history of the idea of welfare state and the growth of the welfare state russell s. sobel, ph.d
TRANSCRIPT
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History of the Idea of Welfare State and the Growth of the Welfare State
Russell S. Sobel, Ph.D.
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Where We Stand Today• Federal Spending appx. $3.7 trillion• Govt. grown by almost 10% of GDP in last decade• Over 60% of federal spending is transfers
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Where We Stand Today
Transfer payments now 1/5 of National Income
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Where We Stand Today
• As recently as 1960 defense was ½ the budget
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Are We At A Tipping Point?
• Individuals benefitting from government now exceed those paying for government
Share of families deriving income from government
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Are We At A Tipping Point?
• Now about 50/50 with Tax vs. No Tax
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Searching for the Origins of the Welfare State – A Trip Back in Time
• I will focus on what the economics literature has argued and found on this issue…..
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When Did It Begin?
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Did Universal Suffrage Cause It?
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Did the Income Tax Cause It?
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Did the Income Tax Cause It?
But is the adoption of the income tax a SYMPTOM or a CAUSE???
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BUT…Spending Growth Prior to 1913 isNot As Flat As It Looks
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Did Union Veterans Start It?
First “selective” transfer as CSA Veterans Didn’t Qualify
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Did Union Veterans Start It?
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Did the Supreme Court Cause It?
• Anderson & Hill trace the birth of the transfer society back to the 1877 Munn v. Illinois case that allowed the Illinois legislature to regulation grain elevator rates.
• Others argue 20th century ‘court packing’, war on drugs/terror, and other changes through time have led to a Supreme Court that has allowed government to go beyond the constitution (“constitutional erosion”)
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Did it start prior to the Civil War?
Also changed:• Line-item Veto for President• Single issue bills only (with
funding source included)• 2/3 majority for spending bills• No open ended entitlements• Benefits received taxation
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Did it start in 1789?
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So Not As Easy As It Looks To Figure Out When It Happened…
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When or Why?
• But even if we knew when, the big question is still WHY?
• Did we lose the “moral” argument, or did we simply lose the “numbers” in an economic and political sense and get “out voted”??
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Thank You
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• Extra Material that may be needed for Q&A stuff follows
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Centralization (caused by Civil War?)
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