Food Stamps and the American Economic Divide

by Francis Cianfrocca

So the New York Times reported this weekend that a full 36 million Americans are now on food stamps, and another 16 million could join that number by 2012.

I’ve tried to say this before, desultorily and in other contexts, without ever really wrapping it up with a bow: America is splitting roughly in half. John Edwards was right about that. The thing is that the real basics of life — food, low-end clothing and subsidized shelter — don’t really cost all that much. So that means that we as a nation can easily provide government-issue subsistence to half of the country, and the people funding it with their tax dollars won’t even notice the expense.

Clearly that means a permanent Democratic majority, which is why it’s such a good idea for the Dems. It’s also the reason I proposed (as soon as I did the math and figured out the game) that people receiving full government subsistence should give up their right to vote in return.

Maybe that’s an idea whose time will come. Here’s how it could: say we pass a grand new law that entitles every American to poverty-level subsistence. Then what will happen is that “subsistence” will keep getting defined upward, just as “basic medical care” does in Massachusetts. At some point, it’ll start to hurt the taxpayers, and they’ll demand an adjustment in the terms.

There’s just going to be no way for capital to flow in economically efficient ways. The government businesses will eat all the investment because they have safe profitability. In terms of economic dynamism, we’ve swapped places with Europe a hell of a lot faster than anyone thought possible, and the nature of the recoveries in the next few years will make that clear.

(On a macro level, lament the eclipse of US economic power. On a micro level, make sure you make your living in a government-sponsored industry.)

Don’t think all this is farfetched. There are tens of millions of people out there without college degrees who aren’t close to retiring. When the economy comes back (say five years from now), there won’t be any jobs at all for those people. Retail and hospitality will always be there. The problem is that the value-added is so low that you won’t see these people making a living wage in an economy that’s increasingly dominated by government spending. They’ll be making so little that, to an extent, they might as well be unemployed. They’re more screwed than anyone realizes.

Another way this could go: These jobs can’t be outsourced to China, so they’re susceptible to unionization. (Just as government, education and healthcare jobs are, for the same reason.) If we see widespread unionization of retail and hospitality personnel, you’ll be eating out a lot less. That’s not bad in itself, but it does ultimately make the problem worse for the workers. And unionization is just a different way of achieving a wealth-transfer from affluent to less-affluent, so it’s not fundamentally different from just giving people free money from the public purse.

The progressive idea of positive liberty includes not only freedom from want, but also freedom from having to see rich people acting all superior. Let ‘em eat cake.

TNL
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- March 20, 2010 -

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