At the same time, it should be clear that the more people depend on government programs, the harder it becomes to cut those programs. That is not to say that the people on those programs are freeloaders or refuse to take responsibility for their lives. But it does mean that they have a vested interest in maintaining those programs. There is a reason why it is so easy for politicians to demagogue Medicare reform, and why Social Security is the third rail of American politics.
Simply look to what is happening in European countries today. Despite the fact that their welfare states have become unaffordable, any attempt to trim benefits leads to massive resistance.
Have we reached that tipping point yet? No, but we may be getting perilously close.
Today, roughly 49 percent of Americans receive some kind of federal benefit. If one includes government employees and contractors, nearly a third of Americans, 97 million people, receive more than half of their income from the government. Aside from Sandra Fluke and some government union workers, these individuals do not generally see themselves as victims — nor are they lazy or irresponsible. But they are a constituency inclined to favor the status quo.
It does make Romney’s call for fiscal restraint and tax relief a bit harder to sell.
Of course, that does not mean that Romney cannot make his case. Nor does it mean that, as some big-government conservatives have suggested, we must simply come to terms with the modern welfare state. But it does mean that those who aspire to a smaller, less costly, less intrusive government must make the argument that cutting government will make people better off — even people receiving benefits from government today.
We know that, as Harvard’s Robert Barro wrote, “public consumption spending is systematically inversely related to economic growth,” and that there is a “significantly negative relation between the growth of real GDP and the growth of the government share of GDP.” In other words, as government spending goes up, economic growth goes down.
Most Americans, even those dependent on government today, want to see more economic growth, more jobs created, and a better future for their children and their grandchildren. Most would be willing to give up something today, if they saw it leading to a brighter future tomorrow. Romney’s challenge is to tie the need for lower taxes and smaller government — for cutting those benefits that people are receiving today — directly to a more prosperous nation.
Unfortunately, if Romney fails to make that case now, it’s not going to get any easier to make in the future.