Too Big to Flourish: An Over-Involved Government Jeopardizes America’s Future
The United States’ social insurance laws, including Medicare and Medicaid, over-expand the Founding Fathers’ intended role for government in America. America was founded so that its limited government would respect personal liberty. As of late, the country has progressively steered away from these principles which once allowed it to flourish as a pinnacle of history. President Obama, who epitomizes the American Dream, stated in his More Perfect Union speech, “in no other country on Earth is my story even possible.” The First Lady also spoke romantically about her family’s story during the 2012 Democratic National Convention—though she seemed to imply that the American Dream was a reality that now is in jeopardy. If I interpret First Lady Obama correctly, she is signifying that a change occurred at some point, and I would agree. To again allow the American Dream to be a reality, we must understand why the President’s story was possible only in America, solve what no longer distinguishes America from other countries, and lastly, peer into the future.
The key to understanding President Obama’s observation is the phrase, “no other country;” meaning, America did something differently than every other country. It should be clear to American History scholars, that the United States distinguished itself from other countries by embracing Lockean and Madisonian principles of freedom from an overarching government. America’s forefathers declared independence from European rule because the European system of heavy government intrusion stifled growth, especially in the areas of business, where Americans were taxed excessively and through a process beyond their control. After winning the Revolutionary War by rallying behind a dream of liberty, America’s Founding Fathers created a Bill of Rights to quell any doubt that the new American government would rule like its predecessors. The Bill of Rights was designed to be (and has proven to be) extraordinarily difficult to amend, further evidencing that the Founders were convinced that government does not belong in all aspects of its citizens’ lives. This big idea, though novel in its time, shaped the country they forged.
The United States that grew became a beacon of freedom, where people of all nationalities and creeds could shed their shackles of government oppression and pursue a better economic future in a free society. While the bondage of former intrusive government was gone, the new generation of Americans understood that their realistic goal was to promise their children and grandchildren—not themselves—a substantially better future, principally through open opportunity. This dream is bounteous with government services, provided by the United States or the individual States,[i] for which people were thankful; however, the public services were undertaken in moderation, minimalizing interference and dependency in people’s daily lives. Thus, people saw their family and neighbors,[ii]not their government, as a support system. The country prospered enormously as a result, as uninhibited motivation and entrepreneurship fueled nation-wide success.
However, in the last fifty years, the United States has removed those values of relying on one’s self and neighbors. The United States government swept deeper into the lives of Americans when it enacted socialized[iii] entitlement programs (including Medicare and Medicaid), reminiscent of the European countries from which most of America’s people left. Instituting and expanding socialized programs based on European models turned the American Dream on its head in three ways: (1) America adopted Europe’s model that it previously fought wars to fend off; (2) America strayed away from the liberty-based governance that had turned it from a mere colony to a superpower; and (3) America stopped looking out for forthcoming generations, and instead mortgaged those generations’ future (those born after about 1981) for the benefit of those born before them. These changes lessened individual liberties in favor of an involved government and reduced individual responsibility, helping to create today’s ‘everybody-gets-a-trophy’ counterculture—a stark contrast to the successful American model.
When the States contracted to unite as a nation, it was with an understanding that the federal government would not progress into an overly-intrusive body like the European models the States had revolted against during the American Revolution. Ignoring that agreement today is a breach of that contract.
The government-administered Medicare and Medicaid programs are funded through employee and employer taxes. Labeled non-discretionary spending, they expand regardless of other factors, and the government made itself fundamentally indispensable for droves of people. Medicare and Medicaid are currently beyond government control. Combined, they totaled 1.0% of gross domestic product (GDP) in 1967, two years after being enacted. Yet, “if current laws remained in place, spending on the major federal health care programs alone would grow from more than 5 percent of GDP [in 2012] to almost 10 percent in 2037 and would continue to increase thereafter.” The programs never have, and are not set to contract, posing a serious risk to future generations and their ability to fund them. According to the Congressional Budget Office, “it is not possible both to keep taxes at their historical average share of [GDP] and to keep the laws unchanged for Social Security, Medicare, and Medicaid.” This implies that significantly higher levels of taxation will be needed in the future to fund entitlement programs’ bottom lines. A serious problem has presented itself, as substantially more money will come out of paychecks.
Medicare and Medicaid, covering most elderly and impoverished Americans, helped the health and financial well-being of their recipients; however, it was expensive for the “Baby-Boomer” generation. Now, a bulged Baby-Boomer population is heading into retirement. The Baby-Boomers functioned well as contributors to the programs because they were more populous than older recipients (3.9 workers per retiree). But their impending contributors—the “Millenials” and those after—are a smaller generation of people (2.2 workers per retiree), and additionally the baby-boomers are living longer than the “Greatest Generation” or “Silent Generation” that they afforded. To further stress the programs, less employers offer health care retirement packages, leaving more employees dependent on Medicare and Medicaid, and health care costs are rising in America. While part of the American Dream once was to make life easier for posterity, the current trend is to take their money before they know there is a hand in their piggy-bank.
