Cleaning Up The Fraud In America's Welfare Programs, British Style

Most rational people would agree that Federal government spending is out of control. That the political class in Washington is writing checks and spending money that the country does not have. This has resulted in a national debt of almost $17 TRILLION, a debt level that has grown about 50% since Obama came into office.

To pay off this national debt:

• Every American household would have to write a check for about $145,000.
• The debt burden per citizen is about $53,000 per person, from the oldest living American to a baby that was just born.
• Rather than pay off this debt via a check, every American household would have to work about three years and donate every one of their paychecks to cover the debt, requiring them not to eat, drive, purchase any goods, or pay any form of taxes.
• Since the combined, total wealth of the wealthiest 400 Americans is only about $3 TRILLION, taxing the wealthy more, even confiscating their entire net worth, would not come close to paying off the national debt.

Osama’s latest budget proposal would add TRILLIONS of more dollars to this already overwhelming debt burden.

These are the global numbers, consider what happened in just one month, March, 2013, from a debt perspective, as analyzed by the fine website, Bankrupting America on April 11, 2013:

• The U.S. Treasury Department recently announced the Federal government ran a $106.5 billion budget deficit for the month of March.
• This breaks down to $337.56 for every man, woman and child in the U.S. and $932.57 for every household in the U.S.
• In other words if we wanted to keep up with the out of control spending of Washington, every household would have had to pay and additional $932.57 in income taxes JUST IN MARCH!
• For each minute during the month of March, the Federal government spent $2,395,412 that it could not cover with its tax revenue stream. Think about it, over $2 million in new debt every minute.
• This deficit could have been used to purchase 234,065,934 tickets to the NCAA men’s basketball Final Four basketball tournament.
• This MONTHLY deficit of over $106 billion was equivalent to about 68% of Bush’s ANNUAL deficit in 2002, 43% of Bush’s ANNUAL deficit in 2006, and about 66% of Bush’s ANNUAL deficit in 2007. In other words, Obama’s monthly deficits are extremely large vs. even Bush’s annual deficits.

Out of control spending insanity, no other words to describe the drunken orgy of spending of the Washington political class. One of the drivers of these huge deficits under the Obama administration has been the skyrocketing cost of welfare payments of all kinds, food stamps, disability payments, unemployment insurance payments, etc.

For example, in January 2009, the number of food stamp recipients was 31,939,110. By October 2012, that number had jumped to 47,525,329. That means the food stamp program grew by approximately 11,133 recipients PER DAY from January 2009 to October 2012. The Federal government spent a record $80.4 billion on the food stamp program during 2012, a 70% increase since 2009.

Now, I am not saying that this is not a vital program for a lot of Americans. Lord knows that the politicians in Washington have done a pretty bad job developing and maintaining a health economy that generates jobs for those in need. This so-called economic recovery has been the most pathetic economic recovery ever. However, there is a tremendous amount of fraud in all government welfare programs where those that do not need the support and those that are just flat out criminal elements receive government checks for no viable reason except greed.

Another example of skyrocketing government costs in the welfare area is in the number of Americans receiving Social Security disability benefits, as reported in a recent Newsmax article:

• In 2012, 8.8 million disabled workers and 2.1 million of their dependents received disability insurance payments totaling $137 billion.
• This is an increase of 1 million new beneficiaries just over the past three years.
• This increase in payments does not include the additional funding and payments for Medicaid, food stamps, housing, and student loan forgiveness that disability recipients can qualify for.
• In 1960, just 0.65% of workforce participants between the ages of 18 and 64 were receiving Social Security disability insurance payments, but now 5.6% get benefits, according to Jonah Goldberg in a recent op-ed piece for the Los Angeles Times.
• This is about a nine fold increase while the total population has grown nowhere nearly that quick.
• In 1960, there were 134 working Americans for every officially recognized disabled worker. Five decades later, the ratio is only about 16 to 1.
• Unless something drastically changes, within three years disability expenditures are expected to rise to $170 billion a year. This comes out to a cost of almost $1,500 per household per year.
• And by 2018, it is projected that nearly 1 in 14 working-age Americans will be receiving disability payments, according to Pamela Villarreal, a senior fellow with the National Center for Policy Analysis.
• Another factor to consider: Villarreal cites reports from Social Security that less than one-half of 1 percent of disabled individuals ever return to work, due in large part to what Villarreal terms a “lack of accountability.”

Again, I am not saying there are no American citizens that do not deserve our compassion and support through this program. But as with every other Federal program, the amount of criminal fraud and waste is probably staggering, probably increasing far too quickly for reality, and is an insult to every American taxpayer who sees the politicians and the Federal government it operates waste their wealth.

But although we know that the food stamp, disability program, Medicare, Medicaid, housing, and Social Security programs waste hundreds of billions of dollars a year, what can be done to stop it? Well, maybe we should look at a simple, realistic approach that the British took and the outstanding the results they had in focusing support and wealth only on those that truly need it:

• In the Newsmax article referenced above, Jonah Goldberg describes how Britain asked everyone receiving an “incapacity benefit,” which is a payment similar to a disability benefit in the United States, submit themselves for a medical test to confirm they were truly disabled and could not work.
• An amazing one-third of recipients dropped out of the program rather than be tested.
• This is equivalent to a whopping 900,000 people who probably knew they were criminally scamming the system and did not want to take the risk they would be caught.
• Of those recipients that actually were tested for their disability, a whopping 55% were found fit for regular, any type of work.
• Additionally, 25% were found fit for some kind of limited work.
• Thus, of those receiving disability payments, well over 80% were either found fit for some type of work (80% of those tested) or dropped out of the program (90,000) altogether to avoid being caught scamming the system.
• Goldberg concluded from these results: “There are those who are quick to argue that there’s nothing amiss with the disability system that greater funding and a better economy won’t fix. Maybe they’re right. One way to find out would be to ask every recipient to get a thorough examination, just as they did in Britain. Maybe the results here in the United States would be interesting too.”

Fabulous idea. If we were to obtain the same results, at least an 80% reduction in enrollment by weeding out fraud and unnecessary payments, in this country under such a program for just the Social Security disability program, we would reduce the $137 billion a year we spend on just this one program to about $27.4 billion a year, saving the American taxpayer about $109.6 billion a year. Over ten years, this equivalent annual savings would come out to about $1.1 TRILLION or well over 6% of our total national debt, a considerable step towards balanced budgets and rationale government spending.

One program, one TRILLION dollars in ten year savings. Fabulous. But will the existing political class do such a thing or will they remain more focused on their next election, energizing their base, and personal self-enrichment rather than fixing what is broken within the Federal government?

Based on their past behavior, chances are slim they will do the right thing relative to protecting taxpayer wealth and eliminating wasteful spending. That is why Sep 39 from “Love My Country, Loathe My Government” is so important. Step 39 would impose term limits on all politicians, one term in office and then they would be gone. This may be the only way to get those in office to do the right thing for the country rather than doing the right thing for themselves.

Note: in conjunction with this great idea from the British, please consider two previous posts along the same lines of how to clean up the wasteful spending without substantially impacting most Americans. Rational, under control spending is possible without heartache if only our so-called leaders had the brains, initiative, and intelligence to do so:

http://loathemygovernment.blogspot.com/2012/05/national-bounty-system-fixing.html

http://loathemygovernment.blogspot.com/2012/12/part-8-eight-days-of-logic-and-sanity.html

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