We’re Getting More Dependent on Government

An aging populace and economic decline in many communities means the share of Americans who depend on government aid (like Social Security, Medicare and Medicaid) has grown astronomically. (WSJ)

A new Economic Innovation Group report: In 1970, less than 1% of U.S. counties relied on government aid for at least 25% of their income.

• By 2022, more than 53% of U.S. counties drew at least a quarter of their income from government.

• Government safety-net programs like Social Security, Medicare, and Medicaid, as well as unemployment insurance and other support, are a significant part of income for 22% of the U.S. population.

Why: This is mainly a demographic challenge, not one sparked by the growth of welfare programs.

• As the report’s authors note: “[T]he nation’s poor population is growing nowhere near as quickly as its elderly population. Income maintenance programs constitute small portions of both total transfer spending and growth in transfer spending over time.”

Red/blue: Much of the growth in government assistance has taken place in Republican counties, which tend to be older, more rural and harder hit by economic stagnation.

Zoom out: In 2022, the U.S. government distributed $3.8 trillion in transfers (government aid and benefits) to Americans.

• This would equal about $11,500 per person if evenly divided across the U.S. population.

• Government transfers now make up 18% of total personal income, a sharp rise from 8% in 1970.

Bubba’s Two Cents

We’ve been beating this drum for a few weeks now: the reason Kamala Harris and Donald Trump’s campaigns are proposing so many government-safety net programs are these initiatives are very popular. This new WSJ analysis, which shows how many Americans rely on these programs, just drives the reality home.