Travel Promotion Act
Treasury Department, U.S.
corporate bailout by
homeowner bailout by
Treasury for Economic Policy
Troubled Asset Relief Program (TARP). See also bailout of 2008-09
Turner, Ted
Tyrell, Patrick
“Underwater and Not Walking Away” (White)
unemployment insurance
cost of
dependency fostered by
user statistics for
United Auto Workers
Universal Service Administrative Company
Universal Service Fee
University of Arizona
University of Chicago
USA Today
on disaster relief programs
on personal income
on public employees
on school meal programs
on welfare use
USDA (U.S. Department of Agriculture)
Livestock Compensation Program by
Vanity Fair
Voegeli, William
on redistribution of wealth
Wahlberg, Mark
Walker, Scott
Wall Street
bailout of
mortgage securities and
The Wall Street Journal
on corporate initiatives
on mortgage defaults
on public employees
Ward Micky
The Washington Post
on agricultural subsidies
on corporate lobbying
on disaster relief
on real estate bubble
Washington State University, Washington
Washington University, St. Louis, Missouri
welfare. See also subsidy/entitlement programs, government
cell phones and
incentive to work and
reform
spending on
stigma of
user statistics for
WHEDA. See Wisconsin Housing and Economic Development Authority
White, Brent
WiFi, theft of
The Wire (TV show)
Wisconsin Housing and Economic Development Authority (WHEDA)
Wisconsin Policy Research Institute
Wisconsin, public employees in
worker’s compensation insurance
work incentive. See incentive, work
World War I
World War II
Yarborough, Pete
Yonkers, New York, public employees in
Young, Whitney
ZBB Energy Corporation
Zingales, Luigi
Zoi, Cathy
Zuckerberg, Mark
ALSO BY CHARLES J. SYKES
50 Rules Kids Won’t Learn in School
The End of Privacy
Dumbing Down Our Kids
A Nation of Victims
The Hollow Men
ProfScam
About the Author
CHARLES J. SYKES is senior fellow at the Wisconsin Policy Research Institute and a talk-show host at WTMJ radio in Milwaukee, Wisconsin. He has written for The New York Times, The Wall Street Journal, and USA Today, and is the author of six previous books: A Nation of Victims, Dumbing Down Our Kids, ProfScam, The Hollow Men, The End of Privacy, and 50 Rules Kids Won’t Learn in School.
A NATION OF MOOCHERS. Copyright © 2011 by Charles J. Sykes. All rights reserved. For information, address St. Martin’s Press, 175 Fifth Avenue, New York, N.Y. 10010.
www.stmartins.com
The Library of Congress has cataloged the print version as follows:
Sykes, Charles J., 1954–
A nation of moochers : America’s addiction to getting something for nothing / Charles J. Sykes. — 1st ed.
p. cm.
ISBN 978-0-312-54770-7 (hardcover)
ISBN 978-1-4299-5107-4 (e-book)
1. Public welfare—United States. 2. Subsidies—United States. 3. United States—Social policy—1993– 4. United States—Economic policy—2009– I. Title.
HV95.S95 2012
361.6'50973—dc23
2011036244
e-ISBN 9781429951074
First Edition: January 2012
* More than 50 million were on Medicaid (another 16 million will be added under Obamacare); more than 40 million on food stamps; 10 million on unemployment; and 4.4 million on welfare. Reported USA Today: “The federal price tag for Medicaid has jumped 36% in two years, to $273 billion. Jobless benefits have soared from $43 billion to $160 billion. The food stamps program has risen 80%, to $70 billion. Welfare is up 24%, to $22 billion.” Even so, these numbers greatly understate the extent or cost of the dependency culture.
*The Catalogue of Federal Domestic Assistance lists 2,025 federal subsidy programs, including 383 Health and Human Service programs, 230 in Agriculture, and 168 in Education, each with active, organized, and well-connected interest groups braying for increased funding. The result has been an explosion in the proportion of the national income paid by government rather than earned in the private sector.
* Although defeated by the Board of Supervisors, the so-called sit/lie ordinance, which banned sitting or lying on public sidewalks citywide between 7 A.M. and 11 P.M., was approved by voters in November 2010.
* The subtitle of his book is The Transformation and Decline of Great Society Liberalism. Davies writes from a generally liberal position that largely defends FDR liberalism against the postmodern version that arose in the late 1960s.
* Here’s how it works: The Daveys receive £439 in “income support,” an £87 housing benefit, £53 for “carer’s allowance,” £119 for “disability living allowance,” £99 in child benefit, and £18 for “council tax benefit,” for a total of £815 a week.
* Some readers think he is merely describing graduate school. I will leave it to readers to decide if the writer was being satirical or was in earnest; in either case, his advice seems to be widely embraced.