At the crux of the problem, politicians and others are aware that they are jeopardizing America’s future, but they pile on to the current and future national debt because it is politically unpopular to address the problem.[iv] People on the brink of retirement paid into the entitlement structure with reliance, and others have serious physical or mental disabilities that prevent them from providing for themselves—all or nothing approaches are not the correct solution in America and the rug should not be swept out from beneath these people. For those who need help, it should probably be available in a civilized society, such as ours. However, those who paid in did not pay enough if their credit cannot cover their debt. Meanwhile, others abuse the system to receive free money[v] that is administered by one of the most wasteful and ineffective bodies—the American government—which charges a massive administration fee. The country must recognize that the scale on which it expanded socialized policies that disfavor liberty and responsibility was unwise; American politicians must come together, compromise, and collaborate to solve issues in a way that is not overly detrimental to any generation.
The principles within policies that erode liberty and replace it with heavy governmental intervention are holding the country back. American greatness was achieved by placing its citizens above intrusive governments. While a socialized government may be able to exist during economic expansion, its governing structure ignores the cyclical nature of economies. A weak economy (which occurs about every thirty years) damns socialist governments, as people have less money to spend on others and less money for consumer services, like insurance. Invasive governance, thus, has derailed the American Dream. America must forego complacency and restore a government that values freedom if the country is to secure its future. Whenever the United States chooses to rule as the authoritative government its once-humble people strived not to create, then the country has lost its way. It has rejected liberty and rationality. It has become too big to flourish.
[i] Public services, to name a few, included: education, roads, a standing army and navy, postal service, waste services, prison management, and many more.
[ii] Neighbors often created a financial support system through wide-spread membership in lodges, which helped pay for their sick. American lodge membership in the 1920s is conservatively estimated at over eighteen million American men and women. David Beito, Lodge Doctors and the Poor, The Freeman Online, Vol. 44, No. 5, Foundation for Economic Education (1994).
[iii] Socialism is not a derogatory term; it is a term of political philosophy. Socialism is defined as: “[a]ny of various economic and political theories advocating collective or governmental ownership and administration of the means of production and distribution of goods.” Merriam-Webster Dictionary, http://www.merriam-webster.com/dictionary/socialism, (September 12, 2012).
[iv] Medicare primarily aids senior citizens, who vote in significantly greater numbers than the young Americans who are being harmed, and the under-18 or unborn Americans who will be at the greatest disadvantage of all, do not vote at all—so many politicians see almost no reason to pander to them—though the issue is often raised.
[v] Obviously the money is not “free.” It may seem free to recipients, but it is paid through a (nearly depleted trust) and by current taxpayers to the extent they can cover payments; to the extent they cannot cover payments, the money is drawn as public debt, to be repaid by future generations, in addition to their regular payments.
Senator Barack Obama, in A More Perfect Union (March 18, 2008) available at http://www.latimes.com/news/nationworld/nation/la-na-campaign19mar19-speech,0,3568071.story.
Michelle Obama, Address at the Democratic National Convention (Sept 4, 2012) available at http://www.npr.org/2012/09/04/160578836/transcript-michelle-obamas-convention-speech.
Edward Countryman, The American Revolution (2003). “The Stamp Act managed to offend everyone. The rich, the poor, producers, consumers, the powerful, the powerless, people of commerce, people of the fields, old people making their wills, young people planning to marry, pious people going to church, ribald people going to the tavern, all of them would feel it.”
Timothy Stagich, The Price of Freedom: The Purpose and Power of Free Choice (2005).
Ian Greener, Healthcare in the UK: Understanding Continuity and Change, at 14–16 (2009).
What is Medicare?, Center for Medicare & Medicaid Services, Sept. 2011, CMS Product No. 11306.
Marvin Harris, Cows, Pigs, Wars, and Witches: The Riddles of Culture, at 111–132 (1974).
Richard S. Foster, Financial Outlook for Medicare, Medicaid, and Total National Health Expenditures, (2012), available at http://budget.house.gov/uploadedfiles/fostertestimony_2-28-22012.pdf.
Douglas Elmendorf, Testimony on the 2012 Long-Term Budget Outlook, Congressional Budget Office, http://www.c-spanvideo.org/program/306443-1 (2012).
CBO Testified on the Long-Term Budget Outlook, Congressional Budget Office, http://www.cbo.gov/publication/43300 (2012).
Andrew J. Rettenmaier and Thomas Robert Saving, The Economics of Medicare Reform, at 7–12 (2009).
Making Medicare Work: Ensuing Health Care Coverage for Seniors in an Age of Exploding Costs, Facing Up to the Nation’s Finances, at 2 (2008).
Kathleen King, Medicare Fraud, Waste, and Abuse: Challenges and Strategies for Preventing Improper Payments, U.S. Gov’t Accountability Office , http://www.gao.gov/products/GAO-10-844T (2010).