measures implemented to fight the financial crisis.

And the measures implemented to buy votes.

At the very least, we can take solace in the fact that we’re not quite at the state welfare levels of Europe. In the U.K., social welfare benefits make up 44 percent of wages and salaries, according to TrimTabs’ Schnapp

Except there is a big difference. Europe is doing something about its runaway spending. The US is not.

This article was posted by Steve on Wednesday, March 9th, 2011. Comments are currently closed.

6 Responses to “Gov’t Handouts Make Up 35% Of Wages”

  1. Astravogel says:

    The United States of America; the
    only welfare system with its own

  2. Petronius says:

    35%! How exciting. And yet the Liberals still clamor for more. Gimme more, more, more!

    How much more? How far do they wish to go down this ruinous path? To 50%? 65%? Or 100%?

    And what will “Liberals” call themselves when at last they have reached the long-desired level of control? That level so fervently wished for? That goal for which they have struggled so earnestly all these many years –– and for which they still struggle with every weapon at their command?

    Will they still call themselves “Liberals” then, or will they call themselves something else? Communists, perhaps? Or totalitarians? Or “the masters”?

    Perhaps someday Bill O’Reilly will ask Nerobama such questions.

  3. proreason says:

    Social welfare? 35%?


    Probably more than half of that is Social Security. I don’t care what the marxists call it, it’s a tiny reimbursement of the hundreds of thousands of dollars I had confiscated from my pay for decades at the point of a gun. If I had been able to keep that money….which the entire country has been assured ad infinitum was in a “lockbox”…then I would have AT LEAST a million dollars in a bank somewhere.

    Getting a pittance back from that ain’t welfare, friends.

    But all of a sudden, it turns out that seniors are not “doing their fair share”. Has anybody but me noticed that? All of a sudden, it’s gone from a lockbox, to money that ought to be put in the public pool to buy $200 sneakers, IPODs and abortions for people who choose not to work.

    Other than a communist who is “transforming” the country, this is the most significant change that has come about in the last 2 years.

    “his people” want to get their hands on the money that generations had confiscated from them. Now that WE are about to collect, the rules are changing. THEY want it, and they will do everything in their power to get it. Mark my words.

    • JohnMG says:

      You and I pay taxes on 85% of that pittance, too, Pro. Where’s the social justice in that?

      Obama’s idea is that you have to continue working and paying into that Ponzi scheme ’til you drop dead in your tracks and never get to collect a penny. My opinion? Those shills pandering for the Obama version of “social justice” are all suffering from a social disease.

    • tranquil.night says:

      I’ve noticed the new narrative, Pro. Baby Boomers are the new Wall Street executives. They pillaged the national treasury with entitlements without concern for how to pay with them. The key point being that the people are greedy and selfish for not wanting to pay higher taxes, not the criminal corruption within the governments programs.

      I think it’s insight into how they’re trying to get ahead of the entitlement reform debate, a looming political reality tied to our deficit. Any marginal cuts and reductions they’ll agree to are going to be shouldered specifically by boomers and those who’ve paid the most into the system. It’s a fundamental repeat to how they dealt with the GM/Chrysler restructuring, how they propose death panels, or flee from democracy to protect government union racketeers. Those who serve the most political benefit to the ruling class are who have the “rights.” Even if it deadlocks the policy debate with senior paranoia, that’s all they probably want anyway.

  4. Chuckk says:

    35% is a breath taking figure. But looking at the people in the welfare line above, I wonder how many votes it actually buys? I suspect that once they get their check it’s straight to the liquor store or drug dealer, not to the voting booth.

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