* Notes Sowell: 80 percent of individuals 65 and older are either homeowners or home buyers, and those individuals report median monthly housing costs of just $339. In addition, households headed by people aged 70–74 “have the highest average wealth of any age bracket in American society” even though their income is lower. The average income of households headed by someone over the age of 65, he notes, “is nearly 3 times the wealth of households headed by people in the 35 to 44 year old bracket—and more than 15 times the wealth of households headed by people under 35 years of age.” (Sowell, Economic Facts and Fallacies, p. 13.)
* The cell phone freebies are subsidized by the Universal Service Fee, essentially a tax on phone service that was originally used to subsidize rural phone bills. The program was expanded in the Reagan years with the creation of the Lifeline program, which provided modest subsidies for the phone bills of poor people. In 1996, Congress further expanded the subsidy program by creating the Universal Service Administrative Company with the express mission of ensuring “all Americans, including low-income consumers and those who live in rural, insular, high cost areas, shall have affordable service and [to] help to connect eligible schools, libraries, and rural health care providers to the global telecommunications network.” While this subsidy was largely still limited to landline phones, in 2008, under the Bush administration, it spawned a further subsidy known as Safelink, which began providing free cell phones.
* Even so, TracFone apparently wants to have it both ways. In Web ads pushing the free phones to poor people in Wisconsin, for example, TracFone touts: “FREE government supported cell phone.” But in a Lifeline/Safelink Fact Sheet, the company insists that “Safelink phones are not paid for by taxpayers or the federal government.” This is a quibble without a distinction, since the funds are paid for from the federally created Universal Service Administrative Company, which was created by Congress, set up by the Federal Communication Commission, and funded by the Universal Service Fee, which is a tax in all but name.
* Spend
ing on welfare and low-income health care assistance rose 113.8 percent from 1989 to 1996, and then rose another 80.2 percent from 1997 to 2005. In just three years, from 2006 to 2009, it rose by another 43.3 percent. (“Confronting the Unsustainable Growth of Welfare Entitlements,” Heritage Foundation; Office of Management and Budget, Historical Tables; Budgets of the United States.)
* “Single mothers increase their chances of living in poverty 416 percent relative to married couples. High school dropouts increase their chances of living in poverty 529 percent relative to college graduates. Not working increases the chances of living in poverty 741 percent relative to those who are working full-time.” (Norman R. Cloutier, director, University of Wisconsin Parkside Center for Economic Education, December 3, 2010.)
* Reports analyst Robert Rector: “Some 92 percent of those who experienced hunger in 2002 were adults, and only 8 percent were children. Overall, some 567,000 children, or 0.8 percent of all children, were hungry at some point in 2002. In a typical month, roughly one child in 400 skipped one or more meals because the family lacked funds to buy food.… Among poor children, 2.4 percent experienced hunger at some point in the year. Overall, most poor households were not hungry and did not experience food shortages during the year.”
† Notes Rector, reliable data gathered by the government show that “the average nutriment consumption among the poor closely resembles that of the upper middle class. For example, children in families with incomes below the poverty level actually consume more meat than do children in families with incomes at 350 percent of the poverty level or higher (roughly $65,000 for a family of four in today’s dollars).…
“It is widely believed that a lack of financial resources forces poor people to eat low quality diets that are deficient in nutriments and high in fat. However, survey data show that nutriment density (amount of vitamins, minerals, and protein per kilocalorie of food) does not vary by income class. Nor do the poor consume higher fat diets than do the middle class; the percentage of persons with high fat intake (as a share of total calories) is virtually the same for low-income and upper-middle-income persons. Overconsumption of calories in general, however, is a major problem among the poor, as it is within the general U.S. population.”
* Reported the Associated Press: “Big money movies shot in Massachusetts in 2009 included ‘The Fighter,’ chronicling the career of Lowell boxer Micky Ward and starring Boston native Mark Wahlberg; ‘The Social Network,’ depicting the origin of Facebook, co-founded by Mark Zuckerberg in his Harvard dorm room in 2004; and the Ben Affleck movie ‘The Town,’ focusing on a Boston bank heist crew.”
* Another sweet deal: “Transferable” tax credits enable producers to sell their credits to a third party. The Center on Budget and Policy Priorities explains: “Often, those purchasers are financial services firms. Insurance companies find purchases of film tax credits especially profitable, since they can use them to reduce taxes on premiums. Through the end of fiscal year 2009, insurance companies had purchased about half of all transferred Massachusetts film tax credits, for example, and other financial institutions had purchased about a quarter of them.”
