Courtesy of Dr. Paul Price, Beating Buffett
Not everyone seems aware of how big an impact government transfer payments (food stamps, unemployment compensation, welfare checks etc.) have had on the “recovery”. There has never been a time in America’s history when so many people were ‘on the take’ as opposed to contributing to the general good of society.
Global Economic Intersection estimates in “Personal Transfer Payments and GDP,” the accumulated value of “extra” transfer payments Americans received from 2008 to 2010 — that is, the amount over and above the long-term trend — worked out to about $569 billion.
The push has been towards layering on more and more taxes on the productive segment of society in order to fund the living expenses of those that live long-term on the efforts of others.
Almost 50% of all American’s now pay zero or less than zero (adjusted for refundable tax credits) in Federal Income taxes. If you are on the receiving end, all government expenditures are just fine (or desired) as they are ‘free’ to you.
Civil servants at all levels (e.g. police, firemen, teachers and bureaucrats, while gainfully employed are fiscally raping the general taxpayer population with their overly generous pensions. In my area (Chester County, Pennsylvania) teachers routinely retire right now with over $78,000 in annual pension payments (after 30 years and age 62) on top of their social security. Due to the state retirement system’s rules they actually ‘earn’ more per year in retirement than they averaged during their working years.
Cities, states and the Federal government are all going bankrupt to support transfer payments to those who either don’t work or are done working. This cannot continue without collapsing under its own weight.
