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USA's 'Point Of No Return' - by Craig Cantoni

Written by Subject: Philosophy: Libertarianism
Has the USA reached the point of no return?

By Craig J. Cantoni

Feb. 23, 2006

The point of no return for the USA is the point where so many voting-age Americans are dependent on the government for all or part of their livelihood, education and retirement that it is politically impossible to stop government at all levels from consuming an ever-increasing share of the economy. It is the point at which the nation begins a death spiral.

Have we reached that point? To answer the question, let’s look at some statistics, starting with Iowa, because of its importance in presidential primaries.

Iowa has the seventh-highest rate of voter turnout of all the states, with 67 percent of registered voters turning out to vote. It also ranks near the top in the percent of farms receiving government subsidies: 70 percent vs. a national average of 33 percent.

Farm subsidies are an example of how government money creates special interests and powerful voting blocs. In the 2004 presidential primary, candidates who didn’t know a pasture pie from an apple pie touted themselves as friends of the farmer and promised to shift more subsidies from large corporate-owned farms to smaller family farms. At the same time, they accepted campaign contributions from agricultural companies.

Nationally, about 710,000 farms receive farm subsidies. Assuming that each farm has three people who are of voting age, there are 2.1 million potential voters with a vested interest in the subsidies. But that is only a starting point in determining the number of potential voters. In addition, there are fertilizer distributors, ethanol producers, grain elevator operators, tractor dealers, local banks and other Main Street merchants. Since it is virtually impossible to estimate how many additional voters have a vested interest in farm subsidies, let’s pull a number out of the air and say it’s 2 million. When added to the 2.1 million farmers, that gives a total of 4.1 million potential voters with a vested interest in farm subsidies.

But that’s a small number relative to the largest special-interest group in the nation: the estimated 100 million parents who have children in K-12 public schools. Although they aren’t considered to be members of a special-interest group by either themselves or by the mainstream media, they are considered to be one here, because they are subsidized by other taxpayers and thus vote to maintain the subsidization. They are subsidized by the 20 percent of Americans who remain childless all their lives, by the one million parents who home-school their children, and by the approximately 10 million parents who send their children to private schools.

In addition to the 100 million public school parents, there are approximately three million public school teachers and an unknown number of administrators, support staff, consultants, suppliers, textbook publishers, desk manufacturers, bus manufacturers and construction contractors with a vested interest in greater education spending. A reasonable guess is that there are at least one million of these non-teachers.

The doubling of per-pupil spending in inflation-adjusted dollars over the last 30 years attests to the political clout of this group. The clout also can be seen in the strong political resistance to vouchers and tax credits for children attending private schools. Of course, government schools are not about to educate students about the insidious growth of government and government dependency.

The 55.6 million recipients of Social Security and SSI comprise the second-largest special-interest group. (Since retirees are automatically enrolled in Medicare when they file for Social Security benefits and can’t opt out of the medical program, Medicare has about the same number of beneficiaries.)

This group also has the highest voter turnout. In the 2004 presidential election, for example, 79 percent of registered voters over the age of 65 voted, versus 58 percent of registered voters under the age of 25.

Medicaid recipients comprise the third-largest special-interest group. Of the 47 million recipients, about half, or 23.5 million, are of voting age.

A side note: By 2075, outlays for Social Security, Medicare and Medicaid alone will total 21 percent of GDP, which is more than what the entire federal government currently spends as a percent of GDP. This huge increase in entitlement spending will result in all federal spending, including interest payments, rising to 40 percent of GDP by 2075. Because they can’t vote and are thus unable to defend themselves against those who can, the current generation of children will be in indentured servitude for much of their working lives to pay the entitlement bills of the preceding generations.

The 21 million public-sector employees at the federal, state and local levels comprise the fourth-largest special-interest group. Assuming that they have one other voting-age person in their household, the total of potential voters with an interest in increased public-sector spending is 42 million. This explains why there are 12 million more state and local employees than there would be if public-sector employment had not exceeded population growth over the last half-century.

Let’s pause here to calculate a total of the number of voting-age Americans in the various special-interest groups discussed so far:

Farm Subsidy Group = 4.1 million

Public Ed Group = 104 million

Social Security/Medicare Group = 55.6 million

Medicaid Group = 23.5 million

Public Sector Group = 42 million

Total = 229.2 million

There is double counting in the above subtotal, however, because individuals can be in more than one group. For example a public school parent can also be receiving Medicaid, and a public-sector employee can also be a public school parent or a public school teacher. After eliminating the double counting, the total becomes:

Adjusted Total = 170 million

This total is 84 percent of the voting-age population. Stated differently, 84 percent of the voting-age population is dependent on the government for all or part of their livelihood, retirement or kids’ education.

Then there are scores of smaller special-interest groups that receive public money, many of which are included in the above total but some of which are not. Examples include:

- The 4.9 million Americans on welfare

- The parents of the 26 million students on the school lunch program

- The millions of employees of public universities, the millions of students who attend those universities, and the millions of students who receive government loans

And let’s not forget the many occupations in the private sector that depend on the regulatory state or government subsidies. Examples include:

- The 53,000 tax preparers

- Some portion of the 973,000 lawyers and workers in the legal system

- The portion of the 150,000 human resources specialists that administers labor and benefits regulations

- The portion of the 10 million health care workers that administers the more than 100,000 pages of Medicare regulations

- The tens of thousands of workers who administer OSHA regulations

Finally, there are thousands of rent-seeking businesses. One example is professional baseball, which has lobbied successfully to have subsidized stadiums built for their private business. Another is transit contractors and consultants, who have lobbied successfully to have light-rail systems constructed in numerous cities.

Many of the rent seekers in private industry are Republicans who rail against big government. However, it is doubtful that in the privacy of the voting booth they vote to have their government rice bowl taken from them. This is one reason why the Republican Party has become another party of big government.

Has the United States reached the point of no return? Given the foregoing statistics, that’s a rhetorical question.


An author and consultant, Mr. Cantoni can be reached at