* Reports the Environmental Working Group: “Despite claims of reform … six of the top 10 recipients of commodity payments in 2009 were in the top 20 in both 2007 and 2008. Of the top 20, 8 were in the list all three years, and three more were there in 2009 and one other year. In contrast to the public fury over billion-dollar bailouts of Wall Street banks, all 20 top subsidy recipients in 2009 received more than $1 million each, several with multimillion-dollar hauls. And this is only one year’s worth of corporate handouts that have gone on for decades. Three of these repeat offenders did quite well in 2009. California’s SJR Farms took in $2,069,453, Louisiana’s Balmoral Farming Partnership received $1,910,834 and Arizona’s Gila River Farms collected $1,711,444.”
* Reported the Post: “The program that pays Matthews was the central feature of a landmark 1996 farm law that was meant to be a break with the farm handouts of the past.… Instead of cutting, Congress ended up expanding the program, now known as direct and countercyclical payments. A program intended to cost $36 billion over seven years instead topped $54 billion.… In fact, so many landowners and farmers are collecting money on their former ricelands—$37 million last year alone—that the acres no longer used for rice outnumber the planted ones.”
* The analogy has been frequently made. In a story on the program, USA Today quoted environmentalist David Conrad of the National Wildlife Federation as saying: “It does seem to fit Albert Einstein’s definition of insanity—to somehow expect something different when you do the same thing over and over again.” (Thomas Frank, “Insurance Underwater,” USA Today, August 26, 2010.)
*The New York Times originally reported that the company had paid no federal tax at all and was actually able to tap the U.S. Treasury for a “tax benefit of $3.2 billion.” But this was later called into question by analyses that suggested that GE paid a minimal amount of 2010 taxes. (Allan Sloan and Jeff Gerth, “The Truth about GE’s Tax Bill,” Fortune, April 4, 2011.)
* According to the Center for Responsive Politics, the “Pharmaceutical/Health Products industry spent more on lobbying since 1998 than any other industry.” (www.opensecrets.org)
* A spokesman for Serious insisted the company had nothing to hide: “Robin Roy had worked for us long before Cathy [Zoi] was offered that job.” Quipped Stossel: “Of all the window companies in America, maybe it’s a coincidence that the one which gets presidential and vice presidential attention and a special tax credit is one whose company executives give thousands of dollars to the Obama campaign and where the policy officer spends nights at home with the Energy Department’s weatherization boss.”
*Mother Jones detailed the special bennies extended to ADM: Beyond the corn-price support program, the company also benefited from the federal sugar program, which the magazine compared to a mini-OPEC, “setting prices, limiting production, and forcing Americans to spend $1.4 billion per year more for sugar,” according to the General Accounting Office. In addition, ADM benefits from ethanol tax credits and subsidies. “Since ADM makes 60 percent of all the ethanol in the country, the government is essentially contributing $2.1 billion to ADM’s bottom line. No other subsidy in the federal government’s box of goodies is so concentrated in the hands of a single company.” (Dan Carney, “Dwayne’s World,” Mother Jones, July/August 1995.)
* There is a Web site by that name: http://www.pensiontsunami.com.
* Steven Greenhut writes: “Pension payments are senior obligations of the state to its employees and accordingly have priority over every other expenditure except Proposition 98 (i.e., K–14) expenditures and arguably even before debt service.” David Crane, chief pension adviser to former California governor Arnold Schwarzenegger, notes that they must be funded before other programs: “All of the consequences of rising pension costs fall on the budgets for programs such as higher education, health and human services, parks and recreation and environmental protection that are junior in priority and therefore have their funding reduced whenever more money is needed to pay for pension costs. (Nieman Reports, “How Severe Is the US Pension Crisis,” http://www.niemanwatchdog.org/index.cfm?fuseaction=ask_this.view&askthisid=00475.)
* In addition to AFSCME, the National Education Association, the nation’s biggest teachers’ union, dropped $40 million on the campaign. AFSCME’s $87.5 million also exceeds the $75 million spent on pro-Republican campaign efforts by the U.S. Chamber of Commerce. (Brody Mullin and John D. McKinnon, “Campaign’s Big Spender,” Wall Street Journal, October 22, 2010.)
* Backdrop payments are a creative way of dramatically boosting public-employee pensions. They allow government workers to collect a lump sum equal to the amount of pension they would have received if they had retired on the date they were eligible for retirement up to the day they actually leave their jobs. In Milwaukee, workers hired before 1982 were also given a 25 percent pension
bonus. For longtime county employees, this could mean seven-figure payouts.
* Before Walker’s proposal, Wisconsin taxpayers were paying $19,128 toward the average employee’s family premium. The average employee contributed a mere $936. Under Walker’s plan, employee contributions would have averaged about $2,500, still far less than the average private-sector employee’s contribution.
* “In part because of these practices, thirteen correctional officers made more than $100,000 in 2009, despite earning base wages of less than $60,000 per year. The officers received an average of $66,000 in overtime pay for an average annual salary of more than $123,000 with the highest paid receiving $151,181.” (Press release, Governor Scott Walker’s office, March 7, 2011.)
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