Cultures Of Dependence

EDITOR’S NOTE: Originally published at The Roots of Liberty April 2015. Statistics and data quoted here are as of the time of publication.

Just a few weeks before I was born, Lyndon Baines Johnson gave his first State of The Union address since becoming President upon the death of John F. Kennedy. The full text of the address is a fascinating read, especially within the context of LBJ’s commonly-understood image and the nation’s history since then. It is in this address that we find the beginning of the nation’s War on Poverty. LBJ stated:

Let this session of Congress be known as the session which … declared all-out war on human poverty and unemployment in these United States.

And so it was.

The War on Poverty included the enactment of Social Security, Medicaid, Medicare, the Food Stamp Act (which converted a pilot program into a permanent one), the Economic Opportunity Act (which established a number of federal jobs programs including VISTA), The Elementary and Secondary Education Act (which established federal subsidies for schools and which morphed into No Child Left Behind), Head Start and other programs.

Half a century of War should have put a pretty solid dent in poverty, yet the government’s official numbers tell a different story. At the outset of the War, 20% of the population lived below the official poverty line. Today, that figure is 16%. According to the Heritage Organization, and excluding Social Security and Medicare/Aid, $22 trillion has been spent on the War in that time. $22 trillion (3x the total cost of all our actual wars in that same span of time) for a decrease of 4%. And, since this figure doesn’t include Social Security or Medicare, it doesn’t reflect the vast unfunded liabilities of those programs (estimated by some at over $100 trillion dollars). In 1964, the national debt was $312 billion, or 45% of GDP. Last year, the national debt hit $17.8 trillion, or 101% of GDP. These figures suggest that this War on Poverty didn’t much succeed in its original goal, but instead did succeed in turning the entire nation poor.

This stark reality not only conflicts with LBJ’s declaration of War, it clashes with much of what he stated in the balance of that State of The Union address. He called for true bipartisanship, he said he’s propose a budget that would be smaller in real dollars than the previous one, halve the deficit, substantially reduce federal employment, reduce the civilian employment of the Department of Defense while maintaining full combat strength, and eliminate unnecessary programs. All these reductions would supposedly fund his War on Poverty without increasing spending. Looking at this from half a century’s remove, this all would be laughable if the failure wasn’t so profound.

There is a more insidious outcome of this War, however. In creating a basket full of support and handout programs, the War has succeeded in changing a nation where the poor routinely and through their own efforts, self-reliance and independence, elevated themselves out of poverty into a nation where poverty has become institutionalized, where dependence on redistributive handouts displaces self-reliance and where the incentives to work one’s way out of poverty are crowded out by the handouts. While there are disagreements as to the exact value, it’s commonly agreed that there is a certain figure at which one’s loss of benefits exceeds one’s income gains. In other words, taking a better job or working more hours ends up costing the earner money. This is not how poverty is solved, this is how poverty and dependence is made permanent.

Let’s now shift to a different culture of dependence, that which the rest of the world has embraced as a result of America’s self-assumed role as the world’s policeman and peacekeeper. America fought a decades-long Cold War with the Soviet Union, a War that cost America, according to one source, $13 trillion dollars from 1948 to 1991. Part of that cost covered the protection and militarization of Western Europe, an effort that enabled those European nations to spend less of their own taxpayers’ money on defense. After the collapse of the Soviet Union and the end of the Cold War, America remained the premier peacekeeper of the world. The Gulf War, ostensibly fought by a 39 nation coalition against Iraq, was primarily fought by half a million American troops and equipment, with the Saudi army a distant second in troop strength and the majority of nations in the coalition sending fewer than a thousand troops each. The bulk of the UN force in Somalia in the 1990s was American. American troops were a major component of the NATO mission in Bosnia. More recently, America has projected force throughout the Middle East and in North Africa in various aspects of the War on Terror.

Many argue that it has been in America’s interest to engage in these post-Cold-War conflicts, both pre- and post-9/11. Others believe they’ve resulted in more harm than good. Set that debate aside in order to focus on an outcome that’s similar to that of the War on Poverty, i.e. the culture of military dependence that has arisen out of America’s perpetual militarism and global force projection. For decades, the knowledge that America was always ready, willing, and able to fight all over the world has enabled many nations to underspend on their own militaries and/or to be reticent in their use of those militaries. These nations, some considered allies and others with common interests, have grown dependent on America’s military might, with unfortunate consequences. Western Europe doesn’t have the guts or wherewithal to stand against a newly aggressive Russia’s encroachments in former Soviet republics. The “stable” nations of the Middle East have been either unwilling or unable to handle groups like ISIS, and the latter grew and spread while the former waited for America to step in yet again.

There’s a simple truism in economics: When you reward or subsidize a behavior, you get more of it, and vice versa. Providing support to those who aren’t managing to support themselves may sound like a humanitarian and noble act, but (and especially when provided by a faceless government) that act encourages people to do what will perpetuate that support i.e. not try to support themselves. The same applies to nations: if a nation knows there’s a bigger nation out there who’ll fight off aggressors, it has less reason to provide for its own defense. A kid with a big brother won’t be as motivated to learn to fight his own fights. When support is maintained for years or decades, those who receive it know of no other way to exist. Someone perpetually on the dole will have trouble living or even imagining a life without it, and a nation perpetually under a Pax Americana will have trouble dealing with a world without it.

There’s another simple truism, spoken by economist Herbert Stein:

If something cannot go on forever, it will stop.

This should be obvious, but it’s something that many people would much rather close their ears and eyes to than acknowledge. In the context of the aforementioned cultures of dependency, the certainty of Stein’s law speaks of real trouble on the horizon. A nation that perpetually spends more money than it collects in taxes cannot perpetually maintain the redistributive handouts to which a sizable chunk of its populace has grown accustomed, nor can it maintain a global military presence and Pax Americana on which many allied and friendly nations have grown accustomed.

We witness an odd dichotomy regarding dependence in modern political discourse. On one side we find people who insist on perpetuating the multiple safety nets for those deemed “poor,” yet denounce spending on militarism, global force projection, and subsidies for foreign nations. On the other side we find people who decry the perpetual War on Poverty, yet are strongly in favor of continuing the policies that make foreign nations dependent on American military strength and protection. Both sides wish to continue to foster some form of institutionalized dependency, not acknowledging Stein’s law and the inevitable outcome it predicts.

The best way to help people rise out of dependence is to wean them off it. They won’t be happy, they’ll complain, they’ll seek to find ways to fight that weaning, but eventually they’ll relent. Welfare reform in the 1990s saw substantial reductions in the number of people on the dole, and smaller more recent efforts, such as requiring some work from the able-bodied who are on food stamps, have incentivized people to work instead of just living off the dole. Similarly, America’s reticence in getting involved in the fight against ISIS has prompted Egypt, Jordan and Saudi Arabia to finally involve their own militaries. Both are trends that should continue. The only way to re-establish self-reliance and independence in the perpetually dependent is to withdraw the support and remove the safety nets. Not all at once, to be sure, and not entirely, either. Half a century of dependence of this sort doesn’t get cured with a “cold-turkey” approach. Yet, “cold-turkey” is what awaits the dependent if the dependence is allowed to continue unchecked. At some point, unless action is taken, America will run out of money. Far better to draw down the multiple cultures of dependence before that day arrives than to have the safety nets collapse all at once.