In a speech at a Florida University yesterday, Barack Obama attempted to dispel the idea that government spending is automatically synonymous with the redistribution of wealth. CNSNews.com reports:
“[T]he idea that together we build this safety-net, this base of support – that allows all of us to take risks, and try new things, maybe try – get a new job – because we know that there’s this base that we can rely on,” Obama told the crowd at Florida Atlantic University in Boca Raton.
“It’s the reason why we contribute to programs like Medicare and Medicaid and Social Security and unemployment insurance,” Obama said.
“So, these investments, in things like Education and research and health care. They haven’t been made as some grand scheme to redistribute wealth from one group to another. This is not some socialist dream.”
Certainly, I understand what Obama is getting at — that the entitlement state is somehow different than the welfare state. A “social safety net,” he’s suggesting, is different than outright handouts. Theoretically, we all contribute to it when we can so that, when we need it, it’s there.
If that’s his argument, he should firmly be in support of the payroll tax and should never argue for a payroll tax cut extension, as we have, at times, seen him do. We all know that the Social Security trust fund isn’t in a lockbox, that it’s frequently raided, but the payroll tax at least ensures that we think of Social Security as a trust fund. Without the payroll tax, Social Security really does become just another redistributive policy.
But the larger problems with the president’s remarks are that they betray his ignorance of two important truths: (1) The government has no money of its own, so, technically, all government programs are redistributive and (2) Our entitlement programs are broken and he has absolutely no plan to reform them. The social safety net is about to rip underneath us because the president refuses to take any steps whatsoever to strengthen it.
Government spending, like all of life, is constrained by reality — and the reality is that we cannot spend money we do not have. We will never have the money to reinforce the social safety net if we do not focus on economic growth. The objection to increased public investment in education, health and other programs is, in many cases, not ideological at all (although in some cases it is, usually from the standpoint that it shouldn’t be the federal government that provides the net), but practical: Such investment is not the best way to grow the economy.