Entitlements Defined

My old friend asked me what my definition of an entitlement is. He said that something you pay into over time and then get paid back later is not an entitlement. He went on to say that since he's been paying taxes all these years, if he were to fall on hard times and avail himself of welfare and medicaid, these would not be entitlements either.

As he correctly points out, the majority (if not all) of Americans contribute tax dollars to directly fund things like Social Security and Medicare (FICA) and, as a result, they feel ‘entitled’ to receive benefits. I think that’s the etymology of the moniker. In general, that's not true with welfare and medicaid so I'd say that he's confusing actual entitlements with what some might call the simple (and wrong) redistribution of wealth.


Traditional entitlements are outside the proper role of government as defined by the US Constitution. Social Security was born in the cradle of a worldwide depression and while it may have made sense then it no longer does. Medicare was born in the 60’s out of selfishness; young people not wanting to bear the expense of caring for their parents; this was also the camel’s nose in the tent of nationalized health care.

There are serious problems with Social Security. One is that congress misappropriates the revenue ($2.7 trillion so far) and spends it on unrelated stuff. Another is that any of what you pay in that would be left after death does not necessarily go to survivors. Another is that the interest accrued is pathetic. Another is that it is essentially a Ponzi scheme that relies on having more payers than beneficiaries; again, true in the 30’s but not now. The most harmful is that it is destructive to society in that it diminishes the notion of self-reliance.

There are problems with Medicare too. It is also a Ponzi scheme. It takes in far less revenue than it spends; we’d have to pay at least the 13% commanded by Social Security to fund it since the expenses are about the same (we current fund it at 2.9%); but jacking up taxes by 10% would push the middle class over the 50% mark for overall taxation. Another problem is that it drives up medical costs since government money is easy money. Congress used to misappropriate this money too. As with Social Security, the most harmful is that it is destructive to society in that it also diminishes the notion of self-reliance.


My friend also correctly points out that government also gives free money to corporations and individuals who did not contribute tax dollars to directly fund the handout. I call these things tax trickery to separate them categorically although I think that they even more abhorrent than traditional entitlements since they represent government selection of winners and losers. I think the mortgage deduction is the biggest one (dollar-wise) but I think that all it really does is non-linearly inflate the cost of housing; like Medicare inflates the cost of health care; like government funding inflates the cost of education; etc..

Medicaid and welfare are like corporate handouts except these are favored by liberals; but they are equally wrong. Instead of government picking winners and losers, this is government incentive to remain unproductive; they also diminish the notion of self-reliance. I think these programs have been lumped together with actual entitlements because some recipients now feel entitled to them instead of being grateful for the (enforced) charity of their fellow citizens and actively trying to get off the dole. A study by the University of California (Davis) suggests that welfare dependence is inter-generational.

So I told my friend that while I have no doubt that he has paid enough taxes to earn a free ride on this bus, I was certain he'd agree that the vast majority of those who do ride this bus did not. However, if all of us who’d paid also rode, we’d all be looking up at broke; because that’s where this bus goes.


In my admittedly conservative view, all wealth redistribution by government would be classified as an entitlement, including actual entitlements.


I’m opposed to all of this stuff because the cost of being an American is simply too high to make for an inclusive society. We pay more than $6 trillion for our government. This puts the annual cost at $19,292 for every man, woman and child. Shedding these programs (and fixing public education) would bring that figure down to under $5,000; low enough to be covered by an inclusive flat tax of about 10% on everyone as I describe in another post.

No more "47 Percent" crap from the right, no more cries of unfair from the left; a far better environment for working together on common problems. In addition, it puts 30% of everyone’s gross income back in their pockets so folks can fund the charitable institutions they want, not have it dictated by a government under threat of imprisonment.

In addition, we'd be spared the sometimes daily headlines about our government as purveyor of condoms and abortions or cheerleader for homosexual behavior. I am socially ambivalent with regard to condoms, abortions and homosexuals as but some folks are distressed by one or more of them and I don't think that they should be forced to pay for such things with tax dollars.

It probably sounds like I'm a heartless conservative but I'm not. We give to charity although not at the roughly 23% rate enforced by government; 40% in total tax minus 7.65% for actual entitlements and 9.3% for optimized government. I might give more if the government hadn't already taken it but, and this is the point, it should be my choice.