Five years into the Great Recession of 2008, the economy continues to stumble along like the walking dead. Though the official jobless rate has fallen to 7.2 percent, the reduction came about because fewer people are actively looking for work. The U.S. Department of Labor estimates that the number of working-age people not in the workforce has hit a 35-year high of 90 million. The “official” unemployment number only counts the 11.3 million people actively searching for work. The other 78.7 million are staying home.
This is happening in part because President Obama and his Democratic allies in Congress have made easier to stay home. According to Census Bureau data, the number of people getting a means-tested government benefit such as Medicaid, subsidized housing, welfare, or food stamps now tops 108 million.
That number, however, excludes beneficiaries of non-means-tested programs like Social Security (50 million), Medicare (46 million), and unemployment (5 million). Add them all up and the total number of people receiving federal assistance of one kind or another exceeds 151 million, or roughly half of the American population.
Obviously, not all of those receiving benefits are unemployed. Plenty of people hold down jobs but still need food stamps or Medicaid. That said, the sheer number of people not in the workforce suggests some serious overlap. Which is part of why the economy continues to sputter. The stimulative effect of people being productive by either getting a job or starting their own businesses is lost when it becomes easier to stay home and do neither of those things.
The most significant domestic public policy success since the Reagan years was the 1994 welfare reform compromise between President Clinton and the Republican Congress. The measure required the able-bodied to get off the rolls and into the workforce, breaking the cycle of the poverty for millions of them. It is no coincidence that the latter half of the 1990s was also a period of strong economic growth. Welfare reform wasn't the only reason, but it contributed to an economic cycle in which everyone benefitted from the resulting economic activity.
Too many liberals have never accepted that dependence on government saps the economy (not to mention the soul) and have bitterly fought such reforms whenever they've been proposed. Obama is actively seeking to reverse them. His Department of Health and Human Services, for example, encourages states to redefine the 1994 reform's work requirements in ways that undermine the very factors that made the measure work. Similarly, the number of food stamp recipients has increased by almost one-half since Obama took office. Obama waived the program's 20-hour work requirement. That “temporary” move in 2009 to cushion the recession's initial shock has never been rescinded.
Obama is now implementing Obamacare, which is already wreaking havoc on the health care and insurance markets. That will be a more obvious blow to economy than the enervating effects of welfare dependency. But that's no excuse for open-minded liberals in government and the traditional media to ignore the more basic problem of government dependency.