The Federal Government Excels At Wealth Redistribution

February 20, 2011
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The founders of our country set up the Federal Government and listed the 20 specific powers the Federal Government.  But what one thing does the government do the most?  Provide and maintain a Navy?  Establish post offices and post roads?  To establish a uniform Rule of Naturalization, and uniform Laws on the subject of Bankruptcies throughout the United States?  No, the Federal Government excels at one thing, printing checks and wealth redistribution.

The percent of government outlays sent to individuals as increased from 2.4% of the budget at the end of World War II to over 66% of government spending in 2010.  Over two thirds of government spending is in the form of checks sent directly to individuals.

As pointed out at HotAir, government payment to individuals account for almost 16% of GDP in 2010.  In 1945, direct payments to individuals was 1% of GDP.  This means that the Federal Government redistributes 16% of our economy.  It is as if the Federal Government believes its job is redistribution of wealth.

Some people would argue that the primary job of the government is wealth redistribution.  However, it is clear that the founders did not intend for the government excel at wealth redistribution.  In 1794, James Madison said “I cannot undertake to lay my finger on that article of the Constitution which granted a right to Congress of expending, on objects of benevolence, the money of their constituents.” — James Madison, 4 Annals of Congress 179, 1794.

Others would argue (including several clueless people in congress) that the “General Welfare” clause of the Constitution gives the Government the power to redistribute wealth.  Again, James Madison – “With respect to the two words ‘general welfare,’ I have always regarded them as qualified by the detail of powers connected with them. To take them in a literal and unlimited sense would be a metamorphosis of the Constitution into a character which there is a host of proofs was not contemplated by its creators.” — James Madison in a letter to James Robertson.

Earlier this week, the Republican run House put forth a budget that cuts $61 billion dollars for 2011 spending.  The President and Senate Democrats call those cuts draconian and severe.  The obviously aren’t aware that we are facing a $1.6 trillion being added to the National Debt this year.

Congress can do very little to get spending under control until they are willing to address the 66% of spending that is an every increasing part of the Federal Budget.  Anything else will fall short of the “fiscal discipline” both parties are promising.  Being that the Federal Government is not granted the power of wealth redistribution, Congress should look to those programs.

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