Monday, January 16, 2012

Nothing More Than a Middleman ?

As investment in the future lags, "payments to individuals" climbs.

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In a recent op-ed piece, columnist Robert Samuelson cites the President's Office of Management and Budget:
From 1960 to 2010, the share of federal spending going for “payments to individuals” (Social Security, food stamps, Medicare and the like) climbed from 26 percent to 66 percent.
So instead of building infrastructure and providing services that help us grow, the federal government acts as middleman with no value added – taking from taxpayers and incurring debt to give to beneficiaries. As Samuelson says, "No one wants to take away; it’s more fun to give."

Mind you, some middlemen can add value by providing an avenue for distribution from producers to consumers. However, the federal government's middleman role takes money from workers (taxes) and their children (debt), giving to those that aren't working – whether they're unemployed or no longer employed.

My father-in-law is a case in point. A prudent hardworking man, he grew up poor and put himself through college to become an engineer, retiring in his early 60s. Now in his early 70s and a Medicare beneficiary, he lives a comfortable and active retirement. But as a prudent man, he knows that his financial situation allows him to contribute more to his own healthcare than Medicare asks of him.

Compassion is a trait of an affluent society, but prudence seems to have taken a back seat to immediacy. English philosopher John Milton said, "Prudence is the virtue by which we discern what is proper to do under various circumstances in time and place."

Now is the time for virtue – for our children's sake.