November 2013

The Failure of Progressivism

By John R. Hendrickson

Investor’s Business Daily recently reported that the federal government “has spent $3.7 trillion on welfare in the past five years, with virtually nothing to show for it.”[1] Adding more dismal news, the September jobs report showed that the jobs crisis is continuing with the unemployment rate rising to 7.2 percent. The federal government also is facing a budget crisis as Congress is in the process of negotiating a budget deal in the aftermath of the shutdown and debt ceiling compromise. With more people becoming dependent on welfare programs, a lackluster economy with high unemployment, a dangerous debt crisis, and the failure of the Patient Protection and Affordable Care Act, it appears that progressivism and its philosophy of “big government” has failed.

Many Americans are struggling to make ends meet in the aftermath of the Great Recession. Americans are still unemployed or are underemployed. As Investor’s Business Daily noted:

The U.S., sadly, has become a nation of dependents, and Obamanomics is accelerating the process. With the debt at $17 trillion and rising, more than $50 trillion in unfunded liabilities and fewer workers to pay for it all we will soon be bankrupt.[2]

It is estimated that “49 percent, or 151 million Americans, got federal aid from at least one program in 2011 — up from 94 million in 2000.”[3] It is clear that more Americans are becoming dependent on the welfare state, which is a sign of national decline. Overall the federal government continues to spend more on welfare/poverty programs since President Lyndon B. Johnson declared war on poverty with his Great Society. As Michael Tanner, a Senior Fellow at the Cato Institute explains:

Welfare spending increased significantly un­der President George W. Bush and has exploded under President Barack Obama. In fact, since President Obama took office, federal welfare spending has increased by 41 percent, more than $193 billion per year. Despite this govern­ment largess, more than 46 million Americans continue to live in poverty. Despite nearly $15 trillion in total welfare spending since Lyndon Johnson declared war on poverty in 1964, the poverty rate is perilously close to where we be­gan more than 40 years ago.[4]

This growing dependency on the government is also directly tied to the unemployment crisis. President Obama’s economic agenda of higher spending, higher levels of taxation, higher levels of regulation, and transformative programs such as the Patient Protection and Affordable Care Act have all resulted in slow economic growth and the continuation of high unemployment. In fact today’s college-age generation is being referred to as the “lost generation” because of the difficulty in finding employment while faced with paying off high levels of student loan debt.

At the heart of this problem is the issue of government spending. Senator Jeff Sessions (R-AL), who serves as the Ranking Member of the Budget Committee, stated that “in the last five years, Washington spent more than $15 trillion and added more than $6 trillion to the debt.”[5] The result, as Senator Sessions explains:

Never has so great a sum been spent for so little in return. Despite this huge stimulus spending, wages are lower than in 1999 and nearly 60 million working-age Americans aren’t working. Fewer people are employed today than in 2007.[6]

The $17 trillion national debt also gets worse when the costs of entitlement programs (Social Security, Medicare, and Medicaid) are taken into consideration along with the impact of the Affordable Care Act. As Michael Tanner wrote:

Social Security’s unfunded liabilities top $23 trillion. Medicare is even in worse shape: Under the most optimistic scenarios, it faces almost $43 trillion in future red ink. If more pessimistic forecasts prove accurate, those unfunded liabilities top $88 trillion.[7]

The Affordable Care Act will also add pressure onto the federal budget along with state budgets as well because of the Medicaid expansion. Medicaid already takes up a large portion of state budgets.

The big government progressive policies being implemented by President Obama have failed. The current disastrous implementation of the Affordable Care Act is further proof. More spending will not solve our problems with unemployment and government dependency.

John R. Hendrickson is a Research Analyst at Public Interest Institute.

The views expressed herein are those of the author and not necessarily those of Public Interest Institute or Tax Education Foundation. They are brought to you in the interest of a better-informed citizenry.

[1] Editorial, “Under Obamanomics, America Morphs into Welfare Nation,” Investor’s Business Daily, October 23, 2013, <http://news.investors.com/ibd-editorials/102313-676389-obama-spending-of-37-trillion-on-welfare-is-a-record.htm> accessed on October 24, 2013.

[2] Ibid.

[3] Ibid.

[4] Michael Tanner, “The American Welfare State: How We Nearly Spend $1 trillion a Year Fighting Poverty and Fail,” Policy Analysis, No. 694, April 11, 2012, Cato Institute, Washington, D.C., <http://object.cato.org/sites/cato.org/files/pubs/pdf/PA694.pdf> accessed on October 25, 2013.

[5] Senator Jeff Sessions, “Sessions issues statement after voting against debt hike, spending bill,” October 16, 2013, <http://www.budget.senate.gov/republican/public/index.cfm/press-releases?ID=f191e47b-eba3-4930-a2f0-923b5910e3f5> accessed on October 25, 2013.

[6] Ibid.

[7] Michael Tanner, “The next budget battle,” Cato Institute, October 23, 2013, <http://www.cato.org/publications/commentary/next-budget-battle> accessed on October 25, 2